DEVELOPMENT OF A WEB-BASED SYSTEM FOR MANAGING SUPPLIERSŸ PERFORMANCE IN CONSTRUCTION PROJECTS

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Department of Computer Science

ABSTRACT

Suppliers play an important role in the success of construction projects as they are the ones who carry out the actual construction work and complete the project by supplying their skills and knowledge (i.e. service) or material. Therefore, getting the right supplier for the right job is critical towards the success of any construction project. To achieve this, however, entails efficient information and communication technology (ICT) aided information system for managing the performance of the suppliers. Most of the local construction companies are found to be unaware of the benefits brought about by such systems and still resort to handle majority of the tasks manually. This research was aimed at the development of a Web-based system that can help to better manage suppliers‟ performance to assist in the selection of suppliers and to facilitate the leveraging of suppliers' knowledge for the benefit of the on-going projects. Literature on the importance of managing suppliers‟ performance, criteria for supplier selection, existing practice for supplier selection, importance of knowledge sharing and reward of knowledge sharing were reviewed. Twelve semi-structured interviews were conducted with the practitioners in the industry to explore the current approaches for supplier selection, the way of managing suppliers‟ performance, and also to identify the end-users‟ requirements on the methodology for managing suppliers‟ performance and knowledge sharing. The case studies revealed that the custom-designed computer applications used by the case study companies for the selection and management of suppliers‟ performance are not comprehensive in terms of the features. The systems do not capture the historical data on the performance of the suppliers for the selection purpose. This information is critical to reveal the reliability of the suppliers and also to allow them to improve their performance. In addition, the systems require the user to scan and then upload the written documents to the system. This is not only time consuming but also inconvenient. The system developed consists of a Web-based database to store the relevant information with modules for managing the criteria for supplier selection, knowledge capture and evaluation, and managing suppliers‟ performance across projects. In order to improve the functionality of the system, the system was tested and evaluated by the participants from the construction companies interviewed before. Positive feedbacks were received with an overall score of 3.8 out of 5.0. Simply put, the system can facilitate the informed decision making on the selection of the most suitable suppliers based on the records captured in the system. It allows the continuous improvement to the project at different stages by allowing suppliers to share their knowledge as to how improvements can be made. Further studies may involve the development of an improved version of this prototype application where it caters for the need to select and manage the performance of different types of suppliers with different sets of criteria. 
TABLE OF CONTENTS Page
ABSTRACT ii
ACKNOWLEDGEMENTS v
APPROVAL SHEET vii
SUBMISSION SHEET viii
DECLARATION ix
LIST OF TABLES xiv
LIST OF FIGURES xv
CHAPTER
1.0 INTRODUCTION 1
1.1 Background 1
1.2 Rationale for the Research 3
1.3 Aim and Objectives 5
1.4 Research Methodology 6
1.5 Scope and Limitations 8
1.6 Report Layout and Contents 9
2.0 LITERATURE REVIEW 12
2.1 Defining Supplier 12
2.2 Importance of Managing Suppliers‟ Performance 15
2.2.1 Cost Reduction 15
2.2.2 Decreased Production Development Lead Time 16
