UNDERSTANDING AND MITIGATING INSTITUTIONAL COSTS ON GLOBAL PROJECTS

A DISSERTATION

SUBMITTED TO THE DEPARTMENT OF

CIVIL AND ENVIRONMENTAL ENGINEERING

AND THE COMMITTEE ON GRADUATE STUDIES

OF STANFORD UNIVERSITY

IN PARTIAL FULFILLMENT OF THE REQUIREMENTS

FOR THE DEGREE OF

DOCTOR OF PHILOSOPHY

Ashwin Mahalingam December 2005

© Copyright by Ashwin Mahalingam 2006 All Rights Reserved

ii

Certifications

I certify that I have read this dissertation and that, in my opinion, it is fully adequate in

scope and quality as a dissertation for the degree of Doctor of Philosophy.

_______________________________

Professor Raymond E. Levitt, Principal Adviser

I certify that I have read this dissertation and that, in my opinion, it is fully adequate in

scope and quality as a dissertation for the degree of Doctor of Philosophy.

_______________________________

Professor Stephen R. Barley

I certify that I have read this dissertation and that, in my opinion, it is fully adequate in

scope and quality as a dissertation for the degree of Doctor of Philosophy.

_______________________________

Professor W. Richard Scott

Approved for the University Committee on Graduate Studies.

iii

Executive Summary Global infrastructure projects that involve collaboration between participants from

multiple countries seem to result in unique challenges that are not faced on intra-national

projects. Many of these projects experience significant amounts of conflicts, leading to

delays and cost overruns that affect project financiers, sponsors and contractors. On

initial analysis, it seems that institutional differences – differences in taken-for-granted

rules, norms and beliefs that lead to regular patterns of behavior in societies – are the

reason for the observed problems. The construction industry in a given country is

governed by a set of institutionalized work practices, and these institutions differ from

country to country. On global projects, participants from different countries interact with

one another and their differing institutionalized practices come into conflict, frequently

leading to delays and cost overruns before the conflicts are resolved.

How can we improve the performance of these projects? Since very little literature

exists on institutional conflict, a first step would be to investigate this phenomenon and

understand the reasons for project failure. To this end, I conducted detailed case studies

on four international infrastructure projects – two in Taiwan and two in India. These

projects were performed under the aegis of local clients, with international engineers and

contractors and local laborers and subcontractors. Through my study I found four key

differences in institutionalized work practices that led to large challenges on these

projects. These were:

1. Conflicts due to differing perceptions in safety and quality standards

2. Conflicts regarding the degree of conformance of the works to the contract

specifications.

3. Conflicts regarding administration of the works

4. Conflicts regarding client-contractor relationships

The first of these conflicts – those due to safety and quality issues were present in both

India and Taiwan as the local laborers were unaccustomed to following the high safety

and quality standards that the international contractors demanded.

iv

In Taiwan, the clients’ organization was staffed with international expatriates and

therefore had no difficulties in working with the international contractors. On the Indian

projects, Indian civil servants staffed the clients’ organization and their fears of being

caught by the local anti-corruption unit led to behavior that was extremely bureaucratic

and rule-following. This in turn led to several conflicts (conflict types 2, 3 and 4 listed

above) with the contractors who were keen on advancing the works.

I observed most of these challenges only in India and not in Taiwan. Further these

incidents were not really unique to global projects. Similar conflicts occur in several

mono-cultural projects as well. However, the degree of severity of these issues was much

higher on these global projects.

Were these institutional challenges mitigated? Or did they result in large delays and

cost overruns? I observed several freelance professionals who hailed mainly from the

UK, working on these projects. These individuals typically spent a few years in a given

country working as freelance consultants (for both the clients and the contractors) and

then used their personal networks to find employment in another location. Since they

were not influenced by a ‘shadow of the future’ with a specific employer in any particular

country, the freelancers who worked with the clients acted as mediators or catalysts in

resolving the problems that arose with the contractors. These freelancers were not

professional mediators, and were hired chiefly for their technical knowledge! Yet they

used four strategies – circumventing existing processes, escalating issues to a higher

level, providing advice and suggestions, and changing the forum for discussion – in order

to resolve conflicts.

My research helps to extend theoretical knowledge on institutional theory and

provides insights into how institutional conflicts are resolved in project settings. My

research questions lead to the generation of a model of the issues that arise on global

projects and how conflicts are resolved. My findings can also provide practitioners with

high-level insights on how to manage global projects better.

v

Acknowledgements As I neared the completion of my PhD, I felt much as I had imagined the Hobbit Frodo

Baggins would have felt as he cast the One Ring into the smoldering crater of Mount

Doom, after having encountered several trials, tribulations and anxieties on his

monumental journey – not to mention the recent loss of one of his fingers to the vicious

jaws of Gollum just moments before the denouement of his quest. As the end approaches,

relief blends with well-springs of gratitude. Had Frodo written his memoirs on the shores

of Valinor, he would undoubtedly have devoted large sections of his chronicle to thank

the many people who aided him in his seemingly impossible quest – Hobbits, Elves,

Dwarves, Men, Wizards and Ents among them. Now it is my turn to attempt to

acknowledge the folk who aided me in my quest for a PhD.

Any journey such as this begins at home, in the Shire. I owe perhaps the deepest debt of

gratitude to my own hobbit-folk – the “Baggins’, Tooks, Brandybucks, Grubbs, Chubbs,

Bolgers and Bracegirdles” that are my family. I will start off with and would especially

like to thank Anusha, Amma and Appa for their unconditional encouragement, patience,

love and support for everything I have ever attempted to do. None of this would have

been possible without them. Next I would like to thank the Bilbos of my world – Mole,

Yashod chittappa, Ashok mama, Revathy manni and Dorai thatha for their indefatigable

attempts at the rather thankless and perhaps Sisyphean task of infusing me with some

worldly wisdom (“buddhi”). They persevered where mere mortals would have long since

surrendered. El, Avan and Vees added just the right amount of nonsensical amusement

that allowed me to retain my sanity, while in the eyes of Jana and Yechchi patti I could

almost do no wrong. I will be forever grateful to all of them. On to the Elves of

Lothlorien: Shankar, Usha, Nitya chithi and Sekhar mama who ceaselessly provided me

with ‘lembas bread’ (Sambhar, Rasam, Keerai, Kootu, Kesari and other Indian victuals)

for my long journey, and indulged in healthy debates over every international, national,

county and village cricket match that was ever played. Samyukta, Saankhya, Keshav and

Maya who transported me back to a lost world of innocence and bliss that I had all but

forgotten. My years in California would not have been the same without them. I would

like to thank Sethu thatha, Athai Jaya, Gopu mama, Charu, Sowmya, Kalyani perima and

vi

Krishna perippa, who influenced me through my formative years. Last but certainly not

the least I am especially happy and proud to thank Aarthi – the newest hobbit to join our

fold and one with whom I will embark on several journeys in the years to come – for her

understanding, belief and support towards my quest. I dedicate the entirety of this work to

all of these enchanted folk.

Any fantastical tale involves a Wizard (or three). My three committee members, a

veritable mixture of Gandalf the Grey, Yoda and Obi-Wan Kenobi, provided me with an

astonishing amount of wisdom, knowledge, guidance and support that helped me

decimate every Orc, Troll or Balrog that I encountered throughout my perilous quest. Of

these wise men, I would first like to thank my principal advisor Prof Ray Levitt for his

continuous support, confidence, comments and thoughts on my progress. I am convinced

I learnt more about research from him than I could have anywhere else. I would also like

to express my heartfelt gratitude to Prof Steve Barley and Prof Dick Scott who held aloft

the light of Earendil and illuminated my path as I navigated the webs of literature,

methodology, analysis and writing that all constitute a PhD. Even as modest as my work

might be, their guidance has helped it attain a quality that I did not think was possible at

the onset. Many Ents – wise and un-hasty beings – also liberally bestowed their wisdom

upon me, though they had no obligation to do so. Unplanned powwows with Monique

Lambert, Mark Triesch and Marc Ventresca often led to matchless insights that cleared

the cobwebs from my addled mind. Dr Julie Kim’s varied experiences and real-world

insights contributed greatly to both my research and to my own personal life. I also

benefited greatly through comments from Prof Pam Hinds, Prof Len Ortolano, Prof Gili

Drori, Prof Woody Powell, Prof Douglass North and Prof Avner Greif as well as from

CIFE’s and the NSF’s support of my research.

What of the Fellowship? Of the Elves, Dwarves and Men that accompanied me through

rain and snow? Tamaki, Ryan and JT – my office-mates and co-researchers whose work

closely complemented my own – provided me with much needed solace and company as

we spent long hours hunched over our terminals. Research is a social product, and I learnt

as much from talking with them, as I did from my own lonely vigils with my data,

vii

journals and books. I would also like to express my heartfelt thanks to Chris Brockmann,

Bijan, Mike Murray, Dana, Doug MacKinnon, Ray Buettner, Carol Cheng, Yan Jin, Marc

Ramsey, Peggy Ho, John Chachere, Rahinah Ibrahim, John Kunz, Renate Fruchter,

Martin Fisher, John Haymaker and all the other researchers who shredded my thoughts

and presentations, and helped me patch it all back together into something even better.

My journey was not merely metaphorical. Just as Frodo left the Shire and marched boldly

up the peak of lofty Caradhras, under and into the mines of Moria, through the woods of

Lothlorien, across the Marshes and even into the land of Morder, my quest too led me to

France and Germany, through Finland, across Taiwan and deep into India before its end.

I would like to thank Grant Stevens, Robert Boucher, Patrick LeConiac, Karl-Franz

Wambach, Alexander Moll, Lars Hubers, Christophe Reschke and others from Hines Inc.

for accommodating my early data collection efforts. Silke, Jurgen, Wenke, Mario,

Michelle, Micha, Carsten, Iduna, Xenia, Lilian and Amrei for their German hospitality.

Tapio Koivu, Antti Ainamo, Risto Tainio, Johanna Nummelin and Sampo Tukianen for

their thoughts and introduction to Finnish culture. To Simon Kwak, Masanobu Sakamoto

and Takuzo Sato for taking a chance on me and allowing me to visit projects in Taiwan. I

cannot forget the Rohirrim or the Riders of Rohan and the Men of Gondor from India

who came out in droves in my hour of need to provide me with data and insights that

have formed the bulwark of my dissertation. Tony Burchell, Steve Lowry and Mike

Thomas eased my passage considerably and did not shy away from relating the ‘real

stories’ that transpired on their projects. Chris Whiting, Stuart Turnbull and Iain Carter

were far more cooperative than I could have ever wished for given the constraints on

their time. Sanjay Kumar often provided me with lunch, enjoyable company and

analytical insights into the Indian mind that proved invaluable in the final analysis.

Hemant Bidiah graciously arranged for me to visit the project site and to talk to as many

people as I possibly could. Not only did Mr B.P Verma, Mr Kamal Nayan, Mr Rajeev

Chaudhary, Mr Rajesh Agarwal, Aashish Kumar, Mr Munz, Mr Wachter, Mr Bill

Berstrom, Mr Bob Batchelor, Mr Andre Czirr, Mr Din, Mr Ian George, Mr Peter Walsh,

Mr Adarsh Jain and several others on the projects in India and Taiwan provide me with

anecdotes and data, their warmth, interest and encouragement made field research a far

viii

more enjoyable proposition than I had ever imagined it would be. I would also like to

thank Prof Koshy Varghese, Prof V. Kalyanaraman and Prof K.N. Satyanarayana of IIT-

Madras, as well as Mr E.Sreedharan of the Indian Railways for making my visit to India

possible.

I would be amiss if I did not acknowledge the avocations that made my life at Stanford

such a pleasurable experience. My interests and desire to contribute to social

development and innovation were kindled through my interactions with BASES and

ESW. Through conferences, speakers and conversations with Jen, Sophie, Molly, Veena,

Kristof, Rebeca, Abhi, Leo, Andrew Ow, Marina and many others I spent delightful years

learning about the magic of social change. Dave, the EPATT kids and crew, and other

tennis players and coaches at Stanford taught me about tennis and patience and provided

me with some much-needed exercise. My “institutionalized values” have been molded

and shaped by my numerous friends and teachers from Vidya Mandir, IIT, Stanford and

other places – Sori, Bullu, Mukund, Sandhya, PM, Bak, Kailash, Anil, Trao, Deski,

Kiddo, Prosh, Kanaka, Neha, JT, Faith and Charlotte to name but a few of the multitude

that I alas do not have the space to acknowledge. I am eternally indebted to all these

people who have enriched my life and from whom I have learned so much.

Finally, every day of my life I have been grateful for all the fascinating things that I have

been able to see and do and for this I thank God.

In Yeats’ words, it was a ‘lonely impulse of delight’ that started my journey. Now the

quest is nearing completion and I leave it to you to ascertain the extent of its practical or

academic merit. However the scales of knowledge might value this work, it would not

have been possible without all of these people that I have mentioned above. Wherever I

turned I found support and inspiration, and through my meanderings I learned from all of

you what Bilbo Baggins captured in verse:

All that is gold does not glitter

Not all who wander are lost

ix

Table of Contents

Certifications.............................................................................................................................iii Executive Summary.................................................................................................................. iv Table of Contents.......................................................................................................................x Table of Figures ......................................................................................................................xiv List of Tables............................................................................................................................xv

Part 1 – Introduction: ........................................................................................................ 1 Chapter 1 – Practical Motivation.............................................................................................2

Preliminary Case Study......................................................................................................................... 4 Chapter 2 – Research Questions and Literature Review.....................................................10

Research Questions ............................................................................................................................. 12 Literature Review................................................................................................................................ 12 Theoretical Point of Departure – Institutional Theory: ....................................................................... 13 The Old Institutionalists and Old Institutional Theory in Sociology .................................................. 14 Neo institutional theory in Sociology: ................................................................................................ 16

Organizational response to institutional pressures ......................................................................... 20 Economics and Institutions ................................................................................................................. 24 The Relevance of Institutional Theory to Global Projects .................................................................. 27 Institutional Change and Conflict ....................................................................................................... 30 Gaps in the Application of Institutional Theory.................................................................................. 34 A review of other relevant theoretical literature.................................................................................. 37

Literature on Culture ...................................................................................................................... 38 Project Management literature ....................................................................................................... 40 International Business literature ..................................................................................................... 42 Development literature ................................................................................................................... 43

Concluding comment .......................................................................................................................... 49 Chapter 3 – Methodology and Research Settings .................................................................51

Selecting a Research Method .............................................................................................................. 52 Case Selection Process and Description.............................................................................................. 56 Projects in Taiwan............................................................................................................................... 60 Projects in India .................................................................................................................................. 62 Comparability of the Projects.............................................................................................................. 66 Tactical Considerations for Field Research......................................................................................... 69

Gaining Entry ................................................................................................................................. 69 Gaining Acceptance ....................................................................................................................... 71

Data Collection ................................................................................................................................... 75 General Approach .......................................................................................................................... 75 Selecting Informants and Conducting Interviews........................................................................... 76 Collecting Data Systematically and Explicitly ............................................................................... 77 Completing Data Collection........................................................................................................... 79

On-site Data Analysis ......................................................................................................................... 80 Data Analysis ...................................................................................................................................... 82 Concluding comment .......................................................................................................................... 88

x

Part 2 – Safety and Quality Issues................................................................................... 89 Chapter 4 – Safety and Quality Problems............................................................................. 90

The attitude of the local contractors and laborers towards safety ........................................................90 Reasons for the attitude of the local contractors and laborers towards safety......................................93 Attitude of the international contractors and consultants towards safety.............................................97 Reasons for the attitude of the international contractors towards safety..............................................99 The Consequences of differing perceptions of site safety..................................................................100 Quality Problems ...............................................................................................................................102 Reasons for the lack of Quality in India and Taiwan.........................................................................104 The Consequences of differing perceptions of site quality ................................................................106

Chapter 5 – Resolving Safety and Quality Problems ......................................................... 108 Strategies employed to improve safety and quality standards ...........................................................110

Educating the local workforce to be more safety and quality conscious.......................................111 Success of the strategy of Education.............................................................................................113 Strategy of Coercive enforcement.................................................................................................114 Success of the strategy of Enforcement ........................................................................................116

Changing the mindset of employees on Global Projects....................................................................117 Concluding Comment ........................................................................................................................119

Part 3 – Client Contractor Issues .................................................................................. 122 Chapter 6 – Introduction ...................................................................................................... 123 Chapter 7- Conflicts due to a Rules vs. Results Orientation.............................................. 125

The Clients’ Perspective ....................................................................................................................132 The Contractors Perspective ..............................................................................................................134 The perspective of the freelance expatriates working for the client...................................................136

Chapter 8- Conflicts due to a Bureaucratic Logic of Administration vs. Craft Logic of Administration....................................................................................................................... 140

Client as ‘Nosy-Parker’ or Mentor ....................................................................................................144 Providing More vs. Less Information to the Client............................................................................149 Delays in Decision Making................................................................................................................153 The Views of Different Project Participants regarding Administration of the Works .......................155

Clients’ View ................................................................................................................................156 Contractors View: .........................................................................................................................157 Freelance Consultant’s Views.......................................................................................................159

Conclusion .........................................................................................................................................160 Chapter 9 – Factors Driving the Behavior of the Indian Client........................................ 162

Origins of the bureaucratic Indian governance system ......................................................................162 The Effect of ‘Vigilance’ on the behavior of the Indian Client .........................................................165

Chapter 10 – Client-Contractor partnerships: A Dictatorial Regime or an Agreement of Equality? ................................................................................................................................ 176

‘Perform Extra Work for Free’ ..........................................................................................................177 Views of the contractors, the clients and the freelancers ...................................................................181

The Contractor’s Perspective: .......................................................................................................181 The Clients’ Perspective ...............................................................................................................183 The Freelancer’s Perspective ........................................................................................................185

Explaining the Clients’ Behavior and the cause of conflicts .............................................................188 Summary............................................................................................................................................190

Chapter 11 – Conclusion....................................................................................................... 192 Leverage held by the Client over the Contractor ...............................................................................193

xi

The Restricted Role of the Client’s Consultant................................................................................. 195 Concluding Comment ....................................................................................................................... 198

Part 4 – Institutional Differences on Global Projects .................................................. 200 Chapter 12 – The Nature of Institutional Conflicts............................................................201

Absence of Client-Contractor conflicts on the projects in Taiwan.................................................... 202 The Nature of the Client-Contractor issues in India.......................................................................... 207 National Differences on Global Projects........................................................................................... 210 Experience of the International Contractors:..................................................................................... 215 Technological Similarities ................................................................................................................ 218 Relying on local intermediaries......................................................................................................... 219 A summary of the analysis of Institutional Differences on Global Projects ..................................... 220 Answering the Research Questions................................................................................................... 221

Chapter 13 – Freelance Expatriates: An Intermediary Community ................................223 Motivations of the freelancers........................................................................................................... 226 How they Find Jobs........................................................................................................................... 228 Families and Lifestyles ..................................................................................................................... 231 The Official Role of the Freelance Expatriates ................................................................................. 234 Structural position and its influence on the roles of the freelancers.................................................. 236 Establishing Trust with the Clients ................................................................................................... 238 Concluding comment ........................................................................................................................ 240

Chapter 14 – Conflict Resolution Strategy 1: Circumvention...........................................241 Strategic Circumvention of the Process ............................................................................................ 241 Using Authority to Eliminate Bottlenecks ........................................................................................ 247 Concluding comment ........................................................................................................................ 252

Chapter 15 – Conflict Resolution Strategy 2: Escalation...................................................253 The Nature of the Managing Director ............................................................................................... 254 Escalation by the Freelancers............................................................................................................ 259 Concluding Comment ....................................................................................................................... 263

Chapter 16 – Conflict Resolution Strategies 3 and 4: Normative Suggestions and Changing the Forum ............................................................................................................. 264

Normative Suggestions ..................................................................................................................... 264 Postponing or Changing the Forum .................................................................................................. 270 A Discussion of the freelancers’ use of the four strategies ............................................................... 275 Freelancers as Mediators................................................................................................................... 282 Frame Alignment and Mobilization Strategies used by the freelancers ............................................ 286 Concluding comment: Unintended consequences of the freelancer’s actions:.................................. 289

Chapter 17 – Conflict Resolution in the absence of the freelancers..................................291 Absence of Freelancers ..................................................................................................................... 291 Presence of Freelancers with low levels of influence ....................................................................... 294 Local Dispute Mediators ................................................................................................................... 298 Concluding Comment ....................................................................................................................... 301

Chapter 18 – Narratives of the Projects in India................................................................303 Lifecycle of project X ....................................................................................................................... 303 Life cycle of Project Y ...................................................................................................................... 308 Conclusion – Comparing project X and project Y ............................................................................ 310

xii

Part 5 – Contributions and Conclusion ........................................................................ 313 Chapter 19 – Contributions and Conclusion....................................................................... 314

Theoretical Contribution 1: Ethnographies of Global Projects ..........................................................314 Theoretical Contribution 2: Answering my research questions – Insights into the problems that beset global projects....................................................................................................................................315 Theoretical Contribution 3: Empirical Validation of existing literature on Institutional Conflicts....319 Theoretical Contribution 4: Advancement of theoretical knowledge on institutional conflicts.........323

Contributions to Organizational Studies and Social Movements Research ..................................327 Theoretical Contribution 5: Studying institutions in a project setting ...............................................329 Theoretical Contribution 6: Extension to the domain of global projects ...........................................332 Practical Contribution 1: Contributions to Practitioners ....................................................................335 Practical Contribution 2: Implications for Policy ..............................................................................338 Practical Contribution 3: Contribution to Project Managers..............................................................339 Summary of Contributions.................................................................................................................339 Concluding Comment ........................................................................................................................341

Appendix A............................................................................................................................. 344 Appendix B............................................................................................................................. 351

Bibliography........................................................................................................................... 358

xiii

Table of Figures

FIGURE 1.1: Growth in the international Construction sector …………………………..2

FIGURE 3.1: Projects in India …………………………………………………………..59

FIGURE 3.2: Projects in Taiwan ………………………………………………………..60

FIGURE 3.3: Consultants’ Organization ………………………………………………..64

FIGURE 13.1: Nationality of Spouses ………………………………………………...232

FIGURE 13.2: Location of Spouse ……………………………………………………233

FIGURE 13.3: Location of Children ………………………………………………….234

FIGURE 16.1: Relative frequency of freelancers’ strategies …………………………276

FIGURE 16.2: Relative frequency of use of mediation strategies by the project director

and the design manager ………………………………………………………………..278

FIGURE 16.3: Variation of intervention strategy based on the issue …………………280

FIGURE 19.1: Process of Resolution of Institutional Conflicts on Global Projects ….317

xiv

List of Tables

TABLE 12.1: Views of Freelancers in Taiwan ………………………………………..203

TABLE 12.2: Views of Freelancers in India ………………………………………..…204

TABLE 19.1: Contributions to Institutional Theory ………………………………...…340

TABLE 19.2: Contributions to a Theory of Global Projects ……………..……………340

TABLE 19.3: Contributions to the Practice of Global Project Management ………….341

APPENDIX A: List of Impasses in meetings in India that were solved using the four

strategies………………………………………………………………344

APPENDIX B: List of Impasses in meetings in India that were not resolved …...……351

xv

Part 1 – Introduction: Motivation, Literature Review and Research Questions

1

Chapter 1 – Practical Motivation

We live in the age of globalization. To some degree, every generation can claim to have

lived in such an age. Nevertheless, it is true that in today’s world, there is a rapidly

increasing amount of global travel and trade in comparison to years past. As travel

becomes faster and cheaper, as language barriers are broken, as markets open up and as

global awareness increases, there is an increased intermingling across countries, cultures,

races and religions for both commerce and pleasure. On the one hand, international

organizations such as the World Bank are engaged in large-scale economic development

and re-development activities in Asia, Africa and Latin America; on the other hand,

commercial enterprises in the information technology, manufacturing, construction and

tourism sectors are involved in a growing number of projects or partnerships overseas.

Since most of these projects involve the creation of facilities, infrastructure or

communities, the volume of activity in the international construction industry has rapidly

increased. Fig 1.1 below gives an idea of the magnitude of this trend.

0 20 40 60 80

100 120 140 160

1995 2001 2002 2003 Year

Inte

rnat

iona

l C

onst

ruct

ion

Rev

enue

s

for t

op 2

25 c

ontr

acto

rs ($

B

illio

ns)

Figure 1.1: Growth in the International Construction Sector

2

Despite the volatility of the international construction market in the late 90’s as a result of

the Asian financial crisis, this current data suggests that the volume of international

construction is steadily on the rise. Looking across the last decade, the top 225

international contractors earned $139.8 Billion in revenue in 2003 (Reina and Tulacz

2004) – 53% more than the $92.2 Billion that they earned in revenues in 1995 (Reina and

Tulacz 1996). This increase in volume of international construction has been particularly

rapid over the past few years. In 2002, the top 225 international contractors earned

$116.5 Billion in revenue (Reina and Tulacz 2003), a 9.4% increase over the $106.5

Billion that they earned in 2001(Reina and Tulacz 2002). By 2003, this figure grew

another 21%. This trend does not show any immediate signs of abating, and large

construction firms such as Bilfinger Berger and Hochtief AG of Germany intend to

generate at least 50% of their overall revenue from foreign projects in four years time

(Reina and Tulacz 2003).

With these bold ventures however, comes a new set of challenges. Economic

feasibility studies are easily done to justify an international venture. In retrospect, these

feasibility studies can be self serving (Perkins 2004) and seldom serve as a viable

roadmap or a plan for implementation. In the immortal words of T.S. Eliot “Between the

conception and the creation … Falls the shadow”. Professionals worldwide bemoan

‘cultural differences’—the ‘surprising’ behaviors of their colleagues, from other

countries, and the regularity with which plans and schedules are derailed.

Anecdotes and case studies suggest that even routine, standardized global cross-

national construction projects result in unexpected problems that contribute to

confusions, delays and increased costs. Informal estimates by multilateral banks indicate

3

that fewer than 30% of their developmental projects in underdeveloped countries fully

achieved their planned objectives. Similar stories abound from professionals who have

had extensive international experience1. Projects performed in South America, Africa,

Asia and Europe with international participation all seem to have encountered a set of

unique problems and costs that were frequently a substantial fraction of the total project

costs. In some rare cases however, the presence of different cultural viewpoints on a

project actually led to creative solutions and cost savings.

Preliminary Case Study

In order to clarify why these global projects were beset by extra unanticipated costs, I

decided to conduct a short case study on a global construction project. The objective was

to gain a preliminary understanding of the kinds of problems that exist on global

construction projects. An American real estate development firm volunteered to be my

case study partner. This firm, Kattadam Inc2 is a successful and highly respected real

estate developer in the USA. Founded in the 1950s as a one-man office, the company

started its US expansion in the 1960’s, and established offices in San Francisco, New

York, Chicago and a host of other metropolitan cities in the US. In the 1970’s, Kattadam

took its first steps overseas and established offices in Mexico and Canada. Now one of

the world’s largest real estate firms, Kattadam’s portfolio includes premier corporate

headquarters, mixed-use centers, industrial complexes, master-planned resorts and

1 Based on interviews with Hernan Martinez, Mark Triesch, Greg Shipp, Dr. Willem Villet, and Dr. Julie Kim. 2 The names of the firm and its employees have been disguised for the sake of confidentiality

4

residential communities. Kattadam has successfully developed over 700 projects, and

currently controls assets valued in excess of $13 billion.3

Waves of radical political and economic change swept over Europe during the

early 1990’s. Predominant among these events was the fall of the Berlin wall and the

unification of the Eastern and Western German states. Kattadam anticipated that the

decline of the specter of communism would lead to redevelopment and opportunities in

the field of real estate, and decided to open overseas operations in Europe. Berlin was a

logical point of entry and the first overseas office was opened in 1991. In a few years,

offices were opened in Moscow, Paris, London, Frankfurt and Prague. As I spoke to

executives from Kattadam and their local partners, it became clear that Kattadam’s

international development projects often encountered several challenges and difficulties.

One theme that I observed in the design phase, for instance, was a clash of views

regarding some of the aesthetic features of buildings such as the design of the façade, the

interior etc. An anecdote about glass windows in high-rise buildings in one of Kattadam’s

projects in Germany illustrates this issue.

In the USA, most high-rise buildings with glass façades have windows that are

‘inoperable’ – they cannot be opened and closed. Air conditioning systems control the

temperature within the buildings. This however is not the approach that is typically

adopted in Western Europe. In these places, most windows in high-rise buildings are

‘operable’ – they can be opened by the occupants of each room to let in outside air,

depending on the ambient temperature. Air conditioning systems are less used. This

difference led to problems on the project. The American expatriates and architects

preferred to design buildings with non-operable windows. In contrast, the European 3 Most of this information was obtained from Kattadam’s marketing brochure

5

project managers were afraid that they would lose respect among their peers if they

constructed an ‘ugly’ building with non-operable windows. In addition, they pointed out

that even if such a structure were built, no Germans would be willing to lease it. One of

the American expatriate managers working on the first Kattadam project in Berlin (a

mixed-use facility) described this scenario:

Kattadam has some specific expectations for system performance on the buildings that they build. Some of these expectations are different in US and Germany. For instance, in the US buildings are regulated almost completely by mechanical systems. In Germany there is a more passive approach to energy usage and consumption, substituted by operable windows that you can open—a more natural approach. In the US buildings are taller in harsher conditions and there is a push towards creating totally air-conditioned environments. The process of bringing the Germans to see the American point of view and vice versa was a challenge. It would have been foolish to build a US building in Germany – there are examples of this that failed! The real goal is to find the best product by combining local architectural and engineering knowledge, local client expectations, international experience and international operating questions. So even before the drawings were made, people sat around the table and talked about what the project would look like. Kattadam came from an American perspective, trying to create an American building in Berlin. We were wrong. So in contrast to the opening stance of, “We will not have these goddamn operable windows,” we do have them since it’s the right thing to have. It was tough to push ourselves out of our box. Companies get into their sweet spot and perform, perform, perform, but when you get into another environment you are forced to come out.

The American representatives initially tried to force their aesthetic views on their German

colleagues and were rather inflexible in their stance. The German representatives met this

attitude with hostility, and this led to altercations on the project. After almost a two-

month delay, the Americans finally came to the conclusion that German practices were

best suited for buildings in Germany. They gave in to their local partners’ views and the

project was allowed to advance.

6

Kattadam encountered several similar problems in its other projects in Europe. In

general, construction work practices and the allocations of project roles among team

members were different in Europe versus the USA, and this led to different

understandings of how the work was to be performed. In a joint global project, these

opposing viewpoints often conflicted, leading to delays and extra costs.

The findings from this case study convinced me that global projects do encounter

significant costs that are not present on mono-cultural projects, due to the differences in

cultures and work practices among the various groups involved. Although minor delays

and extra costs occur on many projects, global projects appear to have more severe

problems that lead to delays and costs far in excess of those specified in the project plans

and estimates. Analyzing and remediating the causes of these problems can help all

stakeholders (international construction companies, host governments, local firms,

multilateral banks, consumers) to be more successful in achieving the planned outcomes

of their global projects.

Many organizations (international construction firms in particular) realize that

global projects do involve extra challenges. To some extent, they try to provide “inter-

cultural” training to their employees by exposing them to various rituals and symbols that

are used in various parts of the world. Companies have recently sprung up that claim to

impart cross-cultural training. As beneficial as this sort of training in culturally

appropriate ways to meet, greet, eat, etc., might be, it is usually insulated from a specific

project context. As a result, this approach ignores problems that arise in a given industry

in implementing specific product features (e.g., operable windows) or specific work

practices (e.g., requiring architects to develop complete working drawings).

7

Some firms draw on past experiences to identify problems that they need to

address and train their employees to overcome these problems successfully. Such training

is clearly useful in combating analogous situations that may arise on a future project.

However, with changing political, social, technological and economic conditions, old

problems fade away and new ones arise. Unless there is a more fundamental—and hence

more generalizable—way to identify the kinds of issues that will crop up on global

projects, firms that participate in such activities can never be totally prepared. As it

stands, many firms have some conception of the risk and rigor involved in international

projects, but they are still unable to predict accurately where problems and challenges

may arise, what kind of a toll these events will take on the project, and how one might be

able to combine diverse experiences and skills to create benefits synergistically on the

project.

In summary, I now wish to make a claim:

Claim: Global projects (projects that involve participants from more than one culture),

incur a set of ‘costs’ that are not present on local projects. These ‘costs’ (time, money,

quality) are often so high that organizations as well as the community that they work in

could benefit greatly if the underlying nature of these costs could be determined,

understood and predicted ahead of time. However, this phenomenon is not well

understood by practitioners. Hence, there is something interesting here that is worth

investigating.

Given the volume of international construction activity and given the severity of

the problems that preliminary anecdotal evidence uncovered, there seems to be a

8

significant need and scope for theoretical advancement as well as business process

improvement in the international construction sector. Since the current frontiers of

theoretical and practical knowledge do not adequately address the problems that occur on

global projects, I was motivated to investigate the problem at hand further and to seek

knowledge that would improve the performance of global projects.

Having indicated my practical motivation for studying the issues that arise on

global projects, I next turn my attention to the theoretical literature, and investigate how

this literature helps explain or predict the issues that arise on global projects. I then

identify gaps that exist within this literature pertaining to my problem, and state research

questions that are aimed to fill these gaps. I then enter the field to gather data that can

begin to answer these research questions. Through this process I hope to be able to

further theoretical and practical knowledge on global projects, and to identify ways in

which the numerous conflicts and issues that arise can best be predicted, managed and

mitigated.

9

Chapter 2 – Research Questions and Literature Review As I analyzed the Kattadam case study discussed in Chapter 1 and tried to understand the

nature of the problems involved, I was struck by one particular quote from a French

Project Manager in the Kattadam organization. This individual had worked previously in

the USA and understood American practices better than most of his compatriots. He

observed:

It takes time to get the people you hire to do what you want – you think they have understood what you are asking, but they didn’t because they are so exposed to their habits that they don’t change. It’s very difficult to get the French company to do it the American way.

This represents an integral part of the problem that most companies face on international

projects. Two different ways of thinking and acting are often in conflict and this is what

leads to the observed problems.

The concept of ‘institutions’ has gained widespread acceptance by sociologists,

economists and political scientists. This concept helps define and describe the problems

encountered on global projects. Each of the academic disciplines mentioned above has its

own conceptualization of the term ‘institutions’. I will use a definition that combines the

most prevalent views held by economists and sociologists.

Merging concepts elaborated by Greif (2005) and Scott (2001), I define

institutions to be ‘a set of norms, rules and values that help generate a regularity of

behavior’. Institutions influence groups of actors and lead to a regularity of behavior

among actors in the domain of influence of the institutions. This regularity of behavior

may not necessarily be completely rational or consistent – it is often arbitrary. For

example, legal traffic rules are institutions that lead to a regularity of behavior wherein

10

people drive on the right side of the road in the USA and parts of Western Europe. In

other countries, a different instance of this institution may lead to a different regularity of

behavior wherein people drive on the left side of the road.

Using this definition of the term ‘Institutions’, I now make the following subclaim

based on my preliminary case studies and observations:

Subclaim: Problems on Global Projects arise due to institutional differences between

participants from different nations. Each nation (or other social grouping) has a set of

institutions. National institutions create specific ‘logics’ that lead to regularities of

behavior. Differences between the institutions or institutionally specified behaviors of

team participants drawn from different nations lead to problems, since these differences

must be reconciled in order for interdependent joint activity to be successful.

The main thesis here is that institutions underline differences among nations, as

well as industries, firms and individuals. For instance, the construction industry in the

USA has a certain set of institutions (e.g. local regulations, industry organization,

contracting practices) that regularize participant behavior in a certain way. The

construction industry in another country may have different instances of the same

institutions (local rules, industry organization, contracting practices, etc.) that lead to

different regularities of behavior compared to that present in the USA. The construction

industry in another country may also have different institutions as compared to the USA

(e.g. the expectation and acceptability of bribery). Due to differences in the behavior

specified by these institutions, people tend to act in different ways across countries. On

an international project, the presence of individuals and firms from different nationalities

11

will lead to the presence of different institutionalized behaviors on the part of project

participants. Reconciling these differences and/or determining how to act in the face of

unfamiliar, “foreign” institutions may lead to misunderstandings and conflicts, extra work

to resolve them and, hence, extra costs to a project in terms of time, money or quality.

Research Questions:

Based on my subclaim, I would like to pose three research questions:

What are some of the kinds of institutional conflicts that occur on Global

Projects?

How are these conflicts resolved?

How can we better organize and manage global projects?

By answering these research questions, I hope to gain some insight into the source of

conflicts on global projects, how these conflicts are currently resolved, the ways in which

differences in institutionalized behaviors between project participants affect their actions,

interactions and task characteristics on projects, and the institutional costs that result. By

understanding some of the drivers behind institutional costs on global projects, I expect to

advance knowledge in this field by providing a testable model of institutional conflicts on

projects. I will also build on this model to suggest some managerial interventions that

have the potential to mitigate institutional conflicts on global projects.

Literature Review:

To answer my research questions, I first review aspects of the theoretical literature that

pertain to the challenges observed on global projects. The object of this review is to

12

gauge the extent to which the theoretical literature can provide answers to my research

questions, and to identify gaps in the theory that can then be filled by going into the field

to observe participants on global projects in work settings.

As I have elaborated briefly above, the concept of ‘Institutions’ appears highly

relevant to the problems that I wish to study. Further, in a book titled ‘Organizational

theory and the multinational corporation’ (Ghoshal and Westney 1993), Doz and

Prahalad discuss the applicability of various organizational theories to describing

multinational corporations (MNC’s). They conclude that institutional theory is possibly

best suited to the study of MNC’s engaged in global endeavors (Doz and Prahalad 1993).

Although there are significant differences between MNC’s and global projects – for

instance MNC’s remain in existence far longer than a single global project and thus have

different goals, time constants and measures of success and failure – both encounter

many of the same challenges. The presence of different nationalities and the interaction

between the local environment and foreign participants are some of the obvious

similarities. Since institutional theory seems particularly relevant to my research

problems, I will first review this theory as my primary theoretical point of departure.

Theoretical Point of Departure – Institutional Theory:

Institutional Theory has given rise to different schools of thought. In this section, I will

briefly review three of these streams – the Old Institutionalist theory, the Neo-

Institutionalist theory and Institutional theory in the field of economics. My aim is not to

provide comprehensive coverage of these vast literatures, but merely to introduce these

13

schools of thought broadly before I delve into specific sub-topics that are more relevant

to my research questions.

The Old Institutionalists and Old Institutional Theory in Sociology

Several scholars have noted and studied the concept of institutions from as early as the

late 19th century. Cooley ([1902]1956) and Hughes (1939) have discussed how individual

behavior is influenced by social structures or institutions such as customs, the

government, religion etc, and how these institutions are perpetuated by the habits of the

very individuals whom they affect. Scholars such as Marx, Weber and Durkheim have

looked at the cognitive schemas, norms and rules that are the product of human society

and which provide a shared framework that guides human behavior in economic activities

(e.g. Marx [1844]1972, Durkheim [1893]1949, Weber[1924]1968). More recently Berger

and Luckmann (1967) defined institutions as a ‘reciprocal typification of habitualized

actions by types of actors’. Institutions regulate the behavior of actors, while, at the same

time, are being (re)created and (re)constructed by the actors themselves. Berger and

Luckmann stress the formation of cognitive institutional frameworks. However as Scott

(2001) points out, this early work on institutions focused on institutional structures and

was rarely applied to organizational forms or fields.

From an organizational viewpoint, the earliest school of thought is what is now

called ‘old institutionalist theory’. The old institutionalists questioned the rational-actor

models of organization. Merton (1936) pointed out that rules within bureaucratic

organizations often interfered with the organization’s purposes. Selznick (1957)

described how taken for granted, institutionalized processes were created within an

14

organization that reflected the organization’s history, its people and vested interests

within the organization, in addition to environmental factors. According to Selznick

(1957), actors institutionalize processes and practices within a firm. If these beliefs do not

fit in with environmental norms and actors’ beliefs, they are reconstructed over time.

Institutions thus contribute to an organizations ‘character’. Stinchcombe (1968)

developed these ideas further by elaborating how powerful actors perpetuated these

institutional structures. The old institutionalists espoused a ‘duality’ in their conception of

institutions. Institutions are created by actors within a domain (an organization). These

institutions then influence and regulate the behavior of actors.

Recently, a new and complementary school of thought – the ‘neo-institutional’

approach – has arisen to study institutions and organizations. Although both the old and

newer, more contemporary institutionalists question the rational-actor model, indicate

that institutions limit the choices available to organizations, acknowledge the role that the

environment plays in shaping institutions and organizational behavior and stress the role

of culture in shaping organizational reality, there are some differences between older and

newer pieces of institutional scholarship. When discussing old institutionalism,

Stinchcombe observes that ‘Institutions were, in the first instance, created by purposive

people’ while in the neo-institutional school institutions ‘manufacture themselves by

opaque processes, are implemented by diffusion, are exterior and constraining without

exterior people doing the creation or the constraining’ (Stinchcombe 1997). According to

Powell and DiMaggio (1991), some of the differences are that the old institutionalists

conceptualized the organization as a discrete entity embedded within and tied to its local

community, while the new institutionalists hold a more subtle view of environmental

15

influence. According to the neo-institutionalists, the environment creates a lens through

which actors view the world. Organizations here are open systems (Scott 1998) that are

present in and influenced by loosely bounded organizational fields. Further, while old

institutionalists such as Selznick (1957) spoke about organizational variety as a result of

institutionalized process, neo-institutionalists stress conformity and homogeneity between

organizations (DiMaggio and Powell 1983). Old institutionalists studied how actors’

responses were shaped by norms and attitudes (Selznick 1957), while neo-institutionalists

focus on taken-for-granted cognitive schema, routines and scripts (Meyer and Rowen

1977). Also, while old institutionalists focus on the role of informal structures such as

coalitions in order to describe how formal organizational structures do not completely

align with the organization’s goals, the neo-institutionalists describe irrationality existing

within the formal structure itself (Meyer and Rowen 1977, DiMaggio and Powell 1983).

However, despite these differences, old institutionalism is far from being a mistaken

approach and in many ways complements and informs the neo-institutionalist theories.

As Scott (2001) notes, one can observe a certain amount of continuity between the old

and new theories. Next I will very briefly review the neo-institutional literature in

organizational sociology.

Neo institutional theory in Sociology:

The neo-institutionalist approach has tended to conceptualize institutions as exogenously

affecting the behavior of actors (Barley and Tolbert, 1997). The neo-institutionalists

conceptualize institutionalization as a ‘process by which certain relationships and actions

come to be taken for granted, and a state of affairs in which shared cognitions define

16

what has meaning and what actions are possible’ (Zucker 1983, Powell and DiMaggio

1991). Similar to old institutionalism, this theory was also developed in response to

certain practices, procedures and structures that could not be explained by prevailing

rational-actor theories (Goodrick and Salancik 1996). In its early years, this theory

emphasized conformity towards institutions, homogeneity between organizations and

taken-for-granted beliefs that the environment imposed on actors, thus regulating their

behavior. Drawing on ideas from Berger and Luckmann (1967), Meyer and Rowen

(1977) identified institutions as sources of formal structure, while similar work by Powell

and DiMaggio (DiMaggio and Powell 1983) saw organizations as enactments of

rationalized myths imposed by the environment. Socially constructed schemas, norms

and rules constrained the ways in which actors could act.

Early neo-institutional thought leaders identified legitimacy as an issue of

concern to organizations. Most organizations adopt institutionally specified forms and

behaviors in order to appear legitimate within their environment. Meyer and Rowen

(1977) predict the emergence of ‘loose coupling’—de-coupling internal processes with

observed form or structure—in situations characterized by high uncertainty. DiMaggio

and Powell (1983) discuss Isomorphism—the tendency for firms to adopt similar

structures in response to coercive, normative or mimetic forces. Organizations thus start

to resemble one another in structure and behavior and are faced with large penalties if

they attempt to deviate.

What are these institutions composed of? According to Scott, “a firm’s action is

seen not as a choice among an unlimited array of possibilities determined by purely

internal arrangements, but rather as a choice among a narrowly defined set of legitimate

17

options determined by the group of actors composing the firm’s organizational field. The

form of this influence is manifested in institutions: rules, norms and beliefs that describe

reality for the organization, explaining what is and what is not, what can be acted upon

and what cannot” (Scott, 2001). These rules, norms and beliefs (or regulative, normative

and cultural-cognitive elements) are the three ‘pillars’ (Scott 2001) or building blocks

that underlie institutions and regularize the behavior of individuals and organizations.

