Engineering Consultancy Services in Malaysia - Challenges & Strategies

ENGINEERING CONSULTANCY
SERVICES IN MALAYSIA –
CHALLENGES & STRATEGIES
By : Ir. Dr. Gue See Sew
Date: 6 July 2011
G&P Professionals Sdn Bhd (www.gnpgroup.com.my)

www.gnpgroup.com.my)
CONTENTS
A. CHALLENGES
• Engineering Consultancy Firms
Stagnant / Decline in size
• Brain Drain / Talent Lost
• Quality of Graduates
• Lack of Support Staff

CONTENTS
B. STRATEGIES
• Grooming of Engineering Consultancy Firms
• Talentcorp Malaysia
• Overhaul of Higher Education
• Harmonisation of Human Resource and
Education

The Story
• Capacity of large Engineering Consultancy
Firms (ECF) in Malaysia has been stagnant
for the last 25 years
• One of the main issues is

SUSTAINABILITY frequently
affected by retirement or
decease of Directors

Large ACEM Panel Firms
No. Name of Firm Total No. of Staff
1990 2000 2010
1 Sepakat Setia Perunding (M) Sdn Bhd 400 373 503
2 Minconsult Sdn Bhd 509 473 450
3 Ranhill Bersekutu Sdn Bhd 290 450 450
4 HSS Integrated Sdn Bhd - 330 370
5 SMHB Sdn Bhd - 304 300
6 G&P Professionals Sdn Bhd - 20 220
7 Kumarasivan Tan & Ariffin Sdn Bhd 193 341 205
8 Jurutera Konsultant (SEA) Sdn Bhd 262 - -
NOTE: Some disappeared from ACEM Directory

Top Engineering Consultancy Firm

in Netherlands
Population of Netherlands: 16.7 Million

Arcadis: 16,000 staff
World Rank: Top 10

Reasons
1. Mismatch

Reasons
2. Brain Drain

Reasons
3. Cyclical Market
2008
1998
1986

Lessons
learned
Knowledge
Experience
Don’t you want to retain these ?

Do’s & Don’ts
Planning
Checklists
Quality
Engineering
Architecture
Methods of
…………
………
control
designs
constructions
………
…….……
……………
…….……
……………
…………..
………..
…………….
…………….
…………..
and many more………..

Challenging Issues On The Quality

Of Graduates
• Attitude
• Command of English
• Adequacy of Fundamentals
• Creativity/Innovations

“…it is
disappointed
about the quality
of Malaysian
engineers.”


Of Graduates
• Poor command of English and

communication skills
REASONS:
• Old Policies on Education
• Teachers & Lecturers
• Usage

Of Graduates
• Lack fundamental knowledge
REASONS:
• Too much political influence
• Compromise on recruitment
– Lecturers lack passion
– Support staff
• Lenient in setting exams and giving grades
• Accept students below par

Challenging Issues On Technical

Support Staff
• Technologists/TAs
• Technicians
• Draftpersons
SERIOUS SHORTAGE!

STRATEGIES

Do you want to groom Malaysian

Engineering Consultancy Firms to
deliver Quality Service and to double
their capacity or size in 3-5 years
without extra budget to the
Government?

Potential Growth of ECF

How to do it?
• Government or government-linked
companies to align the projects to
SUSTAINABLE firms with capability and
capacity

Construction Sector Outlook
• CIDB expects RM70b of construction &
infrastructure projects to be
implemented in 2011 with 3.7% annual
growth until 2015
Source:
YB Dato’ Shaziman Abu Mansor, Minister of Works
Malaysia, The Construction Sector at the Onset of
the 10th Malaysia Plan, The 7th Malaysia
Construction Sector Review and Outlook Seminar, 3
Aug 2010
What defines a SUSTAINABLE firm?

