Addis College

Program: M.Sc, Construction Technology & Management

Course: Strategic Construction Management

Lecture 1: Course Outline & Introduction

By: Dagnachew A. (PhD)

16 July 2022 1
 Contents of the presentation

Lecture:
• Self introduction
Introduction

• Course outline briefing concepts of management

concepts of strategy
concepts of strategic Mgt
• Brain storming
Strategic Management

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 Course outline briefing
A. Course Objective:
o to enable students to develop further theoretical & practical
knowledge to implement the principles of Project
Management in the construction industry.

o to enable students to review & critically analyze the

performance of project management.

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 B. Learning outcome
At the end of this course students will be able to:
– realize key problems & challenges facing the management of the
construction industry,
– understand the extent & magnitude of the challenges facing the
management of the construction industry,
– comprehended the new concepts of construction management:
lean construction,
process mapping,
performance measurement,
benchmarking,,
Supply Chain Management, &
Strategic Partnering .

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 C. Contents/Units of the syllabus
Concepts of Management
Strategic management
Construction management
The construction industry
new concepts of construction management
lean construction,
process mapping,
performance measurement,
benchmarking,,
Supply Chain Management, &
Strategic Partnering .
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 `

D. Assessment/Evaluation

Assignments & projects -------- 50 - 40%

Written examinations:

Final ----------------- 50 - 60%

100%

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 E. Attendance requirements

As per the college’s guideline

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 F. References
• Sir John Egan(1998): Rethinking Construction.

• Glenn Ballard and Greg Howell (1998):’What Kind of Production is Construction’ .

• Implementing Lean Construction: Stabilizing Work Flow by Glenn Ballard and Greg
Howell 1997)

• Elmuti & Kathawala (1997):Benchmarking Process

• Morris, P W G. The Management of Projects, Thomas Telford Ltd. 1994, ISBN: 0 7277
1693 X.

• Kelly, John; Male, Steven and Graham, Drunimond (2004). Value Management of
construction Projects, Blackwell Publishing Ltd.

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 G. Teaching & Learning Methods

• Brain storming

• Lectures,

• Self-study,

• Individual assignments/Projects,

• Q&A

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 Brain storming

• What is management?

• What is strategy?

• What is strategic management?

• What is construction?

• What is strategic construction management?

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 What is Management?
• There are various definitions – only some selected ones presented below:

• A means of achieving political, economic, and social objectives.

• A process of establishing vision, mission, values, objectives, goals, and

strategies and communicating these, and guiding and empowering others
to accomplish them.

• Management is also the process of planning, organizing, leading, &

controlling the use of resources to accomplish performance goals

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 Four Functions of Management

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 Functions of management
Management is a set of goal-directed, interrelated & interdependent activities,
aimed at accomplishing organizational goals in an efficient & effective way.

Functions of management comprises of:

– Planning
• The process of setting objectives and determining
what actions should be taken to accomplish them
– Organizing
• The process of assigning tasks, allocating resources,
and coordinating work activities
– Leading
• The process of arousing people’s enthusiasm to work
hard and direct their efforts to achieve goals
– Controlling
• The process of measuring work performance and
taking action to ensure desired results

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 The Systems Relationship among the Management Functions

Planning
Management
Functions

Controlling Organizing

Management
Skills
Leading

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 Fundamentals of Management

Management sets direction

Resources:
Human
Financial
Raw materials
Technological
Information

Inputs

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Plan helps:

What to accomplish (goals);

When to accomplish the goals;

What resources to use;

Who should accomplish what;

Where to accomplish; and

What methods to use.

Assess all possible scenarios including the best and worst & what actions to take.

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 OR
• Management involves coordinating and overseeing the work activities
of others so that their activities are completed efficiently and
effectively.

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 Efficiency & Effectiveness in Management

Efficiency Effectiveness (Ends)

(A Means)

Resource Goal
usage attainment

Low Waste High Attainment

Management Strives for:

Low resource waste (high efficiency)
High goal attainment (high effectiveness)

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 What does it take to be a Successful Manager?

Management Qualities
– Integrity, industriousness (=determination to perform a
task), and the ability to get along with people

Management Skills
– Technical skills

– Human and communication (Teaming) skills

– Conceptual and decision-making skills

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 New Workplace Issues and Challenges
Technology and Speed

Networking and
Boundaryless Globalization
Relationships and Diversity

Ethics and Knowledge,

Social Learning,
Responsibility Quality, and
Continuous
Improvement

Participative
Management, Knowledge
Empowerment, Management
and Teams
GENERATIONAL DIFFERENCES Change, Creativity, Innovation,
and Entrepreneurship

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 New Workplace Issues and Challenges (cont’d)

• Knowledge, Learning, Quality, & Continuous Improvement

– Information is the foundation of knowledge which, in

turn, is the foundation of competitive advantage.
People (employees) are the competitive advantage!
• Knowledge Management

– Involves everyone in an organization in sharing

knowledge and applying it to continuously improve
products and processes.

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 New Workplace Issues and Challenges (cont’d)

• Change, Creativity, Innovation, & Entrepreneurship

– Knowledge management requires that people change in order to
continually improve.
– The speed of change in modern business has increased because of
globalization & changes in technology. And other factors listed.
– Creativity is coming up with new ideas for improvements, and
innovation is implementing those ideas.
– Entrepreneurship is about generating creative ideas and using them
through innovation.

