W K 1 Issue 1 Volume 1 2012 K Kaibo - kaibogroup.com Engineering... · 1 Issue 1 Volume 1 2012 WELCOME TO KAIBO GROUP..... 1 KAIBO CURRENT NEWS 1-1 INDUSTY NEWS ... Poland and Saudi

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2102 1 eussI Volume 1 WELCOME TO KAIBOGROUP .......................... 1

KAIBO CURRENT NEWS 1-1

INDUSTY NEWS .......... 2-4

GroupKaibo Group is an international project management (EPCM/PMC) company. Where we provide project man-agement and consulting services to owners and Chinese construction enterprises.

2011 in focus for Kaibo Group 2011 was a another successful year for Kaibo Group where we undertook engineering project management and consulting works on projects in Australia, Africa, Europe and Asia at a total value of over 4 Billion USD. These projects received a high degree of recognition from all people involved from Gov-ernment departments to the owners involved. During the course of the year CEO Mr. Sun delivered key speeches at various conferences and events with one in particular at 4th China International Con-tractors Association (CHINCA) which was widely heralded at

the event as he focused on the cooperation model between contractors and engineering consulting firms. In 2011 we started an initiative in sponsoring disadvantaged children in China and abroad where we aim to provide a better future through education. This initiative is one of several Cor-porate Social Responsibility projects we actively pursue for a better future for people not only in China but throughout the world.All at Kaibo Group look for-ward to another challenging year in 2012 and look forward to working together with you.

Current Projects Nigeria—We are the management contractor on a $162millionUSD railway contract where we are providing a full range of EPC Project Management services. Sudan—Providing project management services for a $500USD irrigation project where we oversaw the whole project process including tendering, contract negotiation, assisting contractors and maintaining effec-tive communication with the owner. Mongolia— Project managing a housing development contract.

Kaibo

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The Growing Influence of Chinese Construction

Despite concerns about the quality of their work, Chinese construction companies are winning more valuable interna-tional contracts to build every-thing from roads to railways. Richard di Bona, who runs a Hong Kong transport consul-tancy, said China had signifi-cantly expanded its assistance to developing countries, pre-senting Chinese firms with an inside track into many projects. Although the value of interna-tional contracts won by Chi-nese firms dropped 6.5 per cent year-on-year to US$82 billion in the first nine months of 2010, the value of international contracts won by Chinese firms in 2009 was 10 times more than 2000, according to the China International Con-tractors Association. By the end of September 2010, the cumulative total of interna-tional contracts won by Chi-nese firms was US$642 billion, according to the association. In Africa, the value of Chinese construction projects jumped more than tenfold from

US$1.81 billion in 2002 to US$19.75 billion in 2008. Despite the tremendous in-crease in contracts, there have been examples of poor-quality work or safety issues in certain overseas projects by Chinese construction firms in Qatar, Ghana, Poland and Saudi Ara-bia, said an international engi-neering executive. Chinese construction firms have been able to win overseas contracts because they offer lower prices that come with financial support from Chinese state banks - such as China Exim Bank - which offer loans on generous terms, said the international engineering ex-ecutive. Chinese construction firms are highly competitive in Africa's civil works sector but not in equipment supply or construc-tion consultancy, said the Insti-tute of Developing Economies of the Japan External Trade Organization (IDE-Jetro). From 2004 to 2006, Chinese firms accounted for 31 per cent of civil works contracts in Africa awarded by the World Bank and African Develop-ment Bank. Such a percentage indicates Chinese companies

are highly competitive, as no other country has more than a 12 per cent share, said IDE-Jetro. However, Chinese firms account for only three per cent of the equipment supply mar-ket in Africa and are almost non-existent in construction consultancy in Africa. Chinese construction firms face several problems when expanding overseas, including lack of risk management and poor contract management, the professor said. One example is the light-rail project in the Muslim holy city of Mecca where China Railway Con-struction Corporation booked a 1.39 billion Yuan (HK$1.66 billion) loss. "The Chinese companies real-ize they cannot indefinitely expand overseas on the basis of cheap work and cheap financ-ing alone," said the executive.

