Date: May 2015Location: Hong Kong

Managing projects across borders in East Asia

Contents

• Introduction

• Arup and a Selection of Projects

• Country Characteristics and Challenges in East Asia

• Cross- Border Teamwork for Delivery

• Conclusion

Introduction & Caveats

Introduction

• My Background

• This Talk –

• Part 1 - Project Experience in Japan, Mainland China,

South East Asia (& Hong Kong SAR)

• Part 2 - Lessons learnt in managing cross-border

teams/international projects.

Scope of Talk

Clients Government/

Statutory

Design Procure Construct

Japan x x x x

Mainland

China

x x x x x

SE Asia x x x

HK SAR x x x x

Caveats

• Projects discussed are predominantly private sector projects

and in building/industrial field. Not Government work.

• It’s not a judgment on nationalities and race, more of a

description on procedures and market characteristics of the

countries mentioned.

• Design management of external companies, seldom Arup

(unless internal design role)

• From a western perspective and as a PM

• Some generic observations only, from some cases, do not

wish to stereotype

Arup & A Selection of Projects

DisciplineNumber

of Staff

Civil, Structural, Geo. 5,169

E&M 2,228

Acoustics 123

Architecture & Urban Design 281

ICT 102

Computing 274

Environmental 321

Façade 203

Fire 223

PPM 468

QS/Cost Consulting 42

Transport Planning 393

Other disciplines 1,108

Total technical 10,935

Non-technical 1,721

Total = 12,656

Beijing Aquatics Centre

Full Design

International Commerce

Centre

Structural Engineering

Allianz Arena

Structural Engineering

California Academy of

Sciences

Total Engineering &

Sustainability

Heathrow Airport T5

Project Management and

Engineering

Stonecutters Bridge

Full Engineering Detailed

Design & Construction

Supervision

UK-MEA 120

Continental Europe 172

Americas 42

Australasia 56

East Asia 78

Sub Total PPM 468

The Wider PPM Network

America’s 42

staff with Lead

in New York

Continental

Europe - 172

staff with Lead

in Dublin

UKMEA - 120

staff with Lead

in London

Australasia – 56

staff with Lead

in Brisbane

Clark’s Logistics Centre

USA

Francis Crick Institute

UK

National Grid Power

Tunnels PMO

UK

Rolls Royce Programme

Management

USA

Saxion University

Enschede

Netherlands

Perth Airport Terminal 2

ORAT

Australia

East Asia

Japan 7

South Korea 1*

Mainland China 17

Hong Kong & Macau 27

India 3

Vietnam

Thailand

Philippines

3

1*

19

Sub Total

* Country rep.

78

Transport

- Airports

- Rail

- Highways

Industry

- Data Centres

- Factories

- Specialist Services

Move Management/OR

- Airports

- Hospitals

- Offices

Service Industries

- Leisure

- Financial

Automotive

- Workshops and

Showrooms

Educational

- Schools

- Higher Education

Country Characteristics & Project Challenges

Theory on Culture

EAST WEST

COLLECTIVE

• Family, group, team

• Others shape identity

• Uniformity (nail that sticks out…)

• Belonging to group

• Collaboration

INDIVIDUALISM

• Self

• personality/interests shape identity

• uniqueness

• own person

• own contribution

DUTY & OBLIGATION

• to collective community/ others

• group achievement

• loyalty

• compliant

RIGHT & PRIVILEGE

• personal development

• for time-being

HIERARCHY

• age, position, education

EQUALITY

• personality & skillsApril 10, 2014

Paul Tokonaga

Theory on Culture

EAST WEST

DEFERENCE

• Modesty & self-effacing

• Share complete thoughts

• Ascribed authority

SELF-ASSERTION

• Leadership

• External processing

• Earned authority

RESTRAINT

• Don’t make a scene or show emotions

• Formality

• Tolerate crisis/ fatalism

EXPRESSIVENESS

• Self-expression

• Casualness

• Promote flexibility & change

EVENT/ PEOPLE-ORIENTED

• People/ relationships/ events are priority

• Rude to leave event/ person or to say no

TIME-ORIENTED

• Punctuality is priority

• Rude to be late

WHOLISTIC

•Big picture

•Circular

PARTICULAR

•details

•linear

April 10, 2014

Paul Tokonaga

Theory on Culture

EAST WEST

INDIRECT

• subtlety

• direct asks can shame someone

• not confrontational

DIRECT

• obvious

• indirect asks are frustrating & confusing

• Confrontational

HARMONY

• conflict-avoidance

• cooperative; compromising

CLARITY

• prefer knowing what someone wants/ thinks

• assert opinion

April 10, 2014

Paul Tokonaga

Japan = Detail

General Traits:

