Preview: Katavic-Matic - Construction Managers in the 21st Century

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Construction Managers in the 21st Century Mariza Katavić Faculty of Civil Engineering, University of Zagreb, Zagreb, Croatia (email: mariza@grad.hr) Siniša Matić Faculty of Civil Engineering, University of Zagreb, Zagreb, Croatia (email: simatic@grad.hr) Abstract Managers run companies and projects with the purpose of achieving maximum business results through the direct control of labour performance and the flow of considerable financial resources. Thus educating civil engineers to manage companies and projects successfully is an extremely important task for the development of not only construction industry but country’s economy as well. Management for engineers is a form of additional education, because it provides knowledge and skills that enable engineers to master business processes more easily, and to adapt to globalisation processes more quickly and painlessly. Analysing management curricula from best universities and schools and comparing the “knowledge offer“ with

professionals “knowledge needs“ in companies, using questionnaires and field research tools, we have produced an MBA in Construction program at the University of Zagreb. The content, the programme and some dilemmas are presented in this paper. Keywords: civil engineering, education, MBA. 1. Introduction MBA started its life as an “elite” business qualification for potential leaders and senior managers. The title “Master of Business Administration” stems from times when senior management practice was concerned with administration. It started out as an American, then Anglo-American, qualification and in the 1960s it was adopted in Europe. MBA programmes and curricula have developed along “capitalist” market principles and represent a Western interpretation of management and leadership. All MBA courses, according to Kempner (as cited in Kretovics [1]), have the same objectives: “to develop managers who will run efficient, profitable enterprises in a competitive

world for the creation of wealth in society”. Boyatzis et al. [2] see the objective of graduate management education as preparing people to be outstanding managers and leaders. Originally, MBA was offered only by the “prestigious” business schools, and accreditation with the AACSB, AMBA or EQUIS were taken as necessary stepping-stones on the way to validating and offering the degree. The demand for that kind of education was significantly greater than the market offer. In the meantime the market has changed as more and more providers offer the MBA title, and many of them do not even seek accreditation. The last fifteen years have seen a massive expansion of the Master of Business Administration (MBA) provision around the world, with virtually every university business school having one, and some having more than one. The supply of places largely exceeds demand as the market is flooded with a range of MBA programmes offering different modes of delivery and different

specialisations. Knowing all this, one may wonder if there is any sense in starting another MBA at the University that, in spite of its history of university education since 1669, is not a “prestigious” business school from the UK or the USA. To paraphrase Kathawala et al. [3] “should we have a dilemma? Are we really doing students a disservice by even offering them an MBA? Is MBA a global qualification? Does one size fit all?”. But for us there were no dilemmas at all. The aims of MBA programmes are very clear - to prepare their graduates for managerial roles, help them gain a better understanding of the industrial and business world and its needs, enrich their skills and provide them with competences relevant to their careers. Thus, in the so called transition countries moving from centralised/ socialist/communist economies towards free market/capitalist/western economies, this kind of knowledge is of paramount importance and very much in demand from managers to be of all

kinds. 2 2. MBA? Yes or no? Today MBA is allegedly a global qualification, taught all around the world and also delivered by e-learning, so it is globally accessible. MBA courses and their methods of delivery now differ enormously. There are one-year and two-year degrees, full-time and part-time degrees, campus-based versus distance learning MBAs, “consortium MBAs” with foundation companies, single company programmes and others, including action learning approaches [4]. Birchall and Smith [5] view the MBA market as having considerable potential for a diverse range of business school offerings. Should MBA be offered with specialisations, for example, to address certain niche markets (e.g. an MBA in Health Sector Management, or an MBA in Marketing), or should it remain focused on a generalised, all-round curriculum supposedly applicable to everyone? At the moment, none of the answers to these questions are clear as conflicting views are held both within and between institutions,

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and for and against the MBAs For instance, Mintzberg [6] believes MBA studies are teaching the wrong people the wrong things in the wrong way, arguing that they are “specialized training in the functions of business, not general education in the practice of management”. According to Mintzberg, the value of “MBA” in the market is diminishing as the title is only as good as the “worst MBA” that is being employed. Mintzberg has also argued that MBAs are designed in restrictive “silos”. Subjects, such as finance, IT, management science, and organisation behaviour exist more or less independently of each other. Although there may be some acknowledgement of the need to integrate, the strategy module that might do this has become a silo of its own. It is acknowledged that some cross-cutting topics are considered, for example new product development or collaborative team working, but these tend to be considered within silos (marketing and organisational behaviour respectively).

