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Abstract: Due to rapid growth of world’s population and urbanization in the world
construction is becoming complex, and because of its this nature, effective communication is
essential for ensuring successful outcomes in construction projects. However, ineffective
communication can lead to project delays, increased costs, and disputes that may result in
complicated litigation and arbitration. This literature review aims to examine the impact of
ineffective communication in construction projects in Sabah, Malaysia. The review focuses on
the role of the Construction Industry Development Board (CIDB) in promoting effective
communication, the use of the Construction Industry Payment and Adjudication Act (CIPAA)
to resolve disputes, and the effectiveness of the PAM Contract with Quantities in improving
communication and reducing disputes in construction projects. The review analyses relevant
literature on the topic, including studies that have investigated communication challenges in
construction projects in, Malaysia. The findings indicate that ineffective communication is a
prevalent issue in construction industry of Malaysia and can be caused by factors such as
language barriers, cultural differences, and poor coordination among project stakeholders.
Based on the literature review, recommendations are provided for improving communication
in construction projects in Sabah, including the use of clear communication channels, regular
project meetings, and effective project management strategies. The literature review highlights
the significance of effective communication in construction projects and provides valuable
insights for stakeholders involved in construction projects in the region.
Keywords: ineffective communication, Sabah, Malaysia, litigation, arbitration.
___________________________________________________________________________
1. Introduction
Construction Industry characterized as Complexed in nature due to its dynamic and fragmented
nature as it involves several parties that includes client, Consultant and Contractor therefore
effective communication is essential to overcome any challenge. Construction project varies
from other industries due to its distinctive nature. Due to rapid urbanization construction
industry is getting complex with advancement in technologies and it involves several parties
from both private and public sector (Gamil & Abdul Rahman, 2018). These factors had made
construction project more complexed and challengeable for all stake holders. Among all these
circumstances effective communication if one of the major considerations in project success.
According to research it has been found by many scholars that ineffective communication
during the life cycle of the project can lead to project delay and in worst cases it can cause
project failure.
Effective communication is a critical factor for the success of construction projects (Chan &
Kumaraswamy, 2010). However, the complexity of modern-day construction projects, coupled
with the involvement of multiple stakeholders, has made communication more challenging
(Baiden et al., 2016). Communication breakdowns can lead to various negative consequences,
such as delays, cost overruns, and even legal disputes (Yu et al., 2018).
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In Malaysia, the Construction Industry Payment, and Adjudication Act 2012 (CIPAA) has
highlighted the importance of effective communication in construction projects (CIDB, 2017).
The act requires parties involved in a construction project to establish a written contract that
includes provisions for communication and dispute resolution. The Project Information
Management System (PIMS) and the Construction Industry Development Board (CIDB) have
also established guidelines for effective communication in construction projects. These
guidelines emphasize the need for clear and concise communication, regular meetings and
progress reports, and the use of digital tools to improve communication (CIDB, 2017).
The impact of ineffective communication in construction projects is not limited to delays and
cost overruns; it can also lead to complicated litigation and arbitration. For instance, the Kuala
Lumpur International Airport Terminal 2 project in Malaysia was delayed for several years due
to communication breakdowns between the project owner, contractor, and consultant
(Mohammed et al., 2014). This resulted in legal disputes that took years to resolve and cost
millions of dollars in legal fees.
The ever-increasing population and urbanization, construction has become a necessity for
mankind, and construction projects are becoming more complex with time. Conflicts arise
during these projects, which can lead to partial or complete failure, with miscommunication
being a significant reason (Khahro and Ali, 2014). In Malaysia, the construction sector sees
around 700-800 legal cases annually due to disputes among stakeholders, with most of them
arising from payment issues and ineffective communication (Tse Wen, 2022). Therefore, this
research project aims to investigate the effects and causes of ineffective communication in
construction management, which leads to complicated litigation and arbitration in the Sabah
region of Malaysia. Limited research has been done on this topic in Malaysia, specifically
Sabah, making this study crucial in formulating a better policy to address the issue.
Given the importance of effective communication in construction projects, it is crucial to study
the causes and effects of ineffective communication and develop strategies to address this issue.
This research project aims to achieve this by studying the formal and informal communication
practices in construction projects in Sabah, Malaysia, and investigating the causes of
communication breakdowns, their impact on project performance, and legal issues that arise
due to ineffective communication.
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Lack of mutual trust among Lack of trust between parties involved in the
construction teams construction project
Negligence and casualness Lack of attention or care towards communication
Lack of communication Absence of established communication protocols
procedure and training and lack of training on communication skills
Complexity of construction The inherently complex nature of construction
industry projects
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Similar things happened in case of Nordin Abdul Rahman (trading under the name and style of
Meritimur Jaya) against three parties was filed in the High Court of Sabah at Kota Kinabalu.
The plaintiff, a sub-contractor, claimed a loss of RM 1,519,980.00 against all three defendants
for the project Rancangan Tebatan Banjir Bandaran Sabah Sg Tabanak, Lahad Datu. The first
defendant was awarded the tender for the project on August 11, 2006 and gave power of
attorney (POA) of the project to the second defendant, who then hired the plaintiff as the sub-
contractor. Due to the second defendant's financial instability, the first defendant appointed
another POA for the project on December 21, 2006, with similar power given to the first PA.