1. Ownership structure that encourage
sharing or grooming of engineers to be
partners
2. Proper QA/QC system e.g. ISO9001
3. Comprehensive Training and Knowledge

Management system

What about those smaller
companies?
• Solution – to merge

G&P PROFESSIONALS
(Consulting Group)
PROJECT MECHANICAL
GEOTECHNICS STRUCTURES MANAGEMENT & ELECTRICAL INFRA WATER
CLAIMS &
MARITIME CONTRACTS ZED - G&P
NGI - G&P HIGHWAYS &
TRANSPORTATION
DAMS &
WATER
R&D WATER G&P R INT. G&P-AA

SARAWAK SABAH (SINGAPORE) (CAMBODIA) (Hanoi, Vietnam)

Macro Implementation Plan
1. Enlist of service
providers
2. Grooming
3. Export of Services

Enlisting of ECF with capacity points
Company Level
• SUSTAINABILITY elements
Individual Level
• Capacity and capability of professional staffs
in different fields of engineering such as
Highway & Transportation, Geotechnical,
Drainage, etc.
Company Level Points
3 main SUSTAINABILITY elements are:
• Ownership (60 points)

• QA/QC System (15 points)
• Training & Knowledge Management (25
points)
Recommended minimum of 60 points

Ownership Structure
Percentage of Profit Share by Points
total professional staff
<10% 0
10% to <15% 10
15% to <20% 20
20% to <25% 30
25% to <30% 40
30% to <35% 50
>35% 60
Note : Staff strength must be > 20 people.
QA/QC System
Description Points
ECF without ISO9001:2000 up to 10

Certification
ECF that maintain certification of 15

ISO9001:2000
Note : For companies without ISO9001, the points

are to be based on the quality of the existing system.
Training Programme
Number of Technical Training Events Points
Per Year
<12 0
12 to 24 10
25 to 36 15
37 to 48 20
>49 25
Note: Technical Training includes in-house or
external engineering talks, presentation, colloquium,
conference, seminar on engineering aspects of works
(including KM)
Individual Level Points
3 main components are:
• Experience of Professional Staff

• Professional Qualification
• Additional Professional Recognition

Experience of Professional Staff
Points (N) 1 point for every full year of relevant

work experience up to a maximum of
15 points
Note: The total professional staff shall include all

engineering graduates as well as graduates in
related specialist skills area such as geologist and
hydrologist.
Professional Qualification
Basic Professional Multiplying Factor
Recognition (M)
Engineer without P. Eng. and 1.0
other professional staff
Engineer with P. Eng (with 2.0
“Ir.”)
Note: Professional staff who are non-engineers but
hold a degree in the relevant fields such as geologist,
hydrologist, environmental scientist may be
considered.
Additional Professional Recognition

Additional Professional Recognition & Value Added (V)
Bumiputra Participation to Multiplying
Factor
BEM Accredited Checkers 0.2
Professionally registered with regional or 0.1 each up to a
international engineering organisations maximum of 0.2
Peer Recognition eg presentation, lecture or
technical papers
xIf nos. >5 but ื 10 0.1
xIf nos. >10 but ื 15 0.2
xIf nos. >15 0.3
Bumiputra staff 0.1
Grooming of Sustainable ECF
To groom a firm with 500 to 1,000 staff
• Cost for extra 500 persons per year

= 500 x 6,000 x 12 x1.1 = RM40m
• This is < 3.5% of

yearly allocation
based on 3% fees on
$40b of projects
Matching
• Capability
– Experience
– Field of specialisation
• Capacity
– Number of key staff required

How Sustainability Points System
Work?
• Company size to have at least 1.5x number
of staff required
Total Sustainability Points

= Company Points x Individual Points
100

Example of Project
Project Jabatan Kerja Raya, Cawangan Jalan
Proponent
Project Brief Construct a 10-km two-lane dual carriageway through hilly terrain
Project Stage Detailed Design

1 no. Project Director with minimum 10 years of experience in
Road Construction
Team of Designers (each consists of 1 Senior Engineer with at least
Estimated Man- 5 years experience and 2 Engineers ):
power Required
x2 teams of Road Works and Drainage Designer (6 nos.)
from Designer
x2 teams of Geotechnical Designer (6 nos.) Company to
have at least 24
x1 team of Bridge Designer (3 nos.) staff for capacity
Hence total number of professional staff required is = 16 nos.
Companies bidding for project
Company A
• large multi-disciplinary design consultant with 100 professional staff
• Profit shared by 15% to <20% of total professional staff strength
• ISO 9001 certified
• Company arranged more than 49 events of technical training a year
Company B
• medium-sized specialist firm dealing with road works with 30 professional
staff
• Company arranged 25 to 36 events of technical training a year

