Strategic Plan for a Construction Company

Introduction

Recently as 6 months ago I was involved in the reconstruction and up gradation of my own house. The process lasted 1 and half years due to various reasons, some of which were that we were also living in the same house and the upper story was being built, availability of funds, lack of time on our part etc. But apart from these aspects I learnt that the construction business of today lacks many things. One such thing was that there are no truly professional construction firms that cater to the rather small scale construction of urban houses.

The traditional “Thekedars” prevail in this market sector. These people usually have a team of un educated mistries and mazdoors. There is a severe lacking of application of planning and management procedures and practices. The dynamic nature of today’s construction industry compels owners and contractors to pursue strategies that improve performance.

The ongoing changes and fierce competition of the construction sector exacerbate the ability to predict implications of strategic decisions on company performance. However, decisions are usually made using limited analysis and based on intuition, or evaluated using conventional approaches, which ignore risks and uncertainties. So for this assignment I decided to devise a strategic plan of a hypothetical construction company.

Mission

As described in the introduction, the motivation for forming a construction company is to bring modern management and execution strategies into this relatively raw and immature field of small scale housing construction and there by providing cost effective, reliable and swift services to this industry.

Vision

The vision of the company is to be the market leader in the field of construction. The goals that we plan to set for this company are very much achievable because of the current state of this field in general. The construction industry In Pakistan is booming in general. There are a lot of large scale infrastructure projects being done all over Pakistan.

Bridges, highways, industries, hotels, resorts, power plants, dams, residential Towers, sky scrapers etc are just a few of the areas in which a lot of work is being done. A lot of huge national and international construction companies are doing all of these projects all over the country.

But in spite of this entire boom there are very, very few specialized construction firms that cater to ordinary people for building normal residential homes. I believe that a lot can be achieved in this area if modern construction tools, equipment, building techniques accompanied with modern management and resource allocation techniques are applied in this area. Significant time saving and cost saving can be achieved in this field.

Company Values

The basic values of the company would be to promote merit within the organization. I believe that if merit is promoted and dedication, innovation and hard work is properly rewarded then a sense of motivation and satisfaction can be instilled in the employees of the company. There is a very famous quote by Hazrat ALI (A.S) that is my guiding principle that can equally be applied to any organization or operational unit be it a small company, a huge corporation, a country or the entire world. He says and I quote

“Any government may be run by Kufr, but it cannot be run with injustice”Injustice is a very broad term and not promoting talent and not providing rewards to the people who deserve them is also injustice. Promotion of innovation and excellence is the most important aspect in this business. Any innovation that can reduce cost and time translates to higher profitability of the company and increased satisfaction for the customers.

Gap Analysis of the construction industry

One of the basic short comings in the small scale construction industry is the lack of use of modern tools and equipment. Now the primary reason for this is the lack of willingness of the companies to invest in such equipment and the un-educated and un-skilled working force. Most of the workers are not enough educated to understand the need and effectiveness modern tools. Most of them are even unable to operate a little bit sophisticated equipment.

Second thing that is often observed is that the measurements and analysis of materials to be used is mostly based on intuition and rough estimates rather then being accurately analyzed and measured. This often leads to either less then required material which can be potentially dangerous, or in some cases more then required material which can be an over kill. This results in undue cost increase.

Thirdly there are very little practices in place to measure and certify the quality of work that is done at each stage of the construction. The result of this is that when a stage is near completion and there were deficiencies that were not detected at a previous stage it becomes time consuming and costly to rectify them at the current stage.

Another important lacking is the lack of performance and pace analysis of the workers involved. Due to these reasons most projects fall short of the dead lines if at all there was a dead line in the first place. This increases the cost as well as the time of the over all process.

Strategic goals and strategies

The basic goal of the company is to modernize the construction business by introducing proper analysis, measurement and management procedures in this field. In order to bridge the gaps identified in the earlier portion it is necessary to address all these issues in a systematic manner.

A separate portion of the company budget would be allocated to purchase, maintain and update the tools and equipment required in this field. Find skilled man power and further training of the employees needs to be done on a regular basis. Proper measurement of materials used in different phases and analysis of process of different construction phases needs to be done. This will ensure that only that quantity of materials is used that actually required. This will ensure the durability as well as cost effectiveness of the structures constructed by the company.

Another important strategy would be to devise procedures to measure the performance of the workers. This would involve setting up goals and standards for the acceptable performance of individual workers and also for different phases of the construction process. In this way we will be able to provide customers fairly accurate time and cost estimates and also measure the performance of the individuals working in the company.

A comprehensive incentives plan also needs to be made in order to provide bonus and rewards to meritorious workers. Instilling a sense of satisfaction and dedication is the primary goal of the company management.

Objectives

The major objective is to modernize and revolutionize the construction business. As discussed in the introduction there is a lot of potential in this area as currently there are not many companies that are providing quality services in this area. So at the moment it is a relatively untapped area in the services sector. Our objective is to form a team of dedicated and skilled workers and provide quality and cost effective services to the ordinary people.