Different theorists have paid attention to each of these pillars. Several economists have

stressed the regulative elements (e.g. Williamson 1975, North 1990), the old

institutionalists focused on normative elements (e.g. Selznick 1949) and recent

sociologists have emphasized the cultural-cognitive elements (e.g. Meyer 1994,

DiMaggio 1991).

How and why do these institutions arise? One argument is that organizational

behavior is bounded and cannot always be completely rationally determined by an

organization (March and Simon 1958). At the organization level, ambiguity and cognitive

limitations hinder the ability of individuals and organizations to attend to all aspects of

their environments (March and Olsen 1976, Simon [1945] 1997). Institutional logics help

to remedy this problem by focusing the attention of organizational actors on a limited set

of issues and solutions that are consistent with the prevailing logic (Thornton & Ocasio

1999). Institutional logics define the norms, values and beliefs that structure the cognition

of actors in organizations and provide a collective understanding of how strategic

interests and decisions are formulated (DiMaggio 1997; Jackell 1988).

Since most of the early neo-institutional ideas pointed to stability, legitimacy and

homogeneity as a result of institutional pressures, a lot of early research focused on the

18

diffusion of institutional forms and models (e.g. Tolbert and Zucker 1983; Baron, Dobbin

and Jennings 1986), and the persistence and maintenance of institutions.

Institutions and institutionalized practices are difficult and slow to change. Greif

(1989) adopts a game theory perspective and goes so far as to argue that institutions

generate a Nash Equilibrium outcome in which no party can enhance its payoff by

unilaterally deviating from the equilibrated set of institutionalized practices—e.g., by

driving on the opposite side of the road from everyone else (see discussion of economic

views of institutions in next section). This leads to considerable resilience of the

institutional status quo—bringing about change requires either a high degree of internal

consensus for change or an external disturbance that changes the payoff structures for

participants in the game.

Work by Zucker (1977), Stinchcombe (1965), Miller (1994) and Van de Ven and

Garud (1994) among others, also pays particular attention to organizational inertia,

institutional maintenance and how institutions persist and are difficult to change. Further,

the more an organization is embedded within its environment, the more likely it is to be

successful, while, if an organization encounters a new environment and does not integrate

or embed itself within this environment, success is less likely to occur (Baum and Oliver,

1992).

Some scholars have also analyzed the process of institutional creation. Suchman

(1995a) describes conditions that give rise to new institutional forms. Selznick

empirically examines the evolution of the Tennessee Valley Authority (Selznick 1949)

while Vaughn (1996) discusses the development of a set of routines and decision making

procedures at NASA. Institutional analysis has also been applied at a variety of levels

19

from the world system (e.g. North and Thomas 1973) to the organizational field (e.g.

DiMaggio 1991), to the organization itself (e.g. Williamson 1975).

More recently, several scholars have noted that the early neo-institutional works

stressed far too heavily on ideas of isomorphism, stability and conformity, at the expense

of choice and innovation (Scott 2001, DiMaggio 1998, Powell and DiMaggio 1991).

Actors can exhibit some amount of ‘agency’ and rational choice when influenced by

institutional processes. As Barley and Tolbert (1997) point out, some of these contentious

issues are addressed by the concept of structuration (Giddens 1979, Sewell 1992) which

states that although behavior is grounded in social structure, this structure is reproduced

and can be altered by participants’ behavior. Barley (1986) empirically justifies these

claims. Institutions are thus not as static as the early theories indicate and questions still

remain as to how institutions are deconstructed, how new schemas can overcome existing

logics, and the variety of ways in which organizations can choose to respond to

institutional pressures. Of late, neo-institutional scholars have done much work in these

areas of agency and responses to institutional forces.

Organizational response to institutional pressures

How do organizations react to institutions? A survey of the neo-institutional literature

yields many answers to this question. Powell and DiMaggio argue that concerns for

legitimacy and efficiency cause organizations to become isomorphic with other powerful

or successful organizations within their environment, so that homogeneity might result

(DiMaggio and Powell 1983). However, as mentioned earlier, Meyer and Rowen discuss

the possibility of loose coupling, wherein the organization proffers a veneer of

20

conformance to the institutions, whereas its actual practices may vary considerably from

institutionalized norms (Meyer and Rowen 1977). In a similar vein, other scholars argue

that organizations conform to institutions, but exhibit their own agency wherever the

institutions are most flexible. In other words, they propose an idea of agency within

institutional bounds (Goodrick and Salancik 1996). Still others posit that rather than

blindly responding to institutional pressures, organizations might also go through a

‘sensemaking’ process and try to rationalize and construct a framework for their

responses (Weick 1995, Daft and Weick 1984). Scott (2001) notes that organizations are

not only affected by institutions, but in turn also help shape these institutional forces.

In her work on strategic responses to institutional processes, Oliver (1991) posits

that the way an organization responds to the environment depends on factors such as

interdependence with the environment, the need for legitimacy, concerns of efficiency

etc. Organizations that are highly dependant on their environment and seek legitimacy

will need to accept or conform to their local institutional environment in order to succeed.

However organizations that are more self-sufficient and that do not need to be viewed as

legitimate may compromise, avoid, defy or even manipulate institutions in order to

perform efficiently (Oliver 1991). This formulation helps identify a set of possible

responses that an organization may adopt within the context of a global project,

depending on its needs. Goodrick and Salancik (1996) however warn us that although

organizations can exhibit agency and make strategic decisions, they are still influenced

by cultural and institutional forces.

Of the responses that Oliver delineates, the ‘defy’ and ‘manipulate’ responses are

perhaps most relevant to my research, since institutional conflicts of the sort that I

21

observed with Kattadam occurred when organizations that entered a foreign environment

did not accept the local institutions and attempted to defy them or manipulate them for

their own benefit.

Many other scholars have provided empirical and theoretical confirmation for

Oliver’s arguments. Friedland and Alford (2001) acknowledge the construction of

institutional compromises, especially when frameworks are contested. D’Aunno and

colleagues (1991) in their study of the medical field and Alexander (1996) describe how

organizations find compromises amidst competing logics in the field. Abzug and Mezias

(1993) discuss strategies pursued by organizations when reacting to court decisions and

how they achieved compromises. Organizations ‘avoid’ institutional pressures by ‘loose

coupling’ or by creating boundary units that cope with these pressures and may even take

a life of their own (Taylor 1984, Hoffman 1997), but are not central to the organizations’

intended function. Westphal and Zajac (1994, 1998) empirically examine and give

evidence for loose coupling in their study of CEO compensation packages. They found

that although several companies publicly adopted plans to align CEO compensation

packages with shareholder interests in order to obtain shareholder support, very few firms

actually restructured the CEO incentive plan. Finally, in terms of ‘manipulating’ the

institutional environment, Elsbach and Sutton (1992) describe an empirical study of how

organizations attempted to influence their environment through extended media coverage.

Institutional forces also vary over time and do not affect all organizations in a

field equally. Therefore at any given time, an organizations response to a set of

institutional pressures, its tendency towards isomorphism, the amount of agency it

displays etc, depend on an organizations characteristics (e.g. Scott (2001) enumerates

22

organizational attributes such as size, the number and kinds of linkages the organization

has with its environment, and a reference group of organizations as three such

characteristics), its position within a field and the strength of institutional forces at that

point in time. Tolbert and Zucker’s (1983) study of how civil service reforms were

adopted across states over time and Fligstein’s (1985, 1990) work on how different types

of firms were pressured into adopting the organizational M-form over time, are two

studies that describe how institutional forces elicited varying responses over time and

across the organizational field. There is other evidence that the way organizations react to

institutions also depends on the particular context of the organization’s interaction with

the institution. Barley’s study of the adoption of new technology shows that it is only by

specifying certain historical and contextual information that an organization’s response to

institutions can be gauged. That is, organizations’ responses cannot be generalized

without understanding the contextual factors involved (Barley 1986). Other comparative

institutional studies suggest that historical and contextual factors also play important

roles in the formation of institutions (Hamilton and Biggart 1988; Orru, Hamilton and

Biggart 1997).

It is relatively clear from the above discussion that organizations are not merely

acted upon and molded by institutional forces. Agency and the institutional context also

help define an organization’s response to institutional forces. As the above discussion

illustrates, many scholars have theorized on how exactly organizations respond to

institutions under various conditions. Although these theories are not mutually

contradictory, they are not in complete congruence. The final word is far from being said

23

on the question of organizational response to institutions. With this, I will next move on

to describe the third school of thought – institutional economics.

Economics and Institutions

The Institutionalist tradition in economics dates back to the early 20th century. During

this time, several scholars challenged the classical assumptions of economic theory that

propounded that economics could be reduced to a set of universal laws. These scholars

proposed to move beyond the simplistic and unrealistic conceptualization of homo

economicus (rational and calculating ‘Economic man’) and embed economic activity

within a broader social framework that was influenced by historical and cultural forces.

Foremost amongst these researchers were Thorstein Veblen – who acknowledged the

impact of habits, conventions and social institutions on human behavior (Veblen 1909,

1919) – and John Commons, who described individuals transacting under the aegis of

societal rules of conduct or social institutions (Commons 1970). Scott (2001) notes that

these views are similar to those of neo-institutional sociologists.

Later, neo-institutionalist economists such as Coase and Williamson attempted to

develop an economic theory of institutions. Focusing more on regulative types of

institutions, these scholars used a ‘transaction costs’ perspective to analyze governance

structures and rules that arise in organizational forms ranging from markets to

hierarchies, and posit that economic behavior differs as a result of varied institutional

contexts (Coase 1937; Williamson 1985, 1991). However, some of these approaches are

guilty of employing a functionalist, rational-choice model that imply that institutions can

be easily constructed and deconstructed by changing or introducing new incentives.

24

Pierson (2004) criticizes this approach and argues that the analysis of economic and

political systems and actors should be reframed in terms of institutional development and

not institutional selection or choice. By omitting to consider historical, temporal and

cultural contexts Pierson contends that the results of the analysis could be misleading

(Pierson 2004).

More recently Aoki (2004) has delineated three main streams of thought

regarding institutions in the field of economics. First, many scholars have conceptualized

institutions as the ‘players in a game’. According to this view, institutions are

organizations such as industry associations, technical societies, universities, courts,

government agencies, legislatures etc (Nelson 1994). In this view however, institutions

are not directly related to behavior – it is perhaps their actions that influence behavior.

A second view, argued by Nobel Laureate Douglass North, is that institutions are

the ‘rules of the game’ and not the players. Institutions are the rules of the game in a

society or, more formally, the humanly devised constraints that shape human interaction.

Institutions define and limit the set of choices of individuals (North 1990). There are

certain criticisms that have been levied against this theory. This formulation implies that

there is some external actor or mechanism that enforces these rules. The question then

arises as to what motivates the enforcer to enforce these rules and how to enforce meta-

rules on the enforcer. These mechanisms are unclear and might well turn out to be the

rules of a higher-level game. This recursive logic would then have to be carried on ad-

infinitum to unravel all the games that are being played! According to North, it is the

polity that defines and enforces the rules or the property rights (North 1995 and Aoki

2001).

25

A third view is the notion of institutions as game equilibria. In this approach,

players play a repeated game (such as, say a prisoners’ dilemma) and reach a local Nash

Equilibrium where they follow certain actions and receive certain payoffs that may be

suboptimal from a global point of view, but where no player can improve its position by

deviating unilaterally from the Nash Equilibrium. As a result, they continue to perform

these actions with regularity, and this institution then becomes endogenous and self-

regulating. This game-theoretic approach has been extensively developed by Greif (Greif

1989, 1994), Milgrom, North and Weingast (Milgrom, North and Weingast 1990) among

other scholars. Greif (2005) defines institutions as ‘A set of man-made non-physical

factors that are exogenous to each individual whose behavior they influence. These

factors conjointly generate a regularity of behavior by enabling, guiding and motivating

it’.

This approach also considers situations where multiple equilibria are theoretically

possible. Historical as well as cultural causes are investigated to determine why a

particular equilibrium arose. Among these three more recent streams of thought on

institutions as espoused by economists, this conceptualization of institutions as the

equilibrium in a game, thus endogenously motivating regularities of behavior seems most

similar to my own definition and conceptualization of the term ‘institutions’, despite the

fact that even this formulation assumes that institutions are intentional choices of

purposive, instrumental actors (Pierson 2004). The endogenous enforcement mechanisms

lead to a regularity of behavior in a society. Departing from these regularities implies a

deviation from the equilibrium and hence a non-optimal outcome.

26

The Relevance of Institutional Theory to Global Projects

Having reviewed some of the main tenets of the institutional theory literature, I now

revisit my initial assumption, vis-à-vis the applicability of institutional theory to the study

of global projects. Institutional theory emphasizes the fact that institutions matter. All the

streams of literature reviewed above suggest that these institutions affect participants’

behavior within a given domain and lead to some regularity of behavior among these

participants.

Several scholars have performed comparative analyses of institutions at several

levels – comparing institutional arrangements across nations, organizations, sectors,

fields and societies. Meyer and colleagues (1987) compare institutional frameworks at the

world system level and remark on their similarities. Hult and Walcott (1990) compare

institutional forms at the nation-state level and classify and analyze these forms. Whitley,

Orru, Biggart and Hamilton have looked at how firms and markets are constituted

differently in China, Japan and South Korea as a result of varying institutional forces

(Whitley 1992a; Biggart and Hamilton 1992; Orru, Biggart and Hamilton 1997). In a

similar vein, Biggart and Guillen take an institutional approach to contrast the structure of

the automobile industry in South Korea, Argentina, Spain and Taiwan (Biggart and

Guillen 1999). Dobbin (1994b) examines the different types of industrial policies adopted

in the US, France and England, and analyzes how these policies helped shape railroad

development in these nations along disparate lines. Hofstede (1991) has compared value-

based institutions across 53 countries and has defined five dimensions across with these

institutions vary. Schmitter (1990) compares governance structures within economies and

notes how they differ even as structures between economies grow to look more similar

27

while Wholey and Sanchez (1991) look at different regulative policies within sectors of a

society. Most of these studies indicate that regularized behaviors differ systematically

between nations, sectors and fields, leading to different organizational and industrial

arrangements.

In addition, many of these comparative studies also indicate that behaviors that

are institutionalized at any level are deeply entrenched and very difficult to change, and

that it is advantageous to embed oneself or one’s organization within one’s familiar

institutional environment. Hall and Soskice (2001) compare two predominant

institutional frameworks—the coordinated market economy that depends on coordination

and relationships, and the liberal market economy that depends on impersonal

transactions subject to market forces that regulate actor behavior. They posit that

organizations that function in one institutional framework adapt to their environment and

shape themselves so that they derive a competitive edge in the environment that they

operate in. In a foreign institutional framework where the environmental conditions are

different, these organizations will lose their competitive edge and will therefore have

difficulty adapting. Singh, Tucker and House (1996) also report that ‘legitimate’ social

service organizations in Canada, that conform to state regulatory standards are more

likely to survive their first years of existence. Zuckerman (1999) reported a fall in stock

prices of firms that did not conform to institutionalized industry categories.

Firms are thus likely to develop structures and policies that align with the

institutional pressures that they face. As a result, they are also likely to resist changing

their culture and work practices since these practices lead to legitimacy, a competitive

advantage within their home environments and are well institutionalized over a period of

28

time. However, this advantage that firms develop in working within their institutional

environments often translates into a disadvantage in foreign environments, where firms

find that they are not best equipped to cope with a different set of institutional pressures.

These ideas imply that when two groups come together to interact, there exist

differences between institutions that could well lead to difficulties and conflicts because

each side is likely to persist with its entrenched indigenous institutions. Persisting with

one’s institutions in a foreign environment or trying to impose one’s institutions on other

groups can lead to resistance, conflicts and extra institutional costs to reconcile these

differences on projects.

To revert back to the Kattadam case example, different institutions were present

at a national level, in the construction industry in the USA versus various countries in

Europe. When American and European participants interacted on a project, participants

tried to behave in a manner specified by their own set of national institutions, a way of

behavior that they had become used to. In many cases, this led to contradictory opinions

on what to do or how to do it. These contradictions had to be resolved, but since neither

national group was willing to give up their institutionalized ideas, a series of impasses

resulted. These, in turn, led to poor performance on the projects.

Institutional theory thus helps formally explain why organizations face difficulties

when entering other environments and is therefore very pertinent to my research.

However, apart from understanding why conflicts arise on global projects, the real focus

of my investigations is on the outcomes that result when multiple competing institutional

views clash on global projects. I will now review the literature on institutional change

29

and institutional conflicts to see how these specific areas of investigation help address my

research questions.

Institutional Change and Conflict

The literature on institutional change is vast and I will merely highlight a few studies as

opposed to reviewing this body of work in its entirety. Thornton’s study of the publishing

industry found that, in order to change institutionalized behaviors, higher level

‘institutional logics’ had to be changed (Thornton 2002). Publishing was a highly

relationship oriented industry prior to the 1970’s and this led to the generation of certain

sets of behavior. In the 1970’s, a combination of factors such as attention from

investment banks changed the high level ‘institutional logic’ from a relationship-type

industry to a more corporatized industry, where metrics such as market share and

profitability took precedence. Over time, this brought about a change in the behaviors of

managers in the publishing industry.

Hoffman, in his study of the U.S. chemical industry (Hoffman 1999) and Fligstein

in his study of American industry (Fligstein 1991) both point to the occurrence of

‘disruptive events’ as precursors of institutional change. Economic scholars visualize

institutional change as a shift in game equilibrium. In an economic market context, Dinc

views historical factors as being necessary to understand which equilibrium (relational or

market economy) will be selected (Dinc 1996, 2000).

Groups of firms can also be collectively involved in bringing about institutional

change. Kaplan and Harrison’s (1993) study of US Corporations attempting to change the

legal environment, Hoffman’s (1997) study of the U.S Chemical industry and Halliday,

30

Powell and Gransfors’ (1993) work on bar associations provide empirical justification for

how groups of firms in large numbers can obtain significant bargaining leverage to bring

about institutional change. The rather vast literature on social movements which I will not

directly review here also provides a complementary framework to analyze how groups

mobilize resources, build alliances and frame issues to bring about institutional change

(e.g. Zald and McCarthy 1987).

As in the case of organizational response to institutions, research on institutional

change is still in its infancy and has gained popularity only in the last decade or so.

Further, an explicit understanding of the process, difficulties and costs of institutional

change has yet to be achieved.

As institutions and the organizational field change, old and established logics

interact with new and emergent ‘challengers’ leading to a process of institutional conflict.

The study of institutional conflict is another area of research that scholars of

organizations, social movements and several other disciplines, have keenly pursued in

recent years. Several researchers have acknowledged the co-existence of multiple

institutional logics and have conceptualized institutional settings as constituted by plural

and competing principles (e.g. Friedland and Alford 1991; Heimer 1999; Kleinman and

Vallas 2000; Orren and Skowronek 1999; Schneiberg 2002; Scott et al 2000; Stryker

2000). Several scholars have studied the interactions between these competing

institutional forms and have analyzed the processes and outcomes that arise when various

groups struggle to establish their own conceptions as the dominant logics in the field (e.g.

Campbell and Lindberg 1991; Edelman 1990, 1992, 2003; Edelman et al 1999; Fligstein

1990, 1996b; Hoffman 1999; Kelly and Dobbin 1999; Mezias 1990; Sutton and Dobbin

31

1996; Scott et al 2000; Sine and David 2003; Sutton et al 1994; Townley 2002). For

instance, Townley (2002) studies institutional conflict in terms of conflicts of rationality

as defined by Max Weber. When a different institution is encountered, certain human

rationalities are affected. Rationalities are how we make sense of the world. If rationality

is affected at a substantive or cognitive level, conflicts and resistance results, whereas

differences in formal rationalities may be easier to resolve.

Most of these scholars conceptualize institutional conflict as a highly political

process of opposition, argumentation, contestation and compromise. The outcome of

these highly politically challenged processes however varies according to the situation.

Several scholars have noted that the institutional form that enjoys greater power or

leverage is likely to emerge as the dominant logic, even, in certain cases by banning or

eliminating competing logics (e.g. Baum and Powell 1995; Suchman 1995; McAdam

1996; Covaleski and Dirsmith 1988; Kaplan and Harrison 1993; Phillips, Lawrence and

Hardy 2000; Haveman and Rao 1997). For instance, Zysman (1994) notes that political

elites are often able to control institutional conflicts and force settlements in their favor.

Strang and Jung (2004) corroborate this view with a counter-example in their discussion

of Total Quality Management initiatives (TQM) launched by workers instead of

managers. They discuss how these initiatives and views failed to have any impact when

they did not enjoy adequate political backing.

However not in all cases do institutional settlements simplify into a ‘winner takes

all’ battle. In several cases institutional conflict is a contested, multi-level process where

different logics negotiate with one another and a compromise between these views is

32

often reached (e.g. Schneiberg 1999; Sanders 1986; Alexander 1996; Hoffman 1997;

Stryker 2000; D’Aunno, Sutton and Price 1991).

Scholars have also pointed out that institutional conflict could lead to the

development of multiple contradictory institutional orders such that ambiguity and

multiplicity are preserved in a given social setting (e.g. Berk 1994; Herrigel 1994;

Schneiberg 2002). Others have noted that institutional conflicts and shifting political

alliances could lead to the rise of new institutional forms (Scott et al 2000; Morrill 2003).

In some cases the fragments of the competing institutional views can be patched together

in a process termed as bricolage (Douglas 1986), to create new and hybrid institutional

forms (e.g. Clemens 1996; Stark 1996; Haveman and Rao, forthcoming).

As the above discussion shows, institutional settlements can take several

variegated forms and result in a range of outcomes. The shape and persistence of these

institutional settlements vary according to several parameters. For instance, Armstrong

(2004) theorizes that the outcomes of institutional settlements might be less binding if the

environment is subject to dynamic change. Although there is now a large body of work

that examines processes of institutional conflict, this literature is still growing and

incomplete. Our knowledge of institutional conflict mechanisms is still nascent and at

this stage, it is very difficult to predict the result of an institutional conflict in a given

situation. Furthermore, the study of institutional conflicts has thus far not focused on

project settings, which as I will describe below are somewhat unique. For these reasons,

it is not possible for me to apply the earlier findings on the subject of institutional conflict

directly to my research questions. For instance, Miles (1982) points out that in many

cases the resolution of institutional conflict is a long drawn out process. What then will

33

happen on a project that lasts only a few years? These and other questions are open for

study.

In summary, institutional conflict is perhaps most relevant to my research since

global projects often involve conflicts between various participant groups. Furthermore,

institutional theory and the work on institutional change, conflict and organizational

response to institutions offer many interesting ideas that seem highly applicable to my

study of global projects and the challenges therein. However, extant institutional theory

has not yet addressed some critical issues pertaining to my research questions. I will now

identify these gaps in the application of institutional theory.

Gaps in the Application of Institutional Theory

First, although institutional theory has considered organizations and industries as units of

analysis, it has not been extensively applied in the domain of projects. Projects are a

unique form of organization in many respects. They are usually composed of discrete

teams that come together to perform a particular task. Once this task is performed, these

teams disband and seek other projects. As a result, project organizations exist only for

limited periods of time. Due to their limited temporal nature, processes such as learning,

transfer of information and the formation of institutionalized arrangements are frequently

disrupted. As a result, several different sets of institutional beliefs are frequently held on

projects. Further, due to the short time frame of projects, hybrid institutions that resolve

these conflicting beliefs may not necessarily have time to develop fully, and institutional

conflict might prevail. Projects are thus an interesting Petri dish in which to study

institutions and to focus on institutional conflict.

34

My research questions focus directly on institutional conflicts in project settings

and the outcomes and processes that result. Due to the relative paucity of research on

institutional dynamics in project settings, we have only a limited understanding of

whether institutional conflicts in project settings will lead to the triumph of the dominant

institutional view, the emergence of a negotiated settlement or the rise of new forms of

institutions through bricolage or other processes. Institutional theory thus cannot be

directly applied to answer my research question and I will address this gap in the

literature through my research.

The above discussion describes a gap in the application of institutional theory in

terms of the unit of analysis. There has also been a gap in terms of the domain of analysis

of institutional theory. While many different industries have been the focus of analysis,

systematic studies of the construction industry and the institutions involved within it have

seldom been the focus of study. Apart from work by Stinchcombe (Stinchcombe 1959,

Stinchcombe and Heimar 1985) and a transaction cost perspective by Eccles (Eccles

1981), there are few other works on institutions that feature the construction industry.

The construction industry is somewhat distinctive in many ways. First, this industry

differs from other domains of analysis such as services or manufacturing because it is a

project based industry, and therefore, as discussed above contains some unique dynamics

that the extant literature on institutions has typically not focused on. Even within project

based industries, the construction industry is one of the most heavily fragmented and

specialized. A construction project frequently brings together several times the number of

trades or firms that come together for, say, a project in the software industry. This

phenomenon of intense specialization is a result of both high production costs and

35

relatively low transaction costs (Eccles 1981) in the industry. Inter-organizational

interactions are thus quite complex on construction projects. Construction projects are

typically also extreme examples of decentralized or ‘craft based’, non hierarchical forms

of administration (Stinchcombe 1959). In comparison, the level of central or bureaucratic

control is higher in most other industries. In addition to these distinctive structural

features, the construction industry also carries its own distinct sets of structures and

processes regarding contracting methods, work practices, quality control systems etc.

Thus the fact that the construction industry has very rarely been used as the domain of

analysis reduces the direct applicability of extant institutional analysis towards answering

my research questions as it is uncertain how institutional forces act in this domain.

In recent times there has been an increased interest in research on institutional

conflict and change. In the field of sociology, however, there have been relatively few

descriptive studies of the process of institutional conflict and its relation to outcomes.

Economists have studied the merging of competing institutional frameworks (Aoki 2001,

Dinc 1996). However, these studies predict the long-term stable outcome at the end of

the institutional conflict. The potentially disruptive short-term socio-cultural processes at

the beginning where different institutions start to collide have largely been left unstudied.

There has been a call among scholars to provide descriptive analysis of the processes

relating to institutional conflict (Dacin, Goodstein and Scott, 2002). In addition, many

scholars have called for bridging the gap between the ‘old’ and ‘neo’ institutional

theories. Old institutionalists talked about the process of institutional formation and

change as well as the process by which these institutions form and affect behavior. They

often employed descriptive techniques to achieve these ends (e.g. Selznick, 1949). In

36

contrast, neo-institutionalists largely focus on the effect of institutions and the

environment on organizational behavior. There has been a call for combining both

approaches and investigating in greater detail the micro-processes by which institutions

in the environment influence organizational behavior (Barley and Tolbert 1997, Selznick

1996, Stinchcombe 1997).

My research aims to understand what happens to project outcomes when

competing institutions interact. Thus, in accordance with the arguments above, I will

need to understand the behavioral processes involved in such interactions and how they

influence outcomes. As indicated, institutional theory does not provide a ready-made

solution for this problem. The answer might depend on historical evolution and the given

project context. I plan to help address this gap by studying the micro-processes that result

from larger-scale environmental and institutional effects.

In sum, by not having paid much attention to projects as a unit of analysis, to the

construction industry as the domain of analysis, and to the micro-processes of

institutional conflict, the existing literature on institutions contains key gaps in providing

answers to my research questions. Through my own research, I will attempt to close these

gaps and advance knowledge on institutional conflicts.

A review of other relevant theoretical literature:

I will now review some other streams of literature that are relevant to, and might have a

bearing on, the processes and outcomes that occur on global projects. I will attempt to see

if any of the findings from these literatures can fill some of the gaps identified above.

37

Literature on Culture

The literature on culture is old and vast and dates back to the ethnologic studies of the

19th century that systematically compared human societies (e.g. Tylor 1861). In the early

20th century, cultural anthropologists such as Alfred Kroeber attempted to ‘reconstruct

and present the schemes within which people live their lives’ (Kroeber 1925). Many of

these early anthropologists were concerned with the evolution of societies and often

adopted the view that cultures evolved in a universal, lock-step progression from more

primitive to more advanced forms, a view that was later discredited. In his review of

cultural studies, Scott (2001) points out that early cultural anthropologists tended to focus

on consistent sets of shared norms and values that are well internalized. More recently

however, cultural anthropologists such as Levi Strauss (1958) and Clifford Geertz (1973)

have focused less on abstract concepts and more on ‘meanings associated with symbols’

(Wuthnow 1987). Recent and contemporary scholars also note that cultural beliefs can

vary (Martin 1992) and can have external manifestations (Berger and Luckman 1967).

Over the years there has thus been a shift in the conceptualization of culture.

Without attempting to review the large literature on culture comprehensively, I

now turn to a subset of this literature that is more relevant to my research. There is a large

literature on culture that addresses some of the issues that arise on global projects.

Several scholars focus on national cultural differences (Hofstede 1991; Trompenaars and

Hampden Turner 1998; Triandis 1994; House et al 2004) while others address

organizational cultures (Martin 2002), founder or leader cultures (Schein 1985) or

professional cultures (Van Maanen and Barley 1984). These different areas offer valuable

insights in understanding the behaviors of various national groups, firms (contractors,

38

subcontractors, clients etc) and trades (masons, plumbers, steelworkers etc) on global

projects, and the factors that influence them. By and large however, this stream of the

literature on culture can be considered to be a subset of the larger institutional theory

literature as it addresses mainly the cultural-cognitive values, and to a lesser extent the

norms that are present within groups of people, and the ways in which these influence a

group’s behavior. As a result, it suffers from several of the same limitations as the

literature on institutions and institutional conflicts.

In particular, the literature on national culture, particularly the work by Hofstede

(Hofstede 1991) is especially popular among scholars who have tried to study global

projects. Hofstede defines five dimensions of culture – Power distance, Uncertainty

avoidance, Individualism vs. Collectivism, Masculinity vs. Femininity and Long term vs.

Short term orientations, and scores the typical beliefs of workers from 53 countries along

each of these dimensions. Using Hofstede’s dimensions, several scholars have attempted

to characterize the different national groups on projects and explain how and why

conflicts arose due to differing national characteristics (e.g. Pheng and Leong 2000,

Abeysekara 2003). Trompenaars and Hampden Turner (1998) extended the research on

cultural dimensions by developing seven dimensions of cultural values. Two of these

dimensions are identical to Hofstede’s Power Distance and Collectivism/Individualism

dimensions while the other dimensions offer a somewhat different perspective. More

recently, the GLOBE (Global Leadership and Organizational Behavior Effectiveness)

research program applied both Hofstede’s and Trompenaars’ dimensions in their study of

the relationship between culture and societal, organizational and leadership effectiveness

across 62 countries (House et al, 2004).

39

Although this literature on national culture attempts to define and operationalize

ways in which the values and beliefs of people from different nationalities differ, it

suffers from several limitations. First, national culture deals almost exclusively with

cognitive values as opposed to work practices or legal rules. Based on our observations,

several of the problems that arise on global projects stem from work practice differences.

Therefore the literature on national culture needs to be extended and cannot be directly

applied to explain the problems on global projects. Also, this literature takes a monolithic

view of culture and equates all participants from a given national group with the same

characteristics. No attempt is made to distinguish the culture of an engineer from that of a

lawyer, or a culture of an engineer who has worked abroad and has thereby gained crucial

experience, with an engineer who has not. Contextual variables specific to a particular

setting are usually ignored. These limitations severely hamper the application of theories

of national culture to understand and analyze outcomes on global projects.

Project Management literature:

The literature on project management has focused largely on mono-cultural projects.

Several structural issues and challenges in managing projects such as resource allocation

(e.g. Engwall and Jerbrant 2003), project scheduling (e.g. Laufer et al 1996) and the need

for managerial training (Strohmeier 1992) have been identified and discussed in this body

of literature. However, very little attention has been paid to identifying challenges and

conflict resolution processes on multi-national projects (Shore and Cross 2005).

Some studies investigate the relevance of national culture to multicultural project

management and conclude with a thin layer of empirical justification that national culture

40

does play a role in the performance of projects. However the link between project

outcomes and cultural variables is still largely unexplored (Shore and Cross 2005, Pheng

and Leong 2002, Swierczek 1994). Other studies of projects compare cultural traits

across countries and note the differences (Chen and Partington 2004). However, these

studies stop short of analyzing the challenges that are present when the national groups

are mixed on a single project.

Within the discourse on international project management, there is consideration

of strategies and practices that project managers can use to succeed at global projects

(Ramprasad and Prakash 2003; Eriksson et al 2002; Kruglianskas and Thamhain 2000;

Swierczek 1994). These studies acknowledge that there are additional complexities and

challenges in global projects and encourage project managers to cross national

boundaries and adopt a more relationship-oriented attitude. Some studies and writings

point to the importance of flexible leadership traits towards the success of global projects

(Maekilouko 2004, Davison and Ward 1999). Others point to improvements in cross-

cultural communication and the use of cultural initiation programs for managers to

achieve successful results on global projects (Loosemore et al 1999; Enshassi and

Burgess 1990). The primary focus of most of the work on project management that

relates to global projects therefore focuses on the views of project managers and how to

improve their performance.

This body of work rarely considers the project itself as the unit of analysis and

does not cleanly describe the causes and processes behind the institutional conflicts that

arise between various subgroups on these projects. In addition, most of this literature

mainly considers Hofstede-inspired cultural traits and values when discussing

41

international differences, at the expense of other normative or regulative institutions such

as industry-specific work practices. A limitation of this work is therefore that the

anecdotes, identified issues and analyses are relatively narrowly focused and thus might

not capture some of the rich interactions that take place as a result of work practice

differences on global projects.

International Business literature:

The international business literature also deals with operations that span national

boundaries. However, the bulk of this literature focuses on the firm that is expanding

globally as the unit of analysis, and studies the strategies and management practices

adopted by multinational firms (Ricart et al 2004). Researchers have studied the

internationalization process (Johanson and Vahlne 1977, 1990) as well as the impact of

the degree of internationalization on firm performance (Carpano et al. 1994; Contractor et

al. 2003; Ruigrok and Wagner 2003). Much attention has also been paid to the success of

various entry modes for firms that are entering foreign markets. Popular choices of modes

of entry into new markets are through acquisition, greenfield investments, joint ventures,

strategic alliances, licensing, and so on (e.g. Hennart 1982; Root 1987; Buckley and

Casson 1996).

Further, as Ricart et al (2004) point out, “a substantial portion of the international

business literature focuses on the organization and management of multinational firms.

Issues addressed include the control and coordination of national subsidiaries, the level of

integration across national subsidiaries, and the balance between global headquarters

control and autonomy of national subsidiaries” (Doz and Prahalad 1984; Gates and

42

Egelhoff 1986; Martinez and Jarillo 1989, 1991; Paterson and Brock 2002). Whereas

strategies relating to the success or failure of firms over time are well studied, this

literature pays very little attention to the processes and outcomes of one-time projects

where multinational firms interact with other multinational or local firms.

Development literature:

Another area that could provide a useful source of information on global projects is the

literature on development. Many development projects involve the transfer of aid,

technology or institutional systems from developed to developing regions. There is work

that indicates that directly transplanting one set of institutions from one environment to

another as a ‘one size fits all’ solution (a phenomenon termed ‘monocropping’) might not

result in successful project outcomes (Evans 2004; Roland 2004). While this might help

to explain some of the difficulties that arise on global projects, this stream of the

development literature is highly abstract and policy oriented, offering few propositions or

hypotheses on what might go wrong on global projects.

A large amount of research has been done on infrastructure projects that are

sponsored by multilateral banks and employ international and local contractors.

Challenges and difficulties have been identified and analyzed. However, most of this

work focuses on political, legal and economic challenges that these projects face (e.g.

Khagram 2004; Harris et al 2003; Irwin at all 1997; Wells and Gleason 1995). Little

attention has been given to the socio-cultural factors on global projects. Even amongst

the sociological variables, the broader literature on development has tended to consider

43

the effect of constructs such as trust between various stakeholders on the success of these

projects (Diallo and Thuillier 2005) as opposed to cultural or institutional arguments.

Within the area of development, the transfer of technology from advanced to

developing nations deals with similar issues to those found on global projects.

Organizations engaged in technology transfer are likely to encounter challenges and

conflicts in transplanting their technology into different institutional settings. For the

most part however, the work that analyzes the difficulties in technology transfer

addresses purely technological issues at the expense of cultural mismatches between the

transferor and the transferee (Kedia and Bhagat 1988).

Recent work in technology transfer has indicated that cultural or institutional

differences impact technological transfers through complex mechanisms. However these

mechanisms themselves need to be studied and elaborated further (Lin and Berg 2001).

Several informative, anecdotal cases point to the challenges and unintended

consequences of technology transfer (Bakuli 1994; Warhurst 1991; Brautigam 1993).

However, disparate domains and institutions that characterize these anecdotes make it

difficult to generalize and build a conceptual model of difficulties that arise in cross-

national transactions.

There is also a large amount of literature on development that addresses conflicts,

which might provide me with insights relating to the resolution of institutional conflicts.

Several scholars discuss the conflicts between various discourses on development and

how these disparate views are rationalized (Escobar 1995; Foster-Carter 1976; Campbell

2002). Development projects typically involve a variety of stakeholders – governments,

NGO’s, foreign donors, multinational corporations, local citizens, local corporations etc.

44

Often, conflicts ensue between some or all of these stakeholders as each group brings

different perspectives, interests, incentives and institutions to bear on a development

project. Several scholars have studied these conflicts. Sanyal (1991) points out that there

are often conflicts between the ‘institutional interests’ of government, international

donors and NGO’s. Several studies address conflicts between international organizations,

local governments and local citizens due to ‘structural adjustments’ – i.e. socio-economic

changes recommended by international organizations and implemented by these

organizations, NGO’s or the governments in order to promote economic development

(e.g. Hyden and Karlstrom 1993; Streeten 1987). Fisher (1998) discusses conflicts

between NGO’s and local governments. Fisher points out that the NGO’s ‘lens may be

resented’ and that NGO’s can be repressed or ignored by the government or other people

in privileged societal positions. NGO’s might also face direct competition from

governments, who might try to set up competing grassroots organizations. Fisher

discusses three strategies available to NGO’s in such situations – co-operation, isolation

from the government and advocacy against the government. There are several ways in

which each of these strategies can be enacted. These strategies bear a great deal of

resemblance to Oliver’s (1991) work on how organizations respond to institutional

pressures. Fisher’s strategies are similar to Oliver’s co-operate, avoid and defy strategies.

A set of essays edited by Holmberg (1992) discusses the conflicts between

existing ways of industrial development (as exemplified by corporations) and sustainable

development (as championed by governments, citizens, NGO’s etc). Lipton and Toye

(1990) document the struggle between foreign donors and local government in India, and

attempt to evaluate how successful the foreign aid was. They point to the leverage and

45

bargaining power held by various parties in the Indian development context and describe

how this influenced the outcome of the donor-government conflicts. Morley (1975) also

discusses conflicts between local governments and foreign investors and concludes that a

true market-based approach to foreign investment devoid of any regulative policy

frameworks will only lead to more difficulties in the process of development. In a similar

vein, Behrman (1975) identifies conflicts that are likely to occur between multinational

corporations and the developing countries where they plan to set up subsidiaries, since

each group has different motivations and is likely to pursue a different set of goals and

agendas. Ebrahim (1999) focuses on conflicts between NGO’s and their donors. Donors

typically have an agenda that they would like to see the NGO’s implement, while NGO’s

often resist such donor involvement. Similar to the work by Lipton and Toye above,

Ebrahim describes how this conflict plays out and shows that power and leverage are

important variables in determining conflict resolution. Morvaridi (2004) looks at the local

citizens and the protests that they or other special interest groups stage against the local

governments when these citizens are displaced by development projects such as dams.

Kelleher et al (1996) focus on conflicts between old and new views within an NGO, as

the organization attempts to change. Although they recognize that cultures are difficult to

change, and that some groups may have deep-seated institutionalized views, they do not

explicitly describe the texture of the conflicts or on ways to mitigate them.

Several of these studies provide insights as to how conflicts play out in the

development arena, as well as recommendations as to how to minimize conflicts. Similar

to the work of Lipton and Toye (1990) and Ebrahim (1999) discussed above, various

scholars describe the critical role of power and leverage in resolving conflicts. Laux and

46

Molot (1978) describe how powerful Canadian firms were able to force governments to

help them exploit natural resources. Kaplinsky (1976) focuses on technology transfers

between developed and developing countries, the conflicts that ensue due to varying

needs and goals, and the ways in which actors with greater leverage are able to force a

settlement closer to their interests. More recently Shadlen (2004) discusses ‘North-South’

conflicts on public health policies in the WTO and shows how countries from the ‘south’

used alliances with other countries, activists, trade organizations etc to generate enough

momentum and triumph in their struggle. This branch of development research clearly

indicates that actors who can maneuver such that they control vital resources and obtain

bargaining leverage are likely to be able to influence the resolution of these conflicts.

Power is thus a construct that might be useful for my study.

Apart from the bargaining leverage held by various stakeholders on development

projects, several scholars have also discussed how NGO’s and other special interest

groups can act as mediators to resolve conflicts (e.g. Biggs and Smith 1997). Johnson and

Forsyth (2002) discuss conflicts between the state and the local population regarding

forest use in Thailand and note how NGO’s can play a mediating role. Kolk (1998)

describes international pressures brought to bear on the Brazilian government regarding

deforestation of the Amazon forests and how coalitions led by NGO’s can be used to

transform conflict into cooperation.

In a related vein, researchers also note how participatory processes and early

involvement of all stakeholders in the planning discussions can help reduce conflicts.

Sharp (1992) proposes the need for empowerment and participation and recommends the

creation of institutions that will facilitate these processes. Haro et al (2005) describe

47

conflict management as a pre-condition to the initiation of development activities and

stress that all stakeholders must be allowed to communicate with each other. Leeuwis

(2000) goes one step further and recommends that scientific negotiation frameworks be

adopted in these meetings to ensure the smooth progress of the development activity.

In some cases, conflicts are solved by setting up or creating new organizations

that act as mediators or planners. Sanyal and Mukhija (2001) study the conflicts between

local residents, NGO’s and the state government in a slum redevelopment project in

Mumbai, India. All these stakeholders then nominated representatives who formed a new

organization called the SRA that was in charge of making decisions on this project. Once

this organization was created, the project progressed smoothly. Finally, Ho (2001)

discusses how strict monitoring of NGO’s by the state could lead to fewer conflicts on

development efforts and notes the relatively smooth progress of such activities in China.

However, Ho also laments that the quality of the development efforts in China might

have suffered since the state’s authority was never questioned.

Although the development literature has rarely considered focused explicitly on

‘institutional conflicts’, several of the topics that scholars from this field have dealt with

involve conflicts between different goals, interests and taken-for-granted views on how

the development must progress. This literature provides some insights into the resolution

of such conflicts and highlights the role of power, the presence of mediating influences

such as NGO’s etc. However, a large portion of this literature addresses long-term

conflicts between NGO’s, donors, state governments etc, and does not consider how

conflicts are resolved within the unique one-time dynamics and constraints of specific

project-contexts.

48

Despite this, there are some studies (such as the one by Sanyal and Mukhija

(2001) discussed above) that do focus on conflicts on specific development projects.

However the time frame for an international development project involving the built

environment starts from a conceptualizing phase and proceeds through and beyond the

Engineering Procurement and Construction (EPC) phase to encompass operations and

delivery of value to project stakeholders. The global projects that I plan to study are

mostly restricted to the EPC phase, i.e. from the conceptual design phase to the

commissioning of the structure. As a result, the typical criteria for measurement of

conflict and project success in the development literature revolves around a set of

variables – such as end-user satisfaction, time to financial sustainability from operational

revenues – that are quite different than those used for global projects (quality of

construction, budget and schedule compliance) with much shorter time frames. Also,

many of the conflicts that are considered in the literature on development projects and the

stakeholders involved in these conflicts frequently manifest themselves prior to the EPC

phase. Thus although the development literature provides some insights on institutional

conflicts on global projects, the ‘lessons learnt’, best-practices and other learnings from

development projects are often irrelevant or inapplicable to global projects.