Companies bidding for project

Company C
• large multi-disciplinary design consultant with 100 professional staff
• Profit shared by <10% of total professional staff strength
• Company arranged more than 49 events of technical training a year
Company D
• small to medium-sized specialist firm dealing with road works with
20 professional staff Company not qualified as its capacity is < 24 staff
• Company arranged 12 to 24 events of technical training a year

Company Level Assessment
Criteria Company Points Allocated
Company A Company B Company C
Sustainable 20 40 0
Ownership
Programme
QA/QC System 15 15 15
Training and 25 15 25
Company to have at
Knowledge least 60 Company
Management Level Points
Total 60 70 40
Individual Level Assessment

Staff Detail Individual Points Allocated
Years of Multiplying Value added to Multiplying Factor, V M+V Sub-
Experience Factor, M Accredited Recog- Papers Bumiputra total
Checker nition
Project 15 2 - 0.1 0.1 0.1 2.3 34.5

Director
Road Works
1
13 2 - 0.2 0.2 0.1 2.5 32.5
Senior
6 2 - - 0.1 - 2.1 12.6
Engineer
Engineer 1 1 - - - - 1.0 1.0

Total Sustainability Points
Criteria Company Points Allocated
Company A Company B
Company Level Points 60 70
Individual Level Points 271.5 254
Final Sustainability Points 60 x 271.5 = 162.9 70 x 254 = 177.8

100 100
Company B will
be awarded the
contract
Key Benefits
• Building up expertise, capabilities and quality
of local Engineering Consultancy Firms
• Improve earning potential through increased

capacity, productivity and export of services
• Better positioned to navigate through regional

economic cycles
• It is possible to groom Malaysian ECF to
deliver quality service and to double their
capacity in 3-5 years
• This can be done without extra budget to the

Government by aligning <3.5% of yearly
allocation
• Grooming of SUSTAINABLE firms can bring

great benefits to the country
Brain Drain vs. Brain Gain
• Pluge Brain Drain
• Brain Gain : Talentcorp Malaysia

Success Attributes On Brain Gain
• Improve Working Environment
– Chief/Leadership
• Remuneration Package
– Part 1 – Basic – Similar to IEM’s Survey
– Park 2 – 45% Net Profit e.g. G&P
• Reward the Chief and Team

G&P Professionals
G&P Professionals Sdn BhdSdn Bhd (www.gnpgroup.com.my)
G&P Professionals
G&P Professionals Sdn BhdSdn Bhd (www.gnpgroup.com.my)
PART 2
e.g. In G&P Geotechnics Sdn Bhd
• 45% of net profit for directors/partners

Strategies
Improve English and communication skills
• Teachers
– recruit good retired teachers (template)
• Lecturers
– Improve recruitment strategies
– Structured training to existing lecturers
– Improved usage
• Drama, debating clubs, toastmaster club
– Raise the entry bar

Strategies
Improve Fundamentals
• Recruit lecturers with passion
– Template
– Recruit practitioners as lecturers
• Raise entry qualifications
– Increase Diploma/certificate courses
• Review LAN subjects
• Develop lecture modules
– IEM input

UNDERGRADUATE
TRAINING

UNDERGRADUATE TRAINING
Review and update the undergraduate

syllabus to meet industry needs
Assisted by active & experienced
practitioners
Pooling resources from universities &
practitioners
Knowledge sharing between lecturers and

practitioners through workshops and forums
UNDERGRADUATE EDUCATION
Structured
Strengthen Modules/Lectures
Fundamentals (Uni/IEM/ACEM)
Improvement to
Undergraduate
Education
Lecturers
P.Eng With
Practice Exposure

Strategies
Creative / Innovation

CURRENT STATUS OF R&D
• Malaysia lagging far behind countries
such as US, Japan, China, India,
Singapore and Brazil.
3.6 times>M’sia
www.gnpgroup.com.my) (After MASTIC, 2006)
CURRENT STATUS OF R&D

• GERD/GDP Ratio
1996 2004 2010

0.22% 0.63% 0.7%
???
Behind the country’s target of 1.5% by 2010
More needs to be DONE!!!

