CONSTRUCTION

MANAGEMENT
 The Objectives of Management

• This is to ensure that productive efforts undertaken by a

company/individual are efficient and effective:
• Less time taken
• Less waste (Lean principles)
• Economic use of resources
• Higher quality products
• More value
• Less accidents and fatalities
• Satisfaction of client/employer
• Products are sustainable e.g. green buildings, low impact design,
and passive energy usage
 Project :
A group of milestones or
Operational Management
phases, activities or tasks
that support an effort to
accomplish something

Financial Management

Key Areas of Project Management

Commercial Management
Construction Management

Company Management
• Scope Management
• Issue Management
• Cost Management
Quality Management Company Management Project Management • Quality
Management
• Communications
Management
• Risk Management
• Change Control
Management
Human Resources Management
 Project Lifecycle

Cost and
Intermediate
Staffing
Phases (one
level
or more) Final
Initial
Phase Phase

Time
Start Finish

Milestones :
• defined state of the project
• decision point
Project Lifecycle
 CONSTRUCTION MANAGEMENT

Prepare site
including
•Principal roads and
drainage
•Excavate foundation
• Build substructure to ground floor level.
• Pour sub-floor concrete.
• Build wall construction to first floor level.
• Place floor joist or slabs.
• Build wall construction to second floor or roof level
• Put on roof
• First fix building shell in preparation for plastering
• Plastering all internal and external walls.
• Install second fix components, including doors skirting, radiators, light
switch covers etc.
• Install kitchen and bathroom.
• Clean, test and handover building.
 One World Trade Center, New York

Dome of the Rock, Jerusalem

 Empire State Building, NYC

St Basil's Cathedral, Moscow

 The Stelvio Pass, Italy

Iron Gate 1 dam, Romania

For achieving all these constructions we need
• The ideea
Time
• The budget
• The project-objectives
• Time

Money Objectives
 The lecture content
 Etymology of the word management
 Management definitions
 The evolution of management as science and art
Management – classical approach;
Behavior approach management;
Management science;
Contingential and systemic management ;
Comparing Management
Business Excellence management.
 Organization of construction execution
 Administration of construction execution
 The lecture content
The content, the purpose, the principles and
the parameters of the construction execution
processes
 The production process in constructions.
 The content of construction execution processes
 The purpose of the construction execution
processes
 The basic principles in the organization
 The lecture content
The parameters of the organization of the processes’
execution in constructions
In the projection of the organization of the processes’
execution there are used a series of sizes (parameters),
which, according to their nature, are grouped in:

 Organizational parameters;
 Parameters of development in space;
 Parameters of development in time.

The basic relationship between the organization’s

parameters of the construction processes’ execution.
 The lecture content
• There are relatively few basic scheduling systems in use
today, although numerous variants of each are in use.
Generally, scheduling methods can be classed in four
major categories.
• 1. Bar charts- accompanying a network diagram
• 2. Velocity charts (S-curves)- the relationship between
time and output of a construction project
• 3. Line-of-balance charts- for repetitive work
• 4. Network diagrams- for any type of work
The programming problem is to determine an
appropriate set of activity start times, resource allocation and completion
times that will result in completion of a project in a timely and efficient
fashion.
 The lecture content
The line of balance
• The diagram which shows the inter-relationships
among the project cycles as they are carried out on
each of the sections is known as the line of balance.
• Before presenting the steps of preparing a proper line of
balance schedule, the three basic methods of arranging
(programming), some construction cycles (activities) will be
presented. These are:
 The subsequent method - having two possible variant
forms;
 The parallel method;
 The balance method - having three possible variant
forms.
The very different complexity and nature of the
cycles, determine their different rate of progress,
fact that makes us able to identify the following
types of chains:

The rhythmic complex chain;

The rhythmic complex chain with different rate of
progress from cycle to cycle;
The arrhythmic complex chain
 The introduction of the safety intervals in the rhythmic complex
chain.
• 1.The introduction of the safety intervals between cycles,
accepting a total duration of execution (De), bigger than that
which was initially planned.
• 2.The introduction of the safety intervals by reducing the
calculated rhythms (tci) for certain cycles, in the limit of the
total duration (D) initially planned.