The outcome of silo teaching and data-driven analysis is students who are, for Mintzberg, ill-prepared for management [7]. Reactions to Mintzbergs critique have been mixed. According to Beech [7], whilst some have accepted the assessment of MBAs, that they are overly analytical (for example, Feldman [9]) this view is not universally accepted. Armstrong [9] has argued that Mintzbergs perception is based on a US-centric sample and that European (and particularly UK) MBAs are less guilty of this imbalance. Armstrong, arguing from an academic perspective, and Purcell [10], arguing from a practitioner perspective, both contend that 3 Mintzberg is over-generalising. They hold that there is a European tradition of education, and MBAs in particular, that is different. In this tradition there is greater emphasis on integration. As cited in Beech [7], although Mintzberg wishes to see a decline in MBAs, or at least in the more traditional ones, his wish does not appear to be coming true.

MBAs are expanding, and in contrast to Mintzbergs claims, are proclaiming their individuality and distinctiveness. Purcell [10] states that the European MBA market has grown by almost 40 percent over the last ten years. Examining the UK MBA market, Armstrong [9] states that among part-time students there has been a 31 percent rise during the last decade, a 23 percent rise in distance learning and a 57 percent rise in full time student numbers over the same period. There is also anecdotal evidence of significant student mobility. For example, Burnson [11] reports a “significant rise” in MBA students from Europe going to study in the USA. Ters [12] reports a significant increase (“several hundred students”) in the number of Russian students studying MBAs at Western business Schools. There has also been an “MBA boom” in China [13] with 10,000 students enrolled on MBAs in 2001 (contrasting with 100 enrolled students in 1991!). Specialisation in MBA is today probably the most

highly respected qualification in business in new – former Eastern European countries, as it is perceived as a form of additional high education in management. To understand such an attitude one has to know that former political and economic systems where based on centralised economy, meaning that all major business decisions were politically and not economically grounded. Thus the need for “western style” business education is so huge and MBAs are expanding. 3. MBA in Construction? Who needs it? When it comes to the construction industry, the MBA programmes offering “general managerial training” have to be modified, as they are not entirely appropriate for the needs of construction managers. Construction differs fundamentally from all other industries, because in a “normal” industry the product changes its place and the production factors (people and machinery) are static. In construction it is the opposite – the product (the site, the building under construction) is

4 static and does not change its place. When the “production process” is finished “the product” stays where it was made, while the production factors (people and machinery) move on to the next location – to the “next product”. Managers run companies and projects with the purpose of achieving maximum business results through the direct control of labour performance and the flow of considerable financial resources. The overall purpose of management is to help the organisation achieve its objectives. For the company this means achieving profitability and liquidity, thus guaranteeing survival. A good manager can save a bad company, whereas an incompetent manager can ruin a good company. For years, civil engineers have been successfully heading building and construction companies as well as different large-scale projects (dams, nuclear plants, ports, etc). They have proved their technical knowledge, skills and expertise working in different economic and political