2.2.3 Reduction of Risk 17
2.2.4 Better End Product Quality and Customer
Satisfaction 17
2.2.5 Preventing the Deterioration of Supply Chain 18
2.2.6 To Enjoy Mutual Benefits Brought About 18
2.2.7 Improved Company Competitiveness 19
2.3 Criteria for Supplier Selection 20
2.3.1 Cost / Price 23
2.3.2 Performance 24
2.3.3 Time / Delivery 25
2.3.4 Supplier‟s Profile 26
2.4 Current Practice 31
2.4.1 Web-Based Sub-Contractor Evaluation System
(WEBSES) 32
2.4.2 e-Reporting System 33
2.4.3 Mathematical Programming (MP) 33
2.4.4 Multi-Attribute Decision Making/Multi-Criteria
Decision Making (MADM/ MCDM) 37
2.4.5 Case-Based Reasoning (CBR) 41
2.4.6 Fuzzy Set Theory (FST) 43
2.5 Shortcomings of Current Practice 44
2.6 Summary 47
3.0 KNOWLEDGE MANAGEMENT 48
3.1 Defining Knowledge 48
3.2 Types of Knowledge 50
3.3 Knowledge Management Processes 52
3.4 Knowledge Sharing 54
3.5 Importance of Knowledge Sharing 55
3.5.1 Facilitating the Access and Sharing of
Knowledge across Projects 56
3.5.2 Reduction in Construction Project Costs 57
3.5.3 Faster Completion of Construction Project 57
3.5.4 Improvement of Firms‟ Innovation Capability 58
3.5.5 Risk Minimisation 59
3.5.6 Gaining Competitive Advantage 59
3.6 Rewards for Knowledge Sharing 60
3.6.1 Encouraging Knowledge Sharing Among
Project Participants 61
3.6.2 Recognising Team Member‟s Contribution 62
3.7 Summary 63
4.0 RESEARCH METHODOLOGY 64
4.1 The Meaning of Research 64
4.2 Research Strategy 66
4.2.1 Quantitative Research 66
4.2.2 Qualitative Research 67
4.2.3 Triangulation or Combined Approach 69
4.3 Research Design 71
4.4 Summary 75
5.0 DEVELOPMENT OF THE SYSTEM 76
5.1 Background of Case Studies Company 76
5.2 Findings from the Case Studies 77
5.2.1 Company E 78
5.2.2 Company H 82
5.2.3 Company K 84
5.2.4 Other Companies 88
5.3 Discussion 89
5.3.1 Shortcomings of Current Approach for the
Selection of Suppliers and the Management
of Their Performance 94
5.3.2 Requirements for the Development of the
System 95
5.4 Methodology for Managing Suppliers‟ Performance
and Knowledge Sharing 99
5.4.1 Block A: System Administrators to Register
Users 101
5.4.2 Block A1: Contribution of Knowledge by
Suppliers 101
5.4.3 Block A2: Knowledge Validation by Experts 102
5.4.4 Block A3: Dissemination of Knowledge 102
5.4.5 Block B1: Supplier Selection 103
5.4.6 Block B2: Evaluation of Suppliers' Performance 103
5.4.7 Block B3: Communication of the Performance
with the Suppliers 104
5.5 Summary 105
6.0 OPERATION OF THE SYSTEM 106
6.1 System Architecture of Prototype Application 106
6.2 Selection of Development Environment 108
6.3 User Interface and Program Codes Development 109
6.3.1 Supplier Selection 109
6.3.2 Evaluate Suppliers‟ Performance 112
6.3.3 Validate Knowledge 114
6.3.4 Suppliers to Comment on Their Own
Performance Score 117
6.3.5 Project Administrators‟ Response to Comment 117
6.4 Database Design 118
6.5 Operation of the Prototype Application 119
6.5.1 Logging In 119
6.5.2 Browsing the Home Page 121
6.5.3 Edit Company‟s Profile 122
6.5.4 To View Supplier Company‟s Current Projects 124
6.5.5 Past Subcontracting Works‟ Score 127
6.5.6 My Company‟s Knowledge Contributed 130
6.5.7 Contribute New Knowledge 131
6.5.8 Latest Knowledge Contributed 133
6.6 Roles Assigned to the Users 134
6.6.1 Ordinary Users 134
6.6.2 Experts 134
6.6.3 Project Administrators 135
6.6.4 System Administrators 135
6.7 Testing and Evaluation of the System 136
6.7.1 Prototype Testing 138
6.7.2 Statement Test 138
6.7.3 Prototype Evaluation 143
6.7.4 Evaluation Results 145
6.7.5 Suggestions for Improvement 149
6.8 Summary 151
7.0 CONCLUSIONS AND RECOMMENDATIONS 153
7.1 Summary 153
7.2 Conclusion 161
7.3 Further Work 167
7.4 Limitation of the Research 169
7.5 Concluding Remarks 170
REFERENCES 172
APPENDIX A 193
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