This article is from www.scmp.com. Written by Toh Han Shih

“CHINESE CONSTRUCTION FIRMS

FACE SEVERAL PROBLEMS WHEN

EXPANDING OVERSEAS, INCLUDING

LACK OF RISK MANAGEMENT AND

POOR CONTRACT MANAGEMENT,

THE PROFESSOR SAID. ONE EXAM-

PLE IS THE LIGHT-RAIL PROJECT IN

THE MUSLIM HOLY CITY OF MECCA

WHERE CHINA RAILWAY CON-

STRUCTION CORPORATION

BOOKED A 1.39 BILLION YUAN

(HK$1.66 BILLION) LOSS. “

QUICKNEWS

��CNPC signed a deal in Afghanistan to win the country first ever Oil bid.

��Qingdao Kingking Group to invest $100 million to develop mines in Africa.

��Pan-China Construc-tion win contract in South Sudan to design and construct new capital.

��CCEC signed $1.2bil-lion for railways in Ethiopia.

UPCOMINGEVENTS

3rd IIICF—24—25 of May.

SCET—May

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The China Communication Con-struction Company has won a contract from the Panama Canal Authority to design a third bridge spanning the Panama Canal. The CCCC submitted the lowest bid for the project at US$4.66 million, securing the contract over five competitors, according to Xinhua.

The Chinese company partnered with a U.S.-based engineering consultancy, Louis Berger Group, headquartered in Morristown, New Jersey. The five competitors were Pa-nama’s TYPSA Principia with a bid of USUS$4.9 million, Puente de Colon at US$7.2, U.S.-based URS Holdings at US$6.1 million,

, London-based ARUP at US$8.5 and a second U.S. firm, Ty Lin International at US$9.6 million. The Panama Canal Authority estimates the new bridge will double cross-canal traffic capac-ity when it is completed in 2014, scheduled to coincide with the completion of the canal expan-sion.

PANAMA CONTRACT

WORKING WITH KAIBO

GROUP

We Endeavour to work with all stages of the con-struction project providing world class management, consulting services, and project management. We also provide training sessions to help your com-pany achieve the best re-sults in dealing with Chi-nese enterprises

SINGAPORE CONTRACT

China Railway 11 Bureau has won the last two civil con-tracts of Singapore’s Tuas West Extension mass rapid transit (MRT) project. The contracts have a combined value of US$390 million. One involves the construction of elevated stations at Tuas West and Tuas Link stations and approximately 2.2km of

elevated MRT viaducts. The other is for the construction of the elevated Tuas Crescent station and approximately 2.4km of MRT viaduct, which will be integrated with part of a 4.8km of road viaduct. When completed, the road viaduct will provide motorists an alternative to the busy Pio-neer Road.

Tuas West Extension is an extension of the East-West Line from Joo Koon station, consisting of a 7.5km twin-tracked MRT viaduct, four above-ground stations and a depot. Construction will start in January 2012 and is targeted to complete in 2016.

CONTACT KAIBO GROUP

Address: B1502, Vantone Center, Chaoyang District,

Beijing (100020) Tel: (+86)10-59073235

Email: [email protected]

Web: www.kaibogroup.com

or cultural process?

