• International conference on construction engineering and project management
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• 2005.10a
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• pp.417-423
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• 2005

Contractor's opportunistic bidding behavior refers to contractor's deliberate low-bid, which cannot accord with the cost, and expectation for beyond-contractual reward (BCR), the compensation earned through cutting corners or claims after undertaking the construction project. This research applies System Dynamics to develop a model of contractor's pricing with consideration for dimensions of "cost", "market competition", and "BCR". Iterative computer simulations were performed to analyze the effects of contractor's pricing on the market price. The results were then examined by statistical analysis on data collected from 44 highway projects in Taiwan. It is found that the critical force driving the contractors to bid opportunistically is their excessive expectations in BCR under the current environment. Within the price competition mechanism, if the problem of BCR exists, even if the bidding system is further improved, contractors would still prefer opportunistic bidding behavior, and eventually make the whole construction industry operate ineffectively. Therefore, it is crucial to remedy the aforementioned BCR problem by more effective management policy.

• International conference on construction engineering and project management
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• 2011.02a
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• pp.526-533
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• 2011

Contracting is said to be a high-risk business, and a common cause of business failure is related to cash management. A contractor's financial viability depends heavily on how actual payments from an owner deviate from those defined in the contract. The paper presents a method for contractors to evaluate the punctuality and fullness of owner payments based on historical behaviour. It does this by classifying owners according to their late and incomplete payment practices. A payment profile of an owner, in the form of aging claims submitted by the contractor, is used as a basis for the method's development. Regression trees are constructed based on three predictor variables, namely, the average time to payment following a claim, the total amount ending up being paid within a certain period and the level of variability in claim response times. The Tree package in the publicly available R program is used for building the trees. The analysis is particularly useful for contractors at the pre-tendering stage, when contractors predict the likely payment scenario in an upcoming project. Based on the method, the contractor can decide whether to tender or not tender, or adjust its financial preparations accordingly. The paper is a contribution in risk management applied to claim and dispute resolution practice. It is argued that by contractors having a better understanding of owner payment behaviour, fewer disputes and contractor business failures will occur.

• The Journal of Society for e-Business Studies
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• v.2 no.2
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• pp.115-135
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• 1997

In this paper, we discuss CITIS(Contractor Integrated Technical Information Service) as the information infrastructure of CALS. CITIS is a contractor-developed and maintained service to provide electronic access and/or delivery of Government-procured contractually required information. As the concept of CALS is expanded government acquisition process into industry business, the CITIS is also expanded military CITIS into commercial CITIS. First, we describe CITIS services and functions defined by MIL-STD-974, and then specify the difference of military CITIS and commercial CITIS. The problem of current CITIS for inter-operable business process is indicated, and legal issues for sharing of CITIS data are also discussed.

• Journal of Korean Society of Industrial and Systems Engineering
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• v.41 no.3
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• pp.21-29
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• 2018

The cooperative relationship between Employer and Contractor in the construction industry is the most important factor to achieve the project success. Employer shall draw the Contractor's cooperative behavior during executing the project. A study on the impact of the Owner's power on the contractor's cooperative behavior is rare in the construction industry in Korea even though the negative impact of the high-power distance between the Employer and the Contractor has been a hot issue in Korea. In this empirical study, it is shown that the Employer's power can address the contractor's cooperative behavior. The respondents were mostly employees in the domestic construction companies who have experienced in the construction projects. The total number of respondents was 317 effectively. The multiple regression analysis using SPSS 21.0 were conducted to verify the hypotheses. In conclusion, the Mediated Power is positively associated with the In-Role Behavior and with the Extra-Role Behavior. Some of Non-Mediated Power is positively associated with the In-Role Behavior and with the Extra-Role Behavior. It seems that the Contract underestimate the Employer's Expert Power. It was known that the cooperative power caused by Non-Mediated Power is good for long term relationship of the business to business transaction. So it is highly recommended that the Employer shall foster its expertise.

• International conference on construction engineering and project management
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• 2007.03a
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• pp.289-298
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• 2007

The development of construction industry has led to the increase in the number of criteria imposed by project clients for selecting contractors. For example, clients often request tenderers to satisfy various conditions such as tight programme, financial strength, managerial ability, relevant work experiences, technical strength, high workmanship standard, safety requirement, quality specification, and yet others. This trend has attracted research interests of devising various methods for helping project clients to assess contractors' bids. For example, in recent development, the Works Bureau of the Hong Kong Government has introduced two mechanisms in tender evaluation for various public work contracts, namely, the Marking Scheme effective from June 2002 and the Formula Approach effective from November 2002 [1], [2]. These approaches evaluate a contractor's tender by considering collectively its tender price and performance attributes, the latter including contractor experience, past performance, technical resources and technical content of his proposal. The tender with the highest combined price and performance score (CPPS) will be normally recommended for acceptance. It appears, however, that there is little existing research in helping contractors to identify a competition strategy that enables the contractor to offer his most competitive bid collectively taking into account his resource capacities and project client's multiple performance criteria. This paper examines the factors affecting contractor's competition strategy to compete for works in Hong Kong. The understanding about the factors will contribute to identifying effective competition strategy. The data used for the analysis were collected from Hong Kong construction industry. The research findings may provide valuable references for investigating effective competition strategies in other construction industries outside the region.