Concluding comment:

I propose to analyze institutional conflicts that occur on global EPC projects. Institutional

theory provides a comprehensive framework that describes my research setting and

problems. However extant knowledge on institutional conflicts is insufficient to answer

my research questions since in most cases micro-processes behind these conflicts have

49

seldom been studied, EPC projects have not been considered as a unit of analysis, and the

global construction industry has rarely been investigated. The literatures on culture,

international business, project management and development fail to fill this gap, although

they too offer insights or anecdotes to help conceptualize and understand the unique

problems of global projects.

Since the extant literature does not provide adequate guidance towards

determining the outcomes of institutional conflicts on global projects, I will conduct

direct observations in the field to fill these theoretical gaps and to shed additional insights

on the research questions enumerated earlier in this chapter. Since very little research has

been done at the intersection of the construction domain, the project domain and the

domain of institutional conflict, I perform exploratory ethnographic research work to

identify and analyze relevant phenomena. I use institutional theory as my primary point

of departure and attempt to relate my findings to existing literature on institutional

conflicts and conflict management. Some of the key concepts that I seek to observe and

analyze are the institutional backgrounds and their origins for different groups (e.g.

national, professional) of project participants, how and when institutional conflicts that

occur, how organizations respond to these conflicts and the ways in which these conflicts

are shaped by political, structural and environmental variables (such as agency, power,

mediators etc). However, since my research is exploratory in nature, ethnographic in

method and attempts to shed light on phenomena that have not been rigorously dealt with

thus far, I do not proceed to the field with clearly defined distinctions and variables to

guide me through my study. In the following chapter I outline my research methodology

and the types of results that I hope to obtain.

50

Chapter 3 – Methodology and Research Settings

In this chapter, I describe my research methodology and the settings in which I conducted

my field research. Research on global projects is still in its nascent stages. Researchers

from engineering disciplines who are keen on studying global projects can thus learn a

great deal from the discourse on research methodologies in the Social Sciences.

Prior to entering the field, or even prior to thinking about entering the field,

researchers are well advised to begin by gaining some theoretical background on the

phenomenon they wish to study, defining a set of research questions that they would like

to address, and identifying constructs (e.g. institutions in my case) that they intend to

investigate (Eisenhardt 1989). The discussions in previous chapters have provided a

review of the literature that is relevant to issues on global projects and have defined three

research questions. I now turn my attention to the next step—conducting the study.

First, I discuss the methodology that I selected to perform this study. Next, I

describe the process by which I selected cases or projects for study and describe my

selected research settings. Following this, I explain the methods I used to collect data,

and the ways in which I analyzed the data. I conclude with a description of how I was

able to proceed from my analysis to drawing inferences and writing up my conclusions.

Throughout this process I attempt to identify key risks I encountered, ways in which I

tried to mitigate them, and the level of generalizability of my findings.

51

Selecting a Research Method:

Researchers have a plethora of methodological options to choose from when performing

research on social systems. These options range from qualitative investigations to

quantitative surveys to computational modeling and simulation designed to describe

scenarios and test hypotheses. Methods of field research themselves can be of different

types – such as ethnographies of a single social system, case studies of several units, and

so on. Each of these methods has its own advantages and its own drawbacks and

limitations. A research method must thus be selected based on a careful consideration of

the situation in which it is being used. In the words of Homans:

There are neither good nor bad methods, but only methods that are more or less effective under particular circumstances in reaching objectives on the way to a distant goal (Homans 1949 p. 330).

My task was therefore to select a methodology that would best fit my research objectives.

The research questions that I selected are exploratory in nature. Moreover, the

issue of institutionally driven conflicts on global projects that I chose as the focus of my

research has not been well studied and there are very few theories on this topic.

Numerous researchers have recommended adopting a qualitative research focus in these

types of situations. Eisenhardt describes the rationale behind performing qualitative case-

study research thus:

There are times when little is known about a phenomenon, current perspectives seem inadequate because they have little empirical substantiation…In these situations, theory building from case study research is particularly appropriate because theory building from case studies does not rely on previous literature or prior empirical evidence.” (Eisenhardt 1989)

52

Eisenhardt makes the case for performing qualitative case studies for theory building

when prior research on the subject under consideration is weak. In his essay on Field

Methods in the Study of Organizations, Scott refers to three types of qualitative field

study designs—exploratory, descriptive and hypotheses testing (Scott 1965). In

describing the relevance of each of these studies, he notes that:

The exploratory study is one in which the primary purpose is to gain familiarity with some problem or to achieve new insights which can guide future research. Descriptive studies can define and portray the characteristics of the object of research. Generally speaking, the researcher conducting an exploratory or a descriptive study is more likely to engage in sustained interaction with his subjects (Scott 1965)

Scott therefore calls for field studies wherein the researcher can maintain sustained

contact with the field setting, in situations where the aim of the researcher is exploratory

and/or descriptive. In my case, as my research questions in the previous chapter indicate,

the object of the research was both to explore the factors and the reasons behind the

occurrence of problems on global projects as well as to describe the processes and

outcomes that resulted. In order to answer these exploratory and descriptive questions, it

was appropriate to perform qualitative field research, where I spent sufficient time in the

field.

Also, one of the aims of my research is to analyze the process of conflict on

Global projects. In order to analyze processes, I need to be able to tell a story that denotes

the sequence of events (Ven de Ven and Huber 1990). This further underscores the need

for performing longitudinal case studies, where the unfolding of a process or a sequence

of activities can be observed.

53

Based on both my research needs and the recommendations of other researchers, I

decided to adopt a qualitative research methodology that would involve direct field

observations to shed more light on the phenomenon that I wished to study. As there were

no a-priori hypotheses that I wished to test, I preferred to perform a qualitative study

designed to provide initial insights about conflicts on global projects.

Having chosen a qualitative approach, I then had to choose a methodology from

several options available to qualitative researchers. Scott (1965) describes a continuum of

field research methods. Sustained research – wherein the researcher is in sustained

contact over long periods of time with his informants – lies on the one end of this

continuum; and transitory field studies – where the researcher is present on field sites for

much shorter periods of time, mostly to gather data on specific parameters that have

already been decided on beforehand – lies on the other end. In terms of my own needs, I

felt that a longitudinal ‘ethnographic study’ (Spradley 1979) would provide significant

new insights into global projects. In Stablein’s words, “an ethno researcher is a visitor, a

voyeur, a stranger on a journey of discovery.” (Stablein 1996). This is exactly the type of

a role that I wished to play.

I knew very little about the substantive domain that I was entering, and other

researchers recommended the pursuit of longitudinal studies for the type of research I

wished to conduct. It thus seemed appropriate to conduct exploratory ‘ethnographic’ or

longitudinal research that involved my spending a significant amount of time on a field-

site, in order to obtain data through sustained interactions. Performing such studies, and

being present in ‘real time’ to observe interactions within global projects could prove to

be very advantageous as I would then be able to give rich and “thick” descriptions

54

(Geertz 1973) of conflicts on these projects (Leonard-Barton 1990). Furthermore, subtle

incidents that might escape the notice of a transitory researcher performing retrospective

data collection might be more visible if I were physically present for a sustained duration

on site (Scott 1965).

However, the analysis of several case studies increases the external validity and

the generalizability of my findings (Eisenhardt 1989; Yin 1984). Since these objectives

were not mutually exclusive, I chose to conduct field research that would blend sustained

interaction with some elements of transitory studies. I therefore chose to combine Case-

Study research on multiple cases with a Longitudinal or Ethnographic research approach

on at least some of these cases. In other words, I planned to study multiple projects and

develop case studies (in some cases retrospectively) for each of these projects. Further, I

planned to spend significant time on site on at least some of these projects as they were

being built, performing an in-depth ethnographic study, in order to understand better the

causal factors and processes that resulted due to conflicts on these projects.

Each qualitative research method has its shortcomings, so a strategy to minimize

these shortcomings is to combine multiple methods within a single case study. The

advantages of using one method balance out the disadvantages of other methods

(Leonard-Barton 1990). By combining longitudinal ethnographic studies with case-study

research, I was partially able to balance out criticisms levied at either method

independently. For instance, one criticism of a longitudinal study is that immersing

oneself in the research setting causes the researcher’s findings to take on a subjective

tinge, as the researcher can influence and be influenced by the environment. Further, the

generalizability of findings from a single longitudinal study can be questioned. By

55

performing case studies on multiple projects, I believed that my findings could be more

generalizable. In addition, by comparing incidents across multiple projects, I would be

able to perform systematic comparisons across several cases, lending more objectivity to

my findings. By being physically present for long durations on only some of these

projects, I would not be subjected to subjective biases on all projects.

Having thus explained my choice of research strategy, I next describe the process

of case selection and the particular cases that I selected.

Case Selection Process and Description:

In selecting cases, several theoretical and practical issues need to be addressed: the time

commitment of the researcher, choices about data collection, the degree of involvement

in the project, and so on (Van de Ven and Huber 1990). It was clear that multiple cases

were desirable. This approach helped ensure that I did not misjudge the

representativeness of events that occurred within a single case (Tversky and Kahneman

1986). Conducting multiple case studies also allowed me to use a “case replication”

methodology to test the generality of my findings across cases (Leonard-Barton 1990;

Yin 1984). Briefly, a replication methodology involves the analysis of multiple

comparable cases. Cases that confirm emergent relationships enhance the confidence in

the validity of a given relationship. On the other hand, cases that disconfirm potential

relationships can be used as an opportunity to refine and extend the theory (Eisenhardt

1989).

It is also important that cases must not be selected at random, but must be chosen

to provide either different data points or different explanations for a phenomenon

56

(Eisenhardt 1989; McPhee 1990). A logic of theoretical sampling (not statistical

sampling) should guide the selection of cases (Glaser and Strauss 1967). The aim of

theoretical sampling is to explore the varied conditions along which the properties of a

concept vary (Strauss and Corbin 1998). According to this logic, I needed to select cases

that were similar in nature and scope, and yet systematically differed from one another in

terms of the institutions and organizations involved. By analyzing how the outcomes of

these projects differ given a change in the institutional systems involved, I would then be

able to assess the effect of these institutional systems on the outcomes of global projects.

In creating a qualitative research design involving multiple comparable cases,

Barley’s work is particularly instructive. Barley enumerates three foci of comparison or

analysis—synchronic analysis (analysis and comparison of several varying parameters at

a given point in time); diachronic analysis (analysis longitudinally through time); and

parallel analysis (comparison across cases). He suggests that by adopting an approach

that encompasses all three foci, researchers may better substantiate their claims (Barley

1990). I therefore sought a research design with the following parameters:

1. The presence of different institutional logics ( using different national groups as a

proxy) on each project, so that I could analyze the ways in which each of these

groups reacted to the local institutional norms at a given point in time (synchronic

analysis);

2. The ability to observe the interactions and behaviors of different groups on some

project across time (diachronic analysis); and

3. The presence of multiple comparable projects being performed nearly

simultaneously (parallel analysis).

57

I sought a set of projects where several organizational or national groups were involved

on each project, and where the project was ongoing so that I could spend a reasonable

amount of time observing the interactions and behaviors of these groups over time. (I

intended to perform in-depth ethnographies on at least some of these projects).

Furthermore, I wanted a set of cases where some of the organizations and national groups

were present on multiple projects, so that each project did not have an entirely new set of

players. Commonalities between projects in terms of the actors involved would provide

an aid in project-to-project comparison.

These theoretical considerations aside, there are several practical constraints that

must be considered while designing a research study of this sort (Glick et al 1990). In my

case, funding was a clear constraint that would limit the duration of my stay on these

projects. I also wanted to finish my dissertation and graduate in the foreseeable future and

therefore wanted to spend months rather than years collecting data. Since most projects of

interest were to be found in other continents, it was unlikely that frequent trips to and

from the project would be possible or economically feasible. Therefore I wanted to select

projects where I would be welcomed and allowed to make observations and gather rich

data without needing to make too many return visits. Safe and comfortable

accommodation, availability of vegetarian food, visa and travel restrictions were other

mundane but vital issues that needed to be considered when choosing a set of projects to

study.

Based on these theoretical and practical considerations, I settled on a research

design consisting of four matched projects. Two of the projects were railway

infrastructure projects in India, while two were railway infrastructure projects in Taiwan.

58

The scope of work on the Indian vs. Taiwanese rail projects was roughly the same,

making them quite comparable. These projects presented two other advantages. First,

they both involved several different organizations from various countries as well as a mix

of private sector and public sector players. They therefore represented clear cases of

multicultural and multi-institutional interactions, and increased the likelihood that I

would be able to observe some conflicts. Second, I had personal contacts related to all

these projects that increased the probabilities of obtaining access to the site. This

combination of relevant cases along with good access to the sites has been cited by

researchers as being important for the successful completion of a field study (Pettigrew

1990). Figure 3.1 and 3.2 graphically describe my research design.

Project Sponsor

Project 1 Contractor

Nationalities

Project 2 Contractor

Nationalities

Indian Govt

Figure 3.1 – Projects in India

59

Project Sponsor

Project 1 Contractor

Nationalities

Project 2 Contractor

Nationalities

Taiwanese Govt

Figure 3.2 – Projects in Taiwan

I now describe the project settings in India and Taiwan in more detail.

Projects in Taiwan

In Taiwan, I studied two projects that were part of a high speed rail system that was under

construction. The government had opted to build this system in order to provide speedy

access between the northern and southern ends of the island. A consortium set up with the

help of the government to oversee the construction of the project had complete

responsibility for constructing and managing the high-speed rail system. The upper

management of this consortium consisted of Taiwanese business people, but most of the

operational core of this organization was staffed by expatriates from various countries

(predominantly from the UK) who had been hired as consultants on to the project. The

financing was obtained through a mix of public and private investment.

The entire work on the high-speed rail was split into several work packages. The

civil engineering works were split into twelve sequential sections. The work package for

60

each station was awarded through separate contracts. The track-laying work was split into

four contracts that were also awarded separately, while some of the electrical and

mechanical works also had their own separate work packages. I chose to study two of the

civil contracts that were adjacent to one another. Both of these contracts were bid out as

Design and Build contracts, meaning that the organization that won the contract would be

in charge of both designing and building the project. The entities that won both of these

contracts were joint ventures (JV’s). Each JV consisted of a partnership between a local

Taiwanese contractor and one or more international firms. On one contract, a large

Japanese contractor partnered with a local Taiwanese contractor, while on the other

contract, two large Korean firms partnered with another local Taiwanese contractor. The

contractors’ organization was composed of people from several other nationalities as

well. The JV’s hired several freelancers from various countries (including the UK,

Australia and parts of South East Asia) for various roles (design, construction

management, quality assurance, safety etc) for the duration of the project. Typically the

JV partners hired these freelancers for roles that they could not fill themselves due to lack

of available skills within their organizations. The subcontractors used on this project were

mostly local Taiwanese subcontractors, while the laborers consisted of local Taiwanese

along with some imported labor from Thailand.

I spent only a total of two weeks on the projects in Taiwan (one week on each

project) since the project participants were very busy and feared that I might take up too

much of their time. They therefore invited me to Taiwan only for a short duration. Due to

the relatively brief duration of my stay, it was impossible to conduct a detailed study of

these projects. Therefore, I adopted more of a retrospective case study method as

61

compared to a longitudinal ethnographic study. Although my interviews were open-ended

and ethnographic in nature (Spradley 1979), I was not able to make many direct

observations. Most of the interviews were arranged prior to the start of my visit, and I had

a relatively fixed schedule of interviews with people at various levels and groups within

the projects. The interviews revolved around incidents that had occurred in the not-so-

distant past, as well as the current state of affairs on the project. They were therefore

more retrospective and secondary in nature (i.e. I relied on stories told by my informants

in lieu of direct observations).

Projects in India

In India, I studied two projects that were part of a metro rail system being built by the

local Government of New Delhi. The city in which this project was being built suffered

from severe traffic congestion problems. To alleviate these problems, the local

government decided to build a metro rail system that would reduce the load and the

traffic on the cities roads. The project was financed partially by a multilateral institution

and by the Indian government. An organization staffed by public sector employees from

the Indian Railways (a government organization) was set up to monitor and manage the

project. This organization (that will henceforth be referred to as the Clients) then

employed a consulting firm (henceforth referred to as Consultants or Clients’

Consultants) to help manage relationships with the contractors, to provide expertise in the

building of an underground metro system (a type of structure that the Indian railways had

never built before), and to help with the day-to-day affairs of running the project, such as

reviewing submissions. The Clients were not in favor of employing the Consultants, but

62

were forced to do so by their multilateral financiers who felt that the Clients did not have

the expertise to oversee the construction of an underground metro on their own.

The Consultants organization was a JV agreement between five organizations:

one American organization, three Japanese organizations and an Indian subsidiary of the

Indian Railways (also staffed by Indian railways employees). The American and Japanese

organizations, however, employed very few Japanese or American workers on this

project. Most of their employees were experienced freelance expatriates, primarily from

the UK, who had been recruited to fill positions for the duration of this project. This

organization consisted of a Project Director and a Deputy Project Director at the top, with

a Design Manager and a Construction Manager below them. All of these were freelance

employees.

The Design Manager and the Construction Manager then had their own teams to

manage the design and the construction process. These teams were a mixture of Indian

and expatriate employees. The organizational outline for the Consultants is depicted in

Figure 3.3.

63

Project Director

Deputy Project Director

Construction Design Admin Manager Manager

Construction Team

Admin Team

Design Team

Figure 3.3 – Consultants’ Organization

The entire metro consisted of several sections – both underground and above-ground. I

chose to concentrate on the underground portion of the metro. The civil engineering

works for this portion were split into two contracts of approximately the same order of

magnitude (although one of these contracts was a little larger in scope than the other).

These civil contracts included the construction of stations and installation of some of the

electrical and mechanical equipment. Separate contracts were awarded across the entire

metro project for other electrical items such as signaling, telecommunications etc. Both

contracts were once again Design-Build contracts and were awarded to JV’s that were a

combination of local and international contractors. One of the JV’s was a partnership

64

between a Swedish, Japanese and an Indian contractor, while the other Joint venture was

a partnership between a German, a Korean, a Japanese and an Indian contractor. Both

these JV’s employed the freelance expatriates described earlier. As in the Taiwanese

projects, several local subcontractors were used, and the laborers were also from the local

Indian community.

In India, I had the luxury of being able to spend three months on the projects. I

visited the project sites every morning on weekdays around 9:00 a.m. and left the project

in the evening around 5:30 p.m. I also conducted observations on Saturdays. The project

team worked for half a day on Saturday – from 9:00 a.m. to 1:00 p.m., while Sundays

were holidays. Over the course of these three months, I alternated between the two

projects that I had selected for study. Since I was in India for an extended period of time,

I was able to conduct an ethnographic study, while simultaneously collecting

retrospective data. I sat in as a ‘fly on the wall’ in several meetings within the clients’

organization, meetings between the clients and the contractors, meetings with

subcontractors etc. I also accompanied teams on site for site inspections, and site work

such as concrete pours, tunneling and so on. Finally I also conducted several open-ended

‘ethnographic’ interviews (Spradley 1979) with people on the project. In these

interviews, I asked my informants either to tell me the ‘story’ of these projects and the

conflicts that had occurred retrospectively, or to give their views on the project in general

as well as on specific incidents that I had observed on site or in meetings. I did not have a

fixed schedule of interviews or meetings to attend, prior to arriving on the project. As I

conducted observations, and as I got to know people, I informally set up meeting times to

65

talk to them more about their views on the project. I therefore combined ethnographic

techniques along with case-study techniques while studying the projects in India.

Comparability of the Projects

The four projects (two in India and two in Taiwan) had some features that made them

comparable. First, they were all transportation infrastructure projects that had been

initiated under the auspices of the local governments. The four contracts I studied mainly

involved standard civil engineering and construction techniques and were roughly similar

in terms of the overall scope of work. Furthermore, all four contracts had been set up as

Design-Build contracts, giving the contractors the responsibility for design as well as

construction. All the contractors selected for these projects were international JV’s that

were composed of partnerships between at least one local construction firm and one or

more international construction firms. Furthermore, the clients and contractors on all four

of these projects used freelance expatriates. These commonalities allowed me to control

for variables such as project scope, contract type and technology used and therefore focus

more on the variations in institutional logics and the resulting effects on the projects.

There were also some differences among the projects. First, the public and private

organizations involved in these projects were headquartered in different countries —

Taiwan, India, Germany, Japan, UK, etc. — and the mix of their national backgrounds

varied from project to project. Therefore, different sets of institutional groups and cultural

logics were likely to be present on each project. Also the level of control held by the local

governments varied from project to project. In Taiwan, expatriate freelancers and

consulting firms were tasked with managing the construction of the works, while in India,

66

the Indian Railways (a local government organization) was in charge of managing the

project.

The cases selected therefore had several similarities and differences that fit well

with a theoretical sampling approach to case selection. The similarities in the

technological aspects and the size of the projects offered the ability to control for the

technological characteristics of the project. However, the amount of data I obtained from

each of these projects varied greatly. Since I only spent two weeks in Taiwan as

compared to three months in India, the data from Taiwan was less rich. As a result, the

core of my analysis centered on the projects in India. Since I conducted a detailed study

of two projects in India, I was still able to perform a cross-case comparison of two

projects that involved different nationalities interacting with the same clients and

institutional environments. In India I had the opportunity to conduct a longitudinal study

to investigate the processes behind these responses. I could also systematically compare

across projects to assess how a different organizational or professional group reacted to

different project control structures or institutional environments. I felt that I was able to

meet the theoretical and practical criteria for case study analysis mentioned earlier, with

the cases that I had selected for study.

I used my visit to Taiwan for two purposes. First, since I visited Taiwan before I

visited India, I used it as an opportunity to refine my data collection skills and techniques,

as well as a ‘pilot’ study to gain a preliminary understanding of the dynamics that take

place on global projects. In addition I was able to compare, albeit to a limited extent,

some of the incidents that I observed in Taiwan with corresponding incidents in India, so

as to perform a limited investigation of institutional dynamics in differing environments,

67

of how firms reacted to different pressures and to refine further my analysis of the

incidents that occurred in India. Of Barley’s three foci, my greater focus on India still

enabled me to perform synchronic analysis of the interactions between differing national

groups and organizations on the project. I was also able to perform a limited diachronic

analysis on the projects in India since although I spent three months on these projects,

several behaviors and interactions required a longer duration for comprehensive

observation. The amount of parallel analysis that I performed between cases however was

much lesser than I had originally sought to do, due to the relatively short amount of time I

spent in Taiwan.

The key variables in my research design were chiefly (1) the different national

groups that varied from project-to-project (and hence the national institutional systems),

and to a lesser extent (2) the differing local institutional contexts (in India and Taiwan)

and (3) the different project control structures (local control in India and expatriate

control in Taiwan). Using this design I could evaluate the response of different national

and professional groups within a single institutional environment, and attempt to

investigate which types of institutional differences had a large effect on project outcomes

(e.g. by contributing to conflicts or delays), how variations in these institutions affected

the outcome of projects, and the processes by which institutional differences affected

global projects.

Thus, I mainly focused on the projects in India and most of my anecdotes and

analysis in the following chapters are based on this study. Wherever possibly however, I

introduce relevant comparative examples from Taiwan to show how the incidents that

68

occurred in India were generic or depended on specific parameters peculiar to the Indian

setting.

Tactical Considerations for Field Research:

After selecting a research method, and selecting a set of target field sites, researchers

often need to pay attention to several ‘tactical’ issues that affect the possibility of

collecting rich data during field studies. By paying attention to these issues or challenges,

researchers may increase their chances of answering their research questions. I will now

consider some of these issues and describe how I responded to them.

Gaining Entry:

The first issue that confronts a researcher planning to enter the field is the problem of

gaining ‘entry’ into the research site (Barley 1990). I had adopted the role of an ‘open

researcher’ (Scott 1965). I made it clear that I was a student conducting research, and did

not attempt to disguise the true purpose of my presence on the project. In order to be

successful in such a role, it is advisable to obtain permission from the authorities to

conduct this study (Gardner and Whyte 1946). For the projects in India, I first approached

my undergraduate thesis advisor at the Indian Institute of Technology, Madras. Being a

well-recognized institute, my advisor was able (through colleagues) to notify the

authorities of the project in India about my research interests. The Managing Director of

the Indian project (the senior-most person in the clients’ organization) was excited at my

research topic and sent an official letter inviting me to visit and study the project. This

letter from the highest authority on the project broke down all the logistical barriers to

69

entry. I was allocated a space in which to work and was given permission to sit in on any

meeting or visit any part of the site. No one questioned my legitimacy or my presence as I

had a written letter from the MD. Of course, such an approach does have its drawbacks,

as I could have been perceived as a ‘corporate spy’. I will discuss how I circumvented

this issue in the next section.

In Taiwan, I was much less fortunate. A colleague at Stanford University was

employed by one of the Japanese firms working in Taiwan. Through this contact, I got

the Japanese firm to arrange a set of interviews for me. I searched on the Internet to find

the contact information for one of the Korean managers on the other Taiwanese project

and informed him of my research. This manager then approved my research and

instructed his deputy to help me conduct some interviews when I visited. This approach,

however, did have some drawbacks. Although I was able to visit the projects and gather

data, neither party was committed or willing to host me for a long period of time, as I had

no personal contacts with these people. Furthermore, unlike the Indian case, I did not

know anyone who was able to influence the project leaders in Taiwan strongly (my

Japanese contact, for instance, could only direct me to a mid-level project engineer). I

was able to interview several workers within the contractors’ organization, but was

restricted to interviewing relatively few suppliers, subcontractors and clients’

representatives. This was because I had entered the project through the help of the

contractors, and therefore the clients and other project participants were not committed to

aiding my research. Structurally, the contractors were not in a position to insist that the

clients cooperate and therefore I could only interview those informants who offered to

talk to me of their own volition. Within the contractors’ organization, however, the

70

project managers were able to request employees to stop their work momentarily to talk

to me, and thereby I was able to obtain information even from ‘busy’ employees. In

general, I did spend a busy two weeks in Taiwan, as I was able to interview several

informants from several organizations and nationalities and obtain an understanding of

the issues on these projects.

Gaining Acceptance:

Having entered the project, the field researcher is usually faced with the challenge of

‘gaining acceptance’ from participants on the project. If the participants are suspicious or

hostile towards the researcher or the research topic, the chances of gathering good data

are reduced. Therefore, even after gaining entry into the project, it is wise to endeavor to

gain the support of participants. Several scholars have spoken about the obstacles to this.

To name a few, one could risk being regarded as a corporate spy; encountering hostile

groups who either did not approve of the research topic or saw it as threatening them in

some way; or encounter an uneven distribution of power so that some members of the

organization have more control than others over allowing the researcher to conduct

observations (Scott 1965).

I encountered all of these difficulties. In India, some participants were initially

unsure as to whether I would report negative information on them to their bosses.

Investigating ‘conflicts’ involved telling stories about disputes and fights with colleagues.

Most of these incidents reflected badly on one or another set of participants and therefore

people were reticent to talk about these issues in the open. In one instance in Taiwan, an

71

aggressive Scotsman denied the existence of any problems, accused me of trying to

defame his organization, and proceeded to evict me from the premises!

I used several tactics to mitigate these obstacles. First, whenever I introduced

myself, I made it clear that I was a student who was on site purely for research purposes

and had no connection to any of the entities on the project. I also clarified that I was

studying projects in other countries as well, to help reinforce my image as a person

seeking general understanding. Time and again in interviews and talks I mentioned that

my objective was not to prove that one group was performing better than another, but

merely to understand the challenges (as opposed to using the word ‘conflicts’ or

‘difficulties’) that existed on global projects. I carried around a confidentiality agreement

printed on a Stanford University letterhead that promised not to expose the raw data that I

gathered to anyone else. Furthermore, this letter assured participants that personal

information would be disguised in any paper that I might publish. I also attempted to be

extremely polite and sensitive to the concerns of my subjects. These actions helped allay

some of the participants’ fears and enabled them to be less hostile and more cooperative

towards my research.

Several scholars have spoken about winning trust in the field by identifying

common ground with one’s participants (Scott 1965; Barley 1990). Others have

emphasized the need to build relationships during the initial stages of field research

(Dean 1954; Gardner and Whyte 1946; Richardson 1953). In the initial days of my stay in

India, I concentrated more on building relationships than on noting down observations or

conducting interviews. As an example, several expatriates on all the projects were from a

‘cricket playing country’. In India most of the local participants were keen cricket

72

enthusiasts. Being a cricket fanatic myself, I was able to use our common love of cricket

to build rapport and trust with several participants. I frequently used cricket as an

icebreaker in conversations. Being an engineer also helped build rapport in both India and

Taiwan, as I would be able to start some conversations with a technical question that

participants would answer knowing that I had the background to understand their

response. Having thus started a conversation, many informants would relax and answer

my subsequent questions on the managerial and sociological aspects of the project.

Being Indian, I was able to build relationships easily with the local participants in

India, as we had very similar backgrounds and experiences to talk about. A large

contingent of Indians had studied at the Indian Institutes of Technology (IIT), the

University where I had pursued my undergraduate degree. I was therefore able to

penetrate the ‘IIT Club’ on the project, and most IIT alumni were glad to help out a

fellow IIT-ian. I also observed that the first hour of work every morning in India was a

‘social hour’ where people mostly drank tea and chatted about the stories in the day’s

newspaper. I therefore made it a point to visit various people during this hour, in order to

get to know them better and build trust and rapport with them, even though I did not

collect much data in these conversations.

Several researchers have mentioned the political nature of performing field work

and how one might tend to be associated with one faction by participants in the field, and

thereby be regarded as an ‘outsider’ by other participants (Barley 1990). In order to avoid

such a perception, I continuously rotated my observations and interviews between

different groups on the project. I would spend a few days in the clients’ office, and then

spend a few days interviewing the contractors or visiting their sites. I constantly

73

portrayed myself as a student with no other affiliations who was purely interested in

research, in order to emphasize my lack of political alliances. Enacting this role of a

‘wide-eyed student’ also proved to be highly advantageous, as many participants were

happy to undergo ‘an ego enhancing experience of serving as an expert teacher’ (Scott

1965).

Another tactic that I used that has also been recommended by others is to provide

participants with ‘deliverables’ or offerings that would also be beneficial to them, and

would encourage them to aid me in my research (Scott 1965). These deliverables varied

from entity to entity. Most senior managers were interested in finding out the causes of

the challenges on their projects. I therefore functioned as a ‘pseudo consultant’ and

offered to make a presentation at the end of the project. However, in order to avoid being

perceived as a corporate spy, I made it clear that I wished to make an open presentation

and not just one to the senior management. In other cases, the deliverables were far

simpler. One Indian engineer, who had been reluctant to talk about the project, had a son

who wanted to apply to universities in the US. I explained the application process to his

son one evening, and the next day the engineer invited me into his office for a long

conversation. I was able to offer similar assistance to other engineers who wanted to

apply to universities in the US themselves. Finally, as other scholars have pointed out, I

was also an outlet for people to air views and discuss issues on the project (such as

cultural conflicts) for which they had no other forum. Many participants welcomed this

opportunity to talk to someone about sociocultural or management issues on the project.

Finally, a criticism of longitudinal field research (and a tactical concern that must

be considered) is that, by spending sufficient time on the field, researchers may tend to

74

influence the system they wish to observe. However as several other scholars have

pointed out (e.g. Blau and Scott 1962; Arygris 1952), the constraints imposed on the

individuals by the organizations, the heavy workload, the large scope of the project and

the time constraints were too great to allow them to alter their behavior due to my

presence.

The tactics enumerated above were successful in building trust with participants

in the field. Having described the site selection and trust building process, I now describe

the data collection process.

Data Collection:

Data collection was not a smooth process with a constant stream of data being logged.

The volume of data that I collected grew over time, and the influx of data increased as I

spent more time on the project. In the early stages, especially on the projects in India as I

was getting to know the project, I was constantly concerned that I was getting no data

since I was not making any interesting observations.

General Approach:

In Taiwan I collected data mainly through ethnographic interviews (Spradley 1979) in

which I asked participants to talk about the challenges they faced on the project. In India,

since I had more time, I adopted a different approach. I spent a week reviewing all sorts

of project documentation such as project contracts, organization charts and progress

reports to gain an understanding of the state of the project and the participants involved. I

then spent a month exclusively conducting direct observations of various meetings and

75

on-site activities. I sat in the back of the room at these meetings and jotted down notes

about the incidents that unfolded. At the end of a month, I had a good idea of the main

issues and challenges that the project was facing.

I then started to interview people in parallel with making ongoing observations in

meetings to attempt to learn more about the events that I observed. During the last three

weeks of my stay, I exclusively conducted interviews with project participants. Most of

these interviews were ethnographic in nature, where I explored the issues of conflicts on

the project and the institutional systems that gave rise to them. Typically I asked the

informants to talk about the challenges that they encountered working with other groups

on the project. I tried to see how these views related to the observations that I made.

Some interviews were more structured in nature. As the project progressed and I

understood more about the issues involved, I had specific questions to ask or even

hypotheses that I tested through interviews. All interviews in India and Taiwan were

tape-recorded.

Selecting Informants and Conducting Interviews

How were informants selected? Some informants provided good data, while others were

practically useless. Glick et al (1990) recommends choosing informants who are

interested in the research, who are knowledgeable, and who can articulate accurately. I

tried to identify and cultivate informants from various groups who fit these criteria, and

who would be able to provide rich information.

It is important to conduct interviews at all levels, since no single group in the field

can be considered representative of the entire set of participants (Leonard-Barton 1990). I

76

therefore conducted interviews at various levels of seniority, with participants from

several national groups and organizations (contractors, clients, consultants, freelancers

etc). By collecting data from multiple groups, I could strengthen the internal consistency

of my findings as well as the validity of my constructs (Yin 1984). Other researchers

advise maintaining a daily journal of field notes in addition to conducting interviews or

making observations (Barely 1990; Eisenhardt 1989; Van Mannen 1988) – a strategy that

I adopted. At the end of every interview I spent a few minutes writing down some of the

highlights from the interview. At the end of the day, I wrote down a narrative of the

meetings that I had attended and the interviews that I had conducted. I was then in a

position to review my data without having to transcribe my interviews while still in the

field.

My data collection instruments were minimal. I always wore a shirt with a front

pocket. This pocket always contained my digital tape recorder, a small spiral-bound

notebook and a pen. At any instant I was able either to turn on my recorder or whip out

my small notebook and unobtrusively take notes. While collecting data, I adopted the

approach that no data could be considered irrelevant in an exploratory study. I therefore

tried to collect data on as many aspects of the projects as possible.

Collecting Data Systematically and Explicitly

Although the volume of field notes can be used as evidence of sustained observation, data

collection must be a more systematic process than just aggregating data (Barley 1990). In

Taiwan, I did not have much of a choice as I received a predetermined interview

schedule. In India however, as I pondered on how to collect data systematically on large

projects with so many activities taking place in parallel, I attempted to use the logic of

77

theoretical sampling (Strauss and Corbin 1998; Glaser and Strauss 1999). Instead of

selecting meetings or sites to observe at random, I selected meetings that had participants

from the same professional groups and nationalities and attempted to see if the behaviors

that I observed in one meeting were replicated in the other. Alternatively I would observe

one meeting and then observe another where a group present in the earlier meeting was

absent. I then observed the difference in the incidents that occurred and attempted to

gauge the influence of the group that was absent. By using such systematic sampling

techniques, I attempted to collect data that led to the generation of a more robust theory

of institutional interactions on the project, accounting for the presence and absence of

various situational parameters.

In addition, there were several substantive domains on the projects in India such

as civil works, electrical and mechanical works and tunneling works. I attempted to

interview people and attended an approximately equal number of meetings in all of these

domains so that my data would not be biased towards one substantive domain. However,

with several activities going on in parallel, I often had to choose between events. In such

cases, I chose the event that I thought was likely to result in a conflict or showcase the

largest institutional difference. In addition, I focused on a few events and issues that I had

previously observed, and which I was studying in-depth by following them all the way

through to their conclusion. However, I was frequently able to use project participants

with whom I had built trust as my ‘eyes and ears’ on the project. I would often go into a

participant’s office in the morning, drink a cup of tea and ask him about a previous day’s

meeting that I was unable to attend. In this manner, I was able to use retrospective

interviews to gather data on events that I had missed. With all the activities on the

78

project, I was kept quite busy running from meetings to site visits to interviews

throughout my stay in India.

Quantitative methods are extolled for their explicitness as compared to qualitative

research methods. However, this need not necessarily be the case (Barley 1990). In my

data collection, I was able to identify and note down discrete incidents that occurred in

meetings that I attended. In addition I was able to note down indicators relating to the

setting of the incident. By doing this in a systematic manner for most meetings or site

visits that I attended, I was later able to count and identify the frequency of different

events, prove that some of them occurred on a regular basis, describe what happened, and

analyze what happened when some of the contextual parameters changed.

Completing Data Collection:

Researchers must make a choice about when to stop data collection. My choice was

governed by both theoretical and practical factors. Ideally the researcher would have

reached the point of ‘theoretical saturation’ where no new insights are being obtained

(Glaser and Strauss 1999). In India, although complete theoretical saturation might have

been virtually impossible to achieve, I opted to stay until I felt that I had reached a point

where I understood the causes, the effects and the processes behind most of the

institutional challenges that occurred on the projects. Towards the end of my stay, I felt I

was receiving new stories or insights only at a very slow rate.

Several practical issues also had to be considered. In Taiwan, the project

organizations had only offered to host me for a week each. As a result, I had a non-

cancelable plane ticket and no access to the projects at the end of my two-week stay, and

79

therefore had to return. This kind of time pressure was absent for my Indian case study.

However, I had to make a decision in India keeping in mind the fact that I had to spend

sufficient time analyzing my data and writing up my dissertation, and that I wanted to

graduate in the near future. Combining practical and theoretical considerations, I opted to

leave the project in India after three months of full-time observation, at a stage where I

was confident that I understood most (if not all) of the institutional dynamics on the

project.

On-site Data Analysis:

Data collection is succeeded by data analysis. However, many scholars advocate blending

data analysis with data collection (e.g. Eisenhardt 1989; Strauss and Corbin 1998). There

is much wisdom in this approach since, once a set of data are analyzed, there will

inevitably be gaps that have not been addressed and missing data that prevents the

construction of a robust theory. By coupling data collection and data analysis, missing

data can be gathered in real time as the need arises. Typically, researchers collect data,

take a break and return to home base to analyze the data thoroughly, and then re-enter the

field armed with the knowledge that results from their analysis. However, this was not a

feasible approach on global projects. First, returning to ‘home base’ required expensive

travel making it economically unfeasible. Second, the pace of these projects was such

that taking a break of more than a few weeks meant that it was possible to return to a

setting that was substantially different from the one that I had left, in terms of the tasks

being performed and the actors present.

80

In order to analyze my data while still respecting the constraints imposed by

global projects, I took the following approach. As mentioned earlier, I maintained the

practice of writing daily field notes summarizing my meetings and interviews conducted

during the day. These notes were very important in light of the fact that I did not have

time to transcribe my interviews in the field. Every Sunday I reviewed the daily notes of

the previous weeks to refresh what I had learnt and to develop a mental picture and

preliminary theories of the project. Based on these notes, I came up with constructs and

models that I had investigated or wished to investigate. Depending on the amount of

information I lacked on each of these constructs, I then prepared a tentative schedule of

meetings to attend and participants to talk to in the following weeks, to help shed more

light on my research questions. I then set up meetings and executed this schedule during

the week, and repeated this process the following Sunday.

Over a period of time, I collected more data points and developed confidence that

I had sufficient information to theorize about and describe challenges on global projects

(although I had not yet rigorously transcribed interviews and analyzed my data). This

approach helped me analyze data in parallel with data collection in a fast-paced

environment.

Having iterated between field data and my constructs, and having reached a point

where I felt reasonably certain that I had gathered enough data to provide a robust

description of institutional conflicts on global projects, I then returned from the field to

devote myself to detailed analysis of the data.

81

Data Analysis:

The process of data analysis started simultaneously with data collection. My analysis

method was to use my data to generate ‘codes’ or categories of interest (Barley 1990;

Strauss and Corbin 1998; Glaser and Strauss 1999). I first used a process of ‘Open

coding’ (Strauss and Corbin 1998). As I read through my transcripts or field notes, I

isolated specific instances or incidents and assigned them to a ‘code’ that described the

incident. Since any incident could be viewed from several perspectives, some segments

of data were assigned to multiple codes or categories. As I coded increasing amounts of

my data, I found some codes or concepts that were highly recurrent, whereas some codes

had only a few segments of data within them. I selected the codes that occurred

frequently and use these codes as the basic constructs or concepts that helped explain the

behaviors and interactions on global projects.

The process of identifying and selecting these codes was not quite as linear as I

have suggested. After spending three months in India, I had intuitions as to what

variables and concepts were critical to the behaviors that I had observed on the project.

These concepts were my starting points for analysis, and I used these categories or

themes as my initial set of codes that I applied to the data. Codes also emerged as I

analyzed my data, as I uncovered an incident that would not fit into any of the existing

categories. Often times however, I found myself force-fitting a code onto a segment of

data. I then realized that the code that I had used was too general or simplistic and

perhaps needed to be split into more specific codes that I could subsequently use to label

segments. I then recoded the data with these new codes since the original code was now

obsolete.

82

After generating a set of high-level codes from my data, I went through a process

of Axial Coding (Strauss and Corbin 1998) where I attempted to develop sub-codes and

sub-categories within each of these codes and understand how these various

subcategories related to each other. Initial open coding was similar to taking segments of

data that had common properties and putting them into a ‘bucket’. In this step, I

investigated the contents of the ‘bucket’ and attempted to order and arrange them in a

systematic fashion. For instance, inside a bucket titled ‘issues between the clients and the

contractors’, I attempted to subcategorize the issues into specific themes such as ‘conflict

due to the clients showing behavior X’ or ‘conflicts due to the contractors showing

behavior Y’. In some cases subcategories needed to be split further in order to obtain a

clear picture of all the different types of interactions involved.

For each category, I investigated the amount or the frequency of data segments

(incidents) that I had collected as well as the magnitude of impact that each of these

instances or incidents had on the project. Based on the way that I had collected data, I

was able to perform some level of quantitative analysis. For instance, having observed

several meetings and more than a hundred cases of conflicts between the clients and the

contractors, I looked through my data and come to the conclusion that a certain process or

pattern (sub code) had occurred 25% of the time, while a certain other process had

occurred just once. The sub codes that had either very few incidents or incidents that had

very little impact on the project were considered as not being salient incidents or

parameters in the study of institutional conflicts on global projects. I then analyzed the

sub codes where there were many incidents that affected the project. The various

incidents were arranged to see which ones replicated other incidents within the same

83

subcategory (and thereby gave more validity to their occurrence) and how the different

types of incidents could be used to build or extend a theoretical model.

As an example, within a selected subcategory there might have been several

instances where a certain set of parameters led to a certain outcome. The existence of

several such instances confirmed the occurrence of this type of incident. Also, within the

same subcategory, there may have been several other instances where one or more

parameters were different from the earlier set. The outcome of these incidents would also

be different. Using these two sets of incidents I was then able to build a ‘contingency

model’ wherein given a set of parameters or inputs, I was able to hypothesize on the

outcomes or outputs. In addition, I isolated the effects of a parameter by noting the

change in outcomes as this parameter changed.

As I performed this analysis, I attempted to sample my data theoretically (Strauss

and Corbin 1998). I constantly asked questions of my models. For instance I would ask

myself that since Parameters P led to outcome O, what would happen if a certain entity

was present or absent in the process such that the set of parameters were different? I then

searched my data for such instances, so that I could understand what transpired in the

presence and absence of each of the parameters identified within the sub codes. In this

regard, I was aided by the fact that I remained in good touch with the participants in

India. Therefore, occasionally I was able to ask them a question by email and receive a

response that contributed to a data point that was missing from my data set. As I

performed this analysis, I also connected various subcategories or sub codes and

identified how they related to each other, their relative frequency of occurrence and what

84

parameters (actors, institutional constraints etc) triggered an incident in one subcategory

versus another.

Using these analysis techniques, I was able to develop theoretical models that

explained the observed outcomes on the project. The theories built were grounded in the

data that I had collected. Having analyzed the data, I selected the institutional factors or

parameters (codes) that had an impact on global projects. I then built models that

hypothesized an outcome given the presence of a certain set of institutional parameters.

As some of these parameters changed, the hypothesized outcomes varied. Since I had

detailed observations of incidents, I also explained the process by which a set of

parameters led to a set of outcomes. At the end of my analysis therefore, I had a set of

theoretical hypotheses that helped predict and explain the effect of institutional

differences on global projects.

