PGBM73 MBA DISSERTATION MODULE – Assessment 1

PROJECT PROPOSAL- 20% of Final Dissertation Module Mark

Candidate Name: Prachi Mohan Chavan

Study Centre: University of Sunderland London Campus

Enrolment Date: 10/05/2012 Registration number: 119136276

Project Title: “An empirical study of the factors of employee de-motivation and their consequent effect on Employee Turnover in the Construction Industry – with ACC Concrete Ltd. as an example”

Hand in Date of Proposal: 12 th July, 2012

Project Background: The above topic was chosen with intent to understand factors of employee de-motivation in construction

sector, which could be the cause of increasing employee turnover at ACC Concrete Ltd. and construction

industry as a whole.

Construction industry is considered as one of the oldest laboratories in the field of management sciences,

specifically in arena of production management. The industry is characterized by a complex process of

manufacturing of a particular kind of product which usually is at the delivery point, by a temporary

organization involving multi-skilled ad hoc teams (Ibrahim et al., 2010 cited in Bertelsen and Koskela,

2004).

The economy of a country is recognized as being dependent on productivity levels in comparison to other

nations (Ibrahim et al., 2010 cite in Hill, 1992). In this context, Ibrahim et al., (2010) assert that,

productivity levels of construction sector is one of the economic indicators of a nation’s progress, as this

industry has a significant impact on employment and the Gross Domestic Product (GDP).

Ibrahim et al., (2010) cite that as per Stoeckel and Quirke, (1992) estimates have shown that 10 percent

increase in productivity levels from construction industry results in a 2.5 percent growth in GDP. Recently,

Office for National Statistics – UK (ONS UK, 2012) revealed that GDP dropped down by 0.2 per cent in

the first quarter of 2012 due to weaknesses in construction and the production sector.

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However, despite of it being a significant contributor to economy, construction industry regularly fails to

demonstrate higher productivity levels as compared to other manufacturing industries. Smithers and

Walker (2000) opine that, construction industry is mainly a ‘people’ management business. So the need

for highly motivated workforce is needed as the construction sector tends to be dynamic, uncertain and

complex. Hence, concern for employee motivation in this industry is important as it helps accelerate high

performance levels and reduced unproductive time and turnover rate.

Considering the importance of construction sector to a nation’s economy as whole, the researcher aims at

understanding the factors of employee de-motivation prevalent in this industry, so as to come up with

recommendations to find ways of improving employee motivation specific to this industry which may help

to curb the increasing turnover and thus increase in the productivity levels.

The Researcher was priorly an employee of ACC Concrete Ltd. (Division of Holcim Ltd.). Holcim is a

global construction company, with production sites in around 70 countries. Holcim's core businesses

include the manufacture and distribution of cement and ready-mix concrete (Holcim, 2012). While working

on the Multi-skilling project researcher observed wide fluctuations in the All India Multi-skill Index at ACC

Concrete Ltd. Multi-skill Index is a numerical measure to evaluate the overall skills of the workers in

varied functions.

However, the researcher noticed that wide variations in the Index were a cause of higher fluctuations in

turnover rates of the workers who worked on-site. Consequently, high turnover rate contributed to

increase in recruitment and training cost at ACC Concrete Ltd. During informal conversations with

workers it was found that rising “demotivation” was one of the key catalysts contributing to labour turnover

at ACC Concrete Ltd.

Literature review revealed limited research is conducted on motivation of operational construction

employees (Smithers and Walker, 2000 cite in The Business Roundtable, 1982; Maloney and McFillen,

1986a; Olomolaiye, 1988, 1999a, b; Baldry, 1995), hence this research may help in contributing to the

existing literature.

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Literature Review: .

“Maintaining and attracting quality people is a priority”(Paul Manning - Chief Operating Officer of C. Raimondo & Sons quoted in Yankov and Kleiner, 2001)

Human Resources (HR) are vital in all industries, construction industry being no exception. A ‘disturbing

trend’ in this industry is prevalent due to growing shortage of qualified, skilled and experienced workers

(Yankov and Kleiner, 2001 cite in Levy, 2000). Yankov and Kleiner (2001) cite that as claimed by Michael

Goodrich, CEO of BE & K Inc. (Top ranked construction firms in the United States) and Levy (2007, p. 4),

labour market in construction sector is undergoing change due to scarcity of skilled workers and changing

demographics. Also, increasing ‘burnout’ among the construction workers who put in long hours of work is

a cause of concern.