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Does the emergence of an international stan-dard, and the internationalization of other standards including the dozen or more transla-tions of the PMBOK* Guide mean project management is a standard process across all cultures and societies, or do we need cultural versions of the PMBOK Guide similar to the current industry extensions? I ask this question as the ISO committee final-izes the draft of ISO 21500, A Guide to Pro-ject Management. The PMBOK Guide is pro-duced in 12 official and several unofficial translations but language is only one dimen-sion of culture. To effectively manage pro-jects within a specific culture do the PMBOK’s processes need adaptation? The original trigger for this column was the collapse of a series of ‘binding agreements’ in 2004 between Fortescue Metals Group Ltd (FMG), and some Chinese engineering com-panies to build a new iron ore mine, railway and port (worth billions of dollars). The deal fell through when parallel negotiations around an equity stake in Fortescue collapsed and the final appeal to the High Court over the matter is due shortly. In an Western context, there were separate negotiations and the collapse of one should not have impacted the other. In a Chinese context, the relationship is what matters and the failure of one aspect of the relationship damages all aspects of the relationship. What this case does highlight though, is the impor-tance of ‘culture’ when dealing with stake-holders.Khor Soon Kheng, founder of Asia ICT Pro-ject Management Malaysia, believes good Guanxi (a philosophy dealing with any network of relationships among various par-ties who cooperate and support one another in the Chinese business/project world) is criti-cally important to the successful delivery of projects involving Chinese organizations from bidding through to handover. “Guanxi can rate as highly as technical com-petence and price in decision making and has a significant influence on procurement, Khor says. “Guanxi is intensely personal: while it can be shared and reflected onto the organiza-tion a person works for, the individual ‘owns’ his/her Guanxi and has to invest time in de-

veloping and maintaining it. This gives him/her a competitive advantage as well as the ability to avoid conflict, both of which are beneficial to the outcome of the project.” But this is not just an East/West issue; we experienced two very different approaches to safety management during a major project review in Pakistan. The hierarchal and proce-dural culture of the Indian sub-continent was quite different to the ‘team/group’ culture of the Chinese engineering company building the project. In this ‘culture clash’ the Pakistani engineers were focused on documented safety

procedures, the Chinese engineers and build-ers were focused on developing a group un-derstanding of the risk through discussion and observation to make sure no one in their closely knit team was put at risk of injury; they saw the paperwork as superfluous. Both sides took safety seriously; the approach em-bedded in culture to achieving the ‘safe out-come’ was quite different. Similarly managing issues effectively is cul-turally sensitive. In Japan, the concept of ne-mawashi (pre-arrangements) moves conten-tious items forward so there are no disagree-ments in meetings. Even making a decision can be seen as a failure; decisions should emerge from the group rather than be imposed on the group by a project manager. As the Japanese proverb says, ‘the nail that sticks up gets hammered down’. Conse-quently, nemawashi makes ideas such as a

PMO fearlessly reporting schedule slippage or cost overruns at a meeting almost untenable. The information needs to be subtly conveyed and the actions agreed before the meeting to maintain the integrity of the group. Depending on your viewpoint, nemawashi can be thought of as ‘dealing under the table’ western or as a type of smoothing ‘finding the root of the problem and using some Delphi technique to circulate around the stakeholders to build consensus’ eastern. There is no right or wrong in culture: the Chinese ran an incredibly suc-cessful Olympics, Japanese industry domi-nates in many areas, and South Korea has a long history of successful project delivery. The key question is how much additional value could a cultural adaptation of PMBOK Guide contribute to the development of pro-ject management in these and other cultures? There are advantages to a standardized world wide view of project management and there are advantages to developing culturally rele-vant adaptations. The approach favored by Robert Higgins (another contributor to Advising Upwards) is to clarify and sim-plify the PMBOK to transform it into a dia-mond of knowledge. Like a diamond it needs to be discreet, clear and hard. The ideas in a robust, clarified, PMBOK can be translated easier. Clear ideas spread naturally by com-munication, and because culture is a shared system of beliefs or values based on a com-mon understanding of these ideas, having one robust and clear PMBOK is the greatest strength for creating a global project manage-ment culture. From this base, project manag-ers can use the baseline culture of project management to create common ground in a multi-national teams and adapt to the other aspects of culture in any location. An alternative perspective suggests processes that are not culturally effective get ignored or bypassed, devaluing the overall value of the ‘body of knowledge’. With both the 5th Edi-tion of the PMBOK Guide and ISO 21500 in development, I feel we need to have more discussion around implementation of the ‘knowledge’ within cultures. Can one size fit all? This article was taken from www.cio.com.au, written by Dr. Lynda Bourne.

“GUANXI CAN RATE AS HIGHLY AS TECHNICAL COMPETENCE”

Is project management a standard