The rhythmic complex chain with different rate of progress from

cycle to cycle
• The reduction of the waiting times between cycles with by
introducing several work shifts.
• The reduction of the waiting times between cycles by the
chain’s modulation
• The parameters necessary for the graphic representation
specific to the methods of organization.
The number and the structure of the cycles
 The lecture content
Programming of construction works based on
the Critical Path Method

Definition and content of programming in

constructions

Classification of procedures of the Critical Path

Method
 CRITERIA OF CLASSIFICATION FOR THE PROGRAMMING
PROCEDURES
Following the
probabilistic nature of Following the representation form Following the parameters that intervene in the
activities of activities program

Procedures with
activities whose Procedures that analyse the parameter
duration of time in the shape of activity duration, such as::
achievement is a - fixed sizes (deterministic)
fixed size - variable sizes (probabilistic)
Network graphics PROCEDURES USING TIME ANALYSIS
with activities
DETERMINISTIC
represented by arrows Procedures that analyse the parameter
PATTERNS
time in the shape of activity duration, such as::
C.P.M NETWORKS - fixed sizes (deterministic)
- variable sizes (probabilistic)
•necessary resources for the activities
Procedures with PROCEDURES USING RESOURCES ANALYSIS
activities whose
duration of Network graphics Procedures that analyse the parameter
achievement is a with activities time in the shape of activity duration, such as::
probable size represented by nodes - fixed sizes (deterministic)
- variable sizes (probabilistic)
PROBABILISTIC M.P.M. NETWORKS necessary resources for the activities
OR DECISIONAL activities cost
PATTERNS PROCEDURES USING THE ANALYSIS AND OPTIMIZATION
OF PROJECTS COST
• Rules for the elaboration of the C.P.M.
network graphics (activities
represented by arrows)
• Relations between the activities of a
network graphic
• Programming with the analysis of the
deterministic time parameter through
CPM networks
The elaboration of such a schedule supposes the passing
through the following stages:

 Analysis of the project and determination of the list of

activities;
 Elaboration of the network graphic;
 Determination of the duration of activities;
 Calculation of the network graphic’s elements;
 Analysis of compliance with the temporal restrictions;
 Integration and condensation of the network graphic;
 Drawing of scheduled Bar Chart/Time Chart of the
network graphic.
• Scheduling the execution of construction
projects through the time and resources
analysis
• The heuristic Kelley algorithm for projects
programming with resources allocation
• The Burgess-Killebrew heuristic
process
The Duration and The Cost of The
Activities

The Kelley-Fulkerson procedure

• In principle, the content of the algorithm is as

follows: calculate the normal program with a
normal duration and normal cost.
• Then it forces the shortening of the duration by
speeding the critical activities that have the
lowest unit cost.
 Project Management Software

 There are several popular packages for

managing projects
 Primavera
 MacProject
 Pertmaster
 VisiSchedule
 Time Line
 Microsoft Project
 CONSTRUCTION MANAGEMENT

Definition of management science

“Management” (from Old French ménagement

“the art of conducting, directing”, from Latin manu agere
“to lead by the hand”) characterises the process of leading
and directing all or part of an organization, often a business,
through the deployment and manipulation of resources
(human, financial, material, intellectual or intangible). …

The English people undertook from French the following

terms:
ménage = administration;
ménager = administrate (manage), out of which the verb to
manage (to administer, to govern, to carry out, to handle)
came out.
 CONSTRUCTION MANAGEMENT

The term management hasn’t had from the beginning a

consecration in economics. It was introduced and used,
in the beginning, in administration, police, politics, army and
only at the beginning of the 20th century, the term
management found its consecration within the economic
field of USA, where its significance became
“the management of a business”.

The final consecration of the term management, in the

economic field, is due especially to the contribution of two
great personalities, who brought into economics some
principles and rules of management.

FREDERICK W. TAYLOR and HENRI FAYOL.

 CONSTRUCTION MANAGEMENT

During the 40’s, another specialist, JAMES BURNHAM, in his

work „The Managerial Revolution”, published in New York
in 1941, consecrates definitely the terms manager and
management, showing that the managers have become a
distinct social group, holding a major role within the society.
 CONSTRUCTION MANAGEMENT

DEFINITIONS
The management represents a unitary assembly of concepts,
methods and working techniques with a general character,
whose applicability provides the best use of the human,
material and financial potential within an organization.

The management as a science which studies the processes

and the relationships of management within organizations
and the environment where they act in view of discovering
the legities and the principles which govern them and of
conceiving methods, techniques and means of managing
which concur to efficiency increase.
 CONSTRUCTION MANAGEMENT

The organization, with the meaning used in the

definition of the management as a science, represents a
group of people, whose activity is consciously
coordinated as for reaching a goal (or some common
goals).

The minimum criteria for an organization:

At least 2 people, who belong to the same group;
A certain goal, accepted by the members of the organization
as a common goal;
The intended common activity.
 CONSTRUCTION MANAGEMENT

The management is an efficient administration of the limited

RESOURCES In order to obtain MAXIMUM RESULTS with
MINIMUM EXPENSES.

The management represents the conscious influence of the

manager upon the organization in order to obtain the manager’s
(company’s) estimated results.