Ibrahim et al., (2010) cite Warszawski (1990) claim that construction industry is thus facing the challenge

of increasing worker turnover. The Bureau of Labour Statistics have revealed that construction industry

will have to add up to ten million workers every year through 2012 to meet increasing demand of the

market (Levy, 2007; p. 5).

The Construction Industry Productivity Report – 2003 by FMI Corporation revealed that one of the

constituents inhibiting productivity levels of labourers are factors of motivation (Levy, 2007; p. 5-6).

Serpell and Ferrada (2007) stated that well-known phenomenon of lacking motivation among workers in

construction industry is the reason for their fragile commitment, resulting into high turnover. Skill

shortages and declining productivity in the UK construction industry due to employers inability to attract

and retain workers has been the cause of high turnover (Lobo and Wilkinson, 2007 cite in Bedford, 2003).

Therefore, one of the critical factors influencing construction productivity is motivation of labour force

(Wahab et al., 2008 cite Horner, 1982).

Dozzi and AbouRizk (1993, p. 36) affirm that HRM is one of the important functions in construction sector

due to uniqueness and complexity of construction projects. Therefore, to exploit most out of this resource,

HR manager has to understand what motivates the worker, what acts as a de-motivator, what are the

physical limitations which inhibit their performance.

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‘Employee Motivation’ is of interest to the employers as it is a means to an end, which is, optimum

utilization of HR in the production process (Olomolaiye et al., 1998, p. 170) As per Ruthankoon and

Ogunlana (2003) the word ‘Motivation’ has its roots to the Latin term ‘Movere’ which means ‘to move’ and

has been a popular topic of research for more than 50 years. According to Yankov and Kleiner (2001), in

simpler terms, employee motivation is about satisfying their needs. However, needs of each individual

could be different, but can be narrowed down to a few basic categories.

Olomolaiye et al., (1998) argue that different authors have differing views on the perception of motivation

in construction sector. Contrasting interpretations perceive it to be as an ‘incentive’, while others as extent

of ‘satisfaction’ based on the belief that a satisfied worker will produce more. However, these varying

interpretations centre around the same aspect of switching on the production ‘generator’ inside the

worker.

Yankov and Kleiner (2001) opine that scholars in the field of construction work have come up with specific

theories of HRM pertaining to construction industry such as the ‘New Construction Philosophy’ developed

by Nesan and Holt (1999) and the ‘Lean Construction Philosophy’ by Olomolaiye et al., (1998). The

motive behind development of these theories is to find ways to motivate workers. However, as per

Olomolaiye et al., (1998) existing management theories on motivation are not based on construction

industry. But Olomolaiye et al., (1998) cite Maloyen and McFillens (1983) view, that instead of considering

the differences between construction and other industries, similarities should be extracted and applied

from the prevalent theories.

According to Ibrahim et al., (2010) though there are no specific theories or frameworks designed

specifically for the construction industry, old model of production designed by Koskela (1992) is being

practised in many of the construction jobs. These inputs (raw materials, labourers), conversions

(machinery) and outputs on integration with controlling elements are monitored and the system behaviour

is corrected.

As per Marchington and Wilkinson (2008, p. 455) and Ruthankoon and Ogunlana (2003) there are many

management theories on motivation classified into 2 types, namely, ‘Content’ theories and ‘Process’

theories. Content theories primarily focus on ‘what’ factors motivate people while Process theories

concentrate on ‘why’ and ‘how’ of motivation, aiming at analysing the intrinsic factors influencing an

individual to produce certain kinds of actions or behaviours.

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SUMMARY OF SOME WELL-KNOWN THEORIES ON MOTIVATION:

Source: Armstrong (2009, pp. 319-330); Marchington & Wilkinson (2008, pp. 455–460); McKenna and Beech (2008, pp. 272—277); and Ruthankoon and Ogunlana, (2003); and Tyson (2006, pp. 12-18).

Olomolaiye et al., (1998) opines that research on motivation in construction industry is namely

‘conceptual’ and ‘empirical’, the former examines existing management theories of motivation with

respect to construction sector void of scientific testing and the latter is derived from findings through

observation and experiments. The objective of this research is to determine ‘what’ factors of motivation

are lacking in the organization causing employee de-motivation. The content theories are in relevance to

this research, as they could be used as a base to determine the lacking factors of motivation.