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 New Workplace Issues and Challenges (cont’d)

• Participative Management, Empowerment, & Teams

– Empowering employees to share in performing
management functions by working in teams.
– Learning organizations manage knowledge well by
empowering teams to be creative and innovative.

• Ethics and Social Responsibility

– Managerial integrity
– Situational responses

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 2. What is strategy?
• Strategy: the creation of a unique and valuable position involving a unique
set of activities; being different.
• Strategy is about combining activities whereas operational
effectiveness (OE) is about excellence in individual activities or
functions.
• Strategy involves a whole system of activities, not a collection of parts.
• Activities: the basic units of competitive advantage.
• Competitive Advantage: grows out of the entire system of activities;
capacity to outperform rivals by establishing a difference it can
preserve over time.

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 3. Strategic Management
• It is the art and science of:
formulating,
implementing, and
evaluating cross-functional decisions that enable an
organization to achieve its objectives
• Strategic management is used synonymously with the term
strategic planning.
• Sometimes the term strategic management is used to refer to
strategy formulation, implementation, and evaluation, with
strategic planning.

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• A strategic plan is a company’s game plan.

• A strategic plan results from tough managerial

choices among numerous good alternatives,
and it signals commitment to specific markets,
policies, procedures, and operations.

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 Strategic Management

. Dess, Lumpkin, & Eisner (Strategic Management: Creating Competitive Advantage, 3rd Ed)
defined as:

– Strategic management consists of the analysis, decisions, & actions an

organization undertakes in order to create & sustain competitive
advantages .
 Strategic management
• Analysis
– Strategic goals (vision, mission, strategic objectives)
– Internal and external environment of the firm
• Decisions
– What industries should we compete in?
– How should we compete in those industries?
• Actions
– Allocate necessary resources
– Design the organization to bring intended strategies to reality
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 Stages of Strategic Management

Strategy Strategy Strategy

formulation implementation evaluation

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 Stages of Strategic Management
• Strategy formulation
– includes developing a vision and mission, identifying an organization’s
external opportunities and threats, determining internal strengths and
weaknesses, establishing long-term objectives, generating alternative
strategies, and choosing particular strategies to pursue.
Deciding what new businesses to enter,
What businesses to abandon,
How to allocate resources,
Whether to expand operations or diversify,
Whether to enter international markets,
Whether to merge or form a joint venture,
How to avoid a hostile takeover.
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• Strategy implementation
– requires a firm to establish annual objectives, devise policies, motivate
employees, and allocate resources so that formulated strategies can be
executed
– often called the action stage

• Strategy evaluation
– reviewing external and internal factors that are the bases for current
strategies, measuring performance, and taking corrective actions
• Strategy formulation, implementation, and evaluation activities are a three
hierarchical level.
• Strategic management helps a firm function as a competitive team
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 Vision vs Mission statements
• Vision statement
– answers the question “What do we want to become?”
– often considered the first step in strategic planning
• Mission statements
– enduring statements of purpose that distinguish one business from other
similar firms
– identifies the scope of a firm’s operations in product and market terms
– addresses the basic question that faces all strategists: “What is our
business?”
• Objectives
– specific results that an organization seeks to achieve in pursuing its basic
mission
– long-term means more than one year
– should be challenging, measurable, consistent, reasonable, and clear

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 Developing a Mission & Objectives
• An organization’s Mission
– Reflects management’s vision of what the organization seeks to do and
become
– Provides a clear view of what the organization is trying to accomplish for
its customers
– Indicates intent to take a business position
• An organization’s Objectives
– Convert the mission into performance targets
– Track performance over time
– Must be achievable
– Two types
• Financial – outcomes that relate to improving financial performance
• Strategic – outcomes that will result in greater competitiveness &
stronger long-term market position.
Strategy Plan Hierarchy
Strategic Pyramid
 Coherence in Strategic Direction
Vision
• Massively inspiring
vision
• Overarching (= covering many issues)
• Long-term
• Driven by and evokes passion
• Fundamental statement of the
organization’s
– Values Hierarchy of Goals
– Aspiration
– Goals
 Coherence in Strategic Direction
Mission statements
• Purpose of the company vision
• Basis of competition and
Mission statements
competitive advantages

• More specific than vision

• Focused on the means by

Hierarchy of Goals
which the firm will
compete
 Coherence in Strategic Direction
Strategic objectives
• Operationalize the
vision
mission statement

• Measurable, specific, Mission statements

appropriate, realistic,
timely, challenging, Strategic objectives

resolve conflicts that Hierarchy of Goals

arise, and yardstick for
rewards and incentives.
 Benefits of Strategic Management
• the principal benefit of strategic management is to help
organizations:
formulate better strategies through the use of a more systematic, logical, &
rational approach to strategic choice.
• communication is a key to successful strategic management
• through dialogue & participation, managers & employees become
committed to support the organization.
Guidelines for Effective Strategic Management
 Forms of Strategy

(Source: Mintzberg & Waters, 1985)

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 Strategic construction management ?

• Generally, strategic management is the process of:

creating,
implementing &
evaluating decisions that enable an organization to achieve its
goals and objectives.

• The process of Strategic Construction Management is

continuous that changes as the organizational goals &
objectives evolve.
Thank you so much for your attention