The management is the science and the art of reaching one’s

own goals by using other people’s work, wisdom and reasons
of behavior.
The management as a science is applied in different activity
fields of the company.
 CONSTRUCTION MANAGEMENT

Operational Management – represents the administration of

the production process with the aim of obtaining a product of an
established quality and volume, with a minimum consumption of
available resources.

Financial Management – represents the administration of the

company’s financial fluxes with the aim of providing the upright
performance of the production process (of commerce, of services,
of the economic activity) using the necessary resources.
 CONSTRUCTION MANAGEMENT

Commercial Management – represents the administration of

the company’s commercial activity with the aim of obtaining
maximum sales with minimum expenses.
 Company Management – represents the administration of
the company’s activity with the aim of obtaining the maximum
profit in concrete conditions (the socio-economic situation,
the resources’ limits, the political situation, etc.)
Quality Management – coordinates the activities in order to
guide and control an organization, no matter what its activity
object is, regarding quality.
Human Resources Management – consists in the assembly
of activities oriented towards the providing, the developing,
the motivation and the maintenance of human resources within
the organization in view of meeting its objectives and
the employees’ needs.
 CONSTRUCTION MANAGEMENT

The evolution of management as science and art

They can assert unequivocally that the managerial thinking has

developed since human kind began to set its own objectives to
reach and it used resources in order to bring them to life.
At present, the following stages of the management’s
evolution are known:

Management – classical approach;

Behavior approach management;
Management science;
Contingential and systemic management ;
Comparing Management
Business Excellence management.
 CONSTRUCTION MANAGEMENT

Why We Need Managers Today

Then Now

Work in families Work in factories

Specialized,
Skilled laborers
unskilled laborers

Small, self-organized
Large factories
groups

Unique, small batches Large standardized

of production mass production
 CONSTRUCTION MANAGEMENT

The Classical Management

The classical approach includes the following three theories
and their contributors:
•Scientific Management by Frederick Taylor (1856-1915)
•Administrative Principle by Henry Fayol (1841-1925).
•Bureaucratic Organization by Max Weber
The management’s classical approach is specific to the capitalist
modern age.

F.W. Taylor, American mechanical engineer, acknowledged as

the father of scientific management, took care of the problems
of administrating the activity within workshops in view of reducing
losses and increasing the working efficiency.
In his major work, „The Principles of Scientific Management”
(Taylor, 1911),
 CONSTRUCTION MANAGEMENT

Taylor ranked the concept of scientific management as being

“that type of management which guides business using
standards established based on facts and truths resulted out of
systematic observations, experiments and judgments”.

F. W. Taylor also took care of the relationships between

managers and workers.
Discovering that there were unfavorable conditions in this
regard, characterized by hostility between parties, he insisted in
separating the administrative activities from the
production activities, so that workers, relieved by the
administrative tasks increase their productivity, and implicitly
their wages and the administrative tasks specialize.
 CONSTRUCTION MANAGEMENT

In his work, „The Principles of Scientific Management”,

F. W. Taylor formulated the following 4 major
principles of management:
1. For each working operation they have to draw up a scientific version
of performance, giving up the traditional methods (without optimization analysis);

2. They have to provide a scientific selection of workers, concerning works,

then they have to train the workers by teaching and experience (before that,
workers used to choose by themselves the works and they prepared the
best they could);

3. They have to cooperate honestly with the workers, so that works are performed
according to the scientific principles that they are based on;

4. Work and responsibilities have to be reasonably shared between managers

and workers, the managers taking over all the activities that they can perform
better than the workers (before that, almost the entire production activity and a
big part of responsibility fell on the workers: quality control, production evidence,
works coordination, equipment system, etc.).
 CONSTRUCTION MANAGEMENT

While Taylor approached the problems of management at the

level of operations and workshop, Fayol, brought his contributions
regarding the conception of classical management
at the level of the company’s assembly.

Calling them the elements of management, Fayol defined,

in his work “The industrial and general administration”,
five functions of management:
-Planning
-Organizing
-Controlling
-Coordinating
-Commanding (leading/directing)

The 14 principles of management, formulated by Fayol, are

presented in the next table
 CONSTRUCTION MANAGEMENT

Basic Managerial Functions

Organizing

Planning Coordinating Leading

Controlling
 CONSTRUCTION MANAGEMENT

The principles of management formulated by Fayol

No. Principles Explanations
1 By splitting the complex works into components,
Labor division homogeneous as nature, and assigning them to
specialized performers, they will obtain superior
performances.
2 Authority and Managers have the mission to give orders. Authority
responsibility gives them this right. Authority goes hand-in-hand with
responsibility.
3 Discipline Employees must observe and submit to the rules that
govern the organization.
4 Ordering unit Each employee must receive orders from only one
superior.
5 Unique Any group of organizational activities, having the same
management objective, will be guided by a manager, following a
given plan.
6 Subordination of
the individual Individual interests can not be put above those which
interests are specific to the entire organization.
against the
general ones
7 Remuneration Employees must be paid according to their services.
 CONSTRUCTION MANAGEMENT