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environments in Croatia as well as around the world. However, they had problems in managing companies and projects as they had no formal knowledge or training in management. Following the present trends in modern market economies, more and more people enrol in postgraduate courses. Although nowadays most postgraduate courses offer programmes specialised for specific fields, the demand for multidisciplinary and interdisciplinary programmes is progressively increasing. H. Fayol [14] speaking generally about the knowledge necessary for managerial work, as early as 1949, established the correlation between technical and other general (economic, sociological, managerial and other) knowledge for various job positions in the management hierarchy. Table 1. Correlation between technical and other knowledge Work place 1. Worker 2. Skilled worker 3. Technical manager 4. General manager Technical knowledge needed 85 % 60 % 30 % 10 % Other knowledge needed 15% 40 % 70 % 90 % 5 The percentage

of “general knowledge” grows as one climbs up the managerial ladder. Every manager well knows that the higher his/her position in the managerial structure is, the less he/she has “to do” with solving technical/professional problems and the more time and energy he/she spends in solving “all the other” problems in the company. In a survey [15] that included engineer graduates from the Faculty of Civil Engineering at the University of Zagreb, between 1955 and 1985, specific managerial features and “the most important” knowledge and skills for a construction manager were identified. The result of the respondents’ evaluation was a rank list of the ten most important skills and knowledge for the construction manager, the first being „command of technical knowledge and professional skills”. They firmly expressed the view that a person must in the first place be a good engineer to be a good manager. They placed the ability to control expenses last of the ten most

necessary kinds of knowledge. In 2001, field research [16] about the essential knowledge and skills that the successful manager in the construction industry should possess was undertaken again. Respondents ranked knowledge in management science (analysis, planning, organisation, motivation, control) topmost. Project management (planning methods, resource management, risk analysis etc.) was considered the next most important knowledge by 91% respondents, and economics came third (accounting, marketing, finances, international economic relations etc.). International “MBA in Construction” given at the University of Zagreb (for details see www.grad.hr/mba) is a programme that focuses on construction with the purpose of providing present and future construction managers with knowledge in various scientific and professional fields necessary for understanding and mastering complex management processes. It is entirely comparable with recent European trends, which was confirmed when the EU

approved the program granting 150,000.00 euro, enabling its start in February 2003. Educating civil engineers to manage successfully, as proposed in our International “MBA in Construction” programme, is probably a crucial and extremely important task not only for Croatia’s economic development, but for the region as well. 4. The programme 6 In his recent critique of MBAs, Mintzberg (as cited in Beech [7]) argues that there are four aspects in which an MBA programme can be international: the students; the staff; the location and locus of control; and the context, philosophy and culture. He goes on to say that on the basis of using these aspects of internationalism as criteria, he knows of no international MBA programmes Although we are aware that MBA in Construction delivered by the University of Zagreb and its partners is not meeting these requirements entirely, it was a kind of a challenge for us to evaluate our program according to Mintzberg. Here are the “results”.

The students – as we have already said, the programme was started with the support of the EU TEMPUS academic support program so the “receivers-students” in the first and second generations were students from Croatia. In two generations 44 students enrolled. The average students age at enrolment was 32, and the average duration of their previous work experience was 5 years and 4 months. Enrolment requirements included the GMAT test, which course participants had to pass. The beginning of the next enrolment is planed for the autumn 2007 and it will be promoted within the region of Central and Eastern Europe, thus it will be international. The staff- the International MBA in Construction programme started as a TEMPUS project of Zagreb University (Faculty of Civil Engineering and Faculty of Economics), in cooperation with partner institutions from the EU - Great Britain, Germany and Slovenia. Teachers from Dundee University, Reading University, Salford University, Technische

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Universität München, and the University of Ljubljana taught together with their colleagues from the University of Zagreb, thus we had an international teaching staff with very different philosophies and cultural backgrounds. The location and locus of control - lectures were in the first generation delivered partly in Zagreb and partly in the Centre for Advanced Academic Studies in Dubrovnik, University of Zagreb. In the second generation, lectures were delivered only in CAAS in Dubrovnik. As mentioned above, this MBA in Construction programme started in February 2003 as CD JEP TEMPUS and was thus controlled by EU-TEMPUS bodies and the main contractor, Dundee University in the UK. In June 2003 the University of Zagreb Senate approved the proposed curriculum making it one of two MBA graduate business management programmes that have University Senate evaluation, and is has been recognised as an international university postgraduate course. 7 The programme carries a total of 120