Therefore, this research is a conceptual study as it aims at testing the existing content theory of

motivation and using the variables already available from the previous research. There is literature

available on the construction industry, wherein recommending variables or factors influencing motivation

of construction workers have been revealed (Smithers and Walker, 2000).

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As per Tyson (2006, p. 13), Maslow’s hierarchy of needs theory is divided into five categories ranging

from the basic lower level needs to the higher ones.

Source: Tyson(2006, p.13)As per Maslow’s theory the higher needs become operative only when lower needs have been met. Also

a need that has already been met or satisfied doesn’t act as a motivating force. As per Olomolaiye et al.,

(1998) the Maslow’s model was adopted by Schrader (1972), Hasteline (1976) and Neal (1979) to

determine motivational factors for the American construction workers.

Olomolaiye et al. (1998) cites Schrader (1972) who believes that most ‘working’ people have satisfied the

basic physiological needs and the next level of need for safety and security is also satisfied for most of

the American construction workers. Schrader further argues that the safety needs, such as job security do

not really motivate as strongly as in case of other industries because construction workers are

accustomed to change jobs from time to time. Self-Actualization opines Schrader, is rarely applicable in

the construction industry because workers who have been promoted are reluctant to accept more

responsibilities and try to stick to their craft. So as per Schrader’s claim, the applicability of Maslow’s

model in the construction industry is questionable. However, Tyson (2008, p. 13) states that classification

of needs in the Maslow’s model has provided a basis for future research.

According to Ruthankoon and Ogunlana (2003) and Tyson (2006), Herzberg's two factor theory is derived

from Maslow's theory and is divided into two groups, namely, 'hygiene factors' and 'motivators'. A survey

result carried out on 1675 construction workers concluded, 71% of factors contributing to job satisfaction

were 'motivators' and 69% contributing to dissatisfaction were 'hygiene' related.

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As per Ruthankoon and Ogunlana (2003), evidences suggest that Herzberg's two-factor theory can be

distorted if the test is conducted in any unique setting. As the construction environment have some

distinct features such as strict control on the costs and schedule, labour intensity and numerous conflicts,

customized and on-site work and short-time employment (Ruthankoon and Ogunlana, 2003 cites Nave,

1968; Schrader, 1972; Laufer and Jenkins, 1982). Hence, applicability of Herzberg's theory reveals

different results in the construction industry. So comparative testing of the Herzberg's theory in context of

distinct work settings and other theories needs to be done.

Dozzi and AbouRizk (1993) and Tyson (2006, p. 184) confirm that causes for labour turnover are due to

lacking factors of motivation. Dainty et al., (2004) explains that lacking factors of motivation causes job

dissatisfaction, leading to decline in organizational commitment. Hence, reducing labour turnover and

retention have become one of the core strategic objectives of construction organizations. Different

theories on motivation can be used to identify factors what motivate employees in construction sector with

an objective to increase job satisfaction, lower absenteeism and turnover and thus increase productivity

of this sector (Parkin et al., 2009).

The review of all above mentioned theories will be done in the final dissertation. Herzberg's two factor

theory will be applied to identify the lacking motivating factors of the construction workers at ACC

Concrete Ltd.

Objectives:

1) To critically evaluate key factors for Employee Motivation in construction industry.

2) To empirically determine how a lack of these motivating factors could influence Employee

Turnover.

3) To use the evidences of objective 1 and 2 to identify the situation in ACC Concrete Ltd with a

view to making suitable recommendations for future improvements for Employee Retention.

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Methodology:

Objective 1 is based on deductive logic, as Herzberg’s two-factor theory will be tested to determine

factors for employee motivation in construction sector. Objectives 2 and 3, will help to explore how lacking

factors of motivation could influence employee turnover and thus guide the researcher to come up with

suitable recommendations if any for the organization and the construction sector as a whole.

This research is based on the philosophy of ‘Critical Realism’. The philosophy of ‘Critical Realism implies

that whatever is perceived through the senses needs to be actually tested or studied (Saunders et al.,

2009, p. 114-15 and Maylor and Blackmon, 2005, p. 157). Therefore, philosophy of Critical Realism will

enable researcher to collect primary data based on views and opinions of ex-employees so as to identify

lacking factors of motivation in the organization and derive whether or not these factors influenced their

decisions to quit the job.

