Motivation and Importance of the Study

The growth in popularity of design-build project delivery method has inspired a very large body of literature in the field of engineering and project management. Some studies shows support for the use of design-build (e.g., Gransberg, 2003; Talal, 2005), whilst others reported disadvantages (e.g., Fahmy and Jergeas, 2004). Some discovered through statistical testing the factors that determine the performance of design-build projects (e.g., Ling, 2004; Ling, Chan, Chong and Ee, 2004).

Combining engineering design and construction functions in one single project increases internal interfaces of the design-build entity and generally elevates the level of complexity in the project. Given the freedom of the design-builder to choose a design that will enable it to deliver the facility in the most cost effective and efficient manner, the design-builder is exposed to higher levels of uncertainty. Growth in project scale and scope (such as packaging electrical and mechanical work with civil and architectural works), and concurrent execution of project activities, further add complexity to the project. Such factors impact the structuring of engineering project organisations directly, and eventually the effectiveness of the project organisation. These forces are major challenges for the local industry to seek more effective methods to manage such complex projects. We have seen some well-known construction companies under-performing in the design-build context. We have also observed that most civil and building contractors are “locked-in” to the mindset of traditional design-bid-build project framework, which may explain why some project organisations are performing poorly.

In the search for ways to better organise and structure a design-build project, we looked into organisation literature, where organisation effectiveness is the main theme in academic study. In retrospect to the project management literature, we find many writers in the project management literature have often associated project success with effectiveness, making no conceptual differentiation between the two. Furthermore, we find very little concern for the effectiveness of project organisations in the project management practice. Yet, looking back again into organisation literature, we find deficiency in the study of “remote” project organisations which characterises design-build projects.

Perhaps the most widely cited organisation form for project work is matrix structure

and project team (Galbraith, 1971, 1974; Galbraith and Kazanjian, 1986; Larson and Gobeli, 1989). Different structural forms are effective under different settings, for example Larson and Gobeli found that project success varied according to project structure. However, the matrix and project forms exist within an existing organisation.

Members of the project are drawn from a pool of staff within the organisation, and project work is executed within the boundary and context of the organisation.

Construction projects in Taiwan are often executed by remote projects formed in an ad hoc manner. By “remote”, we refer to temporary project organisations established outside the boundary of an enduring business organisation, for the sole purpose of executing the project work. They are not “temporary organisations within organisations”

(Shenhar, 2001:395). This is evident from field observation that many design-build project organisations in Taiwan are staffed with only few members assigned to the project from the parent organisation that has solicited the project work. Bulk of the project staff is drawn elsewhere, mostly at an ad hoc basis and through subcontracting.

From the preceding discussion, there are several gaps in both the project management and organisation literature that warrant further study. These gaps motivated this study.

1.2.1 Need for study of technology-structure relationships in projects

Various contingency factors shape organisation structure. Mintzberg (1980) identified four sets of contingency factors that have received most attention: age and size, technical system, environment and power. In particular, technology has received substantial attention in the literature. Several technology constructs exist in organisation

literature, relating technology to various dimensions of the organisation structure.

Several studies have also looked into the link between technology, structure and performance.

In the project management domain, Shirazi, Langford and Rowlinson (1996) have discussed the contingent impacts of technology and environment on construction organisations. Shenhar (2001) has developed a typology to classify technical projects along the dimension of technological uncertainty and complexity. Pich, Loch and De Meyer (2002) conceptualised a model of uncertainty, ambiguity and complexity in project management, relating the level of uncertainty to the project management structure. Despite these studies, there is a need for more specific technology-structure studies in project management. Design-build projects are often called for in complex engineering works where managerial effort is required as much as the technical effort.

Previous studies of technology’s effects on project organisation structure are qualitative, and in our opinion, an under-studied phenomenon. More rigorous study of such relationships is necessary to gain more in-depth understanding.

1.2.2 Need for theory building in project management

Shenhar (2001) argued that “theory development in project management is still in its early years” (p.394). Turner (2006a, 2006b, 2006c) presented a theoretical framework for project management, which has been further refined by Sauer and Reich (2007). We see as one of our objectives in this study to contribute to the growing theoretical foundation of the project management discipline. We approach this research with model building in mind.

By theory building, we seek to develop a model explaining the forces that affect the structuring of project organisations, in the face of the technology adopted, utilised and involved by the project organisation. The context in which we choose to extend the theory is design-build projects.

1.2.3 Importance of the study

Based on our experience and observation of Taiwan High Speed Rail (THSR) and Kaohsiung Metro projects, as well as reports of Yang (楊人能, 2002), most local construction companies enter into design-build contracts by means of joint venture.

Typically, the design function is subcontracted to consulting firms, although architects/engineers (the designers) may play a leading role as reported by Yates (1995) and Yen (顏敏仁, 2000). We are also aware that the local construction industry is in its early days of using the design-build method. Varying configurations of design-build project organisations have been used in the THSR, Kaohsiung Metro, Taipei Metro and various public works projects. But what constitutes an effective organisation configuration? This question requires a series of studies.

An effective project configuration is shaped by various forces (Mintzberg, 1980;

Daft, 2004). Having identified such factors, we can critically evaluate the effect of each factor on the structuring of project organisations. When the performances (or effectiveness) of various project organisations are compared, differences in the pattern of project structuring between good and poor performing projects will surface, thereby identifying the key structural elements of effective project organisations. The identification of good performance projects will allow us to benchmark them against other projects, and pinpoint the deficiencies of projects that are underperforming. The

research process described is consistent with Lawrence and Lorsch (1967a), Doty, Glick and Huber (1993), Miller, Glick, Wang, Huber (1991), and, Ketchen, Thomas and Snow (1993).

This study is important to the local construction industry. Taiwan’s participation in the World Trade Organisation (WTO) indicates exposure of the local market to foreign competition. As design-build delivery method gains popularity worldwide, local firms need to learn to manage design-build projects effectively so that they can compete at the international level. This study is an initial attempt to identify one of the factors that affect project organisation structure – technology; the means through which project organisations execute project tasks. It seeks to establish the relationships between technology and the project organisation structure, and lay the foundation for future studies.