• Deadlines are met & Pride in delivery

• Attention to detail

• Super clean sites

• Keiretsu

• Chotto Muzikashi

• Technical Characteristics:

• Advanced Design

• A selection of off the shelf specifications

• Allowable stress design

• Steel (and wood) is big

• Seismicity and height limitations

Institutional Issues:

• Design often sits with contractors (zenicon)

• No Japan IstrucE

• Archs and Struc. Eng. the same at University

• System allows innovation

• Ateliers and then some big Architect house

• Not always competitive bidding

Japan Statutory Requirements

1. Hold initial consultation with local authority 24 days

2. Obtain consent of neighborhood 30 days

3. Obtain building permit from Japan Building Center 70 days

Agency: Japan Building Center

Issue - after the falsification of structural calculation byArchitect Aneha

4. Request workmen’s compensation insurance proof from Labor Control Office 60 days

5. Purchase and post statutory construction notice sign board 1 day

6. Submit construction method plan to local authority and obtain approval 7 days

7. Submit project safety and health and resources recycling plan for approval 7 days

8. Receive intermediate inspection by Japan Building Center and obtain permit 24 days

Agency: Japan Building Center

9. Request and receive connection to water and sewage services 21 days

10. Request and receive final inspection from Japan Building Center 7 days

11. Obtain completion certificate 18 days

12. Register the building with the Land and Building Registry 12 days

Japan Case Examples

• Dubai – Taking Advantage of Don’t Say No

• JST – Attention to Detail, Not knowing contract

• Dubai – Finding a Contractor

• SkyPlaza

China = Relationships

General Traits:

• Protected through certification (e.g. LDI’s, Jianli)

• Always developing

• Keen to adopt new design

• Increasing costs

• Greybeards still recognized

• Guangxi

• Technical Characteristics:

• Good design standards not always followed

• Quality poor but now not always so

• Predominance for concrete

• Off the shelf specifications

Institutional Issues:

• Design co-ordination between disciplines is poor

• Government approval process different in each

region, city

• LDI’s now free to roam and more upskilled

• Expert Reviews formalized but take time

• 3rd Party checker always required

China Statutory Requirements

China Statutory Requirements

S/N Item Government Department

1 Approval of Master Plan and Fang'An (方案)

District Planning Bureau, District Construction

Bureau

2 Receival of Permit for Land Planning (PART 1) District Planning Bureau

3 Issuance of Permit for Construction Planning (PART 2) District Planning Bureau

4 Approval of GI contract from Tender Board Tender Board

5 Application for Temporary Construction permit (Foundation) District Construction Bureau

6 Approval of foundation drawings

7 Approval of construction drawings

8 Civil Defence (人防) Approval City Civil Defence Department

9 Application for Construction permit (Main works) District Construction Bureau

10 Approval of Building Lightning design City Meteorological Bureau

11 Make payment for city infrastrature package fee

12 Fire Approval Fire Department

13 Pre-construction Checks District Construction Bureau

14 Construction quantity declaration District Quantity Monitoring Station

15 Construction safety declaration Construction Safety Monitoring Station

16 Submit Construction record District Construction Bureau

17 Report new wall materials funding District New Materials Office

18 Report bulk cement funding District Bulk Office

19 Submit project fixed cost determination fee District Construction Bureau

20 Construction unit signed contract with Termite prevention company Construction Unit

21 Aplication for the permit to start of construction work District Construction Bureau

22 Post-construction Checks District various

23 Apply Real Estate License City Real Estate Management District Office

China Case Examples

• Putian – Land Issues – Farmers, Neighbours and Contractors

• Heshan – Dealing with Strange Requests & Client Importance

• Tianjin – High Profile Projects and City Mayor

• Putian – Government Approvals

• Mingzhu – Clear Scope definition between parties especially hand-off

to LDI

South East Asia – Malaysia, Vietnam

Institutional Environment

• Relationships more important than contracts

• Local Government backing very important

• Significant funding by richer Asian countries affects market (e.g. ODA, Korea,

ADB, now China)