A Mixed-methods approach which allows the use of both quantitative and qualitative techniques of data

collection will be used in this research. Using this method, the qualitative data can be quantified and vice-

versa. The researcher will use self-administered questionnaires to collect primary data from ex-

employees of ACC Concrete Ltd. These questionnaires will help in identifying what factors of motivation

were lacking and whether or not did they contribute to the employee’s decision of quitting their jobs. As

the organization is located in India, questionnaires would be administered electronically using internet.

The sample size for the conduction of questionnaires would be 30 ex-employees of ACC concrete Ltd.

The researcher will conduct two semi-structured interviews with the Head – HR and Assistant Manager –

HR. These interviews would help in gathering the views and opinions of the manager and Head about the

situation at ACC Concrete Ltd. Considering the distance; researcher will conduct electronic interviews

using the Skype software to gather information. Secondary data such as the graphs and employee

records from the organization will also be used. Secondary data makes easier to triangulate the findings

(Saunders et al., 2009, p. 258).

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Appendix I

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BIBLIOGRAPHY:

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Adel-Wahab, M., Dainty, A., Ison, S., Bowen, P., and Hazlehurst, G. (2008) "Trends of

skills and productivity in the UK construction industry", Engineering, Construction and

Architectural Management, Vol. 15, Iss: 4, pp. 372-382.

http://www.emeraldinsight.com.libproxy.ucl.ac.uk/journals.htm?issn=0969-

9988&volume=15&issue=4&articleid=1733250&show=html (Date Accessed: 29/06/2012)

Armstrong, M. (2009) “Armstrong’s Handbook of Human Resource Management”. 11 th

Edition, London, United Kingdom: Kogan Page.

Dainty, A., Raiden, A., and Neale, R. (2004) “Psychological contract expectations of

construction project managers”, Engineering, Construction and Architectural

Management, Vol. 11, Iss: 1, pp. 33-44.

http://www.emeraldinsight.com.libproxy.ucl.ac.uk/journals.htm?issn=0969-

9988&volume=11&issue=1&articleid=845817&show=html (Date Accessed: 27/06/2012)

Dozzi, S.P. and Abourizk, S.M. (1993) “Productivity in Construction”. 1st Edition, Ontario,

Canada: National Research Council Canada.

Holcim. (2012) http://www.holcim.com/en/about-us/group-company/group-company-

directory.html (Date Accessed: 01/07/2012)

Ibrahim. A., Roy, M., Ahmed, Z., and Imtiaz, G. (2010) “Analyzing the dynamics of the

global construction industry: past, present and future”, Benchmarking: An International

Journal, Vol. 17, Iss: 2, pp. 232-252.

http://www.emeraldinsight.com/journals.htm?issn=1463-

5771&volume=17&issue=2&articleid=1853003&show=html (Date Accessed: 27/06/2012)

Levy, S. (2007) “Project Management in Construction”, 5th Edition, New York, USA, The McGraw Hill Companies Inc.

Lobo, Y and Wilkinson, S. 2008) "New approaches to solving the skills shortages in the

New Zealand construction industry", Engineering, Construction and Architectural

Management, Vol. 15, Iss: 1 pp. 42 – 53.

http://www.emeraldinsight.com.libproxy.ucl.ac.uk/journals.htm?issn=0969-

9988&volume=15&issue=1&articleid=1642102&show=html (Date Accessed: 23/06/2012)

Marchington, M and Wilkinson, A. (2008) “Human Resource Management at Work”. 4 th

Edition, London, United Kingdom: CIPD (Chartered Institute of Personnel and

Development).

Maylor, H. and Blackmon, K. (2005) “Researching Business and Management”. 1st

Edition, Hampshire, United Kingdom: Palgrave Macmillan Ltd.

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McKenna, E and Beech, N. (2008) “Human Resource Management: A Concise Analysis”.

2nd Edition, Essex, United Kingdom: Pearson Education Ltd.

Olomolaiye, P., Jayawardane, A. and Harris, F. (1998) “Construction Productivity Management”, Essex, United Kingdom, Addison Wesley Longman Ltd.

Office for National Statistics – UK (ONS-UK). (2012) “GDP contracted by 0.2 per cent in

2012 Q1”. http://www.ons.gov.uk/ons/rel/elmr/gdp-and-the-labour-market/2012-q1---april-gdp-

update/gdp-and-labour-market-summary---gdp-april-update.html (Date Accessed:

16/06/2012)

Parkin, A.B., Tutesigensi, A. and Büyükalp, A.I. (2009) “Motivation among construction

workers in Turkey” In: Dainty, A.R.J. (Ed) Procs 25th Annual ARCOM Conference, 7-9

September 2009,Nottingham, UK, Association of Researchers in Construction

Management, pp. 105-14.

http://eprints.whiterose.ac.uk/9870/ (Date Accessed: 02/07/2012)

Saunders, M., Lewis, P., and Thornhill, A. (2009) “Research methods for business

student”. 5th Edition, Essex, United Kingdom: Pearson Education Ltd.