BENEFITS OF R&D
• Reduction in delivery time &
construction costs Increased
Profit
• Increased competitiveness without
compromising HSE
• Improve safety
• Better quality of life


Courtesy of Judin Abdul Karim (2006)

• American Inventor
OCCUPIED
American Inventor
Challenge The Norm Thru
Innovation To Excel
THE WAY FORWARD
Roles of Stakeholders

R&D RELEVANT TO INDUSTRY NEEDS
Current Issues
• No significant licensing revenues for the
universities (after Hii HH, 2003)
• No R&D output from universities has been

commercialized yet on a national scale (after Hii HH,
2003)
Example of Successful R&D:

University of Strathclyde, UK - £42 million in
royalty income (www.strath.ac.uk/research)
PUBLIC-PRIVATE SECTOR LINKAGES
• Private companies should form strategic
alliances with research institutions
• Research institutions should actively seek

partners from the industry
• Strong relationship between universities and

industry – alumni, adjunct professors from
industry

CULTURE OF EXCELLENCE
• System for sharing of information
• Environment which encourages

creativity and innovation
• Allocation of time for R&D
• R&D incentives and reward

scheme
R&D BY CONSULTANT
Case History

R&D CULTURE
• R&D Wish List / Suggestion Box
• Policy of minimum 1 hour/day for R&D
• Internal colloquium
• Yearly R&D Achievement Award
• R&D Committee to monitor wish list and output

R&D Wish List
Research & Development (R&D)
Subsurface Investigation
Wish-lists / Issues R&D Topics

1.Could percussion method of advancing casing be used for 1.The effect of percussion method of advancing boreholes the
normal SI for SPT test and collect undisturbed samples for results of SI?
consolidation and triaxial tests?
1.Is foam drilling a must for failure investigation on landslide 2. The effects of foam or new stabilising method for drilling.
sites?
1.What is the correlation between Su and results of Jabatan 3. Correlation between Su and results of Jabatan Kerja Raya
Kerja Raya (JKR) probe for marine deposits of different (JKR) probe for marine deposits of different composition.
composition?
1.Do we have DOs and DON’Ts on subsurface investigation (SI) 4. DOs and DON’Ts and Checklists on SI
- Borehole - Borehole
- Piezocone - Piezocone
- Consolidation test - Consolidation test
- CIU test - CIU test
1.What are the new developments on SI? 5. Review on the development of SI.
1.Does Malaysia have calcareous sand? 6. Properties of calcareous sand in Malaysia.
1.How to de-air porous stone for piezocone and maintain the 1.Method to ensure full saturation of porous stone for piezocone.
saturation of porous stone for piezocone?


2500 Ton Silo
on Very Soft Marine Deposits

OUTCOME
• Development of Software
• Original PIGLET software

– Limited pile numbers and pile of
equal length
• Development of PIGEON software

– Unlimited pile numbers and pile of
unequal length

KNOWLEDGE MANAGEMENT SYSTEM
• Transfer of knowledge
Shareholders
Structured Training
Leadership / Commitment Value to
Shareholders
Directors
Partners R&D
Value to
Industry
On the job training Sharing of

Engineers knowledge through
Coaching
Geologists colloquium Industry
Spreadsheet,
Support Staff software, operating
procedures, etc.


STRUCTURED
TRAINING FOR
PRACTITIONERS

STRUCTURED TRAINING FOR

PRACTITIONERS
Adopt Continuing Professional Development

(CPD) Scheme (by BEM)
Collaborate with IEM, technical agencies,
academia, local governments, private industry,
NGOs, etc
Implement certification and accreditation
system to update competency of stakeholders

STRUCTURED TRAINING FOR
PRACTITIONERS
Review Training Direction
Approval of Knowledge
Training Implementation Transfer
Target Certification &
Projects by Stakeholders (Internal &
Steering External) Accreditation To Local Policy
Committee Authority Implementation
CKC/SEA
Local To
Training Policy
Authority KPIs Government
Topic Implementation
Agencies
Government Workshops
Agencies Interviews To Consultants
Available
/ Specialist Improve
Expertise Universities / Contractor Practice
Institutions Drills
Conferences
Available Consultants To Universities Capacity
/ Specialist Exam Building
Facilities / Institutions
Contractors
Courses
To Property Public
Budget Property Owner Awareness
Owner
Panel Insurance Seminars To Insurance Improve
Reviewer Institution Institution Confidence
Emergency Service Improve

