Expert: Roger Zona - 5/17/2007

Question
Discuss how the criteria used in the selection of the appropriate procurement system can dictate the form of organisational structure for a project, which itself determines the communication channels to be used for the project management information system. explain the chief components of such a system, and assess their benefit to the construction and development process on a major public sector project

Answer
Dear Shane
The construction industry is huge, cumbersome and fragmented which is dependent on small businesses.  Construction, like agriculture, is very labor intense.  Building an appliance, in a modern factory and with the mechanized assembly technology, can be accomplished with the minimum of manual labor.
A production oriented construction company (builders of tract housing) generally consists of the following departments:  General Management, Land Acquisition, Design, Sales Marketing & Public Relations, Site Development, Construction, Customer Service, and Accounting and there are numerous sub-departments within each division.  This sounds like a top-heavy management organization but can be accomplished with a few good managers.  Land acquisition may be a function of General Management, Design can be dictated by Sales and Marketing and Site Development and Customer Service may be managed by the Construction Department.  A larger organization should have an MIS department or individual, reporting to Gen. Mgmt as well as a human resources department or individual.  
Because builders are subject to so many local, state and federal regulations the organizational structure for a project is predetermined by the nature of how a project evolves.  Unlike manufacturing industries, building is a slow and tedious process.  Custom order a new car and you take delivery in 4 to 6 weeks.  Sign a construction contract for a house and you wait 6 or 8 months.  The typical builder is a “broker”.  A management team hires subcontractors and the Construction department (or person) monitors projects progress and costs.  Construction of a typical home requires nearly 40 different businesses to complete the process.  I won’t list them all at this point, but just a few are:  site preparation, utilities contractor, shell contractor, truss manufacturer, window supplier, door supplier, drywall contractor, painter, trim carpenter, cabinet manufacturer, appliances, A/C contractor, electrician, plumber, roofer, insulation, landscaper, etc.
Communication is critical to the process.  Modern electronics has simplified this process while adding a high degree of sophistication to the process.  Computers that accommodate email and faxes are a necessity along with two way radio and/or cellular telephones.  There are many computer programs available that become the life blood of a company and they are best appraised by reference from the current users.
This reply is very broad but I hope helpful.