Power and authority tend to focus on the organization’s

superior levels. The problem consists in establishing the
8 Centralization best degree of centralization through a compromise with
the decentralization, both having advantages, as well as
disadvantages.
Scalar chain represents the authority line which connects
the top of the management’s pyramid with the direct
9 Scalar chain performers. The communication between the links of
management is performed on this chain. In order to
accelerate this communication, they can also use the
cross connection, with the agreement of interested
parties.
10 Order People and material objects will be placed in the right
place, at the right time.
11 Equity (justice) It is necessary for managers to be honest and friendly to
the subordinated staff.
Stability of staff Staff fluctuation is not productive and that is why it must
12 conservation be avoided. The existence of some plans to employ
people within the organization is imposed.
13 Initiative It is necessary to feel free to take the initiative.
14 Body spirit Promotion of the team spirit will create harmony and
unity within the organization.
 CONSTRUCTION MANAGEMENT

The scientific management enjoyed the remarkable contributions

of the Frank Gilbreth (1868-1924) and Lillian Gilbreth
(1878-1972) as well as of Henry L. Gantt (1861-1919).

The Gilbreth spouses, inspired by the taylorian analyses on:

the time norms of the technological operations practiced in the
conditioning workshops, willing to contribute to the amplification
of the human potential, transformed these analyses into exact
scientific applications, of measuring the elementary actions
within the working process.
In order to be able to make measurements of the degree of task
accomplishment, Henry L. Gantt initiated the introduction into
the workshop practice of the linear graphics of activity, through
which they can render the task scheduled according to the norms
,as well as the degree of actual accomplishment
(the Gantt graphics).
 CONSTRUCTION MANAGEMENT

Charts: Henry Gantt

 CONSTRUCTION MANAGEMENT
10 18

t7 = A7

8
7/T

f6 =
f 7 =8

/T
0 0 8 14 19 19 25 25 40 40

A6
=2
A1 A5 A8

t1
1 2 5 7 A10 8
t1 =8/Tf1=6 t1 =5/Tf5=6 t8 =6/Tf8=0 t10 =15/Tf10=0

f 4 =0
A9

t1 = 4
7/T
A
20
5/ T f9=
t9 =
A2 A3
t2 =12/Tf2=0 4 6
t3 =3/Tf3=10
12 12 15 25
CONSTRUCTION MANAGEMENT
 CONSTRUCTION MANAGEMENT

1. Qualification-based hiring Weber’s theory concentrated on

2. Merit-based promotion
3. Chain of command
4. Division of labor
5. Impartial application of
rules and procedures
6. Recorded in writing
7. Managers separate
from owners
the fact that position, should be
structured where there must be
clear line of authority/hierarchy
and all persons must be selected
by competency for the job and
promotion (promotion based on
achievement and a specialized
division of labour), also a formal
structure and position rather
than an individual.
 CONSTRUCTION MANAGEMENT

Max Weber’s remarkable contribution at the theory of organization is pointed out

by the main characteristics of the so-called ideal bureaucratic structure, presented below:
Characteristic’s name
1. Labor division
2.Authoritative hierarchy
3.Formalized selection
4. Formalized rules and
regulations
5.Objectivity (impersonality)
6. Carrier evolution
Characteristic’s description
Jobs are differentiated in simple, well defined tasks.
Jobs and positions are organized hierarchically, so
that the inferior ones are able to be supervised and
controlled by the superior ones.
Each member of the organization must be selected
based on technical qualification proven through direct
examination, education and training.
In order to provide homogeneity and to establish the
employees’ activities, managers must manage according
to some well defined organizational rules.
Rules and controls are applied uniformly, avoiding the
implication of some personalities and of the employees’
personal preferences.
Managers are official professionals, not owners of the
managed units. They function as employees, watching
their carriers within the organization (head of
workshop, general manager, production manager, etc.).
 CONSTRUCTION MANAGEMENT

The contribution brought by Henry Mintzberg, towards the end of the 60’s,
consists in the formulation of the 10 roles of a manager, presented systematically,
on three categories, in table below.
Categories of roles Roles Activities implied by roles
Representation Accomplishment of ceremonial tasks, such
as: anniversary speeches, festivities of
premieres, greeting of external visitors.
Leader Guides and stimulates the subordinates.
Interpersonal
Maintenance of informational connections
Coordinator within the organization and with the
(Liaison) exterior; uses the mail, the phone, the
meetings.
Asks for and receives information,
Monitor periodic analyses and reports, keeps
personal contacts.
Transmits information come from outside
Informational Disseminator or from subordinates to the organizations’
members. Sends memoirs and reports.
Makes calls.
Spokesman Transmits information to the exterior by
word of mouth, reports and memoirs.
 CONSTRUCTION MANAGEMENT

Entrepreneur Initiation of new projects; identification

of new ideas; delegation of
responsibilities to others, regarding the
formulation of new ideas.

