Friday, December 19, 2008

11th Interview: German construction business in Dubai

1st order: I had my 11th interview with the CEO of a German construction company, who is responsible for the company’s business in the Middle East and South Asia.
Project management in construction business: German vs. British/American approach
He told me that there are two fundamentally different approaches to construction business in general and for projects in particular. The British/American approach is very standardized. Checklists are the main tool to plan and organize all phases starting with offer and assignment. The German approach in comparison is based on individualization. Each project is perceived as a unique endeavour. The idea of being a service provider is dominant. While the British/American approach is much faster, because it decreases complexity from the beginning, it also tends to create blind spots. Therefore the German approach although taking longer is more sustainable especially when it comes to difficult and more complex projects.
For some form of standardization his company invented an approach dealing with 65 topics in terms of directing the attention on these fields. It is not about ticking boxes, but clarifying objectives and content within each of these topics. However it turns out that cross-culturality seems to be a bigger issue when using an individual instead of a standardized approach, he said.
Complexity in construction
According to my interview partner there are different types of complexity in construction business. One is what he called content complexity. That is for example in terms of technology, Greenbuildings, which materials are used and how to construct the building or in terms of multiple utilisations the renovation of existing buildings. A second complexity comes in by the internationality in Dubai. Every national background has its own standards and practices. A lot of communication is needed to intermediate between them. He made one side remark here, for example the documentation of meetings is of great importance otherwise it might happen that the other party forgets about already made agreements or takes things for granted that are not. Another complexity especially in Dubai stems from the principal-owner-builder structure which tends to be very branching, especially if governmental organizations are involved. Also each free-zone has its own laws, which one should know when dealing with the administration.
The project manager
I have been told that the competences of a project manager depend 70-80 percent on fact based expertise and 30-20 percent on social competences. 20 percent accounts for Germany, while in Dubai the importance of social competences goes up to 30 percent. However the success of a project depends mostly on the 30-20 percent of social competences. This is where the project managers make a difference. Therefore his company set-up an academy in which the project managers are trained six days on fact-based skills and three days on social skills.
Organizational structure
In terms of his company’s organizational structure he told me that they go for a lean structure with low hierarchies. An executive manager within his organizations has not more than 15-20 people to lead. This is interesting as it reflect the 20 people rule [see preliminary results].

My interview partner fostered the importance of milestones and budget, like others did before (see 7th Interview, section: where to go from here? Merging the best of two worlds >>>)