Two-stage total factor productivity measurement for public construction projects

Abstract

Delivering public construction projects provides significant economic, social and environmental (ESE) benefits to the client and the public. However, the ‘white elephant’ syndrome pervades the construction industry, which imposes an urgent need for integrating post-construction stages into project performance measurement. Most studies looked at the efficiency of project delivery (output), but few considered the effectiveness of the utilisation of delivered facilities (outcome). There are three key knowledge gaps. First, the conceptualisation of construction project productivity (CPP) is vague, and the effectiveness is often isolated from CPP analysis. Second, conventional single-stage productivity measurement approaches and methods fail to embrace the project’s ESE benefits in the utilisation stage. Third, the attributes of CPP measurement are often examined from physical and managerial aspects, but the complexities from intangible and external aspects are overlooked. The absence of the ‘total factor’ concept in measuring CPP results in a narrow and fragmented understanding. To address these issues, this research aims to develop a two-stage CPP measurement model for public construction projects and provide strategies for CPP enhancement. First, CPP is reconceptualised as the integration of site efficiency (SE) and utilisation effectiveness (UE) based on the evolution of production theories and is verified through 21 semi-structured interviews with project stakeholders. Second, CPP influencing factors are identified through literature review and the factors’ significance is measured through a questionnaire survey with 200 industry stakeholders. Using structural equation modelling, the relationships between CPP, SE and UE are investigated. Third, drawing on the systems theory, a two-stage CPP evaluation framework is proposed by extending three system boundaries of CPP evaluation and then is verified through expert interviews. Fourth, the theory of two-stage CPP measurement is developed by analysing the empirical, formal and measurement systems of CPP measurement, individually and collectively. Consolidating the results and the constant elasticity of substitution function-based modelling, the CPP measurement model is developed. Finally, productivity enhancement strategies are recommended through sensitivity analysis and analytical proposition, and the impacts of the strategies on CPP are quantified through scenario-based simulations using Matlab. The developed CPP measurement model is contextualised to, and validated using, a real-life public rental housing project. The results show that SE and UE embedded in CPP are appropriately considered and addressed through the CPP conceptualisation and measurement model. The results of analysing the multiple scenarios show that labour-saving construction materials and equipment have the potential to enhance the SE of construction project delivery. The results also show the critical role of facility management in realising the project’s ESE benefits and enhancing CPP after the constructed facilities are in operation. This research contributes to a better theoretical understanding of CPP and provides strategies for productivity enhancement. This helps the client to achieve long-term ESE benefits and address post-construction management of public construction projects. The research also contributes to the body of knowledge in public construction project management and productivity research through supporting the paradigm shift from output towards outcome orientation and from focusing on the construction stage per se towards integrating construction with utilisation.