Serpell, A. and Ferrada, X. (2007) “A competency-based model for construction

supervisors in developing countries”, Personnel Review, Vol. 36, Iss: 4, pp. 585-602.

http://www.emeraldinsight.com/journals.htm?issn=0048-

3486&volume=36&issue=4&articleid=1610703&show=html, (Date Accessed:

14/06/2012)

Smithers, G. And Walker, D. (2000) “The effect of the workplace on motivation and

demotivation of construction professionals”, Construction Management and Economics,

Vol. 18, Iss: 7, pp. 833-841.

http://www.tandfonline.com.libproxy.ucl.ac.uk/doi/abs/10.1080/014461900433113 (Date Accessed: 16/06/2012)

Tyson, S. (2006) “Essentials of Human Resource Management”, 5th Edition, Oxford, United Kingdom: Elsevier Ltd.

Yankov, L. and Kleiner, B. (2001) “Human resources issues in the construction industry”,

Management Research News, Vol. 24, Iss: 3, pp. 101-105.

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http://www.emeraldinsight.com/journals.htm?issn=0140-

9174&volume=24&issue=3/4&articleid=866754&show=html (Date Accessed:

18/06/2012)

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MBA Dissertation

Key Activities(Milestones)

Time-scale(Plan of action)

Resources required(Equipment, software, personnel etc)

Preparing the research proposal 6 weeks Meetings with the supervisor, Negotiations with the organization (Head - HR), Sanction letter, Approval letter from the University of Sunderland, Books on research methods (Saunders), construction sector and HR, Journal articles, University of Sunderland e-library, UCL Library, Internet media e.g. http://www.holcim.com , http://www.ons.gov.uk

Researching introduction chapter 3 weeks Journal articles and Books relevant to construction and HR.

Literature review 3 weeks Meeting with the supervisor, Journal articles, Books and magazines relevant to construction and HR. University of Sunderland e-library, UCL Library, British Library, Library – Ethames graduate school, www.cipd.co.uk , interviews from www.bvo.com, www.bbc.co.uk , www.arcom.ac.uk

Methodology reviewing and designing of questionnaire and interview preparation based on literature review

2 weeks Discussions with the supervisor, Articles and books on research methods, research onion by saunders

Reviewing primary research data and collection of secondary data

2 weeks Appointments with the supervisor, Ex-employees of ACC concrete Ltd., Head- HR, Asst. Manager – HR, Graphs, employee records, skype software, Internet

Data presentation and analysis 2 weeks Guidance from supervisor, Different softwares such as SPSS, ANOVA etc.

Results and Discussion and conclusion indicating recommendations to the organization and construction sector

2 weeks Meetings with the supervisor, Based on the findings from the primary and secondary data

Reviewing final draft of dissertation and submission

1 week Assessment from the supervisor, proof reading, Printing and binding.

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First Line Supervisors confirmation that the project has been discussed at a supervisory meeting and inclusion of any comment:

Nam GinnyCox....................……..date of meeting…18th July 2012………........................……………

Comments Prachi is actually employed by ACC Concrete Ltd and has the support of her employers in carrying out her research with them, seeing that if she achieves her objectives the result will be very beneficial not only for the company but also for the sector concerned. The backgound.is clear as are her aims. The literature review offers several interesting examples which could have been given a tighter link with the actual topic From our discussions regarding the methods she proposes using she should be able to produce a satisfactory result, seeing that she is well prepared and very enthusiastic.

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FEEDBACK SHEET

Feedback on Project Proposal:

Quality of the Strategic Project overview and objectives (50%)

First class work. This is very good indeed. I look forward to reading the final dissertation. This candidate has excellent writing and analytical ability and a first rate organisational skill.

Literature review synopsis and methodological synopsis (50%)

Comprehensive and thoughtful. An excellent proposal at this stage, with a clearly practical programmeof work being proposed.

FINAL MARK: 70 / 100 marks

Any actions to be discussed with Local Tutor:

A very able candidate. Should offer the possibility of a fine piece of work.

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