CONS0002 Management of

Construction Organisations
Postgraduate – Construction Project Management

Managing the External Environment and

Organisational Culture

CONS0002 – Dr. Elijah F. Boadu

External environment

Forces and institutions outside the organisation that potentially can

affect the organisation's performance.

The specific environment The general environment

 Specific environment

Have a direct and immediate impact on managers' decisions and actions and
are directly relevant to the achievement of the organization's goals.

Government, financial institutions, trade associations, unions

Competitors

Subcontractors, subconsultants, suppliers, vendors

Clients, consultants
 Stakeholder management

Key stakeholders:
Keep happy: Involve
Collaborate
Power

Marginal: Monitor Keep informed

Interest
 General external environment: PESTLE

Political Technological
Government policy, R&D, availability, automation,
incentives, trade restrictions, technological incentives.
political stability, bureaucracy.

Economic Legal
Inflation, interest rates, Laws and regulations, licences
exchange rates, taxes, demand and permits, intellectual property
and supply, growth.

Sociocultural Environment
Demographic profile, social Natural hazards, climate
trends, population growth rate, change, weathers, pollution,
religion, national culture. sustainability agenda.
 National culture

Power distance

Individualism vs. collectivism

Achievement (masculinity) vs. nurturing (femininity)

Uncertainty avoidance

Pragmatic (long-term) vs. normative (short-term)

Indulgence vs. restraint

https://www.hofstede-insights.com/country-comparison/australia/
 National culture

https://www.hofstede-insights.com/country-comparison/china,the-usa/australia,
Characteristics of the external environment

• stability (stable/static or fluctuating/

dynamic
• Sophistication (simple or complex)
• market diversity (integrated or
diversified
• Hostility (munificent to hostile)
 Environmental uncertainty matrix
Degree of complexity
Simple Complex
Stable
Degree of Change

Unstable

Source: Bright D.S and Cortes, A.H (2019). Principles of Management. OpenStax, Houston, Texas
How external environment affect managers

• The external environment is important because it poses constraints and challenges to

managers.

Creates uncertainties

Impacts on jobs and

Effect of employment
external
environment
on managers
Influences decisions and
practices

Affects nature of stakeholder

relationship
Organisational culture

Definitions “The way we do things around here”.

“The shared values, principles, traditions

and ways of doing things that influence the
Perception way organisational members act”.

Culture sets the tone for how organisations

Shared operate and how individuals within the
organization interact.

Descriptive
Levels of organisation culture
 Characteristics of organisational culture
Team orientation
work activities are organised Aggressiveness
around teams rather than
people are aggressive and
individuals.
03 04 competitive versus easy-going
and cooperative.
People orientation
managers take into account the
effect of outcomes on people in 05 Stability
the organisation. 02 Degree to
which organisational activities
emphasis maintaining the
Outcome orientation
status quo as opposed to
managers focus on growth.
results/outcomes rather than how 06
these outcomes are achieved. 01

Attention to detail 07 Innovation and risk taking

employees are expected to employees are encouraged to
exhibit precision, analysis, and be innovative and to take risks.
attention to detail.
Functions of culture

Boundary-defining

Sense of identity

Creates commitment

Enhances stability
 How organisational culture forms

Sources: Top
• Founders management
• Vision and mission Selection Organisational
• Past practices criteria culture
• Existing top Socialisation
management

Training/ Language
induction
Material
Stories symbols

Rituals

Example of story: The Lendlease Story

(https://www.youtube.com/watch?v=l5MvPwBXGho)
Strength of organisational culture

Clarity of
cultural values
and beliefs

Strength of the Size of

original culture organisation

Influencing
factors

Rate of
employee Age of
turnover organisation
Contrasting organisational culture
Strong vs weak organisational culture
How employees learn culture

Stories

Material How
employees Rituals
symbols
learn culture

Language
How culture affect managers

Culture conveys to managers what is appropriate behaviour

Strong organisational culture constrains a manager’s decision-

making options.

Generally, culture constrains what managers can and cannot do and

how they manage.
Managerial decisions affected by culture
 Safety culture

Health and Safety Executive (HSE). (2005). A Review of Safety Culture and Safety Climate Literature for the Development of the Safety Culture Inspection Toolkit, Research Report
367. HSE Books, ISBN 0 7176 6144 X.
 Psychological aspect or safety climate

Management
commitment

Safety
Safety training
communication
Safety
climate Employees’ perceptions and attitudes
towards safety in the organisation or in
their workplace.

Personal Rules &

accountability procedures

Loosemore, M., Sunindijo, R.Y., Lestari, F., Kusminanti, Y., and Widanarko, B. (2019). Comparing the safety climate of the Indonesian and Australian construction industries:
Cultural and institutional relativity in safety research. Engineering, Construction and Architectural Management, 26(10, 2206-2222.
 Behavioural aspect

Job attitudes
• Job is dangerous and macho
• Safety rules and procedures interfere with production
• Safety rules and procedures reduce excitement

Behavioural intentions
• Ignore safety rules and procedures
• Take unnecessary risks

Actual behaviour
• Failure to follow safety rules and procedures
• Risk-taking behaviour

Lingard, H. and Rowlinson, S. (2005). Occupational Health and Safety in Construction Project Management. Oxon: Spon Press.
 Situational aspect

Policy

Organising

Auditing
Planning and
implementing

Information link
Measuring
Control link

Reviewing

Poon, S.W., Tang, S.L. and Wong, F.K.W. (2008). Management and Economics of Construction Safety in Hong Kong. Hong Kong University Press.
Risk management

1 3
2 4
Identifying hazards Controlling the risks
• Inspection • Hierarchy of control
• Past experiences
• Safe design Maintaining and reviewing
• Consult the workers
Assessing the risks
• How hazards may cause harm
control measures
• Review available
• Severity of the harm • Workplace change
information
• Likelihood • Inspection

• Safe work method statement • Consultation

(SWMS) • Reviewing data
Hierarchy of risk control

Elimination

Substitution

Isolation

Engineering control

Administrative
control

PPE
 Mental health in construction

• Most health and safety research focuses on physical injuries and health issues.
• Psychological injuries are invisible and silent; they tend to go unnoticed.
• Suicide statistics in Australia:
• About 75% of people who take their own lives are men.
• Construction workers have suicide rates 84% higher than non-construction workers
• Construction workers six times more likely to die by suicide than in workplace accidents
• Suicide rates among workers aged 15 to 24 are more than twice as high as other males in
that age bracket
• People working in lower skilled jobs are more at risk

https://tpmbuilders.com.au/mental-health-and-safety-in-construction-australia/
 Stressors in the construction industry
• The levels of depression, anxiety, and stress among construction professionals are higher than
those of the general population.

Workload
Time
pressure
Stressors

Long
hours

Nature of
work

Sunindijo, R.Y. and Kamardeen, I. (2017). Work stress is a threat to gender diversity in the construction industry. Journal of Construction Engineering and Management, 143(10),
04017073.
 Work-life balance

Technology
Long work
hours

Stress

Poor work-life balance

Holden, S. and Sunindijo, R.Y. (2017). Technology, long work hours, and stress worsen work-life balance in the construction industry. International Journal of Integrated
Engineering, 10(2), 13-18.
 Addressing mental health issues
Education on Reducing stigma
workplace bullying

Building skills and

confidence; coping Support Increasing awareness

Supporting employees; 1 Making a commitment to

in 4 have experienced improve mental health
depression or anxiety

https://www.chessconnect.org.au/mental-health-construction-industry/