To Emergency
Agency Rescue
Service Agency
Operation
MAJOR OVERHAUL IS NEEDED

ON HIGHER EDUCATION

Harmonisation Of HR/Education
• HR Need
– Study of need of Technologists, TAs and
Technicians
– Direct 30% STPM/SPM students to Diploma and
Certificate Courses



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ENGINEERING CONSULTANCY

G&P Professionals Sdn Bhd (www.gnpgroup.com.my)

G&P Professionals Sdn Bhd (www.gnpgroup.com.my)

G&P Professionals Sdn Bhd (www.gnpgroup.com.my)

• One of the main issues is

G&P Professionals Sdn Bhd (www.gnpgroup.com.my)

1 Sepakat Setia Perunding (M) Sdn Bhd 400 373 503

2 Minconsult Sdn Bhd 509 473 450

3 Ranhill Bersekutu Sdn Bhd 290 450 450

4 HSS Integrated Sdn Bhd - 330 370

5 SMHB Sdn Bhd - 304 300

6 G&P Professionals Sdn Bhd - 20 220

7 Kumarasivan Tan & Ariffin Sdn Bhd 193 341 205

8 Jurutera Konsultant (SEA) Sdn Bhd 262 - -

NOTE: Some disappeared from ACEM Directory

G&P Professionals Sdn Bhd (www.gnpgroup.com.my)

Top Engineering Consultancy Firm

Population of Netherlands: 16.7 Million

G&P Professionals Sdn Bhd (www.gnpgroup.com.my)

G&P Professionals Sdn Bhd (www.gnpgroup.com.my)

G&P Professionals Sdn Bhd (www.gnpgroup.com.my)

G&P Professionals Sdn Bhd (www.gnpgroup.com.my)

Don’t you want to retain these ?

and many more………..

Challenging Issues On The Quality

G&P Professionals Sdn Bhd (www.gnpgroup.com.my)

G&P Professionals Sdn Bhd (www.gnpgroup.com.my)

Challenging Issues On The Quality

• Poor command of English and

G&P Professionals Sdn Bhd (www.gnpgroup.com.my)

G&P Professionals Sdn Bhd (www.gnpgroup.com.my)

Challenging Issues On Technical

G&P Professionals Sdn Bhd (www.gnpgroup.com.my)

G&P Professionals Sdn Bhd (www.gnpgroup.com.my)

Do you want to groom Malaysian

G&P Professionals Sdn Bhd (www.gnpgroup.com.my)

G&P Professionals Sdn Bhd (www.gnpgroup.com.my)

G&P Professionals Sdn Bhd (www.gnpgroup.com.my)

What defines a SUSTAINABLE firm?

2. Proper QA/QC system e.g. ISO9001

3. Comprehensive Training and Knowledge

G&P Professionals Sdn Bhd (www.gnpgroup.com.my)

G&P Professionals Sdn Bhd (www.gnpgroup.com.my)

R&D WATER G&P R INT. G&P-AA

G&P Professionals Sdn Bhd (www.gnpgroup.com.my)

G&P Professionals Sdn Bhd (www.gnpgroup.com.my)

Enlisting of ECF with capacity points

3 main SUSTAINABILITY elements are:

• Ownership (60 points)

Recommended minimum of 60 points

ECF without ISO9001:2000 up to 10

ECF that maintain certification of 15

Note : For companies without ISO9001, the points

3 main components are:

• Experience of Professional Staff

G&P Professionals Sdn Bhd (www.gnpgroup.com.my)

Experience of Professional Staff

Points (N) 1 point for every full year of relevant

Note: The total professional staff shall include all

Additional Professional Recognition

• Cost for extra 500 persons per year

• This is < 3.5% of

G&P Professionals Sdn Bhd (www.gnpgroup.com.my)