Research on values-based leadership in the construction industry poses interesting challenges. Park (1992) performed an empirical study to investigate the perceptual process of top managers of U.S. Construction firms and to examine its relationship with organizational commitment to innovation and internationalization. Kirk (2000) used a qualitative design to discover perceived leadership characteristics of construction project managers and relate the findings to literature review in several areas including leadership, psychology, and cognition. Lemark, Henderson, and Wenger (2004) used systems theory to explore organizational transformation among federal contractors. Welling (2003) did a case study on the history of public housing in Canton, Ohio, to measure the success of this social process as a means for community transformation.
Research by Morris (2000) on values-based leadership skills, values, and concepts studied the potential to improve the southeastern Florida construction industry by using VBL. This quantitative study used the criteria of the Malcolm Baldrige National Quality Award (2004) to study the executive perceptions on delivering value to customers, customer satisfaction, and creating employee partnerships. A study by Bell and Elkins (2004) also used the Baldrige criteria as the scorecard to assess leadership performance, especially the upward influences of ethics. A quantitative survey by Doran (2004) on ethical practices in the construction industry considered issues that the industry executives claim have the greatest impact on their business.
Based on these previous research studies, the author (Moylan, 2005) performed dissertation research on the applicability of utilizing the values-based leadership (VBL) theory to improve the construction industry. The research considered several critical items, including the discovery and assessment of construction executive perceptions, the use of the theoretical VBL construct of leadership that would appeal to a pragmatic audience, and the difficulty of introducing social changes intended to assist the construction industry.
Moreover, focusing on critical topics that interest the business sense of the respondents and using an accepted quality model to assess interest in a leadership construct, such as the Baldrige criteria, was demonstrated as essential. The subject research demonstrates a strong correlation between values-based leadership concepts, values, skills, and sound ethical conduct as critical performance components in the astute managing of constructed facilities projects. The results of the mixed methods research (quantitative and qualitative) support the main question addressed in the study, “Can the application of values-based leadership skills, values and concepts improve the processes of project management, especially within the construction industry?” The research showed that values-based leadership traits of trust, integrity, and people-orientation are critical to success in the construction industry.
In addition, the research exhibited the suitability of values-based leadership for improving the business partnerships within the construction industry (hypothesis) and the applicability of this approach to the leading of constructed facilities programs from concept through completion. The paper summarizes the background, process, and conclusions of the research study conducted by the author in support of his doctoral dissertation entitled, “Building Ethics in Construction Partnerships: An Analysis of Values-Based Leadership” (Moylan, 2005).
Background to the Study This section addresses important background information on values-based leadership (VBL) and its applicability to the construction industry. Review of Literature and Research on Values-Based Leadership The literature on leadership has evolved from a focus on the actions of a heroic leader to a broader view that considers leadership as an influential exercise in any interpersonal relationship and as a social function required to achieve organizational goals (Nirenberg, 2001). During the 1990s, the types of scholarly articles on leadership have transitioned from a strong emphasis on empirical research and some theoretical discussions to a balance of empirical and theoretical with some discussion on leadership methods. The concepts, values, and skills of Values-Based Leadership emerged from the path-goal theory and subsequently the transformational leadership approach that requires a strong trusting and ethical partnership between the leader and team members (Northouse, 2001). Core Principles of Values-Based Leadership Fairholm (1997) notes six centric principles of values-based leadership.
The first principle relates to the leader’s role in stakeholder development to transform himself, his followers, and the organization to focus on accomplishing the vision with creativity and enthusiasm. The second principle considers the leader’s role in creating this vision that epitomizes the core values of the leader and helps target the follower’s actions. The third principle relates how the leader creates a culture supportive of the core values that contribute to the team achieving its personal and group goals. The fourth principle of this sextet correlates the leader’s preparation for the personalized relationships with his or her followers that amalgamate the personal values, self-purpose, and methods with each other in a council-like, two-way exchange (as opposed to a one-way counseling exercise). The next principle requires the values-based leader to be a teacher of his or her followers, coaching on improving personal relationships, work skills, and attitudes to enable, empower, and energize them to greater performance. The sixth principle concludes with the values-based leader’s dual goal of producing high-performance and self-directed followers with an inherent loyalty to the organization and the group mission.
These six principles constitute the philosophical base for values-based leadership (Fairholm, 1998). Although values-based leadership is appropriate for many situations, it is most applicable to leading transformational change initiatives, which require changes in corporate culture and personal behavior to be effective. Value Confederations The hyper-competitive pressures, strains on resources, and emerging market requirements beyond the capabilities of many firms cause the nimble company to form closer relationships and alliances with its customers and suppliers. The benefits of improved coordination and information flow, disciplined product development, and system-wide solutions require access to vital knowledge and competencies not widely available.
A web-like constellation of the necessary expertise, suppliers, distributors, and customers is essential to creating the extended enterprise, with its own set of core values that will meld all of the talents to satisfy the overarching vision (Lei, 2003). The emergence of the “value confederation” of networked companies based on their shared values allows each entity to specialize on its core competencies, leveraging its strengths, and gaining advantage for its weaknesses (Evans & Wurster, 1997). From a values-based leadership perspective, this construct of a value confederation affords each component firm the opportunity to satisfy its individual needs and desires (building personal esteem) while working toward the group vision, goals, and mission (shared values). Moreover, the protective umbrella of the networked enterprise allows the assembled project team to share in the glory (gaining intrinsic goal satisfaction) without having to suffer the risks entirely on its own (creating meaningful team work). Trustworthiness, the fifth element of values-based leadership, forms the defining culture for managing and leading complex organizations.