Final Steps:

My final task was to write up my work into a coherent volume that would provide some

insights to theory as well as to practice. The process of writing began during the analysis

phase. Writing helped clarify some of my analysis and also helped identified gaps in my

theoretical models that I needed to fill by returning to the data that I had collected. While

writing up my research, I used such strategies as attempting to focus on my ‘story’—i.e.

the processes by which institutional differences affect global projects, crafting a coherent

storyline, showing quotes from the field to provide realism to my theories and portraying

dramatic moments to make the story more interesting (Golden-Biddle and Locke 1997).

85

Several scholars have recommended the comparison of concepts or theories that

emerge from such studies with the extant literature in order to make a meaningful

contribution to knowledge (Stablein 1996; Eisenhardt 1989). In line with this approach, I

revisited several theoretical works as my theories emerged and as I was engaged in

writing them up, in order to see how my ideas related to what had already been discussed

in the literature, and how they might extend existing discourses. This was an iterative

process of periodically revisiting new journal articles and books that I found relevant as a

result of my analysis. Based on this ‘enfolding of the literature’ (Eisenhardt 1989) into

my study, I was able to discern and write about the contributions of my work (my

observations and findings) to existing bodies of theoretical and practical knowledge.

When conducting a qualitative case study of the sort that I have outlined here, the

question always arises as to how general or specific the findings truly are. In this regard,

it must be noted that several infrastructure projects in Asia bear many similar

characteristics to the projects studied here. The technologies and the scope of work are

similar. They are mostly financed by multilateral organizations. Most projects are bid out

as Design-Build contracts, and employ international joint ventures. Most of the

international contractors share similar profiles and experiences and almost all of these

projects employ freelance expatriates. Further, economic conditions in terms of the low

cost of labor and the quality of materials are quite similar across several projects in

developing countries in Asia. As a result several of the challenges on-site, such as those

between the JV partners and between financiers and project participants, are likely to

occur in several other infrastructure projects in Asia, and the findings on these

dimensions may be generalizable. On the other hand, the functioning of certain local

86

elements such as, say, the government bureaucracy in India, is likely to be different from

the functioning of government clients organizations in other parts of the world. As a

result, some of the interactions involving the clients or the local authorities might be

specific to the projects studied. Therefore, while the findings from this study may be

applied to projects beyond those that are studied, not all the findings may be general.

Apart from the findings of my research, I hope that this elaboration of the

methodology that I used will provide some modest assistance to other researchers who

perform qualitative studies of global projects. If I were to do this again, I would certainly

change my approach slightly and rectify some of the mistakes that I made.

First, as others have pointed out, it would have been advantageous to have two

researchers on the field (Barley 1990; Eisenhardt 1989). We would have been

able to cover more ground and also cross-validate our interpretations of events

in the field.

Second, I would have been more proactive with scheduling interviews in the

Indian setting. Due to the dynamic nature of the project, participants left as

soon as their work was finished. Therefore by the time I started conducting

interviews, a few participants who I would have liked to interview had left.

Finally I would consider reversing the order of my field visits. I visited

Taiwan first and then India. Since I had no prior knowledge of what transpired

on global projects and since I had only two weeks to spend in Taiwan, I

collected a lot of data without really understanding how useful, complete or

relevant my information was. Had I visited Taiwan after I visited India, I

would have been able to use the knowledge that I gained in India to test out

87

specific hypotheses during my two week stay and systematically uncover how

the projects in Taiwan differed from the projects in India on the key constructs

and dimensions that I had already identified. I feel I would have been able to

gather richer data in Taiwan this way.

Concluding comment:

This concludes Part 1 of my dissertation. In this first Part, I have attempted to describe

my research motivations, my research questions and the research methodology that I

adopted. In the succeeding parts of my dissertation, I will describe the observations and

findings from my study. I observed several categories of conflicts due to the interaction

of different institutional systems, as the international contractors and consultants dealt

with the local construction environment and contractors from other nationalities. In the

following Part, I elaborate on one of these issues—the difficulties that the international

contractors faced in dealing with the local subcontractors, engineers and laborers on site.

88

Part 2 – Safety and Quality Issues

89

Chapter 4 – Safety and Quality Problems

To investigate the effects of institutional differences on Global Projects, I first identified

interfaces where multiple institutional systems came into contact with one another. Out of

several such interfaces, I found two that were particularly salient in that numerous

difficulties arose across these interfaces. The first of these — which will be the subject of

this part of my thesis — was the on-site interface between the international contractors

and the local laborers and subcontractors. Several issues arose due to differences in each

group’s perception of acceptable quality and safety levels on the projects. The second

interface was the interface between the international contractors and the local clients. I

will elaborate on the challenges that resulted due to institutional differences across this

second interface in the next part of my dissertation.

In the eyes of the international contractors and consultants, the local

subcontractors’ work was quite substandard in terms of quality as well as safety, and this

often triggered altercations on-site. Although I focused my study on the Indian projects, I

observed the same dynamic in my briefer visit to Taiwan.

The attitude of the local contractors and laborers towards safety:

I will first consider issues of safety. The local laborers did not have a high level of safety

consciousness on the construction site. A British freelance expatriate who had been hired

as a safety manager on behalf of the Indian clients and who had almost twenty years of

experience as a safety manager on global projects, described the condition of the project

thus:

90

When I arrived, they’d (the local subcontractors) already started work. I had gone on site, and it was terrible! Nobody was wearing helmets, no one was wearing safety shoes, cranes were being used that were bad, welding sets were used that were leaking – a traditional Indian construction site. Safety nowhere.

This international freelancer was appalled at what he saw on the construction sites. Basic

safety apparel such as hard hats and safety shoes were completely lacking, and the local

laborers seemed to work oblivious to any concerns about worker safety.

The situation in Taiwan was almost identical. A Korean construction manager

working in Taiwan bemoaned the lack of local safety consciousness:

Their safety. They don’t care (about) the safety. (They) don’t wear the helmet, don’t put on the shoes

An experienced Japanese construction manager who had worked overseas for fifteen

years and was currently working in Taiwan, observed:

For Taiwanese (they ask us), “Why (do) we need this safety helmet? I work in this area, (and) no construction machine comes here. It’s ok. Why (do I) require the safety shoe?”

In the eyes of the laborers safety measures needed to be taken only in extreme or

dangerous situations. On the other hand, the international contractors considered it wise

to wear safety equipment at all times, since there were many dangers on the construction

site apart from heavy machinery such as reinforcing bars that stuck out, tools that lay

around etc.

It was not only the laborers who exhibited poor safety practices. The local

contractors, who worked on subcontracts on this project, were also not very safety

conscious. They frequently paid ‘lip service’ to any safety regulations that they were

91

asked to obey and were not very serious about following safe practices, since they were

keener on advancing the work quickly. As the expatriate safety manager for the Indian

clients, gave an example:

(Local Indian) contractor C never had to produce a site safety plan before, so they got a consultant to write it for them. The consultant got the project safety manual and basically turned it into their site safety plan. So everything that we said they should do, C in their safety manual said, “This is how we’re going to do it.” Excellent! You think! What happened then was that we started to audit against the safety plan. I went in to see their project manager and started asking questions about their safety plan – and he had not read it – it was just a document sent to him by head office

This was not an isolated incident. As the project wore on, some of the other local Indian

contractors had confessions to make on their commitment towards safety. The Indian

clients’ safety manager spoke about a conversation that he had had with a local contractor

We got all the site safety plans that nobody had ever read. Mr J of local Indian contractor A, he said, “I’ll be honest with you. When we tendered for this job, we hadn’t even looked at that (site safety plans). We didn’t consider it.”

The local Indian contractors thus did not care to ensure that workers wore appropriate

safety gear site and that the construction site was accident-free. They never put their

laborers under pressure to adhere to safety rules. This apathy towards safety both from

local management and the workers led to the poor conditions that the freelancers

observed.

This is neither a new nor a surprising finding. In their article on construction

safety in developing countries, Koehn et al describe the safety situation in India (Koehn

et al 1995) and concur with my observation. They claim that Indian contractors often

have a safety policy on paper but that most employees are not aware of its existence.

92

They list a host of safety problems prevalent in most construction sites in India such as

injuries due to the lack of personal protection equipment (PPE), improper housekeeping

and so on. They also describe the lack of safety consciousness among the laborers and the

workers. They observe that many workers take chances, do not observe safety norms and

do not use PPE (Koehn et al 1995).

The local contractors in Taiwan also exhibited a poor attitude towards

construction safety. Safety was not an important part of the construction process for

Taiwanese firms, as a Taiwanese engineer working in a Japanese-Taiwanese joint venture

pointed out

Basically the Japanese enterprise management style is they always think safety first and then quality. But among the Taiwanese company, they don’t have such a high safety awareness. So the safety will not be their top priority

As these views indicate, the Indian and Taiwanese contractors and laborers on the

projects exhibited neither good safety practices nor a high level of safety consciousness.

The local contractors expressed a lack of interest in safety issues, while the local workers

did not realize the importance of safety.

Reasons for the attitude of the local contractors and laborers towards safety

There were several reasons why the Indian and Taiwanese contractors were not interested

in safe work practices. First and foremost amongst these was the fact that the cost of

manual labor was very cheap, and the amount of money paid as compensation to an

injured worker was quite small. Further, there was no shortage of laborers who were

willing to work on these sites. As a result, when an accident or a fatality occurred, the

93

contractors easily recruited a new worker in place of the injured worker. The cost of

purchasing safety equipment for all the laborers was much higher compared to the small

amount of compensation money that they paid to the injured victims. The financial

equation in terms of low labor and compensation costs therefore discouraged the local

contractors from investing in safety equipment and following safety procedures.

An expatriate safety manager on the Indian project who had several years of

experience working in developing countries described the situation in India thus

You see where a lot of local contractors come from. “If he (a worker) chops his toes off, we’ll pay him a few hundred rupees and he’s set and we’ll get someone else” (is the contractors mentality). And so we see the poor person as a beggar in the street corners. In the UK or the US, workers have a big compensation plan. The Indian contractors pay out peanuts. Workers compensation is less than a lakh (a hundred thousand rupees) – maybe a lakh for someone who is killed. That cost benefit does not yet exist in India, because if you kill a worker, it’s a lakh. That’s nothing. On a project that’s worth 62 crore (620 million Rupees) that’s nothing! Until that changes, until compensation becomes more expensive, the cost benefit analysis (will discourage contractors from caring for worker safety)

A seriously injured worker in India was paid Rs. 500 ($11) and released from service.

Even if a worker were killed in India, the workers family was only paid around $2500,

and a new worker was promptly hired! Workers were thus quite expendable and very

cheap. Given the labor-intensive nature of Indian construction, the local contractors

reasoned that they were better off if they paid occasional compensation fees, than if they

invested a large sum of money and bought materials, trained workers and set up the

construction site to promote safety. This economic equation was identical in Taiwan and

thus safety measures were not observed in both countries.

In addition, a laborer’s life was not valued very highly in the Indian construction

sector. As a result, the Indian contractors did not feel guilty or morally hurt if a laborer

94

had an accident on their construction site. A Singaporean safety manager who worked for

one of the international contractors in India, and had previously lived and worked in India

noted

In Indian society you know, very bluntly, life is not valued here that much. Safety comes when you are talking about lives and the local contractors don’t feel, “Oh! This worker is injured.” (Instead) he just pays him some money and he (the worker) goes (back) to the village. So the concept is not there for human value.

This lack of compassion for the well being of the workers further discouraged local

contractors from taking precautions regarding site safety.

To compound this predicament, India in particular had no official safety

legislation that levied norms and standards on construction firms to coerce them to

improve worker safety. Over several years this led the local contractors to develop a

mindset of not being concerned about safety. Even though other Indian clients

occasionally inserted contract specifications requesting high standards of site-safety, they

rarely enforced them. Therefore contractors had become accustomed to ignoring the

safety specifications and brought this attitude to the global projects that I investigated. An

expatriate British construction manager who worked as a part of the clients’ consultants

and who had worked in several Asian countries for the last fifteen years, noted the

surprise on the part of the Indian contractors when the expatriate and his team actually

attempted to ensure that the contractors maintained the safety standards specified in the

contract. He said:

When you go and inspect if it (the contractors cranes) would work, they (the contractors) were shocked that people would actually take an interest and look at these things and insist on all these nice safety rules that nobody enforces.

95

The contractors or the suppliers, even if they bother to read all the fine print, they’ve probably seen this before on other projects or documents and they’ve learnt to ignore it because its never enforced, while here we do enforce it a lot more. And these subcontractors come in they say, “Of course, of course,” (to our safety specifications) and when it comes down to it and we require them to comply with whats in the contract, they are taken aback.

It was not only the contractors who were to blame. The laborers themselves were not very

safety conscious and discarded PPE’s even if they were given them. They did not seem to

realize that there was a danger of their getting injured, and that an injury affected the

amount of money they earned as well as their livelihoods. The laborers had become

accustomed to working without wearing safety gear and they considered it to be a

hindrance and an inconvenient burden that they now had to get used to. The British safety

manager working for the Indian clients remarked:

It’s a mindset. Nobody told them to wear helmets, and let’s face it, the majority of the workers don’t like wearing helmets! It’s hot. They don’t like wearing steel toe capped shoes since traditionally they’d ideally go barefoot or wear chappals (slippers). And that’s what they do and all of a sudden here is somebody coming and saying, “You have to wear safety shoes, do this and do that”. They are used to wearing old clothes and no shoes, and we are saying, “Go and wear safety shoes.” Some of them have probably never worn shoes before. Its difficult for them.

Since the laborers were just not used to wearing PPE such as helmets or boots, they

resisted attempts at having higher safety standards imposed on the work site. One of the

Indian construction managers who worked for the clients and who had worked on

construction projects in India for over ten years remarked

Still there is not enough safety consciousness (on the part of the laborers). Laborer feels that he will be considered a better guy if he achieves more productivity. If he is given a harness at a height, that impedes his movement. So he will not hang it. So that has not yet sunk into their mind.

96

Furthermore, as this manager indicates, safety devices sometimes inhibited and reduced a

laborers’ productivity. This provided further disincentives for the laborer’s to use safety

equipment since they preferred to work quickly, even if it was not safe to do so.

The cheap cost of compensating an injured laborer in both India and Taiwan

coupled with the lack of regulations or enforcement mechanisms to ensure safe work

practices in India, as well as a lack of concern for personal safety on the part of the

laborers themselves were the reasons behind the lack of attention to safety in India and

Taiwan.

Attitude of the international contractors and consultants towards safety:

In contrast, the international contractors and consultants were very concerned about

safety on the project. The freelance safety manager that the Indian clients hired was very

keen on getting the workforce to adopt safe work practices. Along with his other

international colleagues, he wanted the work done without injuries to the workers.

The international contractors were contractually required to have a person on their

team in charge of safety. Instead of making this a ‘token’ position with no real

responsibilities attached merely in order to abide by the contractual regulations, the

international contractors took this position very seriously. Their safety manager was

tasked with ensuring that there were no accidents or fatalities on site, and was given the

backing and the authority to do so. The safety manager on one of the contracts in India

was a freelancer from Singapore who had been a safety manager on other projects for

97

around ten years. This safety manager spoke about the commitment of the international

contractors (in this case German, Japanese and Korean firms) towards project safety

They (the international contractors) are the management and we have to do a job. They know the importance of safety and without their cooperation I can’t implement any of this (my safety plans). Their cooperation is always there. Quality and safety and so on has to go hand in hand. The top management they don’t compromise on any safety issues.

This freelancer felt that he received the full support of the contractors’ management team

to perform his duties effectively and to ensure that there were no accidents on site. The

contractors placed a lot of emphasis on good safety practices on site, even if it interfered

with the progress of the works.

The Indian clients’ expatriate safety manager, who had earlier made deprecating

statements on the safety consciousness of the Indian contractors, commented on the

international contractors working on the Indian projects:

The international contractors have taken safety pretty seriously. I would match the international contractors against most British contractors. Their sites are not bad. Their cranes are still in good condition

By comparing the international contractors with the British, this expatriate felt that the

international contractors observed safety standards that were far better than those of the

local contractors, and that the international contractors truly believed in the importance of

safe construction. A German project manager on one of the projects in Taiwan spoke

about the British attitude towards safety

Especially the people in the U.K., they are famous for quality and for their safety. I’ve never seen before safety regulations as (strict as) in U.K

98

These high standards were what the Indian clients’ safety manager compared the

international contractors’ to. Both in India and Taiwan, the international contractors and

consultants attempted to ensure that all workers wore PPE, that proper housekeeping was

done on the site (i.e. ensured that sharp and dangerous objects that might be safety

hazards were promptly cleared away) and so on.

In contrast to the contractors and laborers, the Indian clients were quite conscious

of safety and wished to build the project without accidents or fatalities. The clients’

safety manager spoke about a conversation that he had had with the Managing Director of

the Indian client organization

Now the Managing Director, his first statement was in 1999, that he wanted the metro built to international safety standards.

The Managing Director (MD) was the most senior officer within the client’s organization

and had publicly stated his attitude towards safety by indicating that he did not want this

project built according to typical Indian construction safety standards.

Reasons for the attitude of the international contractors towards safety:

In industrialized countries, safety is often considered by management as a priority item in

discussion (Koehn et al 1995). Most of the international contractors came from countries

and construction systems where site safety was considered very important. The presence

of official safety legislation, enforcement mechanisms and a concern for the well being of

their workers ensured that the international contractors were trained to implement safety

procedures on their projects. The Indian clients’ expatriate safety manager observed

99

You have the two international JV’s (joint ventures). They read the contract and for a lot of them – Germans and Swedes etc, this was nothing new to them. In fact it was probably slightly lower standards than they were expecting or used to. That’s the case when your safety legislation is quite high. So they looked at it and said, “Well ok, fine,” and they priced safety into the project

The international contractors were not surprised at the safety requirements in India and

Taiwan. They were used to following safe procedures on their projects and exhibited a

very high level of safety consciousness on the projects both in India and Taiwan.

The Consequences of differing perceptions of site safety:

The low safety consciousness on the part of the local Indian and Taiwanese workers led

to numerous accidents and fatalities. For instance, the local contractors often times did

not inspect the cranes to make sure that they were safe to lift heavy loads. In one case a

local team attempted to lift a large beam. However the crane’s rope that held the load was

frayed. Furthermore the lifting technique was unsafe since the contractors attached the

rope to the bottom of the load and not to the top, and thus increased the chances that the

beam would ‘somersault’ as it was lifted. As they attempted to lift the load, the beam

toppled over and killed a worker on site. The expatriate British safety manager for the

clients described this incident

They (local Indian contractor C) had cranes with twisted jibs! Slings that were falling apart! December last year, they killed a man in a fatal accident. It was a mixture of lifting and stupidity. They had a steel lateral beam that weighed eight tons, made up of steel braces. They were trying to lift it, and they had only got two lifting devices and they were trying to lift it off two points. They tried to lift it off the two bottom members! Anyway, it fell over and killed a man. And that was contractor C. How he didn’t kill half a dozen others, I have no idea! They were a nightmare! An absolute nightmare!

100

Such incidents that could easily have been avoided left the international contractors and

consultants feeling extremely frustrated. Even apart from the larger accidents, the

international contractors were also irritated by normal day-to-day safety violations such

as the failure to wear safety gear or the absence of safety harnesses. They therefore

lodged frequent complaints to the local subcontractors and fought with the crews on site.

In several cases, the altercations on site were quite direct and the international

contractors or the consultants stopped the work that was being performed until the safety

violation was rectified. Such stoppages delayed the subcontractors’ progress and made

them susceptible to penalties due to delayed completion of the work. The international

contractors hoped that this would offer incentives to the local contractors to avoid safety

violations. The British expatriate safety manager working for the Indian clients described

one such incident:

(The contractors put) tremendous pressure to get the work done. Productivity! Productivity! And there’s me and the Project Manager, stopping them and saying, “You can’t do this, you have to do it safely.” Now, on helmets, we were very insistent since we would get things falling from heights. Footwear, in the end, we got to a stage where we wouldn’t expect open toed sandals but we would accept shoes.

If the workers did not have safety helmets or shoes, the work was stopped until all the

workers obtained and wore their safety gear. A similar scenario was enacted in Taiwan. A

South African safety manager who worked for the Korean-Taiwanese joint venture

described a near identical incident where he had stopped a part of the project because the

foreman had not worn a safety helmet. The crew had to wait until the foreman went to his

trailer and returned with his helmet.

101

The local contractors felt hard done by and rarely accepted such productivity

losses without protest. They frequently argued with the international contractors, and in

some instances turned physical! As I was conducting an interview with a German

engineer in Taiwan, he received a phone call that informed him that one of his

construction managers had been hit by a piece of reinforcing steel for attempting to stop

the project!

The international contractors and the local contractors had very different mindsets

when it came to dealing with safety on these projects. The local groups did not pay much

attention to safety while the international actors felt that safety was a very important

consideration on such projects. This frequently led to heated altercations. Before

considering how the two different approaches to safety were reconciled (which will be

the subject of the next chapter), I will next briefly describe a similar set of issues that

arose due to the differences in perception of work quality.

Quality Problems

In terms of quality, the international contractors were more meticulous and wanted to

make sure that the finishes on their products were smooth and that the quality of the

workmanship was high. In contrast, the local contractors in India and Taiwan did not pay

quite as much attention to the overall quality of the work. For instance, in one interview,

a Japanese project manager who had worked overseas for almost fifteen years

complained that the Taiwanese work crews never poured concrete smoothly and that

honeycombs were always present (large voids or cavities that result due to improper

102

vibration and uneven pouring). A Korean project manager on the other project in Taiwan

spoke about the poor quality of the Taiwanese workers as compared to the Koreans:

Taiwan is different. Korean contractors follow the drawings and quality standards in construction. But the Taiwanese contractor is something different – they don’t think about quality

The Taiwanese engineers tended to agree with these views and admitted that the

international contractors expected higher quality standards. A Taiwanese engineer spoke

about the quality of work that their Japanese joint venture partners expected:

All Japanese, when they come to Taiwan for the first time, they use the attitude they used in Japan to face the issues in Taiwan. So their requirement is higher. (It) is stricter for some details. For example for the construction drawing – their construction drawing considers more detail. Its not as rough (as ours).

The Taiwanese construction drawings were quickly and approximately drawn up and did

not have the quality, neatness and the intricate details that characterized the Japanese

construction drawings. The Taiwanese and Indian engineers also often felt that their

international counterparts expected an abnormally high quality of work. A Taiwanese

project manager who worked in a joint venture with a Japanese contractor declared

They (the international contractors and client consultants) don’t really know what they want. They have very high standards, but you know for construction business we cannot just follow the textbook. (For manufacturing a) computer chip, you know you have to be 99.99% accurate- but in construction you just can’t. Sometimes you have cracks, sometimes you have air voids, sometimes you have something else. But this is construction. They really don’t know the limits of (what) the contractor can do – and again we are experiencing difficulties.

103

From this project manager’s perspective, the level of quality that the Japanese contractors

expected was incredibly high and almost impossible to achieve. In fact, this informant

doubted that such high standards of quality were even required for a project of this sort.

The Japanese contractors on the other hand were used to such quality standards and did

not think of them as being out of the ordinary.

.

Reasons for the lack of Quality in India and Taiwan

Even in India, the international contractors espoused higher quality standards as

compared to their local counterparts. Partly, the lower level of work quality in India and

Taiwan was due to the workers’ backgrounds as well as the requirements or norms of the

local construction industry. Just as was the case for safety, quality norms were neither

espoused by contractors nor were they enforced by clients or an overarching legal system.

Local contractors were used to ‘getting away’ with products that were of lower quality as

compared to those built by the other international contractors. Furthermore, laborers who

did the work came from highly impoverished backgrounds and had received very little

job training. Therefore it was difficult for them to perform good quality work. A British

expatriate manager working for the clients in India noted

In (the) UK and US, a majority of workers live in houses and they take some pride in it. They have TV, running water, sanitation etc. Look at the workers working here. On site S they were there on site in corrugated iron huts. No sanitation. The stink was terrible – there were pigs wallowing in it. To the workers, sadly, there’s nothing wrong with that. That’s all they’ve been brought up to expect. No running water. And then you try and say, “We want a quality finish!” They have no conception. They have had no training on how to do the job.

104

The economic and social backgrounds that the laborers came from made it difficult for

them to conceptualize or understand what a high quality job meant and they were unable

to perform work without major defects.

Another reason for reduced quality on the construction site was the difference in

the work ethic of the local and the international participants. Many of the international

contractors’ representatives felt that the local participants would only do exactly the work

assigned to them and were not concerned about the overall quality of the product. A

Japanese construction engineer in Taiwan complained about how the Taiwanese

engineers would start work at 8 a.m. and leave the office at 5 p.m. even if there was more

work that needed to be completed that night. Furthermore the Japanese felt that the

Taiwanese workers were not very productive during the work day. In contrast, the

Japanese and many of the other international contractors would work for longer hours

and re-check plans and drawings to make sure that they were doing good quality work.

The situation was similar in India, and an Indian electrical engineer who had worked for

the Indian Government for almost ten years confessed

We (Indians) have also some shortcomings. We sit around a lot, drinking tea and so on and our productivity is like that

I can personally attest to the Indians’ reduced daily productivity, having drunk many

gallons of tea during the work-day in idle conversation over cricket scores with Indian

laborers and engineers. Since the Indians and the Taiwanese were working under an

aggressive schedule but did not work very diligently, they tried to maximize their

productivity and save time by ‘cutting corners’ on the overall quality of their work.

105

The Consequences of differing perceptions of site quality:

The international contractors and consultants strove to implement high quality and defect

free work on site. However, the local Indian and Taiwanese subcontractors and laborers

did not share these ideals. These two opposing mindsets often clashed on the construction

site, as the international contractors attempted to influence the local workers. In some

cases these conflicts turned quite violent. In one of the project sites in India, a big burly

South African site manager who was almost six-and-a-half feet tall and was working as a

freelancer to one of the international joint ventures, became so frustrated while watching

the Indian laborers work on placing a tunnel lining that he ran in and accosted the Indian

foreman. He then physically flung the foreman (a tiny fellow who was at least a foot

shorter and several pounds lighter) aside and proceeded to do the manual work by

himself, since he did not feel that the Indian workers were placing the reinforced lining

uniformly and meticulously at the right depth. Insulted and hurt by the treatment meted

out to him, the Indian foreman called on his crew to withdraw and call a strike that lasted

for a day, until the other site authorities persuaded both the Indians and the South African

to resume work. Although this incident was far more dramatic than most others, it is an

example of the difficulties and problems that transpired when international contractors

who expected higher levels of quality were thrown into contact with local subcontractors

who were used to delivering lower levels of quality.

However, many of the experienced expatriates on the projects were not so quick

to condemn the workers and engineers in countries like India and Taiwan since they were

aware that the economic circumstances and the history of the construction industry in

these countries had led to lower quality (and safety) norms on project sites. They also

106

understood that they were imposing a much higher standard of quality on these projects

and therefore tried to work within the system to improve quality standards as opposed to

working in conflict with the existing system of construction. A freelance architect who

was of Indian origin but had worked in the UK noted

We know that certain things are not feasible here. Here concreting work is very cheap. Brick work is cheap. Over there (in the UK) if you have a building that has an acute or an obtuse corner, you have to tell the company that you need tiles that are cut in that angle. So they will be cut there (in the factories – neatly according to specifications) and dropped into site. Here you know how the masons work. They cut it on site and plonk (place haphazardly) it over there. So there are differences, and those are the things that you have to struggle with here. The challenge is how to ‘Indianize’ the international specifications and details.

The international employees tried to sculpt their requirements so that Indian construction

workers could achieve them, given their current skills and practices.

Nevertheless, the fact remained that there was quite a large difference in opinion

between the international contractors and the local workers on what constituted an

acceptable level of work quality. The international contractors were often not pleased

with the work done by the local laborers and subcontractors, while the local

subcontractors were not happy when their work was rejected and found it difficult to

change the well-ingrained work practices that they had followed in the past. Conflicts

ensued as a result.

In the next chapter, I will describe how the project progressed as these conflicts

arose, how successful the international contractors were in improving the safety and

quality on the projects in India and Taiwan, and the mechanisms by which disputes that

arose were resolved.

107

Chapter 5 – Resolving Safety and Quality Problems

In order to implement good quality and in particular safety practices successfully on a

project, the clients’ involvement and support is vital (CII 1993; Wilson et al 2000; Hinze

1997a; Hinze 1997b). Should the clients not emphasize the need for say, safety either by

not wearing safety gear themselves on site visits or by not supporting the contractors’

endeavors to attain better safety standards, there is likely to be immense difficulty in

getting the subcontractors and laborers to increase their standards of safety. On the

projects in India and Taiwan however, the clients were extremely committed towards

good safety and quality practices. In Taiwan the clients’ management team was

composed mostly of international freelance expatriates who were used to high standards

of safety and quality. They therefore backed the international contractors in their

struggles with the local subcontractors and laborers. In India, the clients were committed

towards performing the work safely and to high quality standards. They had themselves

recruited a British freelancer with almost twenty years of experience as a safety manager

on various projects in Asia, to act as their safety consultant and had requested the two

international joint ventures to appoint safety managers on their projects. However, the

Indian clients were not cognizant of what exactly they had to do to enforce good safety or

quality standards. Often their representatives turned up on a construction site without

proper safety gear. The clients’ British safety consultant remarked:

When the (clients’) Managing Director (MD) goes out on his regular site visits- the first site visit I went on, he was wearing a pair of trainers and one of these soft floppy cricket hats. And that’s what he was wearing. And British Expatriate B and I had helmets on, and all the clients’ staff were dressed like the MD. Some of them had even worn chappals (slippers). Now if you are going to tell the contractor to do something on his site, then you have to do the same. So the first

108

education as it were was to educate the client to what we were trying to achieve and the standards that they would have to set.

The clients did not realize that they themselves had to be a role model for safety and were

not used to wearing safety gear when they had visited projects in the past. By showing up

on site without helmets or safety shoes, they made it more difficult for the international

contractors and consultants to convince the local subcontractors to adopt safe work

practices. The clients’ safety consultant described a conversation he had with a local

subcontractor:

So getting the client in line was one of the first things we wanted to achieve. This is running concurrently with getting the (local) contractor in line, but quite often in the first couple of months, particularly with contractor A, there was this Project Manager guy there called M. He’s quite a character. We were out on his site, and there’s the MD, with helmet on and still wearing his trainers. M came up to me and said, “Why isn’t he wearing his safety shoes?” – absolutely fair question!

The local subs complained about the existence of ‘double standards’ and questioned why

the international contractors did not bring the clients to task when they committed safety

violations. The international contractors and the clients’ safety manager had to then first

educate the Indian clients to be more aware of site safety. On occasion they stopped a

high-ranking clients’ representative from walking on to the site without appropriate

safety gear, and explained that it was a matter of ‘image’ and only if the clients showed a

conscious attitude towards safety could the local subcontractors and laborers be expected

to comply. The client’s British safety manager described one such incident

All clients representatives had turned up without safety vests and MD was about to start down the stairs – and I said, “Excuse me sir” – I brought the MD back up to the surface, gave him a vest and helped him to put it on. There was no argument. I’d stopped him going into certain areas and never once has he

109

questioned or argued, because he knows that if I raise it with him, it’s because its scene setting.

Fortunately for the international contractors, the clients understood the need to set a good

example and accepted their safety manager’s advice. Very quickly most of the local

clients’ representatives in India adopted adequate safety measures when they visited the

site. The British safety manager noted:

Now I’m very lucky here – I’ve got the support of X, Y and Z (freelance expatriates from the UK working for the client). It makes the job (of a safety manager) just about doable – and now I have the support of the MD and the support of the senior managers of the client. Without that I’d have been gone.

In the safety manager’s view he was able to perform his task of implementing safety

standards only because of the support and cooperation of the clients’ top management.

Both in India as well as in Taiwan, the international contractors leveraged the clients’

backing to employ several strategies to attempt to improve the safety and quality on the

projects. I will now describe these strategies and analyze their effectiveness.

Strategies employed to improve safety and quality standards

Having obtained the support of the clients, the contractors devised two broad strategies to

improve safety standards – a strategy of convincing and educating the local workers (an

education strategy) and a strategy of forcing them into compliance (an enforcement

strategy). As a Singaporean safety manager for one of the international joint ventures in

India who had several years of experience in project safety, remarked:

110

Education is important. I will first explain why (a certain safety procedure has to be adopted). Then if this fails, you start enforcement. Penalties, fines, and so on. So this is how I get the job done.

I will now elaborate on each of these two strategies.

Educating the local workforce to be more safety and quality conscious:

Contractors on all four projects employed numerous methods to convince and educate the

subcontractors and laborers to work safely and achieve higher quality levels. They held

daily ‘tool box talks’ and lectured workers on safety and quality issues relevant to the

tasks that they were going to perform on that particular day. They organized periodic

construction meetings to talk about safety and quality issues. Workers were shown

drawings and pictures of what to do and what not to do and in many cases performed

trials or ‘mock-ups’ that were used to point out safety and quality flaws so that they could

employ corrective measures when they performed the actual work. A Korean engineer in

Taiwan described some of the educational techniques used on his project to improve the

quality of the product

So that’s the reason why I say we have organized weekly construction meetings. Then we will check how you built the first pier. Then we see if something is wrong. Then we can go through a discussion to establish the standards to be followed. So based on that kind of system, we can avoid repeating the same mistake. We go through that system to control our quality. We don’t want to repeat our (mistake) again and again.

The international contractors’ intent was that by constantly educating the workers, by

training them through mock trials and by providing them with feedback, the workers

would learn from their mistakes and the quality of the work would improve. A Malaysian

111

quality engineer who had been hired as a consultant on the Japanese-Taiwanese joint

venture, spoke about a similar procedure that their team had used

We can arrange demonstrations. For example we do the practical work before we do the permanent work. We need to arrange a demonstration, a demonstration to let the workers practice and then we start the permanent work. Let the workers practice on site and then we record any defect or improvement items, and then we improve in the actual permanent work.

This engineer also felt that repeated practice and a diagnosis of errors helped workers

learn how to improve product quality.

Apart from merely telling the workers ‘what’ to do, the international contractors

and consultants also attempted to explain to the workers ‘why’ safety and quality were

important and tried to get the workers to take pride in their work and therefore pay more

attention to quality. In terms of safety the international contractors and consultants spoke

about issues such as the loss of life involved, the time lost on a project due to safety

accidents and so on. They attempted to educate the local subcontractors and laborers on

the consequences to their livelihoods if they did not work safely.

The international contractors and consultants were quite experienced and

understood the need to tailor their arguments to the local environments. As opposed to

making a pre-packaged presentation on safety practices in industrialized countries, they

made presentations that were relevant to the people on the project. The British expatriate

safety manager in the Indian clients’ organization described his method of providing

educational training:

A lot of this is done by training. I do a lot of courses. I spent the first few weeks just going around and taking a lot of photographs. The Project Director said to me, “Haven’t you got any safety videos?” Now I have a good stock of safety

112

videos – a couple of them are just UK ones and a couple are Chinese – but there’s no point in showing any of those videos to people here. You see they use steel scaffolding and they use a lot of mechanical equipment (in the UK), (while) here they do a lot by hand. The UK one – that’s clearly different people – they are clearly in a totally different environment. I can remember 30 years ago when I was in safety, looking at American videos and yawning – well that’s in America – its not the way it’s being done here. So showing a UK scaffolding video, everything is completely different, properties are different. People would just switch off. So what I had to do was to amass a series of photos here. Some of them would actually even recognize where the photos were taken – it’s meaningful.

This manager spent a lot of time documenting errors and taking photographs on the sites

so that he could then use these as effective examples to motivate the local workers. Thus

the international contractors and the expatriate consultants in India and Taiwan felt that

they would be able to improve the quality and safety standards on the project through the

use of various methods of educating the workers. However, as I shall now briefly

describe, this strategy did not yield the desired results.

Success of the strategy of Education

Much to the disappointment of the international contractors, their attempts to educate the

local workforce did not yield the desired results as the local workers seldom changed

their safety practices or improved the quality of their work. An expatriate German project

manager in Taiwan who was part of the Japanese-Taiwanese joint venture project could

not understand why the workers had difficulties following relatively simple safety

guidelines. He said

I was thinking when I got an introduction here on the safety things, I was thinking, “It might be very easy to follow all these rules”, but daily our safety inspectors are reporting from site and saying, “They are not following our regulations.” So it happened already that we stopped the production on site to

113

demonstrate safety techniques. We stopped it because people were not following our advice and our safety standards.

Several other international employees on the projects in India and Taiwan also felt that

educating the workers did not lead to a discernible improvement in safety and quality.

This finding is consistent with Wilson et al’s findings from a study of several

construction projects in the US, that tool-box talks and other educational sessions were

very inadequate in improving safety levels on these projects (Wilson et al, 2000).

Although the projects in Wilson et al’s research study were not global in nature, they also

involved interactions between safety conscious contractors and workers who did not pay

much attention to project safety. Their findings are therefore relevant to the problem that

I uncovered in my field observations.

As a result, the international contractors resorted to another strategy – that of

coercing the local subcontractors and laborers to follow higher safety and quality

standards.

Strategy of Coercive enforcement:

When the strategy of education did not yield the desired results, the international

contractors in India and Taiwan resorted to forcing the local laborers and subcontractors

to employ safe work practices and pay more attention to work quality. One of the primary

methods of coercion was to impose a monetary penalty for unsafe or poor quality work.

The Singaporean safety manager who worked for the contractors described an incident:

Take the example of the bottles. They are not used widely in India. So we started saying, “These bottles need to go back in their canisters.” So initially we used to catch one one bottle and put it back. First of all I made a guideline – blah blah

114

blah, all this should happen. This was education and I started giving pamphlets to all. So then we would go on and site, and if we found something and it wasn’t hazardous, we would say, “By tomorrow you change it.” They still don’t do it when I go tomorrow, then I say Rs 500 fine and we will kick them out. When money comes into the picture you know, then everyone starts to (comply).

Bottles lying around on site constituted a safety hazard and needed to go back into their

canisters. The safety manager had unsuccessfully tried to educate the workers to put the

bottles back in and so he imposed a fine on the workers for every bottle that was found

outside a canister. Once the workers found out that they were going to lose money by

following an unsafe practice, they started to comply with the contractors’ wishes and

safety standards improved.

The same strategy was adopted by several other contractors’ representatives in

India as well as in Taiwan. A Korean Project Manager on one of the projects in Taiwan

spoke about how his organization tried to bring about improved safety standards on their

project:

Every morning (we have) the meeting with the Taiwanese workers and continuously persuade them. If (you) do not follow this safety rule (then) there is a big penalty. Taiwanese like money. Love money. So we control. We are the dam to the money. If you don’t follow the safety rule then you are issued the penalty and we deduct the money from your salary. Yes, so it takes about 3 or 4 months but they follow our instructions. Yes! Money!

This method of coercion worked quite well as most of the workers in India and Taiwan

were motivated by money. The fact that they were paid very little also implied that they

were highly averse to losing their income through fines and as a result quickly learnt to

adopt the safe work practices espoused by the international contractors.

115

A related approach that the international contractors used was to stop the work or

to order the local workers to redo a portion of the work, if appropriate safety and quality

measures were not followed. This was an indirect form of imposing monetary penalties

since rework or work stoppages resulted in delays that often forced the subcontractors to

pay liquidated damages (a penalty paid to the clients if the work was not completed on

time). In certain cases, delays also meant that assets such as construction equipment sat

around unused for long periods of time and incurred higher rental costs. A work stoppage

notice therefore galvanized the local workers to change their approach to safety and

quality. The British safety manager who worked as a consultant to the Indian clients

observed:

So at various stages we stopped the work! “This is not acceptable – so stop. You’ll go no further until you put this right” (we said). And they received a written stop work notice. That had an effect. We don’t like stopping the work, but the risk there was phenomenal!

The international representatives understood that stopping the work had an adverse effect

on the timely completion of the project. However, since they also placed high importance

on project safety and the quality, they felt justified in stopping the work occasionally if it

led to an improvement in safety and quality.

Success of the strategy of Enforcement

In contrast to the strategy of education, the strategy of coercive enforcement was quite

successful in bringing about a change in both safety and quality work practices in India

and Taiwan. As the above incidents have indicated, enforcement of monetary penalties

often coerced the local workers into adopting safe work practices such as wearing PPE

116

etc. Even though there was no guarantee that they would not revert back to their old

unsafe practices on another local project, their work attitudes towards safety on their

current projects displayed a marked improvement. The British safety manager working

for the Indian client remarked:

So you identify what it is that’s going to make them sit up and take notice. And in India there is not a great deal that will make them sit up and take (notice). If the client insists on it and, the client makes it happen, then the contractor will follow in line – because he has to. When I first came here – you see, my views have changed – one of my colleagues said, “We should fine the contractor.” I was totally opposed to ask the client to impose fines on the contractor. That’s for the legal authorities to do. But there is no legal authority to do it. So I now think that we should fine the contractor – because nobody else is going to do this. It’s the only way that we’re going to grab his attention

The safety manager in this instance referred to local subcontractors employed directly by

the clients for some system-wide works such as printing the signs on all stations etc. Like

most of the international employees, he initially felt that logical persuasion and education

would change the local workers’ mentality. He even opposed the use of coercive

measures. However, after having failed in his attempt to educate workers on safety and

quality issues he concluded that the use of force (in the form of fines etc) was the only

way to improve site safety. As a result, there was an overall increase in safety and quality

standards in India and Taiwan.

Changing the mindset of employees on Global Projects:

The incidents related in the current and the preceding chapters are examples of

institutional conflicts within a project setting. Based on their backgrounds, the

international contractors had highly institutionalized views about the work practices on a

117

job site. They were committed to observing high standards of safety and quality. On the

other hand, the local subcontractors and workers had been influenced by a different set of

forces over the course of their careers and were in the habit of paying lesser attention to

project safety and quality. These two differing viewpoints collided on the projects.

The international contractors attempted to change the mindsets of the local

workers. However, as many scholars in the field of institutional theory have observed, the

process of institutional change is not an instantaneous one. Changing the ‘mindset’ or

bringing about institutional change is often a contentious process that takes place over a

long time span – typically over decades (e.g. Townley 2002). The global projects that I

collected data on lasted for only three to five years. Furthermore, the international

contractors had an aggressive timeframe in mind and wished to bring about a change as

quickly as possible, so that they could advance the works seamlessly.

In her study of the introduction of American work practices into Europe, Djelic

1998) deals with a somewhat related situation. She describes an attempt made in post-

World War II Europe, to change the mindsets of the European workers and the

institutions underlying commerce and production in Europe to a set of institutions that

were more in tune with those prevalent in the US. Based on Powell and DiMaggio’s work

(Powell and DiMaggio 1983), Djelic describes three strategies –coercive, normative and

mimetic – that American sponsors and local champions undertook to bring about this

change. The American sponsors in this case understood that even though coercive

strategies led to the adoption of American practices in the short term, this shift was likely

to only be temporary. In the long term, they felt that if the local workers did not fully

embrace the new sets of rules, norms and values, the American model would not be

118

adopted. They therefore used more time intensive normative and mimetic strategies and

tried to inculcate American practices into the education system, attempted to persuade

and convince political leaders and so on. Over a period of decades, they succeeded in

using these tactics to bring about a change in the European mindset.

On the global projects, the need for change was more short term. Since the

international employees were not assured of working in India in the future, they wanted

to spend as little effort as possible and only ensure that the current global projects in India

and Taiwan progressed safely and with high standards of quality. They gladly accepted

temporary compliance towards safety and quality objectives on these particular projects,

even if this did not translate into any improvements in the safety and quality standards of

the Indian construction industry as a whole. Therefore the very strategy that the

Americans had chosen not to pursue in Djelic’s work (use of coercion) was the strategy

that best fit these global projects. Thus when the international contractors realized that a

normative approach did not lead to quick results, they abandoned it in favor of the

coercive approach that successfully yielded short-lasting results that enabled the project

to advance. In contrast to the more normative strategies adopted in a ‘nation building’

environment, coercive means were used to resolve institutional conflicts regarding safety

and quality levels on global projects.