Adoption of corrective actions in cases of

Resolution of crisis and arguments; resolution of
emergencies conflicts between subordinates;
adaptation to exterior crisis;

Decisional Allocation of Decides who receives resources: fixes

Resources priorities to this effect, schedules.

Negotiator Represents the managed compartment in

the negotiations for the contracts with
the unions, sales, purchases and budgets;
defends the department’s interest.
 CONSTRUCTION MANAGEMENT

Behavioral approach (corporate) mangement

The behavioral management theory is often called the human

relations movement because it addresses the human dimension
of work. Behavioral theorists believed that a better
understanding of human behavior at work, such as motivation,
conflict, expectations, and group dynamics, improved productivity.

The behaviorist approach of management considers that man

represents the central element within organizations.
Productivity depends on the understanding shown by managers
to people and on the adaptation of the organizational conditions
to people requests. It is about a humanist interpretation of work,
which is veryimportant in the case of managers whose exercise
consists in working with people.
 CONSTRUCTION MANAGEMENT

The dominant characteristic of the corporate studies is the

foreground use of the sociological and psychological concepts
and methods, such as value system, motivation, role-playing,
group dynamics, status, sociogram, skill tests etc.

The behaviorist approach was launched between 1924 and 1932,

when they performed special studies and researches on
the behavior of workers according to working conditions.

Two paths of the behaviorist approach were outlined:

the approach of human relationships in the process
of management

the approach of the organizational behavior.

 CONSTRUCTION MANAGEMENT

The managerial movement regarding the human relationships met with the
competition of some remarkable scientific personalities, such as: Elton Mayo,
Dale Carnegie, Abraham Maslow and Douglas McGregor.

Elton Mayo (1880-1949) carried on some researches regarding the dependence

between productivity and working conditions.

Dale Carnegie wrote “How to Win Friends and Influence People” (1936), where
he asserts that the way to success consists in the cooperation with other people,
and for this, it is necessary:
• to make people you cooperate with to feel important, appreciating sincerely their effort;
• to create a good impression right from the beginning;
• to stimulate people towards their own way of thinking, letting them talk, showing
sympathy to people and avoiding to apostrophe others when they make a mistake;
• to change people praising their good features and to give the opportunity
to rehabilitate the bad features.
 CONSTRUCTION MANAGEMENT

Abraham Maslow is known as the founder of the theory of

motivation. Without motivation, there are no productive
human relationships.
 CONSTRUCTION MANAGEMENT

Management science
In the work “Fundamentals of Management Science” considered as representative
for this approach of management,
the authors Turban and Meredith define management science as being:

„The application of the scientific method on the analysis and the resolution of
problems of managerial decision” and “ operational researches represent a term
used almost interchangeably with management science”.

The same authors (Turban & Meredith, 1992) present the main characteristics of
management science:
• it focuses on the adoption of the managerial decision;
• the decision’s adoption is made by applying the scientific methods;
• the decisional situation is examined from an ample perspective, using the systemic
approach;
• uses information and methods from different disciplines;
• is based on formal mathematic patterns;
• uses computers on a large scale.
 CONSTRUCTION MANAGEMENT

The initiation of this managerial approach belongs to the English army which,
as it is known, organized interdisciplinary teams, comprising science men, with
the mission of solving the operational problems issued during the Second World War.

The remarkable success of the operation research groups (“OR” groups) in the military
field determined the civil managers to take over the techniques of management science
in view of applying them in decisions.

In 1955, the management science and respectively the operational research

captured the attention of universities. Among the methods and techniques specific
to these domains, there are: the statistic methods, the linear programming,
the dynamic programming, the critical path method (CPM), the PERT method,
the theory of waiting lines, the strategic games, etc.
Nevertheless, management science, although named like this, can not replace
management as a whole, representing the arsenal of quantitative instruments that
management will use more and more intensely.
 CONSTRUCTION MANAGEMENT

Contingential and systemic management

The systemic approach starts from the general theory of
systems founded by Bertalanffy, according to which
“…in view of understanding and organizing the whole,
it is necessary to know both the parties and the relationships
between them” (Bertalanffy, 1972).

The systemic approach improves the performance of

management by creating possibilities of taking into account,
within the decisional process, as many variables as possible
on which the results of a company’s activity depend.