Development of Values in the Construction Industry Research by Shaw (2001) on occupational segregation in the construction industry used both qualitative and quantitative techniques to explore both the social and the structural constraints of women entering apprentice programs. The study found that women who successfully entered the upper levels of their construction trades held to a “family of labor” core values set, which helped them to develop strong peer-support networks and to learn how to persevere despite obstacles. In contrast, the values of the male trade workers in the study showed their concern with job safety, employment security, and the opportunity to do quality work. Other research on the construction industry by Behrens (2002) studied innovative union restructuring and the use of modern management strategies in Germany. The research found that leadership-driven values among the members of German construction trade unions helped ferment the successful adaptation of business administration techniques in improving the union membership organization and in the collective bargaining. A reader survey (Schuler, 2004) of 410 remodelers on their sense of ethical practices in their sector of the construction industry noted the sample having varying degrees of independence in applying ethics in their business practices. Further, an analysis of the results showed “no broad outline, no umbrella, no format or system of ethics by which remodelers throughout the county agree to operate” (p.
This industry acceptability on the variations of valuing ethics in construction is prevalent in a study of construction arbitration cases (Rooley, 2001a). The design professionals (i.e., architects and engineers) follow established professional codes of conduct to retain their professional licensure granted through their state boards, serve the needs of their client over themselves, and satisfy the broader societal needs over the client position. On the other hand, the construction contractors, who obtain their work through competitive bidding, operate independently through an arms-length relationship with the owner and the designer. The study finds that the functions of the competitive business arena - dictated by contract language, governmental regulations, and industry practice - establish an efficient yet adversarial environment fraught with liability and litigation. In the face of this opposing values structure, the Construction Users Roundtable (2004) conducted a tripartite initiative to study ways to improve the “cost effectiveness of the organized construction industry through meaningful dialogue, collaboration, and mutual commitment to positive change” (p.
1) for all members of the construction industry. The initial recommendations of the CURT Tripartite Initiative which address extended overtime, absenteeism, and work disruptions shows a collaborative interest to form meaningful goals (values development) based on member interest and mutual satisfaction (shared values confederation). Another example of a recent construction industry initiative addressing issues that are problematic for owners and contractors alike (shared values confederation) is on the use of internet reverse auctions for construction services (Mechanical Contracting Education & Research Foundation, 2004). The improvements in construction procurement that will better serve the needs of all involved, according to the MCERF study, include well-defined scope of work, use of best-value pre-qualification criteria, transparency of auction procedures, adequate procedures, adequate procedures for redress of errors, adequate safeguards against other abuses, and policy reservations. Suitability of VBL for the Construction Industry A values-based leadership approach was found to be suitable for the residential construction industry (Morris, 2000). The overall construction industry is very keen on developing and maintaining a high degree of professional ethics in the variety of business dealings between all of the players (i.e., owners, architect/engineers, constructors) involved.
This includes but is not limited to the bidding and award scenarios, in meeting contractual obligations, and in resolving disputes (Rooley, 2001). This interest extends to developing ethics education in the construction education programs at the college level (Robertson, 1987). Industry trade groups, such as the Associated General Contractors (AGC), and professional associations, such as the American Institute of Constructors (AIC), actively participate in ethics in construction programs for their memberships (Gonchar, 2003). These construction ethics programs mirror the tenets of values-based leadership, including stressing the need for shared business and ethical values, integrity in the bidding and contracting processes, a common understanding of industry professional practice, partnering, the balancing of risks with financial rewards, and the building of long-term trusting relationships (Gill, 2004).
Moreover, a values-based leadership approach melds with the “integrity chain” of James (2002) that links integrity in the process, trust amongst the members, and repeat business based on satisfactory performance and quality, and a profitable relationship between each of the parties. Although technical knowledge and management expertise is important, it is essential for construction managers to exhibit the innate ability to interact effectively with people to execute the project (Rubin, et al., 2002).
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As inter‐organisational relations represent an increasingly important element in business the ability to build sustainable relationships becomes a key skill. To achieve sustainable relationships parties need to move from a low trust/low ethics base to a high trust/high ethics base in their relating. This paper uses data from a study into trust‐based partnering in the construction industry to demonstrate that ethics is integral to trust building. The data supports the proposition that ethical partnering, which is characterised by reliability, delivery of promises, open and honest communications, respect and reciprocity, and a willingness to act reasonably towards each other, is the most effective model for parties seeking to build sustainable relationships. Yaowu Wang, Haowen Ye, Geofrey Q. Shen and Yong Bai 2014 International Conference on Construction and Real Estate Management Kunming, China September 27-28, 2014 ICCREM 2014 Proceedings American Society of Civil Engineers Reston, VA, (2014)., (2014). 7/777, 10.10400552 Jinshuang Wang, Shuangliang Tai and Jing Li Factors on Trust between Owners and Contractors of Construction Projects in China, (2014)., (2014).
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