ECTS credits in three terms of teaching and a master’s thesis (Katavić et al. 2004) The context, philosophy and culture - as presented above, almost all syllabi were taught by at least two teachers – one Croatian and the other European, sharing and exchanging their knowledge and experience with each other and with students. The syllabi were classed in three groups [17]: - general business management subjects (organisational behaviour and organisation design, business strategy, business ethics, human resource management, decision theory, negotiation and business protocol) - economic subjects (business statistics, marketing strategy, international marketing, managerial accounting, financial management) - construction subjects (project planning and control, project management, construction contract law, facility management, environmental management) We asked all our teachers, even those teaching “pure” general management and economic subjects, to give a “construction industry

touch” to their teaching, by presenting case studies from that field. To conclude, we know we have to improve a lot, but so far we are satisfied with the outcome of our analysis. 5. What should we do to improve further? The problems observed during the first two generations of the postgraduate "MBA in Construction" study course cannot be completely eliminated, but they can be greatly mitigated by taking the objections of the businessmen into account and by closer cooperation. Using the experiences of the first generation of students, some changes were made to improve the quality of the course and to facilitate the recruitment of new participants. In the opinion of the employers, the greatest “shortcomings” of the course was the duration of studies (12 teaching modules require the absence of the employee for as long as that, which employers did not find acceptable); the dislocation of teaching (teaching at 8 the University of Zagreb’s Centre for Advanced Academic

Studies in Dubrovnik, in the employers’ opinion, only increases the expenses of the study course – air tickets, student accommodation, expenses for food - without providing any visible advantages over teaching in Zagreb) [18]. It is interesting that the data about student attendance at lectures showed that the lectures held in Dubrovnik were more visited than those held in Zagreb. The reason was that students were free of their work obligations and could completely devote themselves to their studies, which was not possible during the lectures in Zagreb, which was the place of employment for most students. In this way the idea to dislocate students from their working environment during teaching and to “force” them to entirely devote themselves to their studies and focus on the problems taught showed itself very good, although the employers were probably not enthusiastic. However, after the first week spent in Dubrovnik the students themselves accepted this kind of work with

enthusiasm because they became personally convinced of the advantages of intensive everyday and daylong work and association with colleagues and teachers. The Programme was modified by adding new optional courses and decreasing the number of modules per term. Teaching now includes 6 modules focusing on months that are less active for the construction industry (October, November and January, February). According to the new model, teaching in one module lasts 9 days, from Saturday to the following Sunday, with 8 – 9 hours of lectures a day (see more on www.grad.hr/mba). Now students “sacrifice” two weekends for their education and employers “sacrifice” 5 working days for their education. All teaching was held in the CAAS in Dubrovnik, which showed itself a very good solution ensuring for students the very necessary peace in order to focus on their studies [19]. But still, our customers (students as well as their employers) complained about the amount of time they were absent

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from their workplaces. Bearing in mind the very rapid changes in research and the need to fundamentally change the approach to lifelong education and upgrading, especially in interdisciplinary and multidisciplinary fields, the use of the new e-learning technologies for knowledge transfer by trained highly-qualified professional teachers is becoming a possible solution for the quality lifelong education of constructors, in harmony with European and world trends. 9 Comparing e-learning MBAs and traditional MBAs with regard to their global potential, the strengths are that it can be disseminated to large numbers globally, affording local delivery where students cannot attend class, and allowing people to receive high education without having to be out of work for a long time Thus we are working on introducing e-learning methods to our next International “MBA in Construction” generation of students. 6. Conclusions Many countries in our part of the world require great investments

in construction and modernisation of the infrastructure and other facilities to advance the potentials necessary for economic and political stability and development. This can only be achieved with well-trained managers who are experienced in construction. Therefore, the “MBA in Construction” is designed to appeal to managers within all construction disciplines. Modern education implies contemporary teaching programmes, methods and competencies of knowledge transfer as an essential precondition for the development not only of Croatian higher education, but of society in general. How to maintain the continuity of quality university education and at the same time take into account the reality of the lack of time for education is a problem that faces not only students and their future employers, but in the first place university teachers who are expected to be the bearers of knowledge transfer. New technologies have become an inevitable part of everyday life, which has led to

