Reference no: EM133040307

INTERNET-BASED PROJECT MANAGEMENT

Even before he walks around the job site to talk to the foremen and supervisors, Alexander Kennedy, president of Cederfield Builders in Ghana, can smell inefficiency in a project. The ammonia-like stink that can fill a construction trailer with each set of updated drawings is the telltale odor.

The presence of plans, according to Mr. Walter, whose ghs400 million-a-year company is situated in Accra, implies that certain members of the building crew have yet to embrace the Internet. He understands that those who have already entered the e-construction era can view architectural drawings online and print relevant sections without wasting time waiting for the drawings to be commercially printed, packaged, and delivered to the scores of project participants each time the plans are tweaked. Mr. Walter stated of the awful old blueprint era, "It stinks." "Everything stinks. That is precisely the point."

Unfortunately for Mr. Walter and the other vanguard members, the air isn't clearing fast enough. Many construction executives lament the fact that their industry was one of the last to embrace the Internet, despite the fact that the medium provides a ready solution to their most vexing problem: how to coordinate the efforts of hundreds of separate teams over the course of a project's life cycle as the original plan evolves, doorway by redesigned doorway, conduit by rerouted conduit.

Indeed, the Internet has begun to change the country's ghs2.4 trillion construction industry's upper echelons. The Amandi Corporation and the Regimanuel Group, two of the country's largest contractors, have begun to use e-commerce sites like Bidcom and Cephren to communicate with partners and subcontractors, as well as acquire goods and bid on tasks.

Webcor, despite being a fraction of the size of Amadi and Regimanuel, has joined them in incorporating the Web into their core operations. Mr. Walter stated that the Cephren system was proving to be extremely useful, allowing various parties to communicate "without all the faxes, without all the calls." He estimated the cost savings at ghs100,000, but said it could have been as high as ghs400,000 if all subcontractors and suppliers had been brought online. "It's a good tool for us right now," he said. "It will be more important for people to participate in our projects next year. In two years, it'll be absolutely mandatory."

But, so far, e-commerce has only scratched the surface of the industry's second and third tiers, where faxes, voice mail, and overnight packages are still the norm. According to executives and industry analysts, the result is a potential savings loss of billions of cedis.
"Because it's so local, construction has always been a very fragmented industry," said Malvin, an e-commerce analyst for the Eleora Group, a Tema-based consulting firm.

Required:

1. What are the main obstacles for the construction sector to adopt the Internet in managing projects?

2. What gains can a general contractor in the building business get from web collaboration?