Systems are differentiated according to the intensity of their

communication with the environment in: closed and open systems.
 CONSTRUCTION MANAGEMENT

The modern management, in its systemic approach,

starts from the consideration that organizations are
dynamic, open systems. On this basis, the organization
management must take into account the available
internal and external resources, the technological
developments, the market trends, for all the decisions it
adopts.
ENVIRONMENT

INPUT OUTPUT
ORGANIZATION
* Constructed
* Labour * Transformation process facility or services
* Materials * Management
* Money
* Machines
* Information Feed back (by control)

Fig. 1. 2 The management of an organization as a cybernetic open system.

 CONSTRUCTION MANAGEMENT

Contingential approach, sometimes also called

situational approach, confers to management a new dimension
towards the systemic approach, being an extension of the
systemic approach.

Problems are solved taking into consideration the

interconnections between the organization components
and those between organizations and external environment.

The difference consists in the fact that every time a decision

is adopted, they must take into account both the system itself
and the situation in which it develops. A new, situational
coordinate is, thus, introduced.
 CONSTRUCTION MANAGEMENT

Contingential approach is criticized for the impression it

creates, that the organization is captive to environment and,
consequently, the essays to guide the organization are
useless.
Actually, the organization’s evolution is not providential, it
represents a resultant of the combination between
environment forces and management practices.
 CONSTRUCTION MANAGEMENT

Comparing Management

Comparing management and Business excellence are

new variants of behaviorist management.

Comparing management is the science which study the

processes and managerial relationships between organizations
which functioning in to different national cultural environmental

They represent answers of management to the intensification

of the requirements of human factor and have in view an
absolute utilization of employees.
 CONSTRUCTION MANAGEMENT

Japanese management introduced a series of specific

methods and techniques, such as:
„quality circles”, „Kanban” and „Just in Time” (JIT) methods of
administrating production and stocks, etc. But the most
significant particularity of this type of management consists in
the specificity of solving the organization’s main problems.

The table below presents, comparatively, the way of solving

the main problems of the Japanese and American
organizations, according to the assessment of William Ouchi,
an American professor of Japanese origin, who proposed at
the same time a hybrid that combines the two managerial
philosophies, called: “The organization fitting to the Z theory”.
 CONSTRUCTION MANAGEMENT

The Japanese economy has a dual structure: the great

companies called zaibatsu or kairetsu exist together with a
large numbers of small companies.98% of Japanese
companies are the small ones

In present there are six economic groups well known all

over the world : Mitsui, Mitsubishi, Sumitomo, Fuji, Sonwa
si Dai Schi Kongya.

The vision over the organization

All most japanese have two families: the classic one and
the company. Both of them are equally important
 CONSTRUCTION MANAGEMENT

The great companies called zaibatsu have an

interesting structure:
Inside the groups we have:
Banks
Factories
Commercial companies
PROFILE OF TRADITIONAL JAPANESE MANAGEMENT PRACTICES

consensual and decentralized decision-making „ringisei

extensive use of quality control methods
carefully codified work standards
emphasis on creating harmonious relations among workers
lifetime employment and seniority-based compensation
 CONSTRUCTION MANAGEMENT

The Japanese employees are divided in to three categories:

-permanent 25-40% from the active workers
-semi-permanent
-temporary employees

Advantages
The management invest into employee training
Long time salary predictions
Disadvantages
Inflexibility recruiting staff

Employee teaching by the job rotation inside the companies

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Theory Z is a name applied to two distinctly different

psychological theories.
One was developed by Abraham H. Maslow in his paper
Theory Z and the other is Dr. William Ouchi's so-called
"Japanese Management" style popularized during the
Asian economic boom of the 1980s.

Theory Z is an approach to management based upon a

combination of American and Japanese management
philosophies and characterized by, among other things,
long-term job security, consensual decision making,
slow evaluation and promotion procedures, and individual
responsibility within a group context.

The foundation of Z type organizations by the combination of American and
Japanese organizations.
Japanese organizations
1. Lifetime employment
2. Slow evaluation and
promotion
3. Unspecialized carriers
4. Implicit control devices
(self-control)
5. Decision collective
elaboration
6. Collective responsibility
7. Holistic spirit
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American organizations
1. Limited duration
employment
2. Fast evaluation and
promotion
3. Specialized carriers
4. Explicit control devices
(through special rules)
5. Decision individual
elaboration
6. Individual responsibility
7. Segmentary attitude
Organizations fitting to the “Z
theory”
1. Long term employment
2. Fast evaluation and
promotion
3. Specialized carriers
4. Combined control devices
(bureaucratic control is
supplemented by self control)
5. Decision elaboration by
mutual agreement
(participative)
6. Individual responsibility
7. Holistic attitude from the
employee’s point of view
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Business Excellence management.