• The Research Journal of the Costume Culture
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• v.17 no.5
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• pp.819-833
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• 2009

The current research focused on exploration of a well known Korean fashion and clothing industry cluster, Dongdaemun Fashion Town(DFT). Many clothing and fashion wholesalers in DFT with various business formats are trying to obtain competitive advantages. For the empirical study, a questionnaire was developed. Items measuring descriptive statistics for each business and contractor selection criteria were included in the survey. 161 data from Employees of various wholesalers of DFT were used for statistical analysis. Majority of DFT customers were buyers of Internet shopping malls and street retail shops. 64% of them used domestic contractors for sourcing products. Most of them managed less than three contractors. Contractor selection criteria were factorized as flexibility, production ability, stability, fame and location. Wholesalers were segmented into three groups: product oriented, flexibility oriented and stability oriented groups. Group differences in terms of business practices were assessed and strategic implications were included.

• Journal of the Korea Institute of Building Construction
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• v.18 no.2
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• pp.195-202
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• 2018

The defects that are bound to arise in most construction projects cause disputes among the contracting parties regarding the defect warranty liability (DWL)guaranteed by the retention of the contractor's performance security at the end of the performance period of the contract. Most current projects involve a multiple-tier contractual relationship, causing the liability for some defects to overlap. In addition, many construction projects are made up of multiple detailed work types which an expert hired by the owner inspects the part completed by the contractor and pays an interim payment. However, after the completion of work, the contractor will still hold the defect warranty liability. In a scenario in which the work is delayed due to reasons for which the owner is responsible, the defect warranty liability period is also increased, imposing an additional burden on the contractor. In this study, basic research was carried out with the goal of reducing problems related to defect warranty liability Problems related to defect warranty liability cases and the nature of the defect warranty liability period were investigated. Possible solutions to the problems caused by the DWL that were suggested include the separation of the negligence liability period and the strict liability period, as well as the introduction of a retention money system.

• Korean Journal of Construction Engineering and Management
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• v.4 no.4 s.16
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• pp.106-113
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• 2003

The purpose of this thesis is to provide an appropriate trade-off information for the conflicting interests caused by the various factors between building owner and contractor during selecting the contractor and performing the construction work, in which the construction was contracted by open bidding from the government or private organizations. In order to propose the legitimate evidence, the differences between the domestic contract sheet of drawing change and the process of drawing change and those of the foreign countries were compared and analysed The number of construction ordered in Youngdong area in 2001 whose construction expenses are more than 100,000,000 won is 218 items and 147,005,000,000 won in total cost Among them, the number of 218 items whose total cost amounts to 16,705,000,000 (11.36$\%$) is in case of increase of construction expenses due to the drawing changes, and the number of 48 items whose tool cost amounts to 2,009,000,000 won (1.37$\%$) is the case of decrease. In conclusions, the contractor could have more benefits than the building owner in case they submit the detailed estimate sheet without eliminating the increasing expenses of construction. It is shown that the building owner's loss is increasing whenever the labor cost is higher material cost Therefore, this thesis proposes a proper standards for the harmonious compromise between the contractor and the building owner for the problems caused by the drawing changes when the contract agreement is occurred.

• Proceedings of the Korean Institute Of Construction Engineering and Management
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• 2006.11a
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• pp.440-443
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• 2006

The purpose of this study is to classify government regulations and to present the direction of regulation policy in korean construction industry with focus on subcontract or special contractor. The literature research and type analysis are adopted as research method. And the results of this study are as followed. The study has shown the type of government regulations related with subcontract or specialty contractor in korean construction industry. Also, Having shown the institutional function of the regulations in the market. And the study has presented the approach to reform government regulations in construction industry. First, government must recognize not only economic efficiency but also social equity as equivalent policy values. Second, government must evaluate the benefit and cost of policy group as regulations have changed. Third, government must analysis the functions and effects of regulation reform in comparison with existing regulation.

• Journal of the Korea Safety Management & Science
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• v.20 no.3
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• pp.1-9
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• 2018

This study is intended to look into the effect of construction safety supervision system on risk control and reduction. To achieve this, a survey was carried out to 114 companies in construction, ordering, contract and management. The overall findings were as follows. The effect of construction safety supervision system on risk control and reduction showed that factors of supervision system, supervision cost and supervision method had a positive effect on risk control and reduction. And their perception of the introduction of safety supervision system in construction sites according to process showed that there was a difference between them according to the field of ordering, contract and supervision. There was the biggest difference between owner and contractor in double supervision system, but no difference between them in the perception of risk reduction. These results show that all ordering, contract and supervision are positively needed for the introduction of construction safety supervision. This means that there is a difference between owner and contractor in the perception of process according to system operation. All companies agree to system improvement by the settlement of safety supervision system for the prevention of safety accidents and safe construction, but the systematic complement of safety supervision is the burden of contractor. And there is a big difference between owner and contractor in the perception of responsibility and concern for cost burden.