THE IMPLICATION AND BENEFIT OF THE USE OF SOFTWARES IN BUILDING PROJECT CONSTRUCTION (CASE STUDY OF SELECTED SOFTWARE AND FIRM)
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This study is aimed at investigating the level of Information Communication Technology (ICT) applications in the Nigerian Construction Industry; determine the prospects with respect to benefits, costs, risks and research and development needs and to make recommendations on possible interventions. Relevant literature on studies done in other counties and in Nigeria as well was reviewed. A comprehensive
questionnaire was designed and administered to the respondents (construction industry professional) for data collection and analysis. A total of 63 respondents to a questionnaire survey most of which were construction companies provided empirical data for the analysis. Preliminary findings indicate that Nigerian Construction Industry has not fully appreciated the value of ICT and the impact of its use on the productivity value chain management. This delay in ICT uptake in Nigerian construction industry is limiting advances in construction quality, cost efficiencies and competitiveness of local firms. However, there are indications that the construction companies in Nigeria are beginning to realize that they would record substantial financial benefits as a result of ICT implementation and are flexible in the case of adapting to new technology. The survey through the questionnaire had limitations as it relates to industry best practice in the international Arena because of varying applications of construction techniques and methodologies. Furthermore, the survey was relatively small compare to the target group of over 2000 industry players. This was mainly due to lack of funding for the research. However, the study establishes a baseline for future construction sector ICT studies and further registered the sectoral ICT competitiveness of the
Nigeria construction industry.
1.1 BACKGROUND OF THE STUDY
Information and Communication Technology software, also known as information technology (IT) has radically transformed the way we live, learn, work and play (Capron 2000). Many companies in the construction industry do not generally appear to have appreciated the positive changes and advantages that the new technology was providing to companies in other sectors of the economy. A major construction process demands heavy exchange of data and information between project participants on a daily basis (Masqsood et al., 2004). This makes the construction industry one of the most information-intensive industries, and requires close coordination among a large number of specialized but interdependent organizations and individuals to achieve the cost, time, quality and sustainability goals of construction project (Ugwu et al., 2005). software has been shown to be a vital tool in assisting the construction industry to cope with the increasing complexity of its product and services as well as the increasing demands of clients and regulators (Betts,1999), and to enhance construction productivity (Liston et al., 2000). To asses the impact of software on construction in this regard, surveys on the use of software in the construction industries of various countries in different parts of the world have been carried out in recent times.
They include surveys conducted in Canada in 1999 (Rivard, 2000), South Africa in
2000 (Arif & Karam, 2001), Sweden in 2000, Denmark in 2001(Samuelson, 2002), Malaysia in 2001 (Lim et al, 2002). Turkey in 2001 (Sarshar & Isikdag, 2004) and
Singapore in 2003, (Goh, 2005).
While most of these surveys have been carried out in highly developed European countries and Asian economics, only the South African survey by Arif & Karam (2001) represent an emerging economy in Africa. Oladapo (2007) has also carried out a survey into the use of software in the Nigeria construction industry. However, his survey apart from it being limited to South West Nigeria, focused more on the level of computer literacy of construction industry professionals and mode of acquisition. Oyediran (2005) studied the awareness and adoption of information and communication technology software by Architectural, Engineering and Construction industry educators in Nigeria. Adejimi and Iyagba (2007) compared E-construction technology for integrating building processes between Nigeria, Canada and the Nordic countries. Their study however revealed that the digital divide between Nigeria and the developed world is closing up as more and more computer facilities are becoming accessible. However, they also indicated that modern and advanced information technology facilities such as internet, intra/extranet, virtual reality tools, tele/video conferencing, construction robots etc are grossly inadequate.
The intent of this research work is to ascertain the level of use of software in the Nigeria construction industry and also to determine the prospects with respect to the benefits, cost, risks and research and development needs.
1.2 SIGNIFICANCE OF THE STUDY
The construction sector contributes significantly to the GDP of a nation. In developed countries such as Japan and Korea, construction contributes up to 12 to 14 percent of GDP (Gann, 2000). In the developing countries (according to Dharwadker, 1979) investments in construction projects could be as high as 50 to 60 percent of national budgets.
In Nigeria, the construction industry was the dominant contributor to the nation‟s GDP in the 1980s, accounting for about 70 percent of the GDP (Planning committee on the National Construction Policy, 1989). This made the industry very strategic to Nigeria‟s development efforts. Unfortunately, however, the industry has been bedeviled by a combination of low demand and consistent low productivity and poor performance over the years (Manshued et al 1994; Olomolaiye, 1987; Aniekwu, 1995; Okuwoga, 1998; Adeyemi et al, 2005). This has reduced its contribution to the national economy to a mere 1 percent of the GDP in 2002 (AFDB/OECD, 2004).
The industry is made up of an organized formal sector and an unorganized informal sector. The formal sector comprises small, medium and large scale according to their level of capitalization and annual turnover. The few large firms (mostly foreign), which constitute just about 5 percent of the total number of contractors in the formal sector, control about 95% of the construction market, giving the small firms just about 5 percent share of the market. The results of this study will impact the Nigerian construction industry in the following ways;
- Delineate the software application and the level of adoption.
- Highlight the benefits of software application in construction at the strategic, tactical and operational levels.
- Serve as a guide to construction organizations in the area of the cost of software adoption (both direct and indirect cost); and the risks involved.
- Research and development.
1.3 AIMS AND OBJECTIVES
Oladapo (2006) had reported that the construction industry in Nigeria has during the past few years increased its use of software. However, very little is known about the impacts of the technology on the industry and the prospects for its widespread penetration of the industry. This is because very few reports exist of research in software in developing countries, including Nigeria (Pamulu & Bhuta, 2004). Against this background, the objectives of the study are to:
- Assess the impact areas and the level of used of software by construction companies in Nigeria.
- Evaluate the benefits (strategic, tactical and operational) of adopting software in construction.
- Evaluate the cost implication of adopting software in construction.
- Assess the risk factors.
It also intends to bring to the fore the current direction of development of software and to determine the prospects for research and development needs in the Nigerian
1.4 SCOPE OF THE STUDY
The research covers a review of software adoptions and applications by some construction companies in Nigeria. The companies under study are both foreign companies (Julius Berger, Costain, RCC, CCECC, Bulletin, Hitech, PW, Setraco etc) and indigenous (Ferotex, Master holdings, Maloon, Amec, Jukok, Amumco global, Horoda Ltd, Richgold, Tetratech etc) operating in Nigeria. Appropriate quantitative techniques were employed in analyzing the data gathered.
1.5 STATEMENT OF PROBLEM
Numerous problems are being encountered by the construction companies in Nigeria. Most of these problems are software related. The problems range from low level of software adoption to incompetence in the use of the software as follows;
- Low profitability
- Low quality production
- Poor management of business process
- Poor supply chain management
- Inability to satisfy client needs Increased cost of business process Lack of standardization.
1.6 RESEARCH QUESTIONS
Owing to the numerous problems encountered by construction companies from non adoption or low adoption of software to the problems encountered even when it is adopted, the following research question were formulated.
- What are the software application and the level of adoption of software by construction companies in Nigeria?
- What are the benefits obtained as a result of software adoption?
- What are the costs implications of software adoption?
- What are the risk factors of software adoption?
- Does the benefit derived from software implementation justify its investment?