Concluding Comment:

Although the local contractors and workers were successfully coerced into adopting safer

work practices and paying more attention to work quality, the magnitude of improvement

was not as much as the international contractors had hoped for. The international

119

contractors understood that it was difficult for the local workers to change their practices

completely overnight and were prepared to accept less than perfect work, as long as there

was a marked improvement in safety and quality standards. A Japanese project manager

in Taiwan remarked:

They (the Taiwanese) don’t perform 100%, but at least they perform 60-70% quality work. ‘So-so’ work. So I accept so-so work.

Although this manager forced the local workers to be safety and quality compliant, he

had developed a level of tolerance wherein he accepted work that had some relatively

minor defects. Another project manager in Taiwan also did not feel the need to enforce

100% compliance towards all the safety and quality criteria. In his view, there were some

criteria and policies that had to be strictly observed, while other criteria could be relaxed.

He noted:

For 10 items we will instruct the site office – these two items you cannot violate. 100% you cannot violate. But the other 80%, I will just tell you, “Don’t do that” – and if we find some mistakes we will try to correct it, but we will not say, “This one if you violate I will give you a fine” or something. But those first two items we consider are very dangerous to their lives, and we will very serious(ly) consider them as major item(s) and first priority.

This manager took a practical approach towards safety and quality and categorized issues

as being serious or non-serious. Although he used force to ensure that the serious issues

were addressed, he felt that the non-serious issues were less hazardous and could be dealt

with less harshly. He did not strive to eliminate safety violations and quality defects

completely from the project.

120

In the final analysis, the levels of safety and quality did improve, but not to the

levels that the international contractors had wished for. The international contractors and

the local workers reached a compromise as to an acceptable level of safety and quality on

these projects that was in between each party’s preferred level. This concludes the

discussion on the differences in perception of project safety and quality. In the next part, I

will discuss the challenges that resulted due to differences across the second multi-

institutional interface – the interface between the local clients and the international

contractors.

121

Part 3 – Client Contractor Issues

122

Chapter 6 – Introduction

The client organization for the Indian projects was a local public sector organization. In

the Taiwanese case, the projects that I observed were supported wholly by the Taiwanese

national government. The government had helped set up a privately held BOT (Build

Operate Transfer) consortium to oversee the construction of the works. In both these

countries, the international contractors who were awarded work packages on these

projects had to interface with client representatives. In the Indian case, a large number of

client representatives were local Indian civil servants. There were also several expatriates

from the UK, working as freelancers, who were acting as client representatives in India.

In Taiwan however, most of the key decision-making positions in the client’s

organization were staffed by expatriate freelancers, and relatively few local Taiwanese

nationals were present in these positions. The international contractors were accustomed

to a certain set of formal and informal rules and norms regarding the performance of

work on a construction site. They now had to contend with and negotiate against a set of

logics regarding governance of the works, as put forward by the clients’ organizations. In

some cases the views of the client and the contractor were in alignment, whereas in

several other cases, these views led to conflicts on the project. These conflicts were more

prevalent and far more severe in the projects in India compared to the projects in Taiwan.

The frequency and severity of these conflicts led me to focus on the client-

contractor interface as an important source of conflicts on these global projects that

merited further investigation. I observed two broad types of client-contractor conflicts.

First, the bureaucratic and process-oriented nature of the client came into conflict with a

more proactive, output orientation on the part of the contractor. Secondly, an autocratic or

123

“Master and Servant” view of client-contractor relations that was held by the client, did

not fit well with the contractors’ “partnership” view of the client-contractor relationship

in which neither side would attempt to dominate the other. In the next three chapters I

will elaborate the first type of conflict in greater detail. A discussion of the second type of

conflict will follow in chapter 11. As indicated earlier, most of these conflicts were

observed on the projects in India.

The clash between the bureaucratic nature of the client in the Indian environment

and the output-oriented views of the contractor manifested itself in two ways. First, the

strict rule-following nature of the client came into conflict with a more results-oriented

outlook on the part of the contractor. The contractor was willing to exercise ‘engineering

judgment’ and overlook the strict letter of the contract in favor of a more practical

approach in certain situations, especially when it was expensive or infeasible to follow

the exact specification laid down in the contract. The client on the other hand insisted on

regular investigations and expected conformity to the minutiae of the contract.

Second, in terms of project administration, the client preferred a centralized

decision-making apparatus, with the client in-effect, making the decisions that were

relayed to the top of their organizational pyramid through a chain of control. The

contractors, on the other hand, came in to the project with the expectation that since the

contract was a Design and Build contract, the responsibility for performance lay with

them, and that they would be in charge of administering the works, with some minor

support from the client.

I will first elaborate on each of these two issues and then discuss the

circumstances and institutions that led to such observed behavior.

124

Chapter 7 – Conflicts due to a Rules vs. Results Orientation

I observed the clash between a ‘Rules oriented’ or a ‘letter of the contract’ oriented

clients mindset and a ‘Results oriented’ or ‘Progress oriented’ contractors mindset on two

sets of activities – inspections of the works on site and granting of approvals (for

construction methods, design elements, payments, etc.). I will first relate a few anecdotes

to illustrate issues relating to the inspection of the works.

The clients’ representatives on the Indian projects were contractually entitled to

conduct periodic inspections of the work on the site, to see if the contract specifications

were being followed, whether the quality was acceptable, and whether safety standards

were being obeyed. Apart from regularly scheduled inspections, they would conduct

special inspections before the start of certain activities such as concrete pours, to make

sure that the contractor was following the correct procedures (since rectifying badly-

poured concrete would be costly in time and resources). During several of these

inspection visits, the clients detected errors and omissions based on the exact wording of

the contracts. For instance, the clients often insisted that the spacing between two steel

reinforcement bars was different from what was required in the contract and that the

contractors rectify this defect immediately. Although the contractors usually did not deny

that the spacing of reinforcing bars was a little different from what was specified in the

contract, they maintained that this small deviation had no effect on the performance of

the structure; that it was practically impossible to be accurate all the time; and that a

certain amount of ‘engineering judgment’ or tolerance should be used when evaluating

conformity to specifications. The contractors considered these comments by the clients to

be ‘nit picks’ that would lead to unnecessary rework and cost. As a contractors’

125

representative who had more than twenty years of international construction experience

in Asian countries said:

What happens is that these issues must be resolved very quickly. Now what we would do is we would inspect the area ourselves and if the inspector has a genuine grievance then we would have to rectify it, because that’s the only way we are going to be allowed to do this (pour the concrete). We have to address it. But in many cases it’s the application of common sense in construction. When you say you have longitudinal rebar and they are going to be at 150 (mm) centers – it doesn’t matter if one is at 149 or one’s at 151- what is the real impact of that -- other than it has to be tapped one way or another? That sort of thing if it sort of stops your progress, you would rightfully be very annoyed, So there were lots of issues or lots of adjustments to approaches to the works.4

While inspecting the reinforcing concrete works, the clients were in favor of abiding with

the strict specifications of the contract – insisting that if reinforcing bars were designed to

be spaced 150 mm apart, then they should be spaced only 150 mm apart and even a slight

deviation was unacceptable. From the contractors’ perspective, the clients exhibited a

dogmatic ‘rule following’ mindset. The contractors were less inclined to follow the strict

wording of the contract and were keener on advancing the works. The representative in

this case preferred to abide within the general spirit of the definition of the contract, and

considered that a certain tolerance (deviation from the specifications) was acceptable.

The above anecdote was not a one-time occurrence on the Indian projects. This

type of conflict occurred frequently on the construction site and during the course of my

study, several other project participants, both on the side of the contractors and the

clients, talked about similar incidents. As mentioned earlier, there were several freelance

4 For the purposes of clarification, ‘longitudinal rebar at 150 (mm) centers’ refers to placing reinforcing steel bars at a distance of 150 mm from the center of the adjacent steel bar. The function of these steel bars is to lend added strength to the concrete and thereby to the structure that is being built.

126

expatriates who worked as consultants for the clients. These client-side expatriates had

many years of international construction experience and they attested to several of these

‘Rules versus Results’ conflicts during site inspections as well. As one of these

expatriates, who was originally from the UK but had worked for more than ten years in

Asia, related:

Sometimes our guys (Indians client representatives) would be a bit too pedantic – and small things that you can maybe look at and say it’s slightly different but it’s not a problem, (they would never do that). But again to do that you need a slight element of engineering judgment and you need to have the confidence to say, “That’s not exactly as per the drawings, but as an engineer I understand that that’s ok and you can do it.” But these guys would never do that. It said 10 millimeter (reinforcing) bar at 150 (millimeter) spacing and if you didn’t have 10 mm bar the contractor would put in 12 mm at 140 (mm) spacing. And the guys (from the clients side) would say, “That’s not part of the drawing, take it out and do it again and the drawing says this – you must do it – how can I allow you to do something that’s not per the approved drawing,” which is crazy because what he’s doing is close enough. So there was a little bit of that – sometimes our guys would be a little too pedantic.

Like the contractors’ representative, the client-side expatriates also often believed that the

contractors should be allowed some leeway in complying with specifications laid out in

the design drawings, as long as what was done was ‘close enough’ and there was no

adverse effect on the structure being built. The local clients’ inspectors, however, refused

to allow the contractors to progress further if they observed a slight deviation from the

design specifications, even without really evaluating the effect of that deviation on the

structure. This stoppage delayed the progress of the works and left the contractors feeling

very frustrated. Despite being a part of the clients’ organization and looking out for the

interests of the clients, these expatriates did not condone the strict rule-following

behavior of the local clients’ representatives.

127

Several other project participants in various organizations and roles reported such

incidents during site inspections, where the rule-following behavior of the clients came

into conflict with the viewpoint of the contractors. Although each story differed slightly

in terms of the precise nature of the incident and the perspective of the informant, almost

every occurrence of rule-following behavior was linked with a local (Indian) clients’

representative, while most of the international participants endorsed the use of

‘engineering judgment’.

In addition to problems associated with the inspections of the works on site, I

observed similar problems in activities that involved the granting of approvals towards

the progress of the works. Unlike the on-site inspections where international construction

site engineers interacted with Indian inspectors on the site, the approvals process

involved a different set of actors – international designers, planners and project managers

interacting with the senior management from the clients’ side – in off-site meetings. In

these meetings the participants discussed topics such as the quality of the design

drawings, potential vendors etc. These issues were typically less tangible and less time-

critical than the physical structures that were the bones of contention during the

inspection activities.

One area where I observed conflicts in the approvals process in India, was when

the contractors submitted a set of documents such as the method statements that

explained how they would perform the work, their management procedures, etc. Since it

was a Design-Build contract, the contractors had to submit the detailed design for the

structure, which the clients then approved. Many temporary structures, such as formwork

and scaffolding, also had to be erected in order to perform the work. Since these were

128

temporary works that would be taken down as soon as the construction was done, the

contractors did not feel the need to submit as detailed an analysis as they would be

required to submit for permanent works. However, the clients made no distinction

between temporary and permanent activities and required that all submissions be given in

full detail. The Deputy Project Manager for one of the contractors, an individual with

several years of international construction experience described one such occurrence.

We have the contract and the contract documents. We have an awful lot of requirements to be fulfilled. Huge amount of paperwork that needs to be put in place in order to get started – like method statements, management procedures etc. Now for a lot of work that we are doing you don’t need detailed method statements or detailed management procedures. Now to make a detailed procedure about everything that is going on – the only people in the company who really may be capable of writing this are the core people, Managing Directors and so on. If you start getting stuck on these things, then it’s actually very difficult to get anything moving. And so because of difficulties in the beginning to actually get anything done – insisting for instance that for temporary works we go through the whole rigmarole of concrete tests – that’s absolute bullshit. You need to be sure that the thing will stand up and not fall down. The designers would design things on the back of an envelope and would say, “Yes, ok, fine,” but full drawings and submissions are just bullshit. They require all that from us.

Going by the contractual specifications, since every design element needed to be

supplemented by detailed designs, the clients could not approve the start of construction

activities until detailed submissions had been made for ALL design elements, even

though in some cases, these detailed submissions were not completely necessary. This

difference in outlook led to conflicts because the contractors were reluctant to submit

detailed drawings and the clients refused to allow the works to proceed without these

drawings.

Another example that illustrates the Rules vs. Results conflict in the approvals

process occurred in a design meeting where the contractors tried to get a design approved

129

for a station’s lighting system. Since the contract was a Design and Build contract, the

contractors had selected a design firm with whom they were already working. The

contractors, in conjunction with this design firm had submitted specifications for the

lighting system. The clients’ Indian representatives had approved these specifications.

The contractors had then selected an equipment supplier and, in conjunction with this

supplier, had optimized the lighting design a little further. Doing so changed the lighting

layout that the clients had approved. The contractors had obtained an endorsement from

the supplier, a world-renowned lighting company with sophisticated analysis systems,

that the new arrangement was not substantially different from the old one and that the

performance was in no way inferior. Furthermore, the contractors had also received an e-

mail approval from the design firm that they had selected that the new arrangements were

acceptable. Since this activity was on the critical path of the schedule, the contractors

were anxious to get approval and start work immediately.

However, since a change had been made to the design, the clients contended that

according to the specifications of the contract, the contractors needed to obtain signed

approval from the design firm. As one of the clients’ engineers told me in a private

session:

As per the contract, the contract was awarded to the main contractor – and they are a construction company and they don’t have the expertise, so it was written in the contract that they will hire a designer and the designer company will develop the design to the definitive stage, and thereafter it will be the responsibility of the main contractor to get it done. So Contractor C has hired Designer D for their design. Designer D has done definitive design and they have prepared the specs, we agreed to it and the entire design has been finalized. Now, it is the responsibility of the contractor to develop the design that is in line with the definitive design, but so far they have not done this. They have changed the design to some extent. One more thing was also written in the contract: That the design responsibility will lie with the designer – so if something goes wrong, that

130

responsibility will be there with the designer. So for the lighting they have to decide and design where the lighting will go and this I think is the typical type of thing. In their development of definitive design further, the contractors have changed the type of lumiere that they have selected, and since they have to achieve the same lux level, the lighting layout has changed. So what I was trying to tell them was that since you have changed your design a little bit from your definitive design stage, you must get endorsement from your designer. In fact I also mentioned that this slight change is on the positive side – it is for the betterment – but I feel that the responsibility should lie with Designer D.

Even though the clients agreed that the new design was an improvement, they would not

accept it without official ratification from the designer. The contractors’ problems with

such an approach were twofold. First, in order to obtain the designer’s endorsement, they

would have to wait for several days for the paperwork to be transferred and the

endorsement to arrive (the designers that could endorse this design were based in the

Australian office of the design firm). This would delay the start of the works. Second,

since the designers had already finished the lighting design, any further approvals would

only be done at an extra charge, and therefore this exercise would prove costly to the

contractor.

These anecdotes are merely a few examples of several kinds of conflicts that

resulted due to a ‘follow the letter of the design/contract’ mentality of the Indian clients’

representatives and a ‘let us advance the works in the most practical way possible’

mentality of the contractors. Three parties were involved in these issues – Indian client

representatives, employees of the international contractors and the freelance expatriates

who worked as consultants for the clients. Each party considered their behavior to be

rational. I will now illustrate how each of these groups viewed these issues.

131

The Clients’ Perspective

The Indian clients’ representatives did not claim to be results oriented – in fact they were

very clear that they were keener that the precise wording of the contract be followed, and

that deviating from the contract, even if it was beneficial to the clients would not be

accepted. As one senior representative, who had been working with the government for

his entire career and was working past his retirement age, stated:

Of course the approaches of the contractors are different since they have worked in many other countries and have been conditioned by what they have seen and done in those countries. This is the first time that they are working in India. To us, the contract is important. The expats think that, based on their experiences elsewhere, there are other practices that work just as well and are equally good. In a few cases, the contractor might even submit a good suggestion. However my impression is that the contractor has not been able to convince the client. Therefore none of these changes that have been proposed – that might save money have been accepted.

Another local employee, who was one of the construction managers for a portion of the

works and who had spent the last ten years with the government, also held similar beliefs.

He spoke of an issue concerning the temperature at which the concrete should be mixed

and poured. In his view even a minor deviation of the temperature of the concrete – by

one degree – was not acceptable. He said:

We say 32 degrees temperature should be there. We will strictly follow that. They (the contractor) thought that by arguing, they could also convince us that 33 is equally good. That problem initially was there – we wouldn’t compromise.

Another similar incident was related to the amount of wait-time after the concrete had

cured before the formwork surrounding the concrete could be removed. The contract

stated that this duration was two hours. The contractors however, provided calculations to

132

prove that the concrete would have the same tensile properties even if wait-time was

reduced to ninety minutes, and therefore argued that it was perfectly acceptable to

remove the temporary formwork and reuse these in other parts of the site. However, the

Indian construction manager claimed:

There is no technical issue – we need 2 hour wait after curing although they think there is less needed. I am not convinced we need 2 hours, but still people (from the clients’ side) are questioning this issue – and I think this is more of a paperwork issue. In this case, they (the contractor) are going to wait 2 hours. Initially they (the contractor) sent the proposal and we said, “No no no, you must take 2 hours.”

Even though he was personally not convinced that a two-hour wait was needed, the

clients’ representative insisted that the letter of the contract be followed.

In a similar vein, a senior electrical expert, who had worked with the government

for twenty years, questioned the mode of payments that the international participants

adopted. According to him, in the Indian system, the contract specified that every time

contractors did a certain quantum of work they would be paid a certain amount. However,

on these projects, even when the fixed quantum of work had not been completed, the

freelance expatriates working for the client sanctioned a payment commensurate to the

amount of work done. The idea behind this strategy was that the contractors needed

capital to pay their crews and that denying them this capital would have adverse effects

on all parties. The Indian expert did not readily accept deviating from the contract in such

a manner and refused to sanction payments for incomplete work packages. As we

discussed this issue, he philosophized over what he felt was a difference between the

locals and the international employees:

133

on the interpretation of the contract, we have problems – we just feel sometimes that we are over-careful compared to the expats.

A local construction manager who dealt with a German contractor summed up the Indian

point of view:

So here, we are too theoretical – Germans do not follow rules- they will not say, ‘Contract says this’. They will follow reality. For us paperwork is good – they are more into what is actual.

As compared to the international contractors and freelance expatriates, the Indian clients

were definitely much more rules-oriented. They were aware of this fact and they were of

the opinion that the contract should be followed with as little compromise as possible. To

them, this approach seemed rational and reasonable – and they expected to follow such

an approach.

The Contractors’ Perspective

The contractors, who came from several international countries, not only had a different

opinion, they also held a rather uncharitable view of the clients’ attitude. They felt that

the Indians were being ‘overly careful’ and that this was impeding the project’s progress.

As the following quotes indicate, various participants from the contractors’ side felt

frustrated by this aspect of the clients’ behavior. An experienced British expatriate

working for one of the international joint venture contractors observed:

There is a tendency in the Indian system – to – before something can happen you have to cross all the i’s and dot all the t’s. In common sense in any construction that can’t be – it’s not possible to dot all your i’s and cross all your t’s and have all the paperwork in place.

134

A site engineer from Germany who was working on a different contract stated:

They (the Indian client representatives) are sticklers to formality in the sense they have to have a material test certificate and this and this and this and this, but the picture of what’s going on is lost.

The contractors felt that the clients’ inflexible attitude led to repetition of work that was

unnecessary, time lost in detailed checking, and delays on the jobsite. These delays in

turn could turn out to be a liability for the contractors, since there was a liquidated

damages clause on the project, whereby the contractors would have to pay the clients for

every day of delay beyond the scheduled project completion date. The contractors felt

that a certain amount of leeway with respect to the specifications was completely

acceptable, and a more progressive orientation from the clients could lead to a better

project outcome. As one of the highly experienced British freelancers working for the

contractors (the same freelancer who talked about the contractor crossing their t’s and

dotting their i’s above) noted:

For instance – one of the important things that you do in a project like this is the inspection of the works – and if you have a huge base slab, say 100 – 200 cu m pour and you’ve got it all shuttered out and all your rebar is there and you’re ready to pour – and your inspector walks in there and won’t sign off the inspection form because one of your rebars (reinforcing steel bars) is that much out of center or because he’s not happy about something or because he feels that maybe the shuttering needs to be oiled again or whatever, that can cost you a lot of hindrance, a lot of time and a lot of money – whereas common sense says that work is warranted and its all guaranteed by the contractor – so if there’s any problems it can always be tested later – its all relative.

These discussions indicate that the local Indian clients and the international contractors

had different, and in many cases opposing institutional mindsets about how the work on a

135

construction site should be conducted, and since both sides were rather inflexible in their

views, there were frustrating moments and conflicts on these projects. One of the

contractors’ representatives, an international employee who had worked mainly in

Germany but had only a few years of experience working in other countries, summarized

the situation:

We have different aims – the client has to keep their records clean – what is left for them after everything finishes is the records – for us it’s the structure – so I want the work done properly and for them its important to have the paperwork and the wording and see that its as per the specifications.

The perspective of the freelance expatriates working for the client

The third group in this mix of project participants was the group of freelance expatriates,

who worked as consultants for the clients. Like many of the contractors’ employees, they

had worked on several projects in developing countries and had similar experiences.

Currently they worked with the clients and were in charge of representing the clients’

interests. This group of actors had a contractual obligation to support the clients, but also

had strong ties with the contractors, a community that many of them had been a part of at

various times, and whose backgrounds they shared. As a result, there were cases where

these freelancers supported the clients’ views and other instances where they supported

the contractor.

One of these freelancers from the UK, who was the construction manager for the

client, and had worked in Asia for the last ten years, stated:

So we’ve tried to change (the local mentality) to allow the project to move forward. That’s not really what the employer wants. He wants quality and he wants safety but he does not want absolute quality at the expense of opening 5 years late. So its understanding what are the needs of the project. Really if we

136

bust our gut and flood the project with men and make sure that every piece of rebar has a certificate that can be traced to a mill in Turkey, and you walk out the gate and the rest of it is nothing like that, what is the point? You are not building a monument, you are building a structure. So you need to get people to understand.

This freelancer was critical of the Indian clients and felt that they slowed down the

project by being too focused on the process and on the rules, rather than on the results.

Despite working directly for the clients, many of these freelancers realized that some

departures from the specifications had to be made in order to complete the project

successfully on time. Accordingly, they attempted to advise the local clients’

representatives and tried to change their mentality.

In certain cases these freelancers became very frustrated. In some interviews, they

made disparaging remarks to me on the way the clients handled various situations. For

instance, to gain approval for the procurement of some electrical and mechanical systems,

the contractors were required to test a factory sample and show the results to the clients

for approval. Another freelancer from the UK, who was the design manager for the client

and who had worked in Asia for over 15 years complained thus:

People in the clients’ organization are indulging in pedantry to the extreme. Mr. X is oh!! (grimaces). Here’s another fine example – cooling towers. They are produced in Parapur. They are identical for contract A and contract B. So I said one test will do. “Oh no – no no no no – two tests – one for the first contract and one for the second contract” (insisted Mr. X). I don’t know what the bloody difference is – same model, same manufacturer (shakes his head). Pumps – same supplier – Kirloskar – “No no no no no no – two pump tests.” What can you do?

Because the same equipment supplied by the same manufacturer was being used on both

the contracts, the design manager felt that one test was sufficient. As the Design

Manager’s expressions and his opinion that the client was ‘indulging in pedantry to the

137

extreme’ show, there were conflicts and frustrations even within the clients’ organization

due to these differing views.

On the other hand, there were instances where the freelancers supported the

clients’ perspective. In some cases they felt that the contractors were guilty of delivering

a low-quality product and that strict supervision by the clients’ inspectors was crucial to

preventing the contractors from hoodwinking the clients. While the contractors felt that

the clients were needlessly imposing draconian standards, the freelancers felt that in

certain cases the clients’ representatives were justified in the approach they adopted. A

freelance construction manager spoke about some about inspections conducted prior to a

concrete pour:

Quite often our guys would go there and this bit of paper would have been signed off by these other three bodies and our guy would go there and quite quickly he would find 10-15 glaring defects, and it was pretty obvious that people on the contractors’ side weren’t doing their checking properly. So that was happening some of the time and our guys would get pissed off because they’d get called out there and they’d find 8-10 things that are clearly wrong, which anybody who did a proper check could have seen. So the concrete pour would be delayed, and the contractor would fix some of them and he would call our guy back and he would spot another couple of defects and would then go back again.

In sum, on the Indian projects conflicts arose between clients who relied on the exact

terms of the official contract, and contractors who often felt the need to advance the

works by deviating from the letter of the contract within what they felt was an acceptable

leeway. My data does not indicate that this type of conflict was widely prevalent on the

projects in Taiwan, although there were a few stories of such incidents. A Japanese

construction engineer in Taiwan related the following story:

138

If I ask something to SW-san (the client’s inspector) – then he (would) issue some impractical instructions. We had an argument about the girder a few days ago. There was a transverse girder that has a slope of 2% in the design. Usually its 1% this is for drainage. And they want to keep 150mm for protection layer thickness. SW-San always told us to keep 2% like the design says. “Design is correct – keep design” (SW-san says). But he also says, “Keep the 150mm.” It’s (mathematically) impossible!

With the geometrical constraints, a slope greater than 1% for this girder was not

mathematically possible. Yet the clients’ representative dogmatically insisted on the

contracts being followed and a slope of 2% being maintained. This led to a conflict and

some delays on this project, until the design documents were officially changed.

However, such instances of rule-following clients fighting with results-oriented

contractors were not the norm on the Taiwanese project, and descriptions of such

conflicts were few and far between.

Before investigating why these clashes were absent on the projects in Taiwan

(which will be dealt with in Chapter 2 of Part 4), and how these clashes were resolved

(the subject of chapter 3 of Part 4), I will examine other types of conflict that occurred

repeatedly on these projects. In the following chapter, I will discuss the second type of

clash that occurred between the local client bureaucracy (again mainly on the Indian

projects) and the international contractors – a clash between a bureaucratic and

centralized form of administration and an ‘Edge’ or decentralized form of project

management.

139

Chapter 8 – Conflicts due to a Bureaucratic Logic of Administration

vs. a Craft Logic of Administration

The local Indian clients and the international contractors differed in their views regarding

the administration of the works. The contractors were under the impression that they had

been given a ‘Design and Build’ contract, and therefore were in charge of designing and

building a structure in conformance to the specifications laid out by the client. Since the

performance risk in terms of finishing the construction on time and with the desired level

of quality lay with the contractors, they felt that they should be allowed considerable

latitude in planning and constructing the works, as long as it was in line with the clients’

specification.

This view resonates with Stinchcombe’s work on bureaucratic and craft

administration logics. In this work, Stinchcombe differentiates between two different

types of organizational administration, one of which is prevalent in non-project based

industries such as manufacturing, and another that is prevalent in more project based

industries such as construction (Stinchcombe 1959). The first form of administration is

what Stinchcombe refers to as the ‘Bureaucratic’ form of organization, in which the

organization has centralized authority and planning is done by general managers at the

higher levels of the organizational hierarchy. Therefore all information is passed up the

hierarchy, and typically there is a sizable staff to handle these communications. The other

form of administration is referred to as ‘Craft’ administration, wherein there are local

centers of technical people that manage their work themselves. There are no general

managers and all decisions do not need to go through the hierarchy. These local centers

or ‘crafts’ are specialists who are given the authority to perform. Separate mechanisms

140

such as warranties and the like are put in place to guarantee performance. This form of

administration, where the decision-making is done by pockets of specialists or experts

who are directly in charge of activities is, according to Stinchcombe, more typical of

construction projects where, due to extensive division of labor and specialization, the

professionals in each trade are equipped with the knowledge to manage their own

processes. This system of administration, which was very typical of the construction

industry in the USA, Europe and other developed countries, was more in line with the

views of the international contractors. These contractors thus brought with them the

assumption that the project was going to be administered via a craft logic.

The clients on the other hand were eager to be involved with the day-to-day

operations on the construction site, and wanted to play a part in planning the work on site.

Contractually the clients were expected to approve and inspect the work of the

contractors, and their official role was more passive in nature. In theory, they would

check the work of the contractor, and as long as it was in line with what was required by

the contract, would accept it. If they felt that the work in any way deviated from what

was specified in the contract, especially if the deviation reduced the overall quality of the

work, they were entitled to reject the contractor’s work. However, in reality the Indian

clients’ representatives desired to play a more active role on the project. They saw their

role as being more active participants in the decision making process and attempted to

control and influence the choices made by the contractor in terms of the way in which the

work was performed, the equipment vendors that were selected, and so on. They

preferred a more ‘Bureaucratic’ form of administration, a choice that the international

contractors had not anticipated and were surprised to encounter.

141

The clash between these two logics led to a bureaucratic logic being imposed on

the international constructional professionals. As Scott argues, professionals placed in a

bureaucracy may tend to feel constrained and restricted by the bureaucratic rules, and

resist bureaucratic supervision since the supervisors often lack the necessary technical

competence (Scott 1966). Such a situation was indeed enacted in the Indian projects, and

led to several issues and problems. Like the ‘Rules vs. Results’ issues, the problems due

to a bureaucratic administration were not very prevalent in Taiwan.

Confirming these ideas, an Indian clients’ representative, a design engineer who

had worked with the Indian government for eight years or so, had the following to say:

Most of the Indian people are from the Government organization and bureaucratic set up. So you will find that it is a very hierarchical structure – especially railways is very hierarchical. Whatever the boss says has to be obeyed, whereas these people who are coming from other companies, their work culture is essentially completely different. They are oriented more towards a horizontal type of setup where the experts are working there and they are responsible for whatever they see. And they take care (of issues that arise). I mean because of this there are conflicts. We experienced a lot of conflicts because of the differing mindsets of the people because of the differing backgrounds.

The thing is that in our hierarchical government organization, the person above you feels the need to be responsible for your work as well. Normally he tries to have a hands-on experience on what you are also doing. He tries to understand every little thing of what you are doing. But when the same subject is being dealt with by two people then it is natural that they come up with competing ideas – and that happens in this case also, and that generates the conflict.

This representative stated in many subsequent interviews that he was rather frustrated

with the Indian project management systems. In his view the Indian clients were used to

taking a hands-on approach to the project, making sure they had a clear understanding of

what was being planned, and expecting their ideas to be implemented. On several issues,

the contractors tried to implement a strategy, while simultaneously the client

142

recommended implementing a different strategy. Since both sides often held competing

views and each felt that authority should rest with themselves, conflicts ensued.

In the next few sections, I will describe the various aspects of this phenomenon in

greater detail. Chiefly, there were three types of issues that led to extended discussions

and needed to be resolved. These were the following:

1. In several cases, the clients tried to impose their views on the contractors, and the

contractors resisted this.

2. Since the clients were keen to have complete information on every issue and were

not satisfied by just knowing the final choices made by the contractors, they

frequently asked the contractors for large amounts of information. The contractors

felt that this was not required of them, and that they would need to spend a lot of

time getting this information. Therefore once again this led to resistance

3. Finally, since the clients’ organization was highly centralized and hierarchical,

and since the clients wanted to be in control of every decision that was made, any

piece of information that the contractors submitted not only traveled up to the

higher echelons of the Indian bureaucracy, but was also be carefully scrutinized.

Such a process took a considerable amount of time causing delays on the project.

These delays frustrated the contractors and led to disputes as to who should bear

the costs associated with the delays.

I will now elaborate in greater detail on each of these three elements discussed above

143

Client as ‘Nosy-Parker’ or Mentor

The clients tried to impose their views on the contractors in several ways. The first set of

issues relates to the selection of a ‘preferred supplier’. For every piece of material or

equipment that was used or installed on the site, the contractors were expected to select a

vendor or a subcontractor who was both reliable and could supply the required piece of

equipment at the desired level of quality. The contractors advertised for vendors, and

upon receiving proposals chose a vendor who was both economical (from the contractors’

perspective), and who fit the quality and reliability standards required by the clients. The

contractors’ contention was that since the performance risk was on their shoulders, they

should be allowed to choose a vendor with whom they felt comfortable, as long as this

vendor met the clients’ criteria.

However, in many cases, the clients had specific suppliers in mind, and

endeavored to get the contractors to accept them. In some cases, these suppliers or

vendors were either costlier that the contractors’ choice, or were less reliable in the eyes

of the contractors. In the latter case, since the contractors bore the risk of completing the

project on time and at the required level of quality, they were loath to accept this choice.

Since the clients controlled both the flow of money to the contractors and had to approve

the contractors’ requests, they were in a position to force the contractor to accept their

own choices. The fact that two parties favored different vendors often caused frustration,

especially on the part of the contractors.

One of the expatriates working for the clients had the following story to tell:

Every one of these panels has switchgear inside it. The clients know fine well that they are not going to use Company A’s switchgear, and they’ve allowed Contractor X to just go along and try to improve their submissions and other

144

aspects. They will reject this based on some information from submission one – which they could have easily said, “There is no way you can do this,” right at the beginning. The clients want Company B – and by a process of rejection of everyone else in the market, they have made Contractor Y on the other contract choose Company B.

Although this expatriate was the design manager for the clients he was quite frustrated by

what he viewed as unethical behavior on the part of the clients. In his view, the

contractors’ initial selection of a vendor was acceptable, but the clients preferred

Company B and therefore sought reasons, however feeble, to reject the contractors’

request.

This same expatriate design manager, offered another example:

Talk about signage (signs in the stations). They know who they want and what they’ll pay but they’ll still try to say that they want a fair competition – especially if the contractor suggests someone, since they may not like this guy and use ‘fair competition’ as an excuse to reject everyone except their preferred supplier.

The contractors also shared the view that the clients manipulated the selection of the

vendors. A contract manager for one of the contractors, a freelance British quantity

surveyor with over fifteen years of experience in working in Asia, confessed:

But there are situations whereby you pick a vendor and maybe they want someone else – so maybe somebody gives you a reason to say why the vendor is not suitable and why you should use this one. So that delays things a little.

The project manager for one of the contractors added:

They’ve caused a lot of problems and it has delayed the process of procurement – because we find that if they are not happy with the vendor that we are proposing, they might go into the history of the company rather than go on the technical side – anything really to find ways of rejecting the supplier.

145

In some cases the clients justifiably rejected the contractors’ suggestions on technical

grounds. In some cases the contractors’ selection did not pass the clients’ test of

reliability and quality – and in these cases the expatriates who worked for the clients

agreed that the proposed supplier be rejected. However, even in cases where both the

contractors and the expatriates working for the clients (and therefore representing the

interests of the clients) thought that the contractors’ submissions were acceptable, the

clients frequently unearthed some statistic that disqualified the supplier, much to the

chagrin of the expatriates on both sides. Typically, the contractors therefore proposed a

set of suppliers in decreasing order of preference and the clients then rejected them one

by one until they came to their preferred supplier. This repetition of submissions not only

caused the contractors to delay the start of the works (as they took longer to select a

vendor or a subcontractor), but was also frustrating, since they no longer felt they had

control over decisions that were made on the project.

In some cases, the clients were more aggressive and proactively selected the

vendor or the supplier that the contractors should choose. I observed one such case that

related to architectural finishes for one of the stations on the project. The international

contractors had prepared a package of work items to be bid out. However, the clients’

representatives took charge of this process, oversaw the bidding and selected vendors and

subcontractors that they insisted that the contractors use. In this particular case, the

contractors felt that the firms selected were unreliable and were reluctant to award the

subcontracts to these firms. However, since the clients controlled both the approvals and

the financial flows, the clients had their way.

146

The clients’ hands-on involvement was not restricted to selecting or approving

vendors and subcontractors. In some cases the clients also tried to influence the design

and work processes. When asked to describe the clients’ influence on the entire project,

the contracts manager for one of the contractors remarked

The clients’ involvement in this project is very hands-on – they are involved in every minor detail of this project – whereas if you were doing this project for a private developer, since he is looking for revenue from this, he is really interested in, “How fast can you build it, to the best standards possible and how can I put it into operation? I’ve given you all the risks of that and I will put an engineer into position to ensure that I am protected and you follow the specifications.” And therefore the influences or the hindrances of the employer is far less and therefore the ability of the employer to perform is far greater.

The contracts manager in this case compared this project to other projects that he had

worked on, particularly in the private sector, and believed the clients’ involvement caused

inefficiencies and hindrances on the project.

The clients on the other hand had a slightly different view of the proceedings.

Although they were aware that they were interfering with the contractor’s work, they

claimed they were justified because the contractors were not competent and therefore

their work needed to be monitored closely. An Indian representative who had worked for

the government as a civil engineer for more than ten years maintained that:

We expected that a good job will be done by contractor himself – but we found that they were not doing this. Because they were not aware of the methods. So then we had to take up this matter with their management – and then we had a drive where Project Manager (from the contractor’s side) was asked to conduct a crash course to educate everyone on site. We have ensured this – we monitored who attended and how many people attended. Then we went to the site – then we have just got sample cases. If they don’t know something, then we say, “Either you learn in 3 days or you are out.”

147

It was precisely this sort of heavy involvement in the running of the day-to-day works of

the project, which the contractors were unhappy about. They felt that the clients’

involvement distracted the workers into performing tasks, such as those in the example

above, that were not part of the activities the contractors had in mind for a successful

completion of the project.

Even some of the freelancers who were working for the clients sympathized with

the contractors’ point of view. An expatriate design engineer – yet another Britisher who

had worked for more than ten years on projects in Hong Kong, China, Singapore and

Malaysia, and who worked as a structural consultant for the clients, summed up the

situation:

These are design and construct contracts, and the contractor is responsible for specifying the design. You do have a bit of difficulty for the client understanding that the contractor is proposing doing something different to the way the client sees it done, because it’s a different type of project. One of the interesting things is that clients want to be more hands on involved.

The project director for the clients’ consultants, a British expatriate who had worked in

Africa and in Asia for over 20 years once confided:

The gentleman who just came in – during the tender stage I used to sit down with him and sometimes it would be with all the clients’ people, to try to get him to see what Design and Build was all about. Because he certainly had the view that notwithstanding what it says in the contract, I can select the manufacturer of this Air Handling Unit and I said, “No you cant Mr X – you cannot do that.”

The above examples gave a taste of a situation where the contractors did not expect and

resisted a very hands-on approach adopted by the clients, leading to some conflicts,

difficulties, and frustration. I next explain another type of issue that occurred on these

148

projects due to the clients wanting to be aware of everything that transpired at every level

of the project – the dilemma of more vs. less information.

Providing More vs. Less Information to the Client

The Indian clients, in keeping with their bureaucratic approach to project administration,

were keen on receiving detailed information and justification from the contractors on

virtually every process that the contractors undertook. The contractors, who were

contractually obligated to provide certain pieces of information to the clients such as

method statements and progress reports, often felt that the clients’ requests were over and

above what they were expected to provide. This led to some impasses on the project.

An example that I observed over the course of a few meetings best illustrates this

issue. The clients had increased the scope of work for one of the stations on the project

and had issued an official ‘clients’ variation order’ – a document asking the contractor to

perform extra work. The clients had directed the contractors to prepare an estimate of the

extra costs involved.

The contractors estimated the work that needed to be done, solicited quotations

and purchase orders from prospective subcontractors, added on their standard mark-up

rate (15%) and submitted an estimate to the clients’ Indian representatives. There were

minor disputes on the estimated quantities of some of the civil engineering items (steel,

excavation, concrete etc), but these were generally easily solved as the contractors noted

the clients’ concerns and performed a recalculation, which the clients accepted. The

clients’ consultant, a British expatriate who had worked in the Philippines, in Malaysia

and in Singapore as an expert on electrical systems, had reviewed and ratified that the

149

costs submitted by the contractors for the electrical systems were reflective of the market

rate for the performance of the works in the contract. He therefore recommended that the

clients accept these estimates.

However, in a final meeting that the clients called to assess the contractors’

additional costs for several electrical and mechanical items in the work package, the

Indian engineers objected to the calculations presented by the contractors’ costing

manager.

These clients’ representatives wanted precise estimates of the cost of the works

such as the price of raw materials, the cost of manufacturing equipment, the cost of

delivering it and installing it, and so on. They wanted the contractors to estimate these

costs and determine the price of the variation order, as opposed to the contractors’ earlier

strategy of cushioning the market price of the required services with a markup.

The contractors felt that performing detailed calculations would consume time

and therefore cause delays on the projects. Also, as they were not doing the work directly,

they were not willing to bear the risks of the subcontractors exceeding the price that the

contractors quoted to the clients. The contractors argued that if several subcontractors had

quoted a similar amount, then that amount was the true market price for the works. After

all, even the British electrical expert hired by the clients had accepted the contractors’

estimates.

The debate in the meeting that I observed centered more on the methodology of

evaluation used by the contractors and the adequacy of documentation supplied. It did

NOT center on the actual cost of the work package proposed by the contractors. The

contractors’ costing manager shouted at one point:

150

Is the price reasonable or unreasonable? You have not told us that the price is unreasonable. If it is unreasonable, then tell us it is unreasonable.

To which the client’s representative replied that it was not a question of the price being

reasonable. They merely needed full justification for how the price was calculated in

order to assure themselves that the contractor was not profiting unfairly. As an

experienced Indian design engineer who had worked for the government for over twenty

years, remarked in a later interview:

The thing is – they have submitted a cost and they have to justify it. They feel that we have to justify it. We cannot justify their cost. They have submitted a cost, and the client has asked them for a split up. For example, what is the cost of transformer, labor component, etc. The contractor has to justify this. To justify their cost, some basis is to be adopted. We told them, “Give us the cost of all the different items that you have subcontracted and we can proceed.” They are not submitting that! Till such time that they make up their mind, it is quite difficult.

The altercations concluded with the contractor saying,

Look, I have given my work order – I can give nothing more. What do you want from me? The contract says that we will be reimbursed (for the costs incurred). I don’t need to submit all that you ask – I have given you all the necessary comparisons.

The meeting was then indefinitely adjourned, and at that point no next steps were

suggested. In a subsequent interview, the costing manager for the contractor argued that

the client was being extremely unreasonable and bureaucratic. In his view:

Of course the Indian client is more bureaucratic and wants more backup. My point is quite clear and this is what I said at the meeting already. For us, we cannot force

151

anybody – whether its subcontractor A or another subcontractor to break down their costs and open their books for whatsoever reason. We have no power over their internal arrangements and this is not required. For us, we have already gone one step more than is required. Whatever the subcontractors quote is the cost. The clients are not telling us anymore that our price is unreasonable. The British electrical expert has made an internal estimate and they feel that our price is not unreasonable. But the argument that we have not structured our documentation in the right way, is just nonsense. Anyway, it doesn’t matter what they charge as long as the backup is there so that they can stand up in front of other people. So the cost is not the concern, its just the backup. We are not going to provide them more backup.

An Indian electrical engineer who was also one of the consultants to the clients, but was

sympathetic towards the views of the contractors summed up the situation:

This meeting is one of the good examples of a meeting where the people who are bureaucratic in nature are attending, who do not have the clear-cut understanding with the issues and how (the issues are) to be solved. Just based on their own imagination of how the things should be solved and all that, they are just sitting in the meeting (and saying) that this contractor has subcontracted to someone, and so they must have all the details. The British expatriate has checked everything – and he is saying that their overall figure is reasonable! But when you are checking the reasonableness of their estimate, I don’t know why you should check all these overheads. If you want to purchase a pen – you can ask 3 vendors or 100 manufacturers, and then you have to be conscious of the time that is spent. I tried to say, but I don’t think anyone else was going to listen. If they (the contractor) pay something to the (sub)contractor, they have a contract agreement. Since all these are companies, they are all bound by their own auditing and all that – so they will not do something like that (cheating the client). They (the subcontractor) wont charge differently – they have their own audit and internal accounts and procedures – so they (the client) should not be suspicious.

The contractors were reluctant to provide the information that the clients requested partly

due to the extra work involved. In addition, the contractors envisaged a different

approach to the process and assumed that they were the ones in charge of making

decisions regarding the variation. The clients’ bureaucratic approach where they wanted

to control and specify the contractors’ operations led to the clients asking for more

152

information than the contractors thought was necessary, leading to difficulties on the

projects.

Delays in Decision Making

The Indian clients’ pro-active approach to reviewing all submissions and data and their

highly centralized, bureaucratic decision making process through a long sequence of

approvals took an inordinate amount of time and constantly threatened to delay

construction. Accordingly, contractors threatened to submit claims for reimbursement of

losses caused by such delays. In meetings the contractors frequently protested delays

leading to altercations between representatives from both sides.