increasing pressure to integrate them more efficiently in education processes, because new media enable the lifelong and continuous learning of people in the information society environment. The solution for this problem requires a different and more flexible approach to learning which places the student, his needs, wishes and possibilities, in the foreground. The need for a different and more flexible approach to learning is especially shown after the completion of regular education. Technologies and knowledge change very quickly, and the world is becoming a “global village” where information is exchanged in real time. This is especially so in engineering professions such as construction. Croatia has become part of the European market and there is a need for the additional education of civil engineers, 10 especially in business management, which also includes project management. If Croatia is to enter the global knowledge society we must educate the best engineers and provide

them with new knowledge, competencies and skills. References: [1] Kretovics,M.(1999), Assessing the MBA, What do our students learn? The Journal of Management Development, Vol.18 No.2, 1999, pp.125-136 [2] Boyatzis, R.E., Stubbs, E.C., Taylor, S.N. (2002): Learning cognitive and emotional intelligence competencies through graduate management education, Academy of Management Learning & Education, Vol. 1, No.2, pp. 150-62. [3] Kathawala, Y., Abdou, K., Elmuti, D.S. (2002), "The global MBA: a comparative assessment for its future", Journal of European Industrial Training, Vol. 26 No.1, pp.14-23. [4] Nicholls J.,Harris J., Morgan E., Clarke K.,Sims D.: Marketing higher education: the MBA experience, International Journal of Educational Management, Vol.9 No.2, pp.31-38 [5] Birchall, D., Smith, M. (2002): Scope and Scale of E-learning Delivery amongst UK Business Schools, CEML, London. [6] Mintzberg, H. (2004), Managers Not MBAs: A Hard Look at the Soft Practice of Managing

and Management Development, Prentice Hall, London [7] Beech,N.(2006), Intense, vigorous, soft and fun: identity work and the international MBA, Critical perspective on international business, Vol.2 No.1, 2006, pp.41-57 [8] Feldman, D.C. (2005), The foods no good and they dont give us enough: reflections on Mintzbergs critique of MBA education, Academy of Management Learning and Education, Vol. 4 No.2, pp.217-220 [9] Armstrong, S. (2005), Postgraduate management education in the UK: lessons from or lessons for the US model?, Academy of Management Learning and Education, Vol. 4 No.2, pp.229-34. 11 [10] Purcell, J. (2005), Euro MBAs have a unique appeal, Business Education, No. January, pp.13. [11] Burnson, P. (2003), International business education: shaping future global vision, World Trade, No. June, pp.52-4. [12] Ters, K. (2003), Weighing MBA study: home or abroad?, St. Petersburg Times, No.9 September 2003 . [13] Hulme,V.A.(2004), The MBA boom, The China Business Review, No.

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JanuaryFebruary, pp.24-36. [14] Fayol, H. (1949): General and Industrial Management, Pitman Publisher, London. [15] Katavić, M., Đukan, P.(1989): The Civil Engineer as a Manager, 3rd Yugoslav Symposium in Building Organisation, Cavtat, University of Zagreb, p. 767-779, 19-21 April 1989 [16] Katavić, M., Cerić, A.(2002): In Pursuit of the Perfect Project Manager, 2nd SENET Conference on Project Management, Cavtat, University of Zagreb, p. 73-83, 17-19 April 2002 [17] Katavić, M., Matić, S.(2005): MBA in Construction, 11th Joint CIB International Symposium, Helsinki, Finland, June 2005 [18] Katavić, M., Matić, S., Cerić, A.(2005): The Engineers Education in Business and Construction Management, ARCOM Twenty First Annual Conference 2005, London, United Kingdom, September 2005 [19] Katavić, M., Matić, S., (2006), Business Education for Construction Managers, Konferencija Savremeni problemi u građevinarstvu, 2-3 June, Subotica, Yugoslavia. 12