Excellence in running business is the contribution of

J. Peters and Robert H. Waterman Jr., management consultants, who in
1982 published the book “In Search of Excellence”, based on a research on
causes of success of the best run companies in U.S.A.

For their selection they used performance indicators, such as: average stock
recovery rate, joint stock increase and innovation rate.
The authors systematized their conclusions in a set of eight attributes of excellence,
which managers can use in order to obtain great successes within the companies
they run. These are presented in table 1.5. It will be easy to notice that all the eight
attributes of excellence belong to the field of human and behaviorist relations.

Attributes of excellence in business, in Peters and Waterman’s opinion will be

pointed out in the next table
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No. Attributes of Attribute description

excellence
1 Small experiments, easy to organize, with the aim of
generating acquaintances, interest and employment.
Aptitude for action Managers are open-hearted, they get involved in all
fields by using an active and spontaneous
communication, which constitutes the so-called
concentric management - “Management by wandering
around”
2 As close as Client satisfaction is obsessive for the company. Client
possible to the requirements are taken into consideration during the
client whole cycle of projection – production –
commercialization.
3 Entrepreneurship Risk assumption is encouraged. Failures are tolerated.
and autonomy Innovators are stimulated to defend their favourite
projects till complete fulfillment. A flexible structure
allows to inventive employees to get organized into
small groups of passionate people who can bring to life
various projects.
4 Productivity Individuals are treated with respect and dignity.
through people Enthusiasm, trust and family spirit are encouraged.
Working compartments are small and intimate (human).
People are encouraged to enjoy their accomplishments.
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5 Competence – A clear philosophy of the company is conveyed and

motor of values respected precisely. Personal values are acknowledged
openly (they are not hidden). Leaders represent positive
models, and not typical figures, such as: “Do as I say,
don’t do as I do!”

6 Adherence They promote the management’s adhesion to the best

known business. They put accent on the internal
development and not on the fusion with other
companies.
7 Simple structure, Authority is decentralized as much as possible. The top
minimum staff staff is minimal; talents are stimulated to free their
minds on the action field.
8 Tolerance and A tight control at strategic and financial levels is
exigency counter-balanced by autonomy, authority
coexistence decentralization and creation of opportunities for
creativity.
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Operations Management Tools

Quality control
Forecasting techniques
Capacity planning
Productivity measurement and improvement
Linear programming
Scheduling systems
Inventory systems
Work measurement techniques
Project management
Cost-benefit analysis
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Organization of construction execution

The word organization derives from the Greek term “organon”,

which means “instrument”. The Greek word represented the
origin of adoption of the notion “organ” used in biology
(biological organ), in mechanics (car organ), in administration
(administrative organ).
The performance of a product specific to the construction activity,
table 2.1, implies two distinct stages:
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The constructive projection, concretized in the elaboration of

the Technical Plan, whose framework content is presented
in figure 2.2, having as a goal to establish: sizes, forms and
structure of the construction elements and of the entire work;
the project elaborated this way becomes the instrument of
describing the conception on the constructive technical solution
of the construction work;

The work’s execution, performed by a complex of actions

(construction processes, but also actions with technical,
economical, organizational, administrative character) in order
to transform materials with the aim of edifying the construction
work; all these actions constitute the activity of construction.
The execution of the construction works hasn’t developed,
even in the most primitive forms without a preliminary thinking
about the concrete ways of performance.
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All the man’s conscious activities, so the activity of

constructing too, develop in an organized manner,
meaning through a certain way of concentrating together
human forces and material forces in order to reach some
objectives previously established and usually concretized in:

a certain total duration of execution DP;

a certain productivity WP;

a certain profit PP;

a certain consumption of resources CRP etc.

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The finality of the verb “to organize” is represented by

the organization project of executing the technical project
of the construction work.

At the origin of the technical project underlies the maximum

utility principle, from the point of view of the value of usage.
That means that the technical project must propose those
solutions for:

functional,
resistance structure,
facilities,
closing-ups,
compartmentations etc, which satisfy completely
the user, the construction’s beneficiary.
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The organization project represents the goal’s instrument of

corroboration, the getting of the construction work’s value
of usage, rendered through the technical project, with the
needed resources.

At the origin of elaboration of the organization project underlies

the principle of maximum results with minimum effort;
this principle, regarded from the value’s point of view is called:
the principle of the economic optimum.
The effort needed for the execution of the Th. P.,
regarded from the value’s point of view, gets the practical
significance of Th. P.’s execution cost.
The organization project (O.P.) must look for, identify and apply
all the possible measures which lead to a minimum
execution cost of the Th. P
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We define the organization in constructions, which,

in a concrete way, means the organization of execution
of the technical project of a construction work, under
both theoretical and practical aspects, as being the totality
of conception-projection activities for:

The description of the development in time and space of

the technical project afferent to a construction work;

The assessment of the needed working force, materials

and equipment and their distribution in due time, proper
to the technical project’s execution which was described
in the previous stage;
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The sizing, the distribution (in time), the placing and the
evaluation of the constructions and facilities of field
organization.