The final judgment, which was in favour of the plaintiff, was delivered on August 18, 2010.
The first defendant was ordered to pay a sum of RM 1,000,000 with 4% annual interest, with
taxes to be discussed. This case highlights the importance of proper management and
supervision of sub-contractors, as well as the potential risks and consequences of financial
instability of contractors and sub-contractors.
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The paper titled "A Case Study of S-Curve Analysis: Causes, Effects, Tracing and Monitoring
Project Extension of Time" published in the Journal of Civil Engineering in 2018 discusses the
use of S-Curve analysis in project management, particularly in the context of identifying the
causes and effects of project delays and monitoring the progress of a project in relation to time.
The authors describe S-Curve analysis as a powerful tool for project management, which helps
in tracking the progress of a project over time and identifying any deviations from the planned
schedule. The S-Curve graph shows the cumulative value of work completed over time and
provides an indication of whether the project is progressing as planned, ahead of schedule or
behind schedule. It is also useful in predicting the time and cost required to complete a project,
and in identifying potential risks that could cause delays (Mohamad et al., 2021).
The paper presents a case study of a construction project in the UAE, which experienced delays
due to various factors such as poor planning, design changes, unforeseen site conditions, and
miscommunication among the project team. The authors used S-Curve analysis to monitor the
progress of the project and identify the causes of delays. The analysis showed that the project
was progressing slowly, and that the actual completion time would be much later than the
planned completion date. The authors then traced the causes of delays and identified various
factors such as poor communication, lack of coordination among the project team, and
inadequate planning and design. They also highlighted the importance of effective
communication and collaboration among the project team, which could have helped in
identifying potential risks and resolving issues before they escalated. The paper emphasizes the
importance of S-Curve analysis in project management and its potential for identifying causes
and effects of project delays and monitoring the progress of a project in relation to time. The
case study presented in the paper highlights the significance of effective communication and
collaboration among the project team, and the risks associated with miscommunication and
lack of coordination (Mohamad et al., 2021).
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In 2015, the project was supposed to be handed over as per the contract, but in December 2014,
after 21 months of the project, it was discovered that it was running behind schedule by a factor
of 5.96 and had achieved only 80.47% of the scheduled progress. The actual progress was
contractually required to be 74.78%. This delay was a concern not only for the contractor but
also for the developer, as the contract guaranteed compensation to the buyer for late delivery.
According to the contract, if the project falls behind 70% of actual progress due to any reason,
the contractor is obligated to prepare an Extension of Time (EOT), which seemed more like a
penalty for the developer for late delivery. Table 4 shows the weightage of delays based on the
number of days taken to resolve each issue.
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According to CIPA whatever interim payment certificate has been submit, the Plaintiff should
be paid for all his work done. The final verdict of the high court in favor of GOLDENLINK
ENGINEERING SDN BHD (PLAINTIFF).
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The proposed framework involves four main stages: information collection, information
processing, visual communication design, and visual communication delivery. Information
collection involves gathering project information from various stakeholders, including clients,
contractors, designers, and suppliers. Information processing involves organizing, filtering, and
synthesizing the collected information to generate knowledge that is relevant to the project.
Visual communication design involves creating visual aids that can effectively convey the
knowledge to different stakeholders. Finally, visual communication delivery involves
presenting the visual aids to stakeholders and ensuring that they understand the information.
Shen et al. (2017) emphasize the importance of visual communication in construction projects,
as it can supplement verbal communication and enhance understanding. They propose the use
of various visual aids, such as diagrams, charts, and graphs, to convey information effectively.
The paper also highlights the need for proper training and education to improve communication
skills among project team members.
The communication cycle as a series of stages, which include:
• Encoding: The sender creates the message, choosing words, symbols, or other forms of
communication to convey their intended meaning.
• Transmission: The message is transmitted through a chosen medium, such as face-to-
face conversation, email, or phone call.
• Reception: The receiver receives the message and decodes it, interpreting the words or
symbols to understand the intended meaning.
• Feedback: The receiver provides feedback to the sender, indicating their understanding
or seeking clarification on any points of confusion.
• Understanding: Both sender and receiver reach a shared understanding of the message,
ensuring that communication is successful.
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6. Conclusion
All in all, this review paper has analysed the effects of ineffective communication in
construction projects and its role in causing complex litigation and arbitration. Communication
problems are a common challenge in the construction industry due to its complex nature and
the involvement of multiple stakeholders, including clients, contractors, subcontractors, and
consultants.
Ineffective communication can lead to misunderstandings, delays, errors, and severe financial
and legal consequences. These include project delays, cost overruns, safety risks, and legal
disputes, which are time-consuming and expensive to resolve. As a result, litigation and
arbitration can cause project delays, damage reputation, and financial losses.
To mitigate these issues, stakeholders in the construction industry must be proactive in
addressing communication problems. This involves adopting effective communication
practices, such as regular meetings, clearly defined roles and responsibilities, and transparent
communication channels. The use of technology, such as project management software and
communication tools, can also improve communication and collaboration among stakeholders.
In conclusion, the impact of ineffective communication on construction projects is significant,
and effective communication practices are essential to prevent disputes that may lead to costly
litigation and arbitration. Therefore, stakeholders in the construction industry must recognize
the significance of communication and implement necessary measures to ensure effective
communication throughout the project lifecycle.
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