10.12.12

Contractor's transformation model - Conventional to IBS























The framework is based from 9 critical success factors and 2 important enabling factors. The critical success factors have been categorised into four elements. The elements are:

a) Strategy (Corporate leadership and Business strategy)
b) People (Skills, Training and education)
c) Process (Procurement and contract, project management, technology selection, design management and integration, and management of supply chain)
d) Enabler (Information Technology and continues improvement)

The prerequisite of success depends to a large extent on the establishment of strategy, meetings of human capability and capacity and finally the processes. First element, contractors need to obtain full support from the top management and align business strategy, vision and mission with IBS which are important to convince the decision makers, clients and own organisation structure to use IBS. This support and commitment shall drive the company forward in terms of investment and resources allocation. Contractors need to develop a specific model in their business and to position themselves in the market. This model includes diversifying of business, setting up specific division to deal with IBS and offering wide range of services in IBS.

The second element is the development of people capacity. Migration from conventional to IBS requires new skills set such as integration, design, planning and supply chain which related to IBS implementation. It is imperative for contractor to employ appropriate skill operators at site or enable a range of task to be undertaken by fewer but multi-skilled operators. Training can be considered as an integral part of organisation change. The workers need to be trained on IBS skill sets.

The third element is development in process. Contractors need to enhance their processes in procurement, project management, technology selection, design integration and supply chain. Selection of contract enables them to effectively select and implement technology and facilitate better design integration. The improvement in project management means adopting better supply chain strategy and enables design integration to take place. The final element in the transformation from conventional to IBS is the enablers such as Information Technology (IT) and continues improvement. IT can play an integral part on the processes and has to be a reliable support tool. Continues improvement is also critical. The repetition process each time project is implemented in IBS allows continues improvement for better project performance. Both IT and continues improvement is important support tool in strategy, people and process as depicted in the framework.

All the above four element highly depends on the capability of contractors. This is clearly stressed in the focus group. The respondents highlighted that the capability and maturity is a major issue for progress. The majority of the contractors in Malaysia ware not ready to embrace IBS. If the contractors do not acquire capability to transform to IBS, they need to embark on extensive development on people capacity. It must be recognised in the first place that the transformation from conventional to IBS stems not out of technology but people. The development of human capital will enhance overall organisation’s capability in adopting IBS. Once the company has enough capability, supported by highly knowledgeable IBS personnel, they will start again to realign overall company’s strategy to IBS. This is described in the framework as the capability loop. 

Noteworthy, the transformation to IBS concern change, not just a routine change but a fundamental change. The change from conventional to IBS is a journey over time. As the environment changes, so these external dynamic must be matched as far as possible by internal change. There is a need to evolve constantly. Readiness model should be developed in the future to further enhance this framework. Based on readiness model, level of readiness (both the current and target) should be clear and indicative of the organisation’s situation in term of measurable attributes and in maturity-like levels. By identifying the current and the required organisation status, the readiness gap can be determined and the route of transformation progress becomes visible. Progress can be accomplished when organisation move through the levels in sequential order.

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