One of several incidents that illustrate this dynamic relates to an architectural

feature known as a platform membrane for protecting people on the platform from

electric charges emitted by incoming trains. A special consultant had analyzed this

situation and concluded that no membrane was necessary because even if a surge

occurred, damage would be minimal. Rather than accept the consultant’s

recommendation, the clients deliberated on his analysis. All parties knew the deliberation

would cause delays for the contractors and their subcontractors regardless of the clients’

decision. An architectural consultant, an Indian private sector employee hired by the

clients to oversee the architectural works tried to speed the process along:

I am trying to get a decision now pending with the client – and they are just sitting on it... they are deliberating upon should it be there or not be there ... I have been asking them, give me a decision fast, because (the contractor performing the work) can say, “You caused the delay, you pay me this much extra.”

153

Because projects entailed a multitude of decisions, the clients’ slowness in making and

conveying decisions constantly frustrated the contractors. While decisions were being

made, equipment sat idle, administrative overhead mounted, and consequently the risk of

having to pay the clients liquidated damages if the project failed to meet scheduled

completion, grew. One of the contractors’ employees, a Swedish national who had

worked for internationally for more than fifteen years, believed the problem was endemic

to working in India:

I would say one of the things that is particular about India, is that it is very difficult to get a decision made – extremely difficult. And the person at the top won’t make a decision unless the lowest peon at the bottom has given his comment and there are no negative comments and so it comes all the way up and he can take a decision because all these guys say its alright – its totally frustrating – you cannot have a one-to-one meeting with somebody and decide something – sit down with someone who is going to be a decision maker and – its just not possible – that’s extremely frustrating.

A contract manager concurred:

Within the hierarchical system of the government, there is nobody who is allowed to make that commitment … so they have a tiered system – the ball is on the bottom – you have to push it up to the next level and then up to the next level – when it gets all the way to the top – somebody in government might say – yes I agree – or yes I instruct. So with most issues on a project like this, our task is to push it up that pyramid so that someone can sign it off, agree, release the payment, or acknowledge something. That’s very, very difficult, as I’m sure you’ll appreciate.

The contractors’ need to enquire constantly about decisions and nag the clients strained

relations between contractors and clients.

154

The freelance expatriates who worked for the clients and the contractors agreed

that the clients were delaying progress more than they had encountered on previous

projects. Even the freelancers who represented the clients viewed the clients’ behavior

uncharitably. The construction manager for the client (a British expatriate) underscored

the irony of the situation:

Its all well and good, but [the Indians] have to realize that people on this project are working night and day to get this thing done and if someone is sitting on the approval of a motor for 9 to11 months, then this won’t finish and things will go horribly wrong. The director of electrical works (for the client) will sit around and say sorry Mr. MD (Managing Director of the Indian Project), but we insisted on the best and so things are not ready. It’s scandalous! Comments should come in 28 days! But there were a lot of those that dragged on and on. So, when the MD was asking to advance the opening date, the contractor said you should speed up the responses – our people are not very good at this – people bust their gut to get things built.

The freelance consultant clearly understood the need for progress, especially since the

managing director had asked the for railway line to be opened earlier. Yet, one of the

most significant roadblocks to meeting the clients’ accelerated schedule was that the

clients took an extraordinarily long time to approve the contractors’ submission. The

freelancer who worked for the clients was frustrated.

The Views of Different Project Participants regarding Administration of the Works

The preceding sections have described a set of conflicts and issues that arose on

construction projects because clients and contractors subscribed to different logics of

project administration or governance. Contractors desired freedom to make choices and

expected the clients to play a supporting role. Clients on the other hand wanted control

155

and a larger role in project administration. They believed they should closely scrutinize

the contractors’ work and ensure that the construction and installation work conformed to

their ideas, even if the contractors had a different approach.

Clients’ View

Clients felt their attitude and approaches were justified, because if they were not deeply

involved in the project, contractors might cheat them. As one very senior Indian engineer

stated:

It is a Design-Build contract. The contractors expatriate in charge of the tender specifications said it’s a Design-Build contract and so there is nothing much for us (the clients) to write in the tender specifications. We only have to give our requirement that this is this station, concourse level, platform, plant rooms and other basic requirements. Further details and design need not be given. So at that time, nobody thought of incorporating much details in the tender and so now the contractor is taking advantage of that. Some things are essential, but because it is not written, they take advantage. That is happening and it will happen.

The engineer believed that because the Design and Build contract gave considerable

flexibility and responsibility to the contractors, the details of the structure were not fully

defined in the initial stages. Consequently, the contractors might deliver a structure that

was not in line with the clients’ expectations. Worse yet, the contractors might take

advantage of the ambiguity to deliver a product that was profitable for the contractors but

inferior to what the clients expected. From this perspective, a hands-on approach was an

appropriate strategy for mitigating such behavior from the contractors. Centralized

decision-making was seen as a way of insuring a high-quality structure. As one Indian

engineer noted, the bureaucratic process was quite successful:

156

We were successful in getting a very good design from the designer. Otherwise, on a Design-Build contract, you are likely to lose a lot. You might need one meter wide, and they would give you half a meter.

Furthermore, it was normal practice in public-sector construction projects in India for the

clients’ senior officials to control decisions on the project. The Indian clients’

representatives simply followed the existing management system that they were used to.

One mid-level Indian engineer who had worked for the government for around ten years

explained how the Indian system worked:

Normally we work as an assistant to the boss. He will tell you, “Please look into all of this and get back to me.” I will look into it and explain to him and he will take the decision. If someone is of younger age and he is expert in a particular area, in a horizontal set up he is supposed to take the decisions in that area – but that may not be liked by his Indian boss! He should take the decision only through the boss. The boss will not feel very good if some junior staff takes an independent decision. What happened was that I used to approve the drawings for some of the works and my Indian boss would say, “Why have you done like this, please explain to me.” I tried to go to him and explain each and every thing, but they ask so many questions and it took too much time.

Contractors’ View

The international contractors, on the other hand, did not see the situation in quite the

same way. In their view, the decision-making responsibility lay with the contractors as

per the contract, and the clients were thus being highly meddlesome. A contract manager

representing the Japanese, German and Korean firms, a British expatriate with several

years of experience working in Asia, argued:

This is a Design -Build contract and the Consultant’s (task) is to ensure that we comply with the contract requirement – specifications, drawings and everything else – but I think due to the pressure of the client, they are being pushed into a

157

situation where they are trying to control the job rather than to monitor it. To me, a Design Build project should be monitoring, not controlling – if we are not complying with the document, then OK, its their job to raise it and to push us into complying with the contract – but there are other occasions where they are trying to push us in their direction rather than to let us go on, when everything is in compliance with the contract.

The contracts manager for the other contract, another widely experienced British

expatriate, confirmed this sentiment:

I can pour (concrete) and that pour is at my risk – and if later there is some problem with this, then I will rectify it. Since I have given you (the client) the guarantee of the product, the workmanship and the design, everything is at my risk. So if its at my risk then maybe the decision to pour or not should be mine – or more mine than it is yours. You (the client) have a duty to make sure that we are following specs. As a matter of fact, the employer is risk free – all risks are with the contractor – and in that situation, in a 50-50 situation, it should be his (the contractors) decision whether to continue or to stop. So the main aim on a project like this must be to drive the progress of the works forward – if you have a system that stops it so that the project is all stop go stop go – that’s not good.

Both individuals felt that since the contractual and performance risks were with the

contractors, they should be allowed to proceed with the works as long as it was in

keeping with what was written in the specifications. The fact the clients constantly

questioned and rejected the contractors’ views was an immense source of frustration for

the contractors. In an interview, the second contract manager angrily said:

Why should you view it different from anything else? It’s a person that you (the clients) have an agreement to do something with – and there’s money involved that he (the contractors) will be paid for doing that task – and he has certain obligations to meet like timely completion, quality and so on and you have reciprocal obligations to be on time, not to hinder him, solve all the problems you have for him – to get the project in place. What can be more simpler than that? What is the problem?

158

The fact that the clients did not trust the contractors was not lost on the contractors.

However they insisted that they were trying to do their best, and that they were not trying

to cheat the clients, who in their eagerness to ensure good quality on the projects, were

being too demanding. The electrical and mechanical expert for the one of the contractors

opined:

And here you have so many people from the client that are trying to mess with you all the time, saying, “Now I won’t pass this because I don’t know what’s in this.” And you take it into the equipment – they are asking the most meticulous things. And all you do is turn around and say, “Not required” and they say, “We’re the client – we want it!” What they don’t understand is that it’s a Design Build contract. Responsibility is with the contractor. It’s not with anybody else. And we always put it down to an auto analogy – they are after a Rolls Royce, when a mini will do the job. We’re not trying to cut corners – of course we do believe that there are ways that money could be saved, but it does not mean that we are going to give you, the client, anything worse – the standards are still there.

Freelance Consultant’s Views

In many cases, the freelance expatriates who were working with the clients tended to

support the contractors’ viewpoint. They understood that the contractors were pushing to

get the work done, the timeline was quite aggressive and the contract was Design and

Build. As a result, they felt that the clients were being too intrusive in overseeing the

project. During an interview, the freelance design manager for the clients said:

There’s no recognition of giving the contractor complete freedom to build as he wishes and that is exactly what the contractor must be allowed to do.

We have staff from the client – but they don’t change their mindset to try and understand the fact that we want to quickly get things processed, done with and move on to the next issue. So you still have elements of the design that could drag on. These guys have a bad understanding of the need to get on with things.

159

Conclusion

Aside from trying to push the process continually forward, contractors also took steps to

protect themselves. They documented their complaints in writing to create an official

paper trail that they could point to later on in the claims process. They even threatened to

file claims at the end of the project. As the contracts manager for one of the contracts

described:

For delays I would want to know the reason – Why are we having delays? Are we or someone else responsible? If someone else is, then I will file a claim after I have established all the facts and it’s a claim under the contract. I will then put in a notification letter and I will try to see how I can prove it against the program and how I can cash it. Then I would submit a claim – “This is what happened. Here is what we are claiming under the contract. This is what it costs and this is the amount of time we need.”

However because they doubted they would be able to recover their losses through claims

and litigation, they most strove to keep things simple and get decisions made on time.

The clients were not used to such behavior from their previous experiences with

contractors in India, and thought that the contractors’ behavior was inappropriate.

These examples have illustrated a clash between two different conceptions of

performing work on a construction project. The international contractors favored a craft

administration system where, in a Design-Build contract, the clients would monitor the

works but not micro-manage or control the details of the works by interfering in the

vendor selection processes and similar matters. The local Indian clients, on the other hand

favored a bureaucratic administration system where the clients had complete control of

the decisions that were made on the project. One of the freelance expatriates who was

acting as the Construction Manager for the clients summarized this situation perfectly:

160

In some countries in Europe, contractors are trusted by the client – the contractor produces a good safety plan and a manual and says that he’s going to do everything and the client says yeah ok, go off and build it and let me know when its finished – and so in some parts of Europe I think that’s how it works and so for the main contractors, and so sometimes they see it as we are interfering and that they should be allowed to manage the works. So you could say yeah the contractors were probably surprised at the amount of involvement or the interference from our side. Maybe in some other countries, you don’t see that – maybe there are only so many resources and there is only so much you can do in a day so you do what’s critical – so I think some of the foreigners on the JV’s were surprised and not maybe happy

This expatriate who had wide international experience felt that some of the issues on

these projects could be attributed to differences in national construction environments. As

Stinchcombe proposed, clients tended to be far less involved in projects in Europe.

Several international contractors’ representatives from Europe and developed Asian

countries were used to such a system. However, this set of institutional norms and beliefs

came into conflict with the set of institutions that were held by the Indian clients, who

wished to be highly involved on the projects. Although client-contractor disputes are

present on several mono-cultural projects in Europe and in other parts of the world as

well, my data indicates that some of the difficulties encountered on this project arose due

to differences between generally internationally accepted norms and practices relating to

client-contractor relationships, and the Indian construction management practices. A

further elaboration of this idea will be the main subject of chapter 12.

As mistaken or as irrational as their approach might seem, a set of systems and

drivers in the local environment encouraged the Indians to behave in the manner

described above. Given the existence of these drivers, the Indian clients’ behavior was

quite logical. I will now address the reasons behind the behavior of the Indian clients.

161

Chapter 9 - Factors Driving the Behavior of the Indian Client

The client-contractor issues that have been illustrated earlier deal with conflicts between

rules following, bureaucratic clients and contractors who were more accustomed to

working independently and concentrating on the progress of the works rather than on the

rules of the contract. Most of the contractors had a large amount of international

exposure, and their views were conditioned by their training and experience. The Indian

clients’ behavior was conditioned by a set of regulations, social norms and beliefs that

they were exposed to in the Indian environment. In order to understand the reasons for

the clients’ extreme bureaucratic behavior, we must first understand the historical origins

and nature of the Indian government.

Origins of the bureaucratic Indian governance system

The Indian government was modeled along the lines of the British government, which in

turn adopted a bureaucratic system of governance similar to that espoused by Max

Weber. Up to the end of the 17th century, the political and administrative arms of the

British government system were part of the same ruling body. As a result, decisions could

be made and implemented autocratically. After the Glorious Revolution however, these

two functions were separated into two distinct arms that were intended to work hand in

hand. The political arm was constituted by a set of elected officials who were in charge of

making policy decisions. A separate, neutral administrative arm composed of civil

servants was in charge of implementing these policies. These civil servants were

permanent employees who were selected on the basis of their merit and were loyal to the

constitution and not to the ruling party. They provided input to the transient politicians on

162

matters of policy and as Weber later envisaged, were part of a hierarchical organization

bound by rules and procedures. Internal and external control systems helped ensure that

the civil servants would not engage in corrupt behavior (Misra 1986). This model of

administration was then transferred to India during the colonial period (Misra 1986).

British colonization of India had its roots in the 17th century, when the Crown of

England granted the British East India Company the rights to trade with India and other

nations of the east. Over a period of time, the British East India Company annexed and

acquired Indian territories, and invested in fixed capital assets (buildings, warehouses etc)

to promote their trade interests. In order to administer its growing empire, the Company

needed administrative as well as military staff. The Company set up academies in

England to train officers for overseas postings. The Company also introduced an early

model of "legal-rational" administration in India with emphasis on impersonality and

appointment by merit that even preceded the British government bureaucracy. They thus

introduced bureaucratic control into India. However, the British public’s and the Crown’s

faith in the company was shattered after the revolt of 1857, and soon after, Britain took

over the direct administration of India from the Company (Gardner 1972).

Throughout the East India Company’s and the Crown’s rule in India, British

officers were guilty of taking bribes from local princes in return for political services. In

the late 1780’s, Lord Cornwallis formed the Cornwallis code to address this situation.

This made the rule of law the basis of all executive action. The code placed legal

restraints on the exercise of authority by stipulating procedures to be followed. The area

of discretion was reduced in order to curb corruption (Das 2000).

163

Also, there were a total of 562 princely states and provinces in India. British

premier Macdonald wanted to grant the provinces autonomy and freedom to make

decisions. However his Labor government soon fell and the Conservative government

that came to power modified Macdonald’s scheme as they had misgivings and were

reluctant to part with power to the local Indians. As a result, they set up a very

hierarchical and centralized system of reporting wherein decisions were mostly made at

the top. The mere size of the country and the population required a fairly heavy apparatus

of administration (Nair and Jain 2000).

The British system of administration – first through the East India Company and

then through the British government - in its effort to root out corruption and maintain

control over a large number of extremely heterogeneous territories, thus led to a highly

centralized, bureaucratic and rule-following system of governance. Even after India

gained its independence, the existing model of administration persisted. Das points out:

‘The nature and style of public administration in India has not changed very much since the colonial days. In essence it is a rule-based administration, at least the way it is designed on paper, and a number of control systems, both internal and external, are in place’ (Das 2000)

Contemporary Indian civil servants were therefore trained and educated in a system with

internal controls that encouraged and institutionalized a highly bureaucratic and rule-

following type of behavior.

In addition, another key factor that was an important determinant of the local

behavior, was the role played by an external control organization - the Central Vigilance

Committee (CVC).

164

The Effect of ‘Vigilance’ on the behavior of the Indian Client:

The origins of the Central Vigilance Commission (CVC) can be traced to the Mundhra

financial scandal that came to light in 19575. The Life Insurance Corporation of India

(LIC) had purchased a large amount of shares belonging to an Indian industrialist named

Mundhra, at the behest of some government officials and without the consent of LIC’s

investment committee. The intent was to help Mr Mundhra overcome his financial

difficulties. Firoze Gandhi, the prime ministers nephew, disclosed this surreptitious deal

to the Indian Parliament in 1958. This then led to a nationwide furore and the resignation

of the Indian finance minister.6 A parliamentary debate followed, where many members

of parliament discussed the ‘growing menace of corruption in administration’ and

recommended establishing the Committee on Prevention of Corruption7. The Central

Vigilance Commission (CVC) was an anti-corruption agency set up by the Government

in February, 1964 on the recommendations of the Committee on Prevention of

Corruption, headed by Shri K. Santhanam, to advise and guide Central Government

agencies in the field of vigilance. CVC was conceived to be the apex vigilance institution,

free of control from any executive authority, monitoring all vigilance activity under the

Central Government and advising various authorities in Central Government

organizations in planning, executing, reviewing and reforming their vigilance work8.

In essence, the CVC was a body that was created in order to overcome the evils of

corruption in the Indian administrative system. The CVC would either directly monitor or

send a separate task force to every public sector undertaking in India. The duty of this

5 http://hir.harvard.edu/articles/925/ referenced May 29, 2005 6 Article titled The more things change…’, accessed at http://www.rediff.com/money/2001/aug/08dalal.htm on May 29, 2005 7 http://www.geocities.com/kstability/projects/integrity2/cvc.html, accessed on May 29, 2005 8 From the website of the Central Vigilance Commission - http://cvc.nic.in/, referenced on Jan 30th, 2005

165

task force was to ensure that all the processes undertaken on a given project were free of

corruption. Every task force was set up as an independent entity, and therefore reported

only to the central Vigilance commissioner, not to anyone on the project. The CVC had

established a division in the project that I observed in India and would occasionally visit

various sites, evaluate design changes, purchase orders and so on, to ensure that

appropriate practices were being followed. The project participants referred to this unit as

‘Vigilance’.

In November 2003, the Vigilance Commission sent a message to the project that

started with the following lines:

Corruption is the biggest evil of our society. It has reached such serious proportions that we cannot choose to sit and lie back. Persistence and determination alone would enable us to eradicate the evil of corruption

The Vigilance officers had two roles – preventive and punitive. In their statement of their

roles and functions, the CVC states:

Even though detection and punishment of corruption and other malpractices are certainly important, what is more important is taking preventive measures instead of hunting for the guilty in the post corruption stage.9

Vigilance officers’ roles on the preventive side included activities such as identifying the

sensitive/corruption prone spots in the organization by keeping an eye on personnel

posted in such areas as well as planning and enforcing surprise inspections and regular

inspections to detect system failures and the existence of corruption or malpractices. It

must be noted however, that as a state-run initiative, the Vigilance Commission could

only supervise public sector projects and the work of government employees. Although 9 http://cvc.nic.in/rnfcvo.htm

166

the private sector was also an equally likely source of corruption, the CVC was unable to

directly investigate or take action against private sector employees.

On the punitive side, once someone was found guilty of corruption, the Vigilance

officer’s responsibilities were mainly to gather all the incriminating evidence and to assist

the Central Bureau of Investigation (CBI) in prosecuting the offender.

Corruption was still rampant in India, especially in the public sector as the

message from the Vigilance Commission indicates. A World Economic Forum survey

ranked India 45th out of 49 countries on the honesty of its officials and 44th in the

effectiveness of laws protecting shareholders10. With this in mind, this commission had

been given the independence to take any measures necessary to prevent corruption and to

ensure that the projects undertaken by the Indian government were of good quality and

full benefit to the society. The aim of Vigilance was NOT to impede the works on the

project or to undermine the contribution of the employees, but to help improve project

quality. The Chief Vigilance Officer sent the following memo to project participants.

The purpose of Vigilance is to keep systems healthy and improve upon them; not to harass people and impede progress of work. In fact it is a vigilant team, which makes working environment effective and thus pleasant… Let us have a wonderful project, a transparent project

However, the local participants on the project perceived vigilance differently. An Indian

architect who was a consultant on this project described Vigilance thus

Vigilance is an anti corruption unit kind of a thing. So they keep on checking things so that if they find that something is unduly expensive or hasn’t been worth the money, they keep on asking the question “why has it been so?” because they suspect that people are corrupt. So if you bought something that was expensive, then in their minds you might have received some kickbacks on that. So they are

10 http://www.ncpa.org/pi/internat/pdinter/april98e.html

167

asking questions “why”. Maybe the time was such that it was so short that you had to make the decision and it ended up being more expensive, but with the hindsight you can always say, yes I could have done this. But at the time you have to take decisions, and because that thing is at the back of their (government employees) minds they take much longer to make decisions than they would have, had that thing not been there on their minds.

Most project participants including this architect viewed Vigilance as an organization that

was forever suspicious of the actions of the project participants, thereby causing them to

make decisions more slowly and carefully. ‘Guilty until proven innocent’ was the motto

by which Vigilance operated, and at the slightest suspicion as to whether an employee

had made a correct decision (be it in inspecting the works on site, approving a vendor

etc), they would quickly turn on their spotlight. This put pressure on the Indian

government employees since they felt that they were constantly being investigated. The

disadvantage of being investigated was that if one were to be found guilty, then one

would be apprehended and prosecuted by the Vigilance commission, at a great loss to

both one’s career and one’s bank balance. This often proved to be quite frustrating for the

government employees. As one of the Indian site managers said:

Also, for us – anything you do, you may be hauled by Vigilance. Sometimes we are asked, “did you get any of that cost savings” – Vigilance always catches on that. Vigilance is a very stupid thing – they just go by their guidelines and say ‘why don’t you do this – are you competent? Why did you allow this?’ Whether it is technically feasible or not they do not bother. They can do anything – so they are completely bureaucratic – they have no compassion.

An idea of the workings of Vigilance and its possible effects on the career of a

government employee can best be described by an anecdote that one of the expatriate

freelancers in the client’s organization told me. An Indian employee in the organization

was alleged to have done something wrong on a previous project. A case was lodged

168

against him. While he was under investigation, he was not eligible for pay-raises or

promotions. Nothing happened for ten years and he remained under investigation with his

career ‘on hold’. After ten years, the slow-functioning bureaucratic commission got back

to him and told him that they had made a mistake and that there was nothing wrong with

his performance. This government servant however had not only been denied promotions

or pay increments for ten years, he also had a ‘social stain’ on his character. As the

expatriate mentioned:

Over that 10 year period he’d been sidelined, no promotion no increments and everyone looked on him like he was the black sheep – and that was on his record forever

Such stories frightened the other government employees. Therefore, they tried to make

decisions that were completely in line with the exact wordings of the contract

specifications. This was one of the main reasons why the clients were highly ‘rules

oriented’. Also, in order to be completely sure that activities proceeded in a manner that

was not subject to a vigilance inquiry, they attempted to play a hands-on role on the

project, thus partly explaining their bureaucratic character. If there were incidents where

they were not completely sure as to what decision to make, they delayed making a

decision, and pushed issues up the hierarchy. This behavior frustrated the contractors and

explains some of the delays that occurred on the project. As a freelance expatriate

working for the client said:

You’ll have people who will say we will do this, that and the other and they’ll nod their heads, but when it comes to putting things on paper, they will say one thing

169

and they will then say “oh I don’t know – we should check this and” … anything to delay – very frustrating

An expatriate contracts manager concurred:

The big difficulty in resolving problems on this project is it’s easier to put something against it and delay making a decision because most of them (client’s representatives) have people looking over their shoulder – everything is checked all the way up, in case of corruption in the situation – so everybody has to be absolutely sure that what he has done and it’s a very big problem.

The project manager for one of the contracts, an experienced Swedish manager, stated:

So the biggest challenge as far as I am concerned is that this is a government run project and most, in fact all the international people from various countries and all the people who are in consultant capacity – we are from the private sector – and there is a constant conflict between the way government projects are run and the way we want it run. And in government everybody is always trying to cover up their backs, like well say three years down the line someone is doing an audit of this job, they will come and say oh why did you take this, this is …so they want those kind of things very very complete. They are not much bothered about the time then, their main concern is that their backs are covered – whereas, for us, the consultants, we want to finish off the job and move over to the other one, lets finish it off, take whatever the time is, this is the best that I can take in that time – and just move off – so that kind of a constant clash is going on here

The government officer’s view of Vigilance was such that any mistake, however small or

petty, was a punishable offence. Trivial errors in judgment could ruin a bureaucrat’s

career. An Indian officer offered his views on how Vigilance contributed towards delays:

If you see from the vigilance perspective, everything must be proven on the paper. So we do it until we are sure that this particular vendor is very good and that they can provide the service and we keep telling them (the contractor), please provide documentary proof of each and every thing – so that everything is in order – so that is the thing we do from the vigilance point of view. And because of that the process is becoming more lengthy. It is taking more time because that company has to have all the necessary certifications – some vendors might need to renew ISO certification – this takes time. We also need test samples that we validate – even though we are

170

particularly clear that this company is a valid one, we need all the documentary proofs from the vigilance point of view – and that is delaying the process.

This Vigilance system was well ingrained into the functioning of the government

employees. As an expatriate design manager for the clients pointed out:

First, it’s the ingrained century year old systems of the Indian railways that has pervaded through to the project – which manifests themselves on peoples attention being firstly – ‘am I exposed? Am I setting myself up for any responsibility here whatsoever?’ Now that’s sort of the main drivers in peoples functioning that thwarts the system incredibly – and that’s just the Indian bureaucracy which you can’t change overnight.

Furthermore, it was almost impossible to change these ingrained mindsets of the Indian

employees. The expatriates in the clients’ organization attempted to educate the local

officers on the needs of the project, and how the work had to be expedited. However,

they met with little success. A construction manager recalled:

Some don’t change at all – we just have to keep reminding them. Some of our guys, I mean they tell you that they understand what is needed and why and they fully agree, but when it comes down to it you always have to remind them and say “look, I need that thing so get it signed and send it to me now”. I don’t think some of the guys will ever change – that’s they way they are, for them to change will be difficult –– but you just have to keep reminding them and telling them and its very frustrating.

The inability of the international representatives to change the ingrained views of the

Indian government representatives led to the clients continuing to behave in a

bureaucratic and delay-causing manner, much to the displeasure of the international

contractors.

For their part, most of the Indian government employees were quite candid in

admitting that they wanted to perform their duties in a way in which no one could accuse

171

them of any underhand dealings. As an experienced Indian employee who had been with

the government for more than thirty years said:

We want to go by the word of the document. Since you have grown up in India, you know that so many scams have happened in India. Therefore Indians, at least the sincere ones are over-cautious. We want to avoid doing things that may enable people to point fingers at us and accuse us of collusion. Sometimes the expatriates might think we are unjust. This is the main issue – we want to play it safe and maintain our integrity. We don’t want any extra savings – we don’t want money – we just want the contractor to do as per the contract.

The nature of Vigilance was such that at any point in the future, a question could still be

raised about this project. These issues did not die out at the end of the project, so each

employee had to carefully monitor his record. It was in their interests to be absolutely

certain of a decision before they made one. Another experienced electrical expert from

the Indian clients’ side opined:

The responsibility – as such we are from railways and we feel responsible for so many things – but they (the contractors) are here only for a few years. After this, I will go back to my department and whatever I have done here can be questioned – even after 10 years someone can come back and question me – whereas, the expatriates who come are not going to stay here, and so they may not be that much worried – these basic things make a difference

Ironically, the Vigilance system was developed to improve the quality of the project.

However, in reality Vigilance worked to impede the progress of works on the project by

instilling a deep-seated fear into the Indian government employees. This was partly due

to the culture of the unit as being a constantly suspicious task force that was always on

the lookout for corruption and suspected corruption in almost any transaction between

clients and contractors. Also, the potentially large punitive damages also deterred the

government officers from making bold decisions. On the one hand, Vigilance ensured

172

that the possibility of corruption was greatly reduced. On the other hand, this led to many

negative side effects for the project – there were delays in decision making, processes

became lengthier and rules had to be strictly followed even though there were really no

negative consequences of having a small amount of tolerance. These unintended

consequences led to conflicts between the clients and the contractors and delays on the

project.

Apart from the Vigilance system, there are two other comparatively less powerful

reasons that also help explain this behavior. The first of these relates to the Indian clients’

experience with other Indian contractors. Local Indian contractors were not well trusted

by the clients, since in many cases they did not perform the work in accordance with the

specifications and also tried to cheat the clients. As a result, the Indian clients were used

to micro-managing the work of their subcontractors and brought this same mentality

while dealing with the international contractors. One Indian representative who had dealt

with the local contractors for more than ten years said:

The mistrust with the contractor was generated due to earlier interactions with the Indian contractors – they do not perform as per the design and so there is an inherent suspicion of any contractor – and so with the international contractors they think it is very similar to what they thought (with the local contractors) Normally we Indian people, we have a thinking that the contractor may be trying to get something extra – and that is the normal thinking – and that might not be true of the contractors that are coming from abroad. It is not going to change during this project.

In fact, one of the freelance expatriates working for the clients held a similar observation

about the behavior of the Indian clients. This informant noted that:

Many of the Indian contractors themselves expect the client to have this sort of role. Planning work. Very few of them do detailed planning unless they are forced

173

to do so by the client. They almost rely on the client setting targets for them – this is due the next week and this is due the week after and so on

In this informant’s view, the Indian construction system was set up so that the clients

were almost expected to play a role in determining the processes that were followed on

the project. On this international project, the clients attempted to play their familiar role,

whereas the international contractors expected the clients to play a different role. This led

to problems.

The second contributing reason for the overly bureaucratic behavior of the clients

was that they had never been exposed to such a large Design-Build contract before. The

Indian clients’ representatives had usually overseen much smaller quantities of work, and

therefore had developed a keen eye for spotting minor deviations. In a contract of this

magnitude, the contractors felt that the clients failed to see the ‘bigger picture’ and that

they were lost in the inconsequential details of the work. Also, the clients had not been

exposed to a Design-Build situation before where much greater responsibility lay with the

contractors. This lack of experience helped account for part of the clients’ bureaucratic

and rule-following behavior, as they followed the principles of project management that

they were used to. Several of the contractors’ representatives bemoaned the Indian

clients’ lack of experience with large projects. In the view of an Indian who worked in

the private sector for one of the contractors:

In this case, you have created this corporation 3 years ago and you have taken guys from Indian railways. To be honest, these guys have not done any large projects in the railways system – besides changing the tracks or replacing the ballast from the British days – have you (the Railways employees) added any major lines 1000km somewhere? You haven’t done that. That means that basically these guys they will still be the largest employer in India today but when it comes to contracts, they have been handling very very small contractors and

174

that is what the approach has been and that is what they are more familiar working with

While according to a British freelance expatriate:

We spoke earlier about people from Indian railways – most of them probably haven’t been on a project of this size before – so they don’t understand the concept of Design-Build, the approaches and applications and time frames that are involved – if you break everything down into individual components – concrete shutters and rebar piling and what have you – all the disciplines on paper are very simple – when you bring them all together its very complex and you have to have an understanding of that – and this isn’t a comment on their ability as engineers – its more a comment about their backgrounds, where they have been and what they have done before.

The Indian clients’ representatives admitted that such a system of Design-Build

contracting was new to them and that as a result they were being a little over careful. A

lack of experience with a new system, coupled with an inclination to follow the old

system thus led to the Indian clients adopting their standard approach to the

administration of the works, which was highly rules-oriented and which conflicted with

the contractors’ perceptions of project management.

In this chapter, I have attempted to identify the reasons behind the behavior of the

Indian clients, which led to a highly ‘rules oriented’ and ‘bureaucratic’ mentality. In the

next chapter, I will discuss the third and final type of conflict that occurred frequently

between the clients and the contractors – a conflict engendered through a dictatorial

orientation on the part of the clients and a partnering orientation on the part of the

contractors.

175

Chapter 10 – Client-Contractor partnerships: A Dictatorial Regime or an Agreement of Equality?

Another set of issues on these projects arose out of differences in perception of the

relationships between the clients and the contractors, as well as each party’s rights and

responsibilities. The clients tended to feel that they could ask for more than what was

required from the contractors as per the specifications of the contract. They adopted the

stance of a dictator and expected the contractors to provide extra services free of charge,

without asking any questions. Although the contractors were amenable to making minor

modifications, they expected to be reimbursed for incurring extra costs due to new

features that were not part of the original contract specifications. These two differing

points of view led to several issues that were different from those described in the

previous chapters, which focused on the process of construction. The issues described in

this chapter center less on the means of the construction process and the works itself and

more on the scope of the work, with the clients wanting to enlarge the scope as much as

possible.

The following quote from an experienced German manager best illustrates the

clients’ dictatorial attitude. When asked to describe some problems in interactions with

the clients, this informant said:

In India, both clients as well as contractors are totally unreasonable. Not so long back there was somewhere an article about the Indian construction market that said the clients are unreasonable because of the conditions that they are enforcing on the contractors – and contractors are unreasonable by accepting everything the client says even though they know they cannot do this. This reflects the cultural difference between India and Europe. In their behavior, they (the client) behave reasonably as an Indian client. For example, when a tender is issued and the contractor is making very valid points where the contract is obviously wrong or the provisions are impractical, and a number of company’s are raising the points in a pre-bid meeting, this is just rejected, rejected, rejected. “Please go away, we

176

are the client” (they said). In a meeting once we had raised a lot of points and one person from the client stood up and said, “No! Shut Up! I am the client! If there are any kinds of conditions, you have to sign it!”

The Indian clients expected the contractors to comply with their commands, however

excessive, impractical or unreasonable they might be. Two sets of issues arose due to this

mentality. First, the contractors were expected to perform extra work for free, and

second, the clients subjected them to abuse.

‘Perform Extra Work for Free’:

The following anecdote illustrates this category of problems. The stations in the Indian

projects called for fresh water pumps to be installed. The contract documents provided

certain specifications for the pumps, and the contractors had designed according to these

specifications. While the expatriate consultants felt that the design was adequate, the

clients wanted these pumps to have an extra corrosion resistant lining. This lining

represented an unnecessary increase in costs since the pumps were only used in fresh

water and were not in any danger of corroding. Yet, the clients insisted on getting these

enhanced pumps without paying any extra money to the contractors. The British Design

Manager who was employed by the clients recalled:

The classic example was the pumps for the A/C system. They (the client) went down to the factory and they saw these pumps being coated with a special lining, and that lining is normally applied for untreated water – and the A/C system has got very clean water. So anybody who is an engineer or a beggar in the street with commonsense would say that this coating is not required for a pump with clean water. But the client said, “Oh, I want the coating on these pumps.” Didn’t give any reason for this. Just like a kid going into a sweetshop and saying, “I want this, this and this.” They will readily say I do not approve of these pumps unless you can provide my coating. There’s a chink in the armor of commonsense. For example, at the end of the day the client might say that coating provides a superior

177

pump – and you can’t argue with that – it does. The question then is are they entitled to that superior pump – and in my opinion that would be no.

Since the contractors had no interest in providing equipment for which they were not

going to be remunerated, conflicts between the clients and the contractors occurred. This

anecdote was only one of several frequent occurrences where the clients unilaterally

escalated demands without the consent or the approval of the contractors, who were also

not offered payment for the extra scope of work.

Another similar example was an instance where clients had asked for the level of

a depot to be raised to a higher elevation. Since this activity was on the critical path and

needed to be performed almost immediately, the contractors asked the clients for extra

payments but went ahead without receiving the clients’ formal consent. Six months after

the completion of the works, the contractors had still not received their extra payment, as

the clients did not feel the need to pay for additional work that had been done. When the

contractors protested, the clients asserted that the contractors’ claims were completely

unjustified. The contractors had no recourse but to move for an official legal alternative.

In some other situations, the contractors would be reimbursed for extra work

performed, but not to the amount that they expected. A British construction manager who

had been employed by the clients related the following incident:

The designer had to change their drawings midway for the 25KV transformers – and they asked for an extra 1.8 million. We suggested 1.2 and a committee from the client recommended 800 thousand– so they arm-twisted us to propose that even though we did not agree with them – and the Managing Director (of the client) just said 600. There was no rationale, and the contractor said we want to go to arbitration – and the client in their obtuse line of thinking said, “A dispute does not exist. You just can’t see that you are wrong.” The client just said, “Sod off,” and they said, “If you want to take it further, lets go to the courts.”

178

In this case, the clients had changed the specifications, forcing the contractors and the

designers to do extra work. The consultants acting for the clients then performed an

inspection and found some flaws in the contractors’ cost estimates. They discussed this

with the contractors and negotiated a reduced amount. However, the clients unilaterally

reduced this amount further without specifying any reasons for doing so, thus trying to

dictate terms to their advantage and expropriate work done by the contractors.

Abuse of the Contractors

In many other cases, the dictatorial attitude of the clients towards the contractors

translated into direct verbal shouting and abuse of the contractors’ representatives. In

several cases, the clients yelled at the contractors for no apparent reason. In one meeting,

the contractors had started to inform the clients of the status of orders placed on pumps

and others mechanical items. Immediately a senior Indian client representative shouted

and asked the contractors what the problem was. A contractors’ representative replied

that there was no problem and that they had placed the order. The clients’ representative

shouted back and asked why they weren’t following the approach used by the contractors

on the other section of the project, who had this item under control. The contractors’

representative replied that they had followed the same process and that there was no

problem. Despite the fact that the contractors had not confessed to any difficulties, the

Indian representative once again screamed “Bloody, then what is the problem I say?”,

and followed this up with a very loud ‘aside’ to his fellow engineer:

There is absolutely no concept of a project here. I have faced this with small petty contractors, but I didn’t think that with international contractors and consultants this would happen. It must be our misfortune to deal with these people.

179

Sitting at the far corner of the room, I heard this very clearly – the whisper was meant for

the benefit of all concerned. The British construction manager for the clients’

organization had this to say about the abusive behavior of the clients:

X (a different Indian client representative) would roast people! The meetings would be very funny. You’d have the contractor and they would say the schedule was slipping and X would shout, “You guys have the gall to come in and tell me! You show your face and you say you are running late and you haven’t done this and you haven’t done that! I don’t want to see you, if you don’t get this concrete in by Friday.” Sometimes there would be a problem in an area and he would say, “Who is responsible? Who is responsible?” And someone would say, “I am”, and X would turn to Y (British expatriate working for the client) and say “A letter must go today – and I want that man sacked and off my project.” He would be whispering but everyone around the room can hear him. He fires off these bullets. We’d be 5 minutes into the meetings and X would explode and shower over, and really it’s like scolding a child.

In cases such as this where the contractors had made mistakes, the clients’ strategy was to

shame, threaten, and abuse them into compliance. In certain cases, this verbal abuse

reached a point where the contractors refused to come to meetings any longer. In one

case, the project manager for one of the international contractors wrote a letter to the

clients saying that the international employees had been carefully selected due to their

experience and expertise. Despite putting in a lot of hard work and trying their best, they

were still being needlessly abused in meetings. The project manager wrote that due to the

unprofessional attitude of the clients the contractors had decided to stop attending the

monthly progress report meetings! This standoff persisted for a few months and even

though the project progressed, no review meetings were held. The British Project

Director acting on behalf of the clients then convinced the contractors to come back to

180

these meetings, on the condition that particularly abusive client representatives would no

longer attend.

Views of the contractors, the clients and the freelancers

The Contractor’s Perspective:

Some of the contractors’ representatives referred to the clients’ behavior as a ‘master-

servant syndrome’, where the clients unreasonably expected their every whim to be

obeyed. Referring to one of the numerous occasions where the clients refused to

acknowledge the rights of the contractors, one of the contract managers for one of the

contractors, said:

Quite simple – under the ‘Master-Servant syndrome’, the master turns around and says, “There is no dispute and so there is no conciliation or arbitration, since I’ve decided that there is no dispute and I’ve told you that you haven’t got any entitlement.” So that’s a bit dictatorial isn’t it? So it comes back to that. The contract is an agreement between two parties – one promises to do something and the other promises to pay – that’s all that is. It doesn’t say I’m the master and you’re the servant and I will dictate what you do.

Many of the international employees working for the contractors realized that they had

come to a different country and made adjustments to fit into the local culture. Despite

acknowledging the existence of national differences in client-contractor relationships,

they felt that the clients unfairly treated them as incompetent contractors and not as

equals. The British contracts manager for one of the contractors, noted:

A contract like this is a partnership between two parties. It cannot be the master-servant situation that India is so used to. But the early thinking was, “I am the master, and you are the servant. You do what I say.” Then we have to say politely, “No. I don’t do what you say. I do what I am obligated to do under the contract and here is the contract that you signed.” It can’t be a dictatorial regime, although

181

… they did believe that, “Hey! Here’s a normal Indian contract. It’s a normal Indian project. Master-Servant.” Obviously international contractors come to India and they have to respect the culture and try to fit in and not be too disruptive. So in actual fact it’s highly reliant on us fitting into your culture. But at the same time, there needs to be a reciprocation from your culture to accommodate what’s there in the contract and to deal with an international contractor.

Although Indian contractors accepted such behavior from the clients, this informant felt

the need for a ‘partnership’ arrangement between clients and contractors where the rights

and responsibilities of each of the parties was not transgressed.

The contractors did not take the clients’ edicts lying down. They considered the

clients’ behavior to be unacceptable and expected to receive compensation for extra work

performed and be treated as collaborative partners as opposed to ‘slaves’. As the project

progressed, they tried to make their point clear by protesting and refusing to work before

an agreement was formally signed. The following points of view were offered by a

construction manager and a project manager from the contractor’s organization:

See – we are going along with things, and we don’t see any reciprocation. It’s when you have a lack of reciprocation and you don’t get paid for payments that you expect. That’s when you realize – you’re not getting your money out – so from one aspect of it, it was pure necessity – in order to get things moving, to finish on time, we had no choice but to dig our heels in the sand. And then you would protest. In certain issues it has to be quite confrontational, since we are not going to agree to a change that will cost us 16 or 20 million rupees ($500,000). We just can’t agree to that so we just can’t lie down and we’ll say, “No. We can’t do that unless you give us a variation,” – and then the argument starts.

However, the contractors’ responses and strategies failed to attain their desired

objectives. The reasons for this will be explored in greater detail in the next chapter.

182

The Clients’ Perspective:

The local client representatives were often surprised at the protests from the contractors.

In one instance, a road had to be diverted and the clients asked a German site engineer to

add new elements on to an existing drawing. The contractors asked the clients to approve

the change officially but the clients’ representative refused to do so. In an interview, the

German site engineer said:

They (the client) couldn’t do that. “Please put your initials” (I said). They were extremely upset at being talked to like that. “My edict rules the site. I will not pay for anything and I want everything” (the client says). Now I come from a culture where the client orders something and he will have no problems initialing it, and so I was very much clashing with those guys. So I told them to initial the change and left the site, and they were so upset that they called my project manager – and I didn’t know what I did wrong.

This anecdote shows a clear clash of two different institutionalized systems. At a

cognitive level, the German engineer expected the clients to authorize the change.

However, in addition to being frustrated by the contractors’ behavior, the clients were

upset and angered at the contractors’ expectations. They did not think that the

contractors’ bottom line would be impacted a great deal by the clients’ requests, and

expected the contractors to perform these activities in good faith. The clients did not

consider themselves to be unreasonable and claimed that the contractors were focused

very selfishly and narrowly on the costs. In contrast to how partners were expected to

behave, the clients felt that the contractors were not willing to perform an iota of work

beyond what was in the contract. One senior Indian design engineer remarked:

In construction phase, they are independent and they don’t bother – even if they are putting two more screws, they will ask for more money – in a contract of Rs. 1000 crore ($250 Million), they will ask for this.

183

To give another instance that underscores the clients’ viewpoints, a high-ranking Indian

official discussed a potential change in electrical equipment in an internal client’s

meeting. The new equipment was more expensive than the equipment specified earlier.

The Indian official argued that if the government waived the custom duties, then the

increase in costs to the contractors would be less (Note: there was still an increase in

cost), and therefore the contractors should have no objections to purchasing the more

expensive piece of equipment!

In addition, the Indian clients had a different view of variations and claims. A

variation was often construed as a way in which the clients helped the contractors benefit.