• Ethnicity issues (Malaysia)

• Red tape

• History of western and Japanese colonization

• Rise of China becoming an issue

South East Asia

Project Issues to Be Dealt With

• Not so systematic in management and project development

• Slower pace than China, Japan

• Corruption is an issue

• Construction quality is generally not good

• Lack of clear planning and execution

Hong Kong – Upon Reflection

• Design planning is weak - Continual pushing and updating

• Corporate Architects

• AP’s and RSE’s

• Statutory approvals (not unusual to have >50 initial approval and amendment

submissions for projects) resulting in programme delays

• Withdraws and resubmissions now automatically built in to programmes

• Proper checking and reviews

• Standard designs with little innovation often wins

• Govt and market restrict innovation

• Naturally many Clients now prefer Cantonese as spoken medium with Manadarin

becoming increasingly important but written form still english

Cross-Border Teams & Delivery

Client &

Project

Location

Arch, SMEP

& Facade

Design Team

Vertical

Transport-

ation Team

Geotech &

Foundation

Team

Fire Engineers

& Review

Team

Project

Manager

Project 1 – Dubai Tall Building

Project

Location

Arch &

SMEP Design

Team

Local

Design

Institute

Project Manager

& QS

Client’s

Regional

Management

Project 2 – Fujian Factory

Client’s HQ &

Engineering

Team

Design Issues

• Most countries require a locally approved design company to certify the

design and submit this to the local authority and utility companies.

• In any event you need them for local conditions.

• The quality of local consultants will dictate how much of the design

responsibility is allocated to them.

• There should be a careful prequalification and vetting exercise undertaken

of local consultants and contractors (go to their offices in the process)

• Scheme Design in one country and detailed design in another can be

fraught difficulties without regular, strong communication

• Time zones are a problem for co-ordination.

Design Issues

• There needs to be a contingency in the event the

local designer does not deliver.

• Understand the local design approval process

before procuring any local design company.

• Set up a clear responsibility schedule as

handover of the design will be an issue.

• Architect has to understand local environment

and if small, needs to allocate, proper resource.

• Undertake reviews at key stages in the design.

Commercial & Procurement Issues

• Tax is often an issue while setting up international agreements, especially

where local consultants are concerned.

• Different countries have different requirements for contracts e.g. in Mainland

China, Construction Contracts need to registered with the government

bureaus.

• Have a contract or at least first payment before you start work.

• Ensure market is ready for what you are proposing (e.g. capable for Design

and Build?)

• Client will need active involvement with a difficult contractor (e.g. Putian

foundations)

• For longer term private projects understand the local economy (e.g. tall

buildings).

• Risk assessments should be undertaken.

Construction Issues

• Project does become more local at this point.

• Can not rely on local consultants in less developed countries for quality

control.

• Needs to be a full-time competent attendance on site at least to know

when problems arise.

• Regular visits (at least monthly) and progress meetings by Project

Manager with Main Contractor.

• Design team needs to be pushed to resolve technical and statutory issues

and so their terms should include for such and adequate resource

provided. They won’t want to travel.

• Consultant contracts should state clearly frequency and level of

attendance on site.

People, Processes & Systems

• A web-based document management system needs to be established (MS

sharepoint does suffice)

• Project Execution Plan should be thorough but not many people will read it and

many will forget it.

• Try to keep same key staff throughout project.

• Regular meetings at fixed times and unmovable.

• Understand the client organization and how it works.

• Know how to deal with bad practices.

• Senior management support to staff in the field is essential.

• Always be professional.

Conclusions

• Don’t spread your team all over the world if you can help it

• Scheme Design can be undertaken close to Client but not essential

• Try to minimize parties involved in design development

• Set up regular meetings and face-to-face reviews/visits and stick to them

• Have clear contracts with clear scope demarcation and clarify at RFP stage so everybody agrees.

• Have full-time supervision presence you trust on site.

Thank You

Questions?