The first group of activities, the development in time and space

of the technical project’s execution, is a problem specific to
the organization of the construction execution, arising from
the main particularity of the constructing activity, the fact that
while the construction work is immobile, the process of
construction is mobile; the construction process’s mobility means,
in a concrete way, the movement of all the processes’ elements
working force, materials, equipment from a construction work
to another, as well as within the same work, movement
determined by the execution of the processes which lead to the
accomplishment of different elements of the work.
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Their execution needs for the processes to follow a very

complex development in time and space, imposed by the
constructive solution, by the adopted technology and organization
methods, as well as by other factors of conjuncture
(technical, economical, administrative, legislative)
The place where the activity of construction takes place is the field.
This is the reason for which, among the problems of organization
an important place is occupied by the projection of field
organization works, meaning that assembly of constructions,
facilities and even equipment fitting, necessary to be performed
on the field in order to help the execution of the basic works.

It is the case of: constructions for workers accommodation,

materials storage, constructions for technical and economical
activities (offices, laboratories), water, electric energy,
thermal energy supplying facilities.
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Govern-
ment
Lenders Users
Authorization
Term Loan Approvals
Agreement Offtake
Agreement
Share- Equity Project
holders Subscription Const.
Company ContractContractors
Purchase The projection of field
Agreement Delivery& Operating
Agreementorganization works
Material Performance
Suppliers Guarantees
Equip. Operators
Suppliers
Organization is finished in the organization project, but this
doesn’t mean actual execution too. The organization project
is an instrument which establishes the way in which execution
must be performed.
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Administration of construction execution

The administration of construction execution consists in

the assembly of methods, techniques and procedures
used to put into service and to provide the correct
performance of the production apparatus, respectively
the means of production and the working force, in the
framework established by the organization project, so
that the reaching of the estimated objectives is provided

total execution duration DP;

productivity WP;
profit PP;
limited consumption of resources CRP etc.
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All these transformations are possible by exercising the main

attributes of management:

a) The Order, meaning initiation of actions,

putting into service of the production means and of the
working force;
b) The Coordination of actions performed by people and
equipment in connection with the development in time and
space of the project’s execution;
c) The Control, on stages, of all the transformations, under
two aspects:
Quantitative, meaning the measurement of the quantities
of executed processes;
Qualitative, meaning the identification and the measurement
of sizes which characterize the qualitative execution of
processes, according to the standards in force.
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d) The Evaluation of the obtained results, on stages, in order

to take measures in the following stages. The stages are the
calendar months, because these are the time units at the limits
of which the quantitative, qualitative and economic evaluation of
the construction activity takes place and, as a consequence of
this evaluation they do “the sale” (“the sale” in constructions,
in most of the cases, is performed “bit-by-bit”, and not at the
end of the work).

As a consequence of the result’s control and evaluation,

the management can confront two situations:
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•discovers the accomplishment of all the provisions

scheduled in the organization project until that stage and
the possibility of continuing the execution in the following
stage, according to the same provisions;

•discovers that the initial hypothesis from the

organization project, regarding the conditions of
execution suffered modifications ( variation of the
number of workers and/or pieces of equipment, difficult
atmospheric conditions, changes of the solutions from
the constructive project etc.) which could not be
foreseen in the organization project or which were
omitted.
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In this situation the management takes decisions and corrective

measures in order to align the situations and conditions which
appeared during the process of execution
with the provisions of the organization project; these decisions
and corrective measures allow the passing to the following stage

The management of the project’s execution assimilates

the best variant:
(a1) or adopts one of the best variants
(a2), according to its own criteria (decision criteria),
implements it, has in view and is responsible for its application
the way it was conceived in the organization project, which has
to be the material instrument of the management’s activity.
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Without the organization project, in the sense and content

exposed above, the management becomes aleatory, performed
according to the “common sense” of the moment inspiration,
with negative consequences on all the technical-economical
indicators.

To this effect, we consider that Seneca’s reflection is

very important:
“The captain who sails without a target always complains
that the wind blows from the other direction.”
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CONCLUSIONS
Etymology of the word management
Management definitions
The evolution of management as science and art
Management – classical approach;
Behavior approach management;
Management science;
Contingential and systemic management ;
Comparing Management
Business Excellence management.
Organization of construction execution
Administration of construction execution