The clients therefore avoided issuing variations because systems such as ‘Vigilance’

would descend upon the project to investigate. The contractors on the other hand viewed

the issue of a variation order as a normal event when being asked to perform work

outside the scope of the contract. The following quote from an Indian design engineer

helps illustrate this issue:

In general, these international contractor conditions are different. The variations from contractor are taken as the normal course in international contracts. So for instance, this Almirah (chest of drawers) is colored yellow. In case we ask the contractor to color this red, they will ask us for a variation and for money. This is taken as normal for international contractors. But here in India, it is considered quite serious. It is even viewed to the extent that this is a relaxation offered by anybody to the contractor. So any deviation from the contract is viewed here very seriously. Very seriously. In international contract, I feel that they don’t care at all. They feel that this is common. If this is a variation, we should pay them.

The clients were dumbfounded, and could not cope with the fact that the contractors

considered variations and requests for change as commonplace matters. Furthermore, in

some cases, the clients viewed variation orders as personal insults and an indication that

184

they needed to pay the contractors more money as a result of the clients’ incompetence in

crafting comprehensive specifications prior to the start of the project. As an Indian

construction manager, who had worked for the government for over twelve years,

remarked:

As an Indian officer, if somebody makes a claim, it becomes a very emotional issue with us. We think, “Are we so irresponsible that Govt. of India is going to lose money on account of us?’ We are so attached (when) we are managing the contract. If I am to give a claim, it is as if I am giving from my pocket – it is that psychology which works. So we were never comfortable with that claim. So if anybody claims the money, you will find that body language is so poor on our side that we would say, “What the hell has he talked! This is just not acceptable.”

This perception that a claim bordered on a personal statement of incompetence led to

many instances where the clients reacted by rejecting or contesting any claims or pleas

made by the contractors.

The fact that the clients reacted defensively to claims being filed coupled with the

fact that clients viewed claims very seriously, led to their developing a distaste for the

way in which the contractors operated. The clients did not feel that the contractors’

behavior was justified and felt that the contractors were trying to extract more money on

flimsy pretexts.

The Freelancer’s Perspective

In several cases, the freelancers felt that the clients’ requests were out of place and that

the clients were asking for far more than what was required by the contract, so much so

that on the whole, the contractors were bound to feel financially strained. The expatriate

construction manager on the clients’ side pointed out:

185

So yes contractors have to maximize their profits and we’re there to see that they deliver what they promised that they would deliver – but not to screw them at it – I do find that with our Indian colleagues in particular, they want a Rolls Royce, irregardless of what a specification states.

The expatriate design manager from the clients’ side painted the following rather graphic

picture describing the extent to which the clients’ demands exceeded the contractual

specifications:

There are one or two throwaway comments in the contract that say that the project should be to international standards or should be built to the standards of modern metros – and that gave them (the client) the right to ask for the cake with cream on the top and strawberries on top of that and chocolate sprinkled on top of that – the best of everything – in all aspects of the system. And really, at times its bordering on the insane, what they are asking for, in terms of what you’d normally expect in a metro, and that’s frustrating the execution of the project, where it just creates a situation where it’s a standoff between the client saying this is what we want, and the contractor saying give me the money otherwise I wont give it to you. Irrespective of that, the client wants the contract to be built in half the time and they will not budge on these issues.

The expatriates often felt that the clients’ excessive and unreasonable demands led to

unavoidable conflicts and impasses between the clients and the contractors, a situation

which placed a greater burden on a project that already had very tight deadlines. In

addition, the expatriates also viewed the clients as being prone to bully the contractors.

Since the clients were theoretically in control of the finances and therefore on the top of

the organizational pyramid, the clients felt that they could impose their opinions on the

entities below. The freelance construction manager put it thus:

They have the mentality that might is right and the client is superior to the contractor and the contractor is superior to the subcontractor and to the supplier and so on – and therefore, “Don’t challenge me because I’m bigger” – that type of atmosphere hangs over the job a little.

186

The construction manager felt that the clients believed that their words were not to be

questioned, as they viewed themselves to be superior to the contractors. In many cases,

the freelancers thus supported the contractors’ views.

However, there were a few cases where the freelancers supported the clients’

arguments. In one meeting that I attended, the contractors and clients discussed the

design of power generators for the stations. The clients rejected the calculations that the

contractors proposed and asked the contractors to include several other loads in their

design. Accounting for these loads led to the need for more expensive generators with

larger capacities. The contractors complained that the clients were requesting more than

what was required in the contract, and that this would delay the project. The freelancers

present in this meeting called for a copy of the contractual specifications and concluded

that the clients were justified in their requests. They felt that the contractors had

neglected to include several items that were clearly indicated in the contracts and advised

the contractors to revise their calculations. In a subsequent interview, the clients’

freelance design manager, said:

Our stance on the generators was that, “This is ridiculous”. The contractors had to include all of these other loads. The contractor initially tried to blackmail and now they have come around.

Although in most cases the freelancers did support the contractors, there were some cases

such as the one illustrated above where they felt that the clients were not being as

unreasonable or as dictatorial as the contractors made them out to be.

187

Explaining the Clients’ Behavior and the cause of conflicts

The clients’ perception of what constituted an appropriate relationship with contractors

was formed over long periods of time through past interactions with local contractors.

These interactions led to the formation of firmly institutionalized views on how

contractors were dealt with and helped explain some of the clients’ behavior.

In the Indian context, the Indian Railways (the clients for this project) were the

largest client in the country, and one of the largest clients in the world, in terms of the

quantity of work that they contracted out. Therefore, every Indian contractor was

interested in being in the good graces of such clients, in order to increase their chances of

being awarded future contracts. This placed the clients in a position of power since they

could threaten the contractors with loss of future work, in order to make the contractors

comply with their wishes. An Indian Engineer who worked for the clients pointed out:

With an Indian contractor he will say, “Ok ok,” because he knows that if he does not do on this contract, he won’t get another contract.

One of the British contract managers for one of the contractors once went to a meeting of

local Indian contractors, and was aghast at what he found there. He said:

The local contractors will not be aggressive because they are always thinking about future work and relationships with the employer and all these sort of things. I’ve spoken to local contractors about this situation and I’ve said, “Why didn’t you record this (extra request made by the client) at this particular time?” and he (local contractor’s representative) said, “If I do that then they will make me stop the work completely and I will lose a lot more money.” So there is a lot of blackmail, there is a lot of squeezing going on.

The local contractors also feared the clients’ power to inflict losses on the contractors in

terms of delays and cost overruns.

188

This dynamic led to a situation where the clients could make demands that went

beyond the bounds of the contract, and still be reasonably assured that local contractors

would obey these commands without protests, claims or requests for variations. For

instance, on a section of the project performed wholly by Indian contractors, the

contractors awarded a subcontract to a particular firm. Although this firm showed the

technical capability and competence to perform the project, the clients refused to let them

do it and insisted that the subcontract be awarded to another firm. A British freelancer

who was employed as a consultant by the client for this project said:

The client wanted us to approve X and reject Y, and I said I couldn’t do that and so in the end we said both (X and Y) are approved. The client didn’t like that and so they wrote back in a letter saying please instruct the contractor to award the project to X. So our letter to the contractor said, “The employer has directed….” Fortunately the contractor was P (local Indian contractor), so they went ahead with the clients’ suggestion. But elsewhere internationally you couldn’t do that – you would have a claim.

The local contractors in this case did exactly what the clients wanted. However, in the

eyes of the expatriates who had over twenty years of experience working in developing

countries, this would not have occurred in a more typical international setting.

This behavior had formed a part of the clients’ strategy for several years, and as a

result, they tried to employ the same tactics on this project. One senior Indian manager

confessed to the fact that the clients’ behavior might not have been appropriate for this

project:

Being a Government officer, we were also a little arrogant – and maybe in an international environment, this was not the norm and we are not supposed to show arrogance. We are slightly different here.

189

However, the international contractors did not feel the same ‘shadow of the future’ that

the local contractors felt. Since the international contractors were not assured of future

work in India, and had plans and options for working in other areas of the world, they did

not fear the local clients’ displeasure quite as much. An embargo for them performing

work in India was not as serious as it was for the local contractors, since public sector

Indian projects could constitute quite a large share of the local contractors’ revenues. An

Indian architect who did not work for the Government, but who had experience working

on projects in India, compared the international contractors and the local contractors:

So the other thing is that they (the client) are also aware that if I do this, then this (international) contractor is not going to sit back and say, “Ok, I’ll do this for free” – like the Indian contractors do, but this contractor is going ask for money. I mean the international contractors will not just do something just because you are forcing them or just because they are trying to please you or something – they will go by the legal implications of the contract conditions. But certainly I find it very difficult.

The international contractors were not accustomed to being treated in such domineering

fashion by clients. Therefore, they protested against the treatment that was meted out to

them. The Indian clients in turn became frustrated because they did not encounter the

customary servile response from the contractors, and this led to conflicts. These

contextual circumstances, that were peculiar to the Indian context, serve to explain the

clients’ behavior and some of the reasons for the master-slave conflicts on these projects.

Summary

Many issues on these projects came about due to differences in the functioning of the

Indian public sector construction industry and the practices adopted on international

190

construction projects. In chapter 7, I illustrated how the clients’ representatives insisted

on following the exact wording of the contract. In this chapter however, the clients were

shown to alter the terms of the contract freely. In order to prevent confusion between

these two views, consider the following. In the examples presented in this chapter, the

clients were attempting to get a better product with their dictatorial attitude. In the

examples in the previous chapters, the clients were trying to ensure that the contractors

did not cheat them and that ‘Vigilance’ never accused them of illicitly partnering with the

contractors. Therefore they took great efforts to make sure that the processes on the

project followed the formal rules and specifications. In the incidents discussed in this

chapter, no such accusation could be made against the clients since they had tried to

procure a superior product for the money paid to the contractors. Therefore, while trying

to control and constrain the process and remove ambiguities by being bureaucratic and

rule-focused, the clients simultaneously tried to exceed what was in the contract

specifications by being dictatorial, in order to get a better product.

This chapter concludes a discussion of the specific issues that arose between the

local clients and the international contractors. In this chapter I have attempted to

elaborate on conflicts that occurred through a dictatorial orientation on the part of the

clients and a partnering orientation on the part of the contractors. In the next and

concluding chapter to this part of the thesis, I will summarize the issues that were

described in the previous chapters, and indicate some of the structural and power

arrangements that were present between the various parties on the projects which played

a key role in determining the resolution of these conflicts.

191

Chapter 11 – Conclusion

The chapters in this section of my dissertation have set out to describe some problematic

aspects of the relationships between the clients and the contractors, focusing primarily on

the projects in India. As the examples in Chapter 7 and Chapter 8 indicate, the Indian

clients were highly rules-oriented and bureaucratic, were very slow to respond and

wished to make most of the decisions on the project. The contractors, on the other hand,

were more inclined to push forward the works as fast as possible and wanted the

bureaucratic machinery to interfere as little as possible. The opposing views held by the

contractors and the clients led to difficulties on the project where the contractors were not

able to proceed as planned and would retaliate with official letters to the clients and

threats of taking these disputes to a ‘claims resolution’ forum.

The ‘Vigilance’ anti-corruption system instilled a deep-seated sense of fear into

the Indian Government employees, who felt that their careers would be threatened if they

made even a slight mistake, since Vigilance viewed any deviation from the letter of the

contract as a possible instance of corruption. The Indian client representatives therefore

tended to follow the letter of the contract and delayed making decisions that they were

unsure of. Furthermore, lack of trust of other local Indian contractors and a lack of

exposure to large Design-Build projects contributed to the clients adopting a bureaucratic

hands-on approach to the project.

Finally, the Indian clients expected the contractors to do extra work at no — or

virtually no — extra remuneration. The international contractors, on the other hand, did

not expect to provide ‘free lunches’ to the clients, expected to be treated respectfully and

192

wished to abide by the scope of the works as set forth in the contract. This clash once

again led to problems.

In order to understand how these clashes might play out, it is relevant to

investigate the relative bargaining powers of all parties on the project, since the balance

of power could well dictate which party(s) would have to compromise in cases of

conflict. In this regard, I consider two main interfaces. First I consider whether the clients

had greater leverage over the contractors, or vice versa. Second, the clients’ consultants

were set up as an independent entity with certain discretionary powers that could have led

to a situation where they could influence the resolution of conflicts on the projects.

Leverage held by the Clients over the Contractors

The clients were in a position to quell the contractors’ protests as a result of being in a

structural position of greater power on the project. The clients controlled the cash flows

to the contractors and disbursed an amount to the contractors once a portion of the project

had been designed or built to their satisfaction. As one of the clients’ representatives, an

Indian engineer, pointed out with regards to the design:

It is meant in the contract that you (the contractor) will design. It will be reviewed by the client and you will get payment based on the final accepted design.

The international joint ventures that performed this project were motivated by the

potential of making a profit. Although they financed a small portion of the works

themselves they were not capable of financing the entire project and were dependant on

timely progress payments from the clients. As a representative from one of the

international contractors’ pointed out:

193

We can’t afford to wait. We’d lose more money. It was a matter of, “Do we go ahead and finance it and charge financing charges?” or saying, “We can’t do that,” and trying to work around it. You’ve got to think of the balance in the situation. Generally the client knows that, for the contractor, it costs them a lot of money since they have very high overheads especially in the international sector. First of all we’ve got a JV partnership here – 5 partners, (and) they are all looking for a split and they are all providing certain resources to carry out the job – and we’ve got the setup here – there is a site head office – and that has to be carried as overhead. We have offices in Germany, Japan, Korea and India and they have a certain overhead as well – so they have a percentage and so it works itself up to the top.

The contractors could not afford to delay the project since they would continue incurring

unbudgeted expenses for fixed home-office overheads. Even if the contractors protested

and the impasse was resolved in the contractors’ favor, they would still have to pay the

overhead costs incurred during the delay that ensued. Conversely, the contractors would

have money flowing into their coffers if they did not protest and obeyed the clients’

dictates. The clients thus enjoyed some leverage over the contractors. As the Project

Manager for one of the contracts said:

There’s not a lot of resistance that you can (offer). So say for example, just recently they’ve asked us for all our records and accounts in a certain format to do with DST (Sales Tax Code). Now that exercise is an exercise that produces us money. It gets money back into our cash flow. So regardless of the fact that they have all the information themselves, they know that we need the money and that we will do this.

In some cases, the clients allowed the works to proceed in accordance with the

contractors’ wishes, but later reduced the amount paid to the contractors. This made the

contractors even more reluctant to argue with the clients. One of the freelance expatriates

who worked for the client spoke about an issue where the clients had insisted that the

194

contractors use a different supplier than the one they had proposed. He summarized the

situation and observed:

The contractor has kicked up a fuss and kicked up a fuss, but at the end of the day, the contractor has to give in or go to the supplier and start new rounds of commercial discussions that are a waste of his time. So you look every direction, it’s a no win situation. Plus the delays are affecting his (contractors) program as well. This is just a case of the client saying ‘might is right’. There is nothing that the contractor can do – 99 times out of a 100 he does what he doesn’t want to do, and then submits a claim. The two possibilities are that they are rejected by the client and are not even allowed into the works, or the client knows that if the pumps aren’t installed then they’d never get it finished on time. So he (client) says, “Install the pumps,” and chops 5 million rupees of the next payment.

As a result, there were several cases where the contractors did comply with the clients’

mandates. However, since the international contractors were more adversarial than the

local contractors and since the ‘shadow of the future’ of working in the Indian

environment did not hang too heavily on them, they frequently sent in official letters,

asked for variations, or fought claims, especially for issues not on the critical path, that

would not delay the completion of the project. As a result, the international contractors

were also involved in several disputes with the local clients. The manner of resolution of

these impasses is the subject of Part 4.

The Restricted Role of the Client’s Consultant

Conflicts between clients and contractors are not new to construction projects, as the

leverage that clients have over contractors could lead to clients enforcing unreasonable

demands on contractors on any construction project. The International Federation of

Consulting Engineers (FIDIC) attempted to create various mechanisms to solve this

problem.

195

FIDIC represents the international business interests of firms belonging to

national Member Associations of engineering-based consulting companies. As such, the

Federation represents the business interest of firms supplying technology-based

intellectual services for the built and natural environment11. FIDIC has released many

statutes and codes that are recommended for international contracts. Many project

sponsors such as the World Bank, insist on these statutes being an integral part of the

contracts on global projects12. The FIDIC statutes recommend that the client appoint an

Independent Consulting Engineer to oversee the works on behalf of the clients. The

generic provisions state:

Employer may appoint an independent Engineer to act impartially, should he wish to do so. The form is recommended for general use, though modifications may be required in some jurisdictions13.

The actual terms of the contract are more detailed, but the essence of the contract

specifications is that the consulting engineer or the ‘Consultant’ would be a neutral party

operating independently of the clients to ensure that the contractors were performing

work in accordance with the contract, while simultaneously ensuring that the clients did

not make unreasonable demands or behave in a manner that hindered the contractors’

progress.

The contract adopted on the projects in India was loosely based on FIDIC

specifications. The clients did appoint a ‘Consultant’ who, however, was not completely

neutral. In addition to expatriate freelancers, several of whom were hired in top

management positions, several Indian Government employees were also part of this

11 http://www1.fidic.org/federation/default.asp# referred to on 2/6/05 12 Private Conversation with a Retired Head of the Project Procurements Division of the World Bank 13 http://www1.fidic.org/resources/contracts/describe/FC-AF-A-AA-10.asp accessed 02/06/05

196

organization. Therefore the Consultants were a hybrid and in some ways a biased

organization as they contained a representation of the culture and the views of the clients.

FIDIC recommends that the Consultant’s organization be independent and be give

full authorization to make decisions on behalf of the clients. On this project, this was not

the case as the Consultant’s decision-making powers were reduced. The Consultant was

only allowed to recommend and not to approve any of the contractor’s activities. The

clients were the final decision-making authority. One British freelance expatriate, who

worked for one of the contractors and who had several years of experience working with

contracts based on FIDIC, remarked:

They (the consultants) do have expatriates. Very, very experienced expatriates in fact. But the manner in which the contract is put together requires the consultant to act as the employer’s representative. Now in the contract, in that situation, the consultant becomes the agent of the employer and is not required to act as the engineer as under FIDIC. The engineer under FIDIC is a totally independent and impartial party even though his fees are being paid by the client. In a contract where you have an employers representative, he is the employers agent and so he is there to ensure that the employer gets the project that he wants – ensures that the specs are followed and everything else. So the power that the engineer has under FIDIC is not bestowed upon the consultant by the client.

The Consultant’s lack of power led to situations where despite the consultant’s

suggestions, the clients could implement their own agenda. By not being in a position to

make decisions, the consultants themselves delayed making decisions by referring

everything to the clients. This frustrated the contractors. One project manager from

Sweden (a contractor’s representative), remarked:

It’s not even us sitting across the table from someone like Mr X (from the Consultant’s organization) and hammering it out and say(ing), “Yes I’ll agree.” All we can get from Mr X is, “Yes, that seems ok. I’ll make my recommendation to the client,” whereas an engineer under FIDIC would say, “Yes that’s agreed.

197

I’ll confirm accordingly and I’ll notify the employer that ‘Yes this is agreed.’” It will go into the system and payment will come through. That sort of facility is not there in a contract like this.

Furthermore, the employees working for the Consultant realized this dynamic as well. A

construction engineer working for the consultants noted:

The Consultant is a very pliable consultant I will say. If the client asks us to bend backwards, we do so. Contractually, the consultant is not very independent.

While one of the architects hired by the client to serve as a consultant opined:

Well – our job is not to make the decisions, our job is to give them (the client) the options. “If you choose this, here are the advantages and disadvantages and so you please tick which one you like.” So when the time becomes very very short we say please please please, make the decisions very very fast. So this is what we do. The final decision is with the client.

Therefore, although FIDIC offered a way to overcome client-contractor problems, the

fact that the recommendations in FIDIC were not adopted in the contract structure led to

a proliferation of such problems on this project.

Concluding Comment

The issues described thus far arose as a result of deep-seated beliefs and values held by

the parties on the project. Based on their backgrounds and experiences, the local Indian

clients and the international contractors each had an institutionalized set of views on how

projects should be designed and built. The fact that these views were different and

conflicting led to a series of difficulties on these projects, as has been illustrated.

Although the balance in power favored the client, nether party was readily willing to

198

compromise and accede to the other party’s views. The issues were compounded by the

project being a fast-track project with an aggressive completion date. This meant that

problems needed to be solved quickly in order for the project to be completed on time.

The aim of these discussions was to give an idea and a sense of the texture of

some of the major client-contractor conflicts that occurred on the global projects that I

studied. In part 4, I will explain the process of resolution of these conflicts.

199

Part 4 – Institutional Differences on Global Projects

200

Chapter 12 – The Nature of Institutional Conflicts

In the previous chapters, my objective was to give a flavor for the major types of issues

that arose on the projects that I studied, and describe the texture of the conflicts to

provide the reader a detailed and somewhat graphic idea of the events that transpired,

despite physically not having been on these projects. The objective of this chapter is to

take a step back from the particular instances observed in the field and to investigate the

significance of my preliminary findings. In this chapter, I will analyze how my

observations help answer my first research question: What institutional differences are

significant on global projects? I will investigate the extent to which the data that I

gathered were specific to global projects, as well as how these data compare to a-priori

theoretical assumptions of conflicts on global projects.

The conflicts that I observed can be classified into two broad categories. First,

there were conflicts that arose due to differences in values and norms relating to safety

and quality. Although I focused my data-gathering efforts mainly on the Indian projects

and conducted a study in Taiwan only as a pilot study to inform my research in India, I

observed these differences on all four projects. The main reasons for poor safety and

quality standards in India and Taiwan were the cheap cost and plentiful supply of poorly

trained labor, a characteristic that is typical of developing countries. As a result, safety

and quality issues are perhaps likely to be prevalent in cases where contractors from well-

developed countries (where strict safety regulations such as OSHA in the USA exist, and

where labor is relatively expensive) perform work in developing countries where the

construction industry is not as mature.

201

Second, I observed several conflicts between clients and contractors in India. The

international contractors had worked in several countries, and were used to situations

where they were given full responsibility for completing projects under the supervision of

an “impartial” engineering consultant, using FIDIC or a related mechanism for contract

governance. The Indian clients however, had poor prior experiences with local

contractors (who needed to be micro-managed to provide adequate results). This coupled

with the punitive threats of the Vigilance anti-corruption agency made them impose their

own views on the project and constrained and delayed the contractors’ activities. Two

different institutional views on project management and administration – one held by the

local Indian clients, and another held by the international contractors – clashed, leading to

several conflicts.

Absence of Client-Contractor conflicts on the projects in Taiwan

Since I did not spend as much time on the field in Taiwan as compared to India, it is

difficult to compare the two projects directly. However, I encountered several freelance

expatriates with significant work experience on global projects, working in both of these

countries. Given the comparable nature of their backgrounds and experiences, it is

instructive to compare their responses to determine how the conflicts observed in India

compared with the ones in Taiwan. In Taiwan, I spoke to six freelancers over a two-week

period. Their views on the nature of conflicts in Taiwan are summarized in the table

below:

202

Table 12.1 : Views of Freelancers in Taiwan

S. No. Position Nationality Safety and Quality

problems?

Client-Contractor problems?

1 Design Manager Australia No No

2 Quality Control Manager South Africa Yes No

3 Contracts Manager England Yes No

4 Track Consultant Australia Yes No

5 Track Consultant Germany Yes No

6 Site Engineer Philippines Yes No

As this table indicates, all the freelancers with the exception of the design manager who

was not involved with the work that took place on site, pointed to the existence of safety

and quality conflicts. None of these informants attested to the presence of client-

contractor conflicts. In India, I interviewed four freelancers over the first two weeks (the

same amount of time that I spent in Taiwan). The table below summarizes their views on

the nature of conflicts in India. In order to match the number of informants with those in

Taiwan, this table also includes the views of the next two freelancers that I interviewed.

203

Table 12.2 : Views of Freelancers in India Italics indicate freelancers interviewed after the second week

S. No. Position Nationality

Safety and Quality

problems? Client-

Contractor problems?

1 Construction Manager England Yes Yes

2 Tunneling Manager Scotland Yes No

3 Design Manager England No Yes

4 Structural Expert England No Yes

5 Contracts Manager Scotland No Yes

6 Project Manager Ireland Yes Yes

Five out of the first six freelancers indicated the presence of client-contractor conflicts in

my first interview with them. Three of these six freelancers also spoke about the presence

of safety and quality issues on the project.

Despite the fact that my data on the Indian projects are much richer than the data

from Taiwan, these statistics suggest that while safety and quality conflicts occurred on

all the projects, client-contractor conflicts were virtually absent on the projects in Taiwan.

My data from interviews in Taiwan suggest that the primary reason for this was the

nature of the clients’ organization in Taiwan. In India the clients’ organization was

composed in large part of local Indian employees; the clients’ organization in Taiwan had

only a thin veneer of local Taiwanese representation. The Taiwanese government had

recruited several freelance expatriates to manage this organization and administer the

works on the project. As one Taiwanese construction manager working for a contractor

said:

204

The client is a local company, but again their key personnel are from Britain, from USA, from Canada and from Australia – all kinds of nations.

These freelancers, much like the international contractors, had worked in several different

countries and shared the same set of assumptions on project management and

administration. The clients’ organization therefore conducted itself in a way that was in

keeping with the expectations of the contractors, thus leading to fewer client-contractor

conflicts. As one contractors’ representative who had worked in Hawaii, as well as in

some parts of Asia remarked:

Well – again, I think these specialists (freelance expatriates working for the client) make some difference. I think the senior management (the freelancers) of the client are very smart. And so although sometimes we complain and sometimes we say, “Well this could be better,” if (we) ran (the project) a different way perhaps we wouldn’t get the same quality and progress. It’s a very successful project.

Although minor quibbles were always present between the clients and the contractors,

several of the contractors’ representatives who had previously worked internationally

stated that they had virtually no complaints against the Taiwanese clients’ representatives

and enjoyed working on this project. One Japanese employee compared this project with

all the other projects that he had worked on and concluded:

Half of my career has been spent in foreign countries, but this is the best project I have performed in a foreign country.

A British Freelancer who was working for a Korean contractor commented on the clients’

attitude towards the contract and the contractor. He observed:

205

Well, on this job, I haven’t found any difficulties whatsoever. The communication channels are clear, very clear. The contract here is fair.

The following anecdote clarifies some of the differences between the Indian and the

Taiwanese clients. Unlike in India, the Taiwanese clients’ representatives understood that

it was not always practically possible to conform strictly to the design specifications, and

accepted some amount of deviation. Therefore when situations arose where the leeway

specified in the design was very difficult to achieve, the clients would discuss the issue

with the contractors and allow them to relax the specifications. Referring to one such

incident, a local Taiwanese construction manager, said:

For the tolerance of the pier location the (specifications) say, “5mm only,” but actually that one is almost not achievable. Even in our local contract we say, “5 mm” but that is not achievable. So when we see that clause we will consider that it is just a clause. It is applied to every contract, but we still carry out the project according to our experience. Some reasonable tolerance (must be taken into account). If you want to see that 5mm become governing, then of course you (are) afraid of that kind of clause. So after lot of discussing, we have some understanding with the clients: first we cannot jeopardize the function of the structure, (and we discuss) under that condition some tolerances can be allowed. Based on communication (with the clients) I think we reached some kind of agreement.

As long as the structural integrity of the piers in this example was not compromised, the

Taiwanese clients’ representatives had no hesitation in approving the contractors’ plans.

Both the clients and the contractors in Taiwan believed that, in a Design-Build

environment, the contractors were to take the responsibility for the progress of the works;

and the clients’ role was to monitor, rather than directly administer, the works.

Furthermore, the clients and the contractors were both results-focused. Due to the

206

alignment in the viewpoints of the clients (who were staffed mostly by expatriates) and

the contractors, there were fewer client-contractor issues in Taiwan than in India.

The Nature of the Client-Contractor issues in India

A surprising observation regarding the projects in India was that the fundamentals of

these conflicts were not necessarily different from those present in mono-cultural projects

performed within a single country. Disputes between somewhat bureaucratic clients and

contractors aiming to make rapid progress are present on virtually any construction

project. Workers in the construction industry who had wide experience working in a

single country and who were external to the Taiwanese and Indian projects, analyzed my

anecdotes and noted that they had encountered similar issues on their own projects. Even

some of the participants on the projects in India and Taiwan claimed that such clashes

were not completely new. An Indian electrical engineer working for the clients, pointed

out:

The culture of the contractor is the same everywhere. Whether it is local or international, the same issues come up. Probably its our Indian mentality to respect people with white skin and we take it for granted that they are reliable – that they are going to do the job with full sincerity. But later on we realized – forget about it! Every contractor is a contractor and they have all the qualities of the contractor! They just economize and give no attention to the quality. We learnt this over interaction.

To this clients’ representative, several of the issues and complications that arose were

typical of any relationship with a contractor.

An incident regarding Switchgear is quite instructive in illustrating how several of

the conflicts that arose could have occurred on mono-cultural projects. The contractors

207

procured Switchgear of type 3b. However, the clients interpreted the specifications

slightly differently and thought that they were entitled to a more expensive switchgear –

namely of type 4b. The ambiguous nature of some of the contract specifications made it

virtually impossible to decide which party had made the correct interpretation and as a

result, a conflict ensued. Such contract ambiguities are part and parcel of the construction

industry in almost any part of the world.

Client-contractor conflicts occasionally arose in Taiwan as well despite the fact

that clients’ representatives and the contractors shared similar backgrounds and outlooks.

In some cases, the clients’ representative adopted a hands-on approach to managing the

project and expected the project to conform exactly to the design specifications. This led

to conflicts with the contractors. A Malaysian supervisor, who worked for the clients and

had several years of international construction experience, remarked:

We have a very strict specification and a very clear requirement. But how to comply with the actual site work? I have a (responsibility) you know. This is very important. My duty is try to conduct the site activity and (to make) the results comply with the specification. So we need some kind of discussion and sometimes even arguments with the site engineer (from the contractors’ organization) that this is a specification requirement. We need to force them (contractor) in gentle way or more aggressive way, to get them to obey the instruction.

This suggests that issues featuring bureaucratic clients and progress-minded contractors

could occur on virtually any construction project.

Although clients in general tended to be relatively bureaucratic, participants in

India felt that the clients’ concern for control was more extreme than they had ever

encountered before, and that conflicts occurred far more frequently than in other projects

they had worked on. Several expatriates confessed that this was the ‘worst project’ that

208

they had ever been on. A British structural expert who worked for the clients and who

had over fifteen years of experience on global projects compared this project with other

projects that he had worked on, and commented thus:

I think one thing compared to Singapore and Malaysia was that here (in India) there was a much stronger local involvement, and local ideas on how this was to be done (here), whereas my experience certainly in Singapore was that it was almost entirely done by foreign consultants – the local input was really very small in terms of the technical issues and so you didn’t have that issue quite so much. And the same in Malaysia. Whereas here there was a much more powerful local presence and therefore you could say that there was more potential for conflict.

The Indian clients’ mistrust of contractors, their history of being heavily involved in

projects, and the unintended consequences of the Vigilance system, all served to create

conditions that were quite unique compared to most projects in other parts of the world.

A German construction manager summarized the situation thus:

I would also expect any other client to behave in a similar manner – but they (the Indian client) are a little extreme, especially addressing problems.

In essence, the types of issues observed were not unique to the projects in India. As part

of an accepted logic of performing large complex civil engineering projects, international

contractors expected to encounter some amount of resistance from clients due to the

conflict of interests rooted in the buyer/seller distinction. However, the frequency and

magnitude of the conflicts that ensued were amplified, due to situational parameters

(such as Vigilance) that were unique to the Indian situation.

This leads to the next puzzle. When I embarked on this research, I had expected to

find differences and issues that were unique to global projects. I deliberately chose to

study projects with representatives from over twenty different countries in order to

209

investigate issues that occurred due to systematic national differences (e.g. between the

Japanese, the Swedes, the Germans, the Koreans etc). Prior research by scholars, such as

Hofstede (1991), Trompenaars and Hampden Turner (1998), and others, has pointed to

the existence of systematic differences in values and beliefs between people of different

nationalities. These theories have been applied to the construction industry (e.g.

Abeysekara 2003) to support the proposition that problems on global projects arise

primarily due to national differences in work practices and norms related to construction

projects. Yet, most of the issues that I observed arose from professional-bureaucratic

differences between the Indian clients and international contractors (that were

independent of the nationality of the contractors), as opposed to values-based national

differences between contractors from different nationalities. Why was this so? It is to this

question that I now turn.

National Differences on Global Projects

National differences were not entirely absent from the projects that I studied. For

instance, on one occasion, a Japanese project manager in India encountered severe

difficulties in managing the Indian private-sector employees on his team. While the

Japanese were used to a system of organization where every employee was in charge of

all operations on a particular area of the site, the Indians were used to a system where

each employee specialized in a particular function – soils, concreting, electrical

equipment, etc. The Japanese project manager attempted to give his Indian team-

members broad responsibilities, but within a few weeks he realized that this system was

210

not working. He then had to reconfigure his organization and gave specific functional

responsibilities to his Indian crew. Overall, this process led to slight delays on the project.

There were also issues between the Swedes and the Japanese on the Indian

projects. The Swedes were less ‘uncertainty avoidant’ (Hofstede 1991) and preferred

fewer rules, while the Japanese were just the opposite. This led to problems when the

Swedes and Japanese tried to work together within their joint-venture. As one Swedish

project manager put it:

Swedes tend to be a bit more informal and relaxed about things – especially about procedures. Japanese try more to follow the procedure and like to have procedures. It’s quite stressful. Particularly if you have people not used to working in a regimented way, working for someone that likes it that way. That creates stress and friction. Then management must sort it out. Sometimes it sorts itself out. Once there was this Swedish guy who came to me and was very frustrated about his Japanese manager. I said, “Have you told him about how you feel about it?” There was a lack of communication. He said he didn’t do it and I said, “Do it!” and so he did it, and then he got on fine after that. The Japanese hadn’t understood that this was how he felt but after that it was fine.

The frustration that the Swedish engineer felt could have led to poor productivity on the

project. However, just as in the previous anecdote between the Japanese and the Indian

employees, this issue was identified and sorted out fairly early on in the project with the

Japanese manager allowing the Swede to work in a less constrained fashion.

Even within the clients’ organization, the Indians and the freelance British

expatriates encountered occasional problems. The Indians were a relatively collectivist

(Hofstede 1991) group, where individuals would never be personally singled out for

praise or blame. The British on the other hand, were more individualistic in their outlook

and were used to dealing directly on a person-to-person basis. This led to a few problems.

211

In one case, a British expatriate responded to a complaint by a senior Indian electrical

engineer with a terse public memo that read:

This is a product of Mr. X’s (the electrical engineer’s) imagination. This is not a problem and the consultant should make its recommendation.

This public bandying of the Indian official’s name did not go down very well with the

local Indian employees as they expected to be addressed in an official and respectful

manner. The Indian engineer in question was extremely upset by the expatriate’s

comments and observed:

But the remarks are personal! That this is my personal imagination! Here in our working, we never make personal comments. We keep personal life and work separate. Very clear. In case I am talking to you, on an official issue, I will not comment to you as Ashwin. Say you are some expert – I will talk to you as electrical expert only. I will make all my comments treating you as expert only. We will never make any personal comments. Here we have a number of conflicts. Say a train has got derailed. The responsibility has to be addressed. Everyday we are in conflict, but we never make personal comments. We never make comments that Mr X is at fault. Earlier I told the Project Director (another British expatriate) also that this is not our culture. We are not working as individuals. We are working as a team, and in a team nobody is an individual. As a team, we need to make sure that we are taking the right decision.

There were also some incidents where the foreign contractors suffered due to the lack of

knowledge of local conditions and work practices. For instance, renting equipment in

India involved a long lead time before the equipment arrived on site. The Japanese

contractors were initially not aware of this and therefore grew quite frustrated as they

waited for their rental equipment to arrive. Consequently the project was delayed.

In some cases, lack of knowledge of local norms led to employees leaving the

project. In one amusing incident, an American expatriate walked into a senior Indian

212

official’s office and proceeded to place both his feet on the Indian’s desk. Shocked by

such a gesture of incivility in what was a purely professional relationship, the Indian

official issued a complaint and had the American dismissed from the project. In another

case, a set of experienced tunneling experts from Germany were unable to cope with the

tardiness and the poor quality of the responses that they received on the Indian

construction sites and boarded a flight back to Germany a week after they arrived. A

German site engineer remarked:

One man was a very senior person in tunneling and he has a very good name in Germany – and he is on the site, and he gets all promises and no action. For 30 years he has been working in environments where people keep their words and do their jobs – he’s an old guy and that is old-fashioned thinking. This is the way he expects to move, and here he wants equipment tomorrow and the equipment hasn’t been even ordered, and that gets him upset. So he says, “If you want me to do the job, give the means to do it – if not, give me a plane.” And so he went.

As these anecdotes show, issues arose due to national differences in norms and work

practices. However, almost all project participants felt that such issues arose only at the

beginning of the projects, and had very little overall effect on the outcome of the projects.

A British expatriate with several years of international experience who worked as a

contracts manager on a joint venture in the Indian project, commented:

I think as a JV (Joint Venture), essentially there are 3 construction companies. I’m sure like any other JV, initially they had several teething problems. You’ve got the Indian culture, the Western culture (Swedish) and you’ve got the Japanese culture and the thinking on different issues is quite often very different, and so they also have to get down and come to a consensus on many issues. From what I see – I think it works quite well. Overall – as I said it has worked quite well.

Many informants from various nationalities also attested to an initial ‘teething phase’ on

these projects where national differences occurred and were resolved through discussions

213

and mutual understandings. These national differences rarely re-surfaced in the later

stages of the projects. In Taiwan too, this was the case. An experienced Australian design

manager who worked for a Korean contractor, remarked:

I really can’t say that the cultural differences (between nationalities) affect the project one way or the other. I think that issues really come down to communication. (From the) Design point of view — cultural differences, I’ve never had a real issue.

And a German project manager echoed:

Not too much (national differences). Not too much. It’s okay. There’s nothing to complain about. As I said to you before, the beginning period is always difficult.

A German engineer even proposed that less than twenty percent of the problems on these

projects were due to national differences.

In sum, it was clear that the problems that arose as a consequence of the sorts of

national differences theorized by scholars such as Hofstede (1991), were neither abundant

nor very significant. Why was this so? My data suggest three reasons. First, almost all the

international employees on these projects had previously worked on several international

assignments and were well experienced in dealing with different nationalities. Second,

the technological base used for the design of these projects, was well understood and

created a ‘common language’ across nationalities. Third, strategies, such as the use of

local experts for the purpose of material procurement etc, further reduced the possibilities

of problems due to differences in local norms and practices. I will now briefly elaborate

on each of these issues in turn.

214

Experience of the International Contractors

Most of the freelancers and the international contractors’ representatives had several

years of experience working on other global projects alongside people from a host of

different nationalities. These participants were both aware of and adept at dealing with

national differences. An Australian Design manager in Taiwan, who worked as a

freelancer to a Korean contractor, remarked:

I find that the more you deal with people who have worked on international projects they’re able to be more flexible. They’re not also frightened off by something different. They’re used to having something different. And if you’re working overseas and you’re working in your minority groups, then you know how to deal with difficulties in language or everything else.

A Japanese Project Manager in Taiwan also noted: I work as a civil engineer – first two years in Japan, then two years in Mexico, another two years in Mexico, two years in Panama and again come back to Japan and then I went to Syria and work in Middle east,– so I don’t get surprised (when I see something different)

As these informants indicated, the international employees were accustomed to

encountering national differences and were used to combating these issues without

getting frustrated or letting them get out of hand. One British contracts manager

mentioned that most international employees had a little bit of trouble with national

differences on their first few projects, but were able to handle these better over a period

of time. He said:

I think for the experienced expats, the expats that have been away for more than 5 years, the adjustment to the culture of a country becomes second nature after your first one. The first time you go overseas, say you go to China, you may struggle for a while to get into the culture because there’s do’s and don’ts. So you quickly have to learn those do’s and don’ts and everything follows after that.

215

Another British contracts manager also talked about the benefits of experience and

exposure in dealing with national differences.

Experience helps a lot. I’ve dealt with Japanese and Korean companies before – I haven’t dealt with Indian companies so that was something new, but I’d dealt with German companies, Scandinavian, British and so on – Dutch as well – and I’ve been on both the consultancy as well as the contracting side – and so I know both sides of the story. So I take a very international approach to the project.

Through their experiences, most international employees had acquired some ‘cultural

intelligence’ (Earley et al 2004a, 2004b, 2004c) on how to adapt quickly to different

national environments and adopted an attitude of flexibility towards the project. Rather

than coming in as experts and saying ‘this is how it must be done’ or ‘this is the right way

to do it’, these expatriates listened to and carefully weighed the views of other project

participants before taking a decision. As one experienced British expatriate who worked

for a German contractor in India pointed out:

Generally the managers tend to adapt. Here in India they have to get the best progress that they can to the situation that is here – and so I think everybody has adapted to that. You need to get progress and you cant come in here and say we’ve got to do it this way and this is the way its done in Europe, because you cant change the whole system here for this one project. From my point of view, with my overseas experience, I come in, open, to see what the situation is and to see what I have to do to adapt to the situation, and get the job going.

A narrow-minded and inflexible approach towards how tasks were performed could have

led to fights and conflicts between parties. However, by virtue of having the experience

to understand the presence of different viewpoints the expatriates brought the different

views to the discussion table and avoided conflicts.

216

Further, the more experienced employees shepherded the less experienced

employees and ‘showed them the ropes’. In one instance, an inexperienced Japanese

engineer was frustrated with his Taiwanese counterpart, who would never admit that the

schedule was slipping. The Taiwanese engineers preferred to please his partner rather

than tell the truth. The Japanese engineer said:

I was very irritated. Every Japanese who comes to Taiwan for the first time feels something like that. When I came here I was told by X-San – another experienced person, don’t get irritated – they are that kind of people. So we just do something.

X-San, an experienced Japanese manager who had been in Taiwan for several years,

educated the young Japanese engineer about Taiwanese behavior. The Japanese engineer

then devised other methods to obtain schedule information and had fewer conflicts with

his Taiwanese counterpart.

The preponderance of such experts on these projects led to a situation wherein

most international employees, irrespective of their nationality, had similar experiences

and shared similar outlooks. A British expatriate in India summed up the situation thus:

(The effect of national differences is) Surprisingly little really and I think a major factor is that in a project such as this, it always draws in a considerable amount of international experience. And on everything really – from the designers and the main contractors and suppliers, it brings in a tremendous international involvement and so you have a large cultural commonality.

The international employees on these projects could be thought of as part of a larger

community of experienced ‘international workers’ who shared common beliefs and

practices, as opposed to entities from distinct national groups. Therefore there were fewer

national differences between project participants from varying nationalities. Thus, the

217

existence of a community of extremely experienced international engineers with flexible

attitudes and common outlooks helped minimize problems due to national differences.

Technological Similarities

Almost all the participants on the projects in India and Taiwan were engaged in building

a civil engineering structure. They had received comparable technical education and used

International Building Standards and codes that they were all familiar with to design and

construct these projects. Commenting on the technology of the project, a British

Structural engineer remarked:

Same experience in Singapore and Malaysia. They are using designs that go back to British design rules, and a bit has obviously been adjusted locally, but there is an awful lot that has not been adjusted and it’s the same in all places and I would say that generally for structural design, it doesn’t differ hugely. Concrete and steel are not new and little really has changed over the years, because it’s a material that’s been there that long, (and) the whole world has learned to use it. I’ve had a little bit of involvement of codes from Germany etc where it didn’t come from England, but even so, even though it has a slightly different way of doing the calculations and so on, it tends to come up with pretty much the same result. So suspension bridges are not that different in every part of the world.

Differences in building codes and local standards can serve as generators of conflicts

when people from different national backgrounds are involved, since some aspects of

national systems of construction may differ from one system to another. However, such

issues were avoided by adopting international standards that all participants were familiar

with, creating a ‘common technical language’ that bridged national boundaries. A Korean

project manager observed that on the site, there were virtually no national differences:

The Professor, Mr Brockmann, kept talking about, “Culture, culture.” But engineer is engineer. Engineer’s culture is the same (irrespective of nationality).

218

After we finish the site work we go to the entertainment place or other places, and there I know the culture is different, but on the site, the culture is not different you know

As this informant suggests, the common ‘engineering language’ that all the project

participants used led to the generation of shared understandings on the construction site,

thereby reducing the effects of national differences.

Relying on local intermediaries

Since the international contractors were not familiar with the nuances associated with

working in the local environments in India and Taiwan, they formed joint venture

alliances with the local contractors, a mode of operation characteristic of large global

projects. In all but a few cases, the local partners were in charge of negotiating with local

suppliers, selecting local subcontractors, managing the local interfaces and so on. The

construction manager for one of the local Taiwanese joint venture partners on one of the

contracts, said:

Subcontracts. Basically I think in procurements we (the Taiwanese contractor) take the lead. And again this area is a little unsafe. Our Japanese partner trusts us. In our case all the procurement is done by us. I also feel very lucky. Their behavior is pretty good and they trust us.

Due to their inexperience with the Taiwanese construction industry, the Japanese

contractors knew they would not be able to undertake the procurement process as

efficiently as the Taiwanese, and therefore allowed their Taiwanese partners to take

charge of these activities. Since the Taiwanese contractors knew all the local procurement

players and nuances, they obtained services for a fair price. Similarly, in the other project

219

in Taiwan, the local Taiwanese engineers were put in charge of dealing with local

stakeholders, since they best understood the needs and requirements of these parties. As

the Taiwanese construction manager on that contract noted:

The Japanese have come to Taiwan for this first time – so they don’t know about the behavior of the local government and they don’t know the local government’s power. Even in our construction, there are many many complaints from the local residents and the local government. So because the Japanese didn’t know how to deal with these complaints they assigned our local engineers to deal with that. I think this portion is not under their control. Almost for all the interface issues, there is assign to our local engineers.

As these examples show, international contractors used local partners to make up for their

lack of local knowledge, thus avoiding potential difficulties due to differences between

their own views and local practices.

A summary of the analysis of Institutional Differences on Global Projects

In this chapter I have attempted to analyze the nature of the conflicts illustrated in

preceding chapters. The first surprising observation was that the main categories of issues

observed were of the buyer-seller variety and were NOT fundamentally unique to global

multicultural projects. However, as in the case of India, specific situational and national

parameters did lead to extreme instances of these problems. Also, the wide multicultural

experiences of the project participants and their flexible mindsets virtually eliminated the

occurrence of problems due to national differences between many international

contractors on the project. Furthermore, use of a common technology that brought all

participants onto a common footing and the use of local partners helped the international

firms avoid dealing with local nuances. As a result of this, systematic national differences

220

in values or beliefs (Hofstede 1991) between the various international contractors were

not a significant cause of concern on these projects.

Despite the fact that I had only studied two projects in detail, project participants

who had extensive international experience indicated that these findings applied to

several other large infrastructure projects, especially in Asia. Similar types of

international firms were involved in all these projects, project scope and structures were

nearly identical, and most of the staff on these projects had large amounts of international

experience. Therefore, it might not be inappropriate to propose that, on large global civil

engineering projects, conflicts are rooted more in institutional differences in viewpoints

held by local clients vs. international contractors, than in values or beliefs-based national

differences (Hofstede 1991) between contractors, subcontractors and engineers.

Answering the Research Questions

The first research question posed was ‘What types of Institutional Conflicts occur on

Global Projects?’ Based on current findings and the discussion above, the following

institutional conflicts were most salient on global projects:

Institutional Conflicts regarding safety and quality: A conflict between a high-

safety and high-quality oriented international contractor and less-safety and

less-quality oriented local subcontractors and laborers

♦

♦ Institutional Conflicts regarding conformance of the works: A conflict

between ‘Must-Stick-To-Rules’ oriented clients and results-oriented

international contractors.

221

Institutional Conflicts regarding administration of the works: A conflict

between a bureaucratic form of administration on the part of the Indian clients

and a decentralized craft form of organization on the part of the international

contractors.

♦

♦ Institutional Conflicts regarding Client-Contractor relationships: A conflict

between ‘Master-Slave’ oriented Indian clients and ‘Equal Partner’ oriented

International contractors.

The second research question that I asked was ‘How are these conflicts resolved’. In

order to answer this question, I will next introduce another observation – the presence of

a large number of freelance expatriates on these projects, and the role that they played.

Although I have already mentioned the existence of this community in the course of

earlier chapters, I will now seek to analyze further the roles expatriates play on these

projects and how they proved to be a key element in resolving institutional conflicts.

222

Chapter 13 – Freelance Expatriates: An Intermediary Community

By far, my most surprising finding was the existence of a community of freelancers from

various countries, who performed a wide range of tasks on the projects. These expatriate

freelancers were not permanent employees of any of the organizations on the project.

Rather, they were independent short-term contractors who were hired as ‘project’

employees by the international joint ventures for a limited time period, ranging anywhere

from a few months to the full duration of the project (four years). The duration of

employment was based on the technical skill set that they possessed and the duration of

the need for that particular skill on the project.

Most of these expatriates had worked on several such projects in the past. In fact,

most members of this ‘community’ (in reality an informal group of people with similar

backgrounds), shared similar career profiles. Typically, they initially worked as

employees for firms in the country of their birth. After they gained some experience at

these firms (this duration could range from two to as many as fifteen years), they

typically took up an offer as a project employee on a global project outside their home

country. Some expatriates then spent the remainder of their career hopping from one

global project to another, working as freelancers for a limited period of time on each

project. Other freelancers returned to their country of origin for a few years, and ‘re-

enlisted’ later.

Most freelancers were specialists in an engineering discipline (structural

engineering, geotechnics, construction, tunneling etc), and had built up an impressive

resume working on large complex civil engineering projects over the course of their

careers. As a result, when faced with the need to bring in a person with a certain skill set,

223

many firms chose a freelancer with the necessary expertise so as to minimize their long-

term overheads. Had they hired or trained a person in this skill in-house, they then had to

make sure that this person was staffed on subsequent projects so that the newly trained

expert generated sustained revenue to overcome the training costs. The international

construction firms avoided these costs by hiring freelancers on temporary contracts.

I observed this rather large, loosely knit community both in India and in Taiwan,

and conversations with experienced project participants indicated that these freelancers

were present on other global projects as well, especially in Asia. Most had worked in

several different Asian countries and had developed an itinerant lifestyle. For example, a

freelance British expatriate working in Taiwan as a contracts administrator for a Korean

contractor had worked for more than twenty years on highway, tunnel and bridge projects

in Singapore, Malaysia, Indonesia, Vietnam, Japan and Korea. In India, the clients had

hired a British design manager who had worked for a few years in the Middle East, six

years in Singapore, four years in Thailand and five more years in Singapore before

coming to India. Another British expatriate who worked on the side of the contractors in

India, had the following to say about his experience:

I’m from London but the last 13 years I’ve been overseas. First trip was to Pakistan–– Karachi, Pindi. Last 13 years I went Pakistan, Oman, back to Pakistan, Singapore, Hong Kong and now to Delhi.

As can be seen from these descriptions, most expatriates were widely experienced both in

the terms of the variety and the number of projects on which they had worked. There

were a few freelancers who were much younger and were just starting out on their

itinerant careers, but their more experienced counterparts outnumbered them. A large

224

proportion of freelancers came from the UK. In India the legal systems and bureaucracy

were partly influenced by British colonial rule and therefore the expatriates from the UK

were somewhat familiar with them. Further, the fact that English was the official

language on most global projects and the fact that several of the building codes and

standards were offshoots of the British building codes made it easy for expatriates from

the UK in particular to adapt to most global projects.

The academic literature is almost completely silent about the existence of these

expatriates on global construction projects. Yet, freelance expatriates composed

anywhere from 10% to 50% of the manpower of the joint ventures on the projects that I

visited. On the contractors’ side, all of the joint ventures that I observed employed these

expatriates, and experienced practitioners seemed to be well aware of the existence of this

community. Although the clients’ organizations in India and Taiwan did not directly

employ them, freelancers constituted a large part of the consulting organizations that the

clients recruited to aid them in administering the works.

The number of freelancers varied throughout my stay on the projects. In India,

roughly one third of all freelancers worked as the clients’ consultants, while the

remaining two thirds were employed by the contractors. A little less than half of all these

freelancers were present in ‘boundary spanning roles’ such as contract administrators,

overall project managers, quality control and assurance etc. The remaining freelancers

occupied technical or managerial functional positions such as tunneling engineer, design

manager, electrical and mechanical expert etc. In the clients’ organization, half of the

freelancers occupied high-level positions such as project manager, construction manager,

structural design manager etc. These positions had large decision making responsibilities

225

and involved synthesizing inputs from various technical functions. The other half of the

freelancers were involved in mid-level positions within the organization and were tasked

mainly with providing technical data and recommendations regarding a given engineering

function. In the contractors’ organization, two thirds of the freelancers occupied the

higher decision making positions.

Freelance expatriates had a key role to play in the mediation of conflicts,

especially on the projects in India. The strategies that they used in India are the subject of

subsequent chapters. Although this is not directly central to the subject of this research, I

will now attempt to provide a little more insight into the lives of these freelance

expatriates. I will briefly discuss their motivations for such an itinerant existence, their

lifestyles, how they went about finding future employment and the main reasons for their

being hired on these projects. I will then conclude this chapter by briefly mentioning an

alternative role that they played – that of the Mediator.

Motivations of the freelancers

As one can well imagine, living the wandering life of a freelance expert was not easy.

Freelancers found it virtually impossible to settle down and establish roots in any one

place. Every few years they went through a process of relocation, made new contacts,

relinquished existing friendships and so on. Needless to say this was also a burden on

their spouses, and maintaining a family in such circumstances was quite a challenge.

Children needed to shift schools every three or four years, and this placed a greater

burden on them to adjust continually to new circumstances. Conversations with these

expatriates yielded two main sources of motivation for overcoming these difficulties –

226

money, and the challenges of building large projects in developing countries. A small but

significant number of freelance expatriates also pointed to the lack of challenging jobs in

their home countries.

Most expatriates were paid handsomely. They earned the same amount of money

that they would have earned as a professional in countries such as the UK. Given the

lower cost of living in most of the Asian countries, they were able to spend less on living.

Furthermore, the freelancers from some countries such as the UK were not required to

pay taxes for earnings abroad, provided they were abroad for more than nine months out

of a given year (c.f., 11 months for US expatriates). Many freelancers saw their current

careers as a means to earn and save money so they could afford a more comfortable

lifestyle in the future. However, a few expatriates pointed out that since no one from this

community was really part of an organization, they were not eligible to receive pensions

and other benefits that employees of a firm might receive. As a result, they had to work

longer to make up for the lack of benefits.

Freelancers also said that they preferred their work and lifestyle because of the

challenging and exciting nature of their jobs. One British expatriate who was working as

a consultant to the client, said:

I like big projects. There’s a certain satisfaction in being part of a big project – seeing it in all the stages of its life. When I first went abroad – I was 26 when I went to Hong Kong – I’d left the University and I was determined to be Isembard Brunel the Third – these high aspirations. Certainly working oversees, you had more responsibilities and you have the exposure to more interesting large scale projects than you do in the UK – for example the Jubilee line extension (in London) had a project team of over 1200 people – so there would be no way that I would have been Project Director of Jubilee line – I’d be 5 levels down and certainly as a young engineer, we’d just be one of many looking after a tiny little part of the work – so there’s much more job satisfaction and scope for personal enhancement by going abroad.

227

Many of the international projects particularly in Asia were challenging feats of

engineering. Furthermore, the expatriates were given greater responsibilities on these

projects than they would have been given at home. Finally, working in several different

countries, and getting to know different cultures was an adventure that most of these

freelancers found appealing.

By contrast, the construction market in many developed countries such as the UK,

had saturated to a point where the jobs available were limited, and the structures that

were being built were rather mundane. This also led many of these expatriates to seek

greener pastures abroad. One British contracts manager working for the contractors in

India pointed out:

I’m a quantity surveyor – and then because of the situation back home, there was a low workload and so I went into the litigation side and became an arbitrator as well. What made me leave Scotland? The financial situation mainly plus the fact that I always wanted to go overseas. I progressed pretty well career-wise until we had the slump in 1975 in the UK and salaries were suppressed because there wasn’t enough work. Nobody wanted to go into the construction industry. The conditions were terrible, there was a risk health-wise as well – it was accident prone – you didn’t have a decent office and a decent internet connection – and the salary was low compared to other professions.

How they Find Jobs

Being a freelancer was somewhat of an uncertain and risky profession. Job security was

very low, contracts were relatively short and every few years these expatriate freelancers

searched for new jobs and opportunities so that they could remain employed. Freelancers

mainly learned of new job opportunities through word-of-mouth from other expatriates

that they had worked with in the past. Although the freelance community was so big that

228

not everyone knew each other (in fact each freelancer had only a relatively small circle of

acquaintances compared to the total number of freelancers working in Asia), and

although there was no formalized system of notifying all freelancers of available jobs, the

mutual ties that these freelancers developed helped them become aware of opportunities.

One expatriate summed this up and said:

So the expat community – although it is probably several hundred thousand worldwide is quite small compared to world numbers – and you meet people in various places and you keep in touch and this, that and the other. So you normally pick up another project through word of mouth or recommendation or whatever. So it’s like a roll-on effect. I can’t remember the last time I had to go through an agency (to find a job).

My data suggests that these informal networks proved to be fertile sources of job

information. These informal networks operated both through a ‘push’ and a ‘pull’

mechanism. My observations indicate that in the ‘push’ mechanism on the projects in

India, expatriate freelancers proactively contacted other freelancers and informed them

that they were looking for work. Some of their contacts told them about an open position

on a project that they were currently working on that fit the skill set of the freelancer

looking for a job. The freelancer then applied for this position, and in most cases were

‘highly recommended’ by their compatriot on the project. This often led to a temporary

contract. For instance, a Scottish tunneling expert had written to one of his managers on a

previous project, an expatriate from England, asking for a letter of recommendation so

that he could apply for new jobs. This manager who was the project director for the

clients’ consultant in India then told him of an open position on the Indian project and

facilitated hiring the Scotsman for a period of two years.

229

Although a few freelancers had been recruited through the ‘push’ method, I

observed the other mechanism — the ‘pull’ type — to be a far more common means of

recruitment on the projects in India. In this situation, an expatriate who was already

working in India proactively contacted people in his network of freelancers to see if

anyone was coming to the end of their tenure on another project and was available to fill

an open position on this project. Several of the freelancers thus approached accepted an

offer to work in India even before their earlier contract was completed. As one of the

British expatriates working in India related:

One of the guys – an Australian guy who was very much involved in the project- I knew him and I was in touch with him. So he sent me an email when I was in Hong Kong to say that the contract (in India) was signed and as the contract moved on, he sent me an email to say – he was looking for a commercial manager

Another British expatriate working for the client in India said:

I used to work on the opposite side of table as Mr X in our last job at Singapore – he was with the client and I was with the contractor – and he said that he was going to India – and that he had a position and asked if I was interested. I thought about it, and I could expand my CV since this was a higher position. So I thought it might be a good move in terms of future work, so that’s why I came here.

Almost without exception, these networks helped the freelancers on the projects in India

find jobs when they needed to, and very few people in this community were left

involuntarily waiting between jobs. This finding bears a lot of relevance to Granovetter’s

(1973) work on ‘the strength of weak ties’. Several studies done within the US indicate

that many individuals find out about new jobs through personal contacts (e.g Brown

1967; Granovetter 1970) and that those colleagues to whom a worker is connected by

weak ties are likely to move in different circles and thereby become aware of new job

230

opportunities that the worker does not know of (Granovetter 1973). Freelancers were

acquainted with each other through having worked on previous projects. Although they

occasionally saw each other in a non-work context during the course of a project, they

rarely encountered one another after the end of the projects. The ties between them were

thus not extremely strong. Yet, as Granovetter (1973) argues, these weak ties were an

important resource in making possible mobile opportunity since other freelancers who

worked in different areas knew of opportunities that job-seeking freelancers were not

aware of.

E-mail played a crucial role in ensuring the sustainability of this loose network of

weak ties. Freelancers no longer needed to remember which projects their colleagues

were working on and keep track of constantly changing postal addresses. They collected

a set of email addresses that they wrote to for job related information. Almost all the

freelancers in India and in Taiwan had two email addresses. The first email address was a

temporary project address that their employers gave them for the duration of the project.

The freelancers used this address to exchange communication specific to the project that

they were working on. The second email address was a more permanent and private

address — typically a hotmail account — that they shared with their colleagues. The

freelancers used this private email address to maintain their network of contacts.

Families and Lifestyles

The itinerant lifestyle placed a large amount of stress on spouses and family members, as

they were never allowed to settle and establish roots in any given place. On interviewing

19 freelancers from all the four projects studied, 14 of whom were British, 3 of whom

231

were South African and two of whom were Australian, it turned out that there was no

‘one way’ of dealing with these issues that everyone within this community adopted.

Although there were only a few types of choices that these expatriates made, the

community was diverse enough that different freelancers chose different options.

Most freelancers were married. Some had married women from their countries of

origin; others had met their spouses in the Asian countries where they had worked. Figure

13.1 represents the relative proportion of freelancers with Asian wives as compared to

freelancers with wives from their country of origin.

Country of originAsian

Figure 13.1: Nationality of Spouses

As the data indicate, roughly half chose each option. Some expatriate freelancers

preferred to have their spouses with them as they traveled from country to country.

Others chose to work alone, while their spouses and children led relatively stable lives in

their home countries. The latter made frequent visits back home (depending on the

number of holidays that they were allowed) and spent time at home between projects.

Once again, the distribution between these two choices is represented in the form of a

chart in figure 13.2 below:

232

Spouse in countryof originSpouse on site

Figure 13.2: Location of Spouse

Just as in the previous case, the freelancers were almost evenly split between the two

alternatives. Further, of the eleven spouses who came from the freelancers’ own countries

of origin, five of them lived on site, while the remainder lived in their country of origin.

Similarly roughly half of the spouses who came from Asian countries lived on site while

the remainder lived in their country of origin.

Several expatriates were old enough that their children led independent lives.

Many other expatriates had children who were still studying in school. The freelancers

whose spouses were back in their country of origin entrusted the care and education of

their children to their spouses. Freelancers who lived with their families had two

generally preferred modes of operation. Most freelancers preferred to send their children

to a British School or an International School in the city in which they were currently

working. A few freelancers preferred to send their children to boarding school back in

their home country. Figure 13.3 graphically illustrates the distributions of the choices

made by the freelance expatriates.

233

N/A

On Site

In Home Country

Figure 13.3: Location of Children

Slightly less than half the freelance expatriates had children who lived independently. Of

the remainder, the majority had children who were studying in their country of origin

(mostly with one of their parents), while a significant minority (those with dependant

children and spouses on site) had children who were studying locally in British or

international schools.

The Official Role of the Freelance Expatriates

The freelance expatriates were considered to be highly knowledgeable technical experts

and were officially hired to provide technical advice and support to the design and

construction of the structure in question. A very experienced Indian Government official

commented on the role of the expatriate freelancers:

The expats are here as the technical advisors of the project. So for instance, take expat E. I was told to interact directly with the Chief Resident Engineer over contract issues. “Don’t bother with E since he is the technical construction manager,” I was told. So they are basically experts or technical advisors.

234

Another senior Indian official commented:

The expat experts have been working in this field for quite long. As far as technical issues are concerned, there are no disputes – but we normally think that technically what they are telling has more merit. We just go to them and discuss it and try to find out ways.

As this official indicates, the clients and the contractors regarded the freelancers as the

supreme technical authorities, and their word was seldom questioned on technical issues.

Even the expatriates viewed themselves as technical experts who used their expertise to

enable the project to be completed successfully. One expatriate who worked as a

construction manager on the Indian project remarked:

People like to test you out. Sometimes it would piss me off. I’ve always been more interested in the technical side of stuff. Tunneling is very challenging, but you find that more and more your time is being consumed by managerial stuff – and I have not had training for this. So I get frustrated a little.

This freelancer felt that his expertise and responsibility were to be directed at solving

engineering challenges on the project. However, as a construction manager he had to

perform several time consuming administrative and managerial tasks, which left him

feeling quite frustrated.

Although the intended role of the freelancers was of a purely technical sort, the

data show that they played a different role on the Indian projects and helped solve the

inter-group or inter-personal conflicts that arose on these projects as well. I will elaborate

on this role in the next few chapters. In the remainder of this chapter I will take a look at

the structural position of this community of freelancers on the Indian projects, and

analyze how they were positioned to play a part in conflict resolution.

235

Structural position and its influence on the roles of the freelancers

The projects’ organizational chart included three distinct formal groups – (1) the local

laborers and subcontractors, (2) the international contractors, and (3) the local clients. An

informal ‘fourth group’ that was not indicated on these charts was the community of

freelance expatriates who were temporary employees in both the local clients

organizations as well as the international contractors.

In many cases a third party is called in to mediate conflicts between two parties.

Several professional mediators and arbiters fulfill this function in many aspects of daily

life. On these projects, the freelance expatriates were a neutral third-party group since

they were not permanent employees of any organization. Therefore they possessed some

of the necessary attributes to play the position of a mediator to resolve client-contractor

conflicts. However, their effectiveness depended on the type of conflict as well as the

positions that they occupied on the projects.

The contractors were in a position of relative strength with respect to the local

subcontractors and the laborers. Most of the international contractors’ employees had

worked in several countries before and had similar experiences and outlooks to those of

the freelancers. The freelancers faced virtually no difficulties in integrating themselves

into the fabric of the large international contracting joint ventures and were quite

sympathetic to the views of the international contractors regarding conflicts. Therefore

with regards to safety and quality issues, although the freelancers who worked for the

international contractors did not act as mediators, they helped resolve conflicts and

effectively used the strength of their position to impose the contractors’ views on local

subcontractors.

236

In terms of client-contractor conflicts, the clients were in a position of relative

strength as compared to the international contractors. The freelancers who worked for the

international contractors were not in a position to influence the clients, since in the eyes

of the clients they were no different than the other employees of the contractors. They

were unable to mediate directly or resolve disputes. However, those freelancers who were

hired by the clients were in a better position to affect the outcome of client-contractor

conflicts as they were allied with the organization that held the greater leverage.

The clients had hired a consulting organization that included several Indian

government employees who were bound by the same pressures as other civil servants

(e.g. the influence of ‘Vigilance’), and behaved in a highly bureaucratic and dictatorial

manner towards the international contractors. Some freelance expatriates occupied upper-

level managerial positions within this organization, and influenced the outcome of

client-contractor conflicts that originated from within their own organizations. This

particular subset of freelancers mediated these disputes and arrived at resolutions that

were accepted by both parties. In some cases these expatriates took the side of the clients’

consultants and in other cases they supported the contractors.

Although some freelancers enjoyed a position of strength within the consultants’

organization and could mediate disputes involving Indian employees who were part of

this organization, they faced some difficulties when dealing with the clients themselves.

In the initial stages of the project, the clients did not give the freelancers much authority

to make decisions and this limited their ability to act as mediators. As a result they had to

establish good relationships first with the Indian clients. Unlike the international

contractors, the Indian clients did not have much experience dealing with people from

237

diverse backgrounds. Issues arose due to differences in national backgrounds and the

freelancers needed to establish trust with the clients.

Establishing Trust with the Clients

In India, the group of freelancers present within the consultants’ organization at the start

of the projects did not get along well with the local clients’ representatives. The project

director, a British expatriate who had worked as a consultant on the project almost since

its inception recalled:

Our Monday meetings used to be full of people complaining about the client, “Oh stupid people don’t know what they’re doing. They cant make their minds up,” (they would say), instead of focusing on, “We’re the consultants, so lets make the recommendations – and if you need it in a week, we’ll say so – and if that doesn’t happen Mr X you go see the Managing Director.” That wasn’t happening then – the sort of close working relationship with the client was not happening.

In the beginning, these freelancers were frustrated by the clients’ bureaucratic behavior.

They constantly complained about the clients and did not have open channels of

communication with them. In addition there were a few national differences as well. As a

result of this several of the freelancers present at the start of the project were not

comfortable working in India, and left either of their own accord or at the behest of the

clients, leaving the consultants’ organization in flux. The project director spoke about

these expatriates:

The people that were here when I first came – they’ve all gone. This guy Freelancer A was desperate to leave. Freelancer B worked for me. As soon as I came on I gave him a bit of a hard time so he wanted to leave. Freelancer C was desperate to go and Freelancer D got thrown out because he insulted Client Representative X.

238

The current project director then took over this organization. Being a very experienced

expatriate, he realized the need to build a good working relationship with the clients for

the project to move forward with minimal conflicts and delays. The project director

proceeded to bring in some freelancers that he had met on previous projects, who he

thought would be flexible enough to deal with and build relationships with the clients. In

an interview he said

I was able to select the guys for those positions – P,Q,R and S – I knew them from before and I knew that they had the right frame of mind – because you have to be project orientated. Not somebody who has a hidden agenda about some of the other folks on the project. So I guess it was a change of guard almost, and I guess the people now are all pulling in the same direction. I suppose it’s interesting because the concept is still the same – the structure – but the people – maybe that’s the motto – people count.

The project director and the new freelancers proceeded to build good working

relationships with the Indian clients’ personnel. They proactively held discussions with

the clients to build trust. Each freelancer often met his contemporary in the Indian

organization and held discussions or aired differences. Over a period of time, the

relationships between the clients and the contractors improved and the number of

disputes reduced. The Project Director explained his strategy thus:

One of the things I learned in Cairo was that if you have an acquaintance and if you don’t go and see them (the clients) more or less every day, then they think you’re not friends anymore. So when I took over here, I was in another building and MS was here. Virtually every day I would come across and chat and say, “This is what we’re doing,” and pretty soon the letters dropped to very few. Once every 2 or 3 weeks before I took over, the Managing Director would call a progress review in the board room – the clients on one side and the consultant on another side – and it would always turn out to be the heads of the clients department on one side always criticizing the consultant: “Consultant hasn’t done

239

this, consultant hasn’t done that,” and I said this is no way to run a project. Particularly there has to be a partnership between the consultant and the client. So I said to the MD, “How do you want me to report to you?” Then he thought for a minute and he said, “I’d like you to come and brief me once a week” – which I have been doing since then and which really helped me break the ice.

The Indian clients’ representatives were then willing to trust the freelancers and this

allowed the freelancers to play a mediating role on issues that came up between the

contractors and the clients. The ways in which freelancers who worked for the clients

strategically mediated and brought about a satisfactory solution to client-contractor

conflicts will be discussed in subsequent chapters.

Concluding comment

In order to play a mediating role, the freelancers needed to occupy a structural position of

strength within the project organization. The freelancers who worked for the contractors

occupied such a position when it came to conflicts with the local subcontractors.

However, they were marginalized when conflicts occurred with the clients. Some

freelancers acting as the clients’ consultants were in a structural position in the project

hierarchy that allowed them to mediate some of these conflicts, especially those that

arose between the consultants and the contractors. In order to mediate conflicts that

directly involved the clients however, these freelancers needed to build relationships with

the clients as the clients were in a position of greater leverage.

240

Chapter 14 – Conflict Resolution Strategy 1: Circumvention

The freelancers used four main strategies to mediate conflicts. These were:

Circumventing existing bottlenecks in the project processes ♦

♦

♦

♦

Escalating the issue to a level where it could be solved

Diplomatically convincing one or more parties of the right approach to follow

Postponing the issue or changing the forum to one where the conflict or issue

under question could be solved

I will further unpack the first of these strategies in this chapter. The other three strategies

will be dealt with in subsequent chapters.

Several client-contractor conflicts occurred due to the fact that bureaucratic host

country officials who worked as the clients’ consultants acted as bottlenecks. Many of

these host-country employees reported to some freelancers who occupied senior positions

in the project hierarchy. These freelancers used their seniority to circumvent and avoid

these bottlenecks in two ways.

Strategic Circumvention of the Process

First, since the local Indian personnel continually obstructed the contractors and delayed

making decisions, the freelancers sometimes used the authority vested in them as senior

managers to change the approval process flow such that it was the freelancers themselves

and not the Indian representatives who were in charge of making several of the decisions.

Far from being upset that they were deprived of their responsibilities, the Indian

employees were often quite jubilant. The loss of responsibility was like a ‘monkey off

241

their back’ since they could not now be blamed, accused or suspected by ‘Vigilance’ if

any of the decisions taken turned out to be poor ones.

As an example, the Indian project was split up into various cost centers and

activities such as concreting, excavating, strutting and so on. Each of these activities had

several milestones, each with a certain sum of money attached to it. For instance the

completion of 25% of the excavation at a particular station was designated as a milestone

event. The clients’ consultants’ monitored the contractors’ progress and issued milestone

certificates at the end of each month for all the milestones achieved during that period.

The consultants’ engineers on site prepared a checklist for each milestone to ascertain

whether the work was done properly, whether the contractors had the appropriate method

statements, whether they followed these method statements and so on. The contractors

then sent the clients an invoice and received payment for achieving these milestones.

The consultants’ engineers were mainly local public sector employees and were

often very reluctant to sign their names on the checklist even if there was only a minute

deviation in one particular criterion, because they were afraid that Vigilance would

question them if they made any mistakes. This delayed payments to the contractors. The

consultants’ construction manager, a freelance British expatriate described one particular

incident:

This is a big hurdle to get over since if there is money involved, then Vigilance would come along and say, “Why did you sign that?” An example would be milestones that say, “Concreting of the base slab 50% complete,” and our people would work and measure it and say, “48.9% achieved – milestone for 50% not achieved, not achieved!” And this is for a payment of 20 or 30 million rupees. The contractor needs that to pay for his sand and aggregate and his workers – and if we delay him and if we pay him next month then he’s not having that money now – he has no cash coming in and some cash going out. So some of our people

242

are really stupid on this – they wouldn’t sign off if they thought that there was any possibility for it to come back to them.

The contractors did not have large reserves of cash and depended upon timely or even

advance progress payments from the clients in order to finance a further piece of the

projects. Payment delays of even a month often proved very difficult and untimely to the

contractors. The contractors protested against the clients’ consultants’ reticence to

approve milestones and the project threatened to come to a halt.

In this scenario, the freelancers stepped in and helped solve the issue. Instead of

having the on-site engineer authorize whether the work met the milestone criteria, the

freelancers changed the role of the engineer to one of merely recommending whether

payment should be authorized or not. The freelancers themselves made the decision on

whether or not to authorize the milestone. The construction manager continued his story:

So what we did is that they could write on there: “Only achieved 47%” – so the engineer can sign it and say “47% – (milestone) not achieved,” and it’ll come to me and I’ll write, “This milestone substantially achieved, can issue now.” And I sign it and it goes to Mr X and he issues it. Those guys down below are then happy since they’ve said, “Don’t pay it” so vigilance cant touch them.

In this manner, the freelancer circumvented the existing process. The contractors were

satisfied and were able to progress the works on the project.

The clients’ consultants also had a design manager who was a very experienced

British freelance expatriate. This design manager, like many of his colleagues voiced

almost identical sentiments to those of the construction manager. Describing the decision-

making process on the project, he said:

243

I don’t know what to do. Sometimes I just do it myself to avoid other people making a mess of it. Or other people say, “I’ll do it,” but they end up never doing it. So we basically just avoid those people. Sometimes though I will just take it off them and sign it myself without consulting them – can’t be bothered with them.

This freelancer felt that the local engineers’ slowness in decision-making was detrimental

to the project’s successful completion. Since people within his organization were

reluctant to sign documents, he himself signed them and took them off the local

engineers’ hands in order for things to move forward. His authority as design manager, a

very high position in the consultant’s organization, gave him the leverage to pursue such

a strategy. In another interview with him, he said:

I will sign it, and then you’ll hear this enormous sigh, and they’ll give you everything to sign and they will say, “My senior, my superior signed that – don’t bother me, my future is safe.” I was very aware very early on that nothing was going to happen if I didn’t do it.

The local representatives were extremely grateful to the freelancers for taking up more

responsibility. Knowing that the freelancers were keen on progressing the works, several

Indian engineers even asked the freelancers to sign documents that they were not

comfortable approving. The freelance construction manager observed:

If there are letters where the staff is loath to commit to something in writing, then they’ll draft it and get it to me to sign at the bottom. Sometimes you just dive in and say – stop messing around, I’ll sign it and get on with it – stop moaning and groaning.

In an interview, an Indian electrical engineer provided an insight into the local Indian

viewpoints:

244

Hats off to Freelancer X, the way he has managed this – the way he has handled this. He will never complain, he is always ready to solve this. If you are not ready to draft a letter – and it has happened to me also – he will say, “Ok leave it, I will draft a letter.” He will draft it himself. All those gestures really move me.

If the Indian engineer did not have confidence in the information he possessed, he

worried about the fact that he would make an error and be caught out by ‘Vigilance’. He

therefore went to the freelancers and asked them if they could sign these documents, and

was grateful to them for reducing his exposure to Vigilance.

By circumventing the existing process and taking on the responsibility

themselves, the freelancers overcame the unintended effects of Vigilance and helped the

work progress, to the satisfaction of all parties on the project. This strategy succeeded

because Vigilance only affected the careers of local civil servants and did not have the

power to affect the careers of the freelancers, who could find work in another country.

The freelancers had relatively little fear about their future in India. Their worst case

scenario, if the local government was not happy with them, was that they would have to

find future work in a different country. This was not the case for the local Indians who

did not expect to work abroad and thus needed to preserve their reputation in the eyes of

Vigilance and other government bodies. As a result, the freelancers were able to take a

few liberties and assume a few extra responsibilities, with full knowledge of the fact that

their future was not compromised if they made a mistake. This coupled with an attitude

that favored project progress enabled the freelancers to circumvent processes strategically

and play a mediating role to resolve conflicts on the projects in India.

245

The contractors, for their part readily acknowledged and appreciated the roles

played by the freelancers in the clients’ organization in helping the project move forward.

A project manager from one of the international contractors quoted:

Freelancer X is very practical here. If it hadn’t been for freelancer X and freelancer Y, we would have been a couple of years behind – as would the other contractor. They approve our drawings and they process our drawings and approvals – because we need to have their notice of no-objection.

Several other project participants who worked for the contractors echoed this sentiment

as well.

In some cases, the freelancers adopted a slightly different strategy. Using their

authority at the top of the organizational pyramid, they changed the process to remove

any interference from anyone from the clients’ side. Instead of merely circumventing the

bottlenecks, they eliminated them altogether and gave the contractors more freedom and

the responsibility to perform work to acceptable quality standards. The contractors no

longer had to rely on the approvals of local Indian engineers. The consultants monitored

the site albeit at a reduced level in order to ensure that an acceptable quality-level of work

was being performed. As one of the freelancers working for the client described:

The works were getting delayed and getting held up. Once tension starts rising, people get entrenched and they start to dig their heels in and they say, “Right. Just go and read the specs again.” So yeah we have the two sides and we were at loggerheads and we weren’t getting anywhere – so what we did in fact then, as directed by freelancer B was that in the inspection and test plans there were these hold points – before the concrete could be poured etc – where the consultant and the inspector had to sign it off. So what we did was we took out that hold point and we said ok, quality is all down to you (contractor). You don’t need any of our signatures and you just go ahead when you think its ready – we’ll still do our own spot checks, but if we find things out, we’ll find a different way to nail you. So that was done and we took our guys off the night shift and we still have guys

246

roaming around, but this was not quite as intensive as we thought – so that allowed the work to pick up slightly.

The contractor was almost completely in charge of performing the works and this helped

push the project forward and eliminated bottlenecks caused by the inaction of the local

Indian engineers.

In many cases, the existing approvals and inspection processes involved large

transaction costs as clients and contractors often disagreed and spent a large amount of

time negotiating and arguing with each other. The freelancers used the strategy of

circumvention to reduce these delays and other transaction costs such as the time spent on

haggling, leading to smoother and faster progress on the project. In order to do so

however, the freelancers had to increase their own quota of direct work.

Thus far the discussion has centered on how the freelancers (working on the

client’s side) circumvented existing processes in order to resolve impasses, conflicts and

bottlenecks. By eliminating bureaucratic Indian civil servants from the process flow, the

freelancers helped move the project forward. I will now turn to the second strategy that

the freelancers employed to overcome bureaucratic bottlenecks – the use of authority.

Using Authority to Eliminate Bottlenecks

The freelancers sometimes used their authority to forcibly direct the Indian public sector

employees in the consultants’ organization to pursue a different course of action. In this

way they forced the ‘bottlenecks’ to disappear.

As an example the contractors had procured a fire-resistant cable that they

believed met the required specifications. They sent the technical details along with an

247

official catalogue that endorsed the performance of this product to the clients’

consultants. The Indian electrical engineer who reviewed these submissions felt that

despite the endorsement of quality, the contractors had not provided sufficient proof that

the product met the required standards as stated in the local codes and in the contracts.

This engineer wanted an independent agency to certify the quality of the product.

Unfortunately for the contractors, there were no local experts in India who could provide

such a certification. As these arguments were presented in a meeting, the design manager,

a freelancer who was in charge of all the Indians in the design team including the

electrical engineer, stepped in and told the Indian engineer to approve the contractors’

submission because the contractors had the supporting documents to prove that the

product was a good one. The Indian engineer merely nodded his head and the group

moved onto the next item in the agenda.

In another meeting, an Indian electrical engineer refused to approve the

calculations that the contractors had submitted for some generators, since the power

requirements submitted by the contractors were fractionally below what the Indian

engineer had himself calculated. Once again, at this point the design manager intervened.

In a follow-up interview, he said:

Generators! X (the Indian Engineer) was arguing with them (the contractors) about generators and that their calculations were fractionally off. I said, “X, the generators are only being used when the power fails, and we have backup systems – the whole thing is so coated with uncertainty so what’s there in saying it should be 10% this way or that way. So find the nearest size generator that is close to the calculation and order it – and while you’re doing that, order it for the rest of the stations as well – and get on with it.”

248

The generators in this case were a secondary level backup, to be used only if both the

main power supply and the primary set of generators simultaneously failed in all parts of

the station. Since the likelihood of this scenario was quite low, the contractors and the

freelancer felt that the technical calculations did not need to be perfect. The freelancer

felt that the Indian engineer was being overly rule following and asked him to stop ‘nit-

picking’ the calculations. Once again, the Indian engineer stopped voicing his complaints

and ordered the piece of equipment.

In another instance, the clients had approved a particular vendor for a certain

piece of equipment. The contractors were unsure as to the reliability of this vendor and

wanted a second vendor approved as a backup. The contract indicated that only one

vendor needed to be approved and therefore an Indian engineer who worked for the

consultants refused to consider the contractors requests, despite the fact that the

contractors had submitted the required documentation for the approval of the second

vendor. The Indian engineer claimed that if he humored the contractors, then there would

be no end to extra vendors that they would submit for approval. In a monthly meeting the

contractors’ project manager became very frustrated and this led to a shouting match

between the Indian and the contractors. It was at this point, when tempers were being

raised, that the project director – an experienced British freelancer stepped into the fray.

He felt that the contractors did have a legitimate need to have another vendor approved

and turned to the Indian engineer and said

Mr X, the contractor is completely right. It is a risk and we cannot turn a qualified vendor down. This is a legitimate risk.

249

He then turned to the contractors and asked them to respect the Indian engineer’s views

and not to submit requests for additional vendors unless they were absolutely necessary.

This ensured that the Indian did not ‘lose face’. The contractors were satisfied with this,

and the Indian engineer merely nodded and accepted the freelancer’s judgment.

In several cases the freelancers identified the overly bureaucratic and rule

following behavior of the clients as the chief issue behind the observed problem. Those

freelancers who were in senior positions in the organizational hierarchy ordered the errant

Indian officers to follow more progressive courses of action. As the construction manager

for the consultants, a freelancer with almost fifteen years of international experience,

observed:

One way around it is to go round and listen to people and announce your decision – and say there is no discussion, here is the decision.

Being in a structural/political position of lesser bargaining power, the Indian engineers

had to set aside their predispositions and follow the freelancer’s directives. In most cases,

the Indians did not feel appear to feel very resentful at being asked to adopt a different

course of action. The freelance construction manager said:

Sometimes P (Indian construction engineer) would call me and say, “We have a problem here. Mr. contractor is saying this and we are saying that”. So as long as I would go and I would issue a presidential decree or whatever, then everyone would be happy. Then they would all go home and say, “Well, we brought it up, we thought it was a problem, but Mr. F (freelancer) came and said it’s not a problem –carry on.” So our guys would go away happy.

The Indian engineers often implemented the freelancer’s wishes (even if it was contrary

to what they believed and favored the contractor), content in the knowledge that for their

250

part they had raised an objection and the responsibility for the decision was with the

freelancers. There were a few instances however, where the Indian engineers were not

pleased at the freelancers’ interference and preferred to follow their own rule-following,

bureaucratic or dictatorial strategies, even if these meant that the project would be held

up or slowed down. A freelancer recalled some such incidents:

It’s handy that I know contractors representative X, because he and I and we have a reasonably good understanding. So yeah I would call up the local engineers and say, “I have spoken to the contractor and this is what we have decided” – and they’d say, “Oh, we can’t do this,” And I’d say, “Sorry, this is what we’re doing!” – and there were a few times where Indian engineer P would write me a few snotty emails saying, “As instructed by you we are ignoring the procedure, and as per your orders,…,”….. so be it.

Yet, being in a position of lesser authority, the Indians were forced to obey the

freelancer’s dictates and did so with some degree of grumbling and frustration.

Also, the freelancers’ verdicts were not always favorable to the contractors. For

instance, in one of the monthly meetings the contractors claimed that they had submitted

a milestone schedule and had not received any response from the clients. A mid-level

Indian civil servant (with around 20 years of experience) who was dealing with this issue

replied that milestones submitted did not match the original version of the document. The

contractors’ German project manager entreated the Indian representative to take a more

progressive approach. His view was that the old milestone schedule had been replaced, so

there was no point in re-submitting it. The Indian insisted that according to the contract

whenever a new milestone schedule was drawn up the old one had to be sent in also for

comparison purposes. Once again both parties argued back and forth on their positions

with neither party willing to forego their stance. At this point the project director, an

251

experienced British freelancer, stepped in and asked the contractors to please submit the

extra documentation, as it was quite true that the clients required it. This freelancer was

in a position of greater strength and was well respected by the contractors. As a result, the

contractors accepted his decision.

Concluding comment

The freelancers, who were recruited as technical experts, played a ‘mediating’ role on the

project. Since they were not affected by Vigilance, they were able to assume

responsibility and circumvent any bottlenecks to the project’s progress by changing the

process flow or by exercising their authority. The freelancers on the clients’ side

successfully used the circumvention strategy outlined in this chapter to resolve many of

the conflicts on the project and to reduce the transaction costs associated with client-

contractor interactions.

In addition to this strategy the freelancers used three other strategies as well, to

help resolve some of the client-contractor impasses. I will discuss these strategies in the

next two chapters. I will then proceed to elaborate briefly on instances and issues that the

freelancers were not able to resolve, and investigate the reasons behind why this was so.

252

Chapter 15 – Conflict Resolution Strategy 2: Escalation

The second major strategy that the freelancers used to resolve issues that arose between

the Indian clients’ representatives and the international contractors can be best termed as

‘Escalation’. The freelancers working for the clients’ consultants directly intervened

when problems occurred between the international contractors and subordinates within

their own organizations. However, structurally they were not in a position to employ

strategies of circumvention, in cases where Indian government employees who were

working directly for the clients engaged in disputes with the contractors. Also, in rare

cases the freelancers had subordinates who did not obey their instructions. In such cases,

the freelancers raised issues to a more senior level within the clients’ organization –

typically to the level of the Managing Director (MD). The MD in particular was a very

progress-minded individual who wanted the project to be completed. Upon being notified

that there was an impasse, he often stepped in and ordered his subordinates to be less

bureaucratic and to grant approvals to the contractors. The MD was a very senior and

highly respected person in the Indian engineering system and upon his intervention the

Indian clients’ representatives invariably modified their stance and helped the project

advance forward.

Before delving into a more detailed inspection of this phenomenon, I will first

provide some more background into the character and the role of the MD, as this

individual was largely responsible for the success of this strategy of escalation.

253

The Nature of the Managing Director

The MD of the project in India was a very experienced and famous Indian civil engineer

who was several years past the age of retirement. He had worked as a civil servant his

entire life and had been asked to delay his retirement twice to work on flagship projects

built by the Indian Government. A decade ago, he was put in charge of one of the largest

railway projects undertaken in India, at a point in time where the project was in danger of

losing large sums of money. Under the MD’s leadership, this project was turned around

and finished on time and within budget, an eventuality that most analysts did not think

was even possible. The success of this project made the MD’s name a household one in

many parts of the country and he came to be widely respected among the other engineers

in the Indian government as well as by the public at large. In 2001 he was also awarded

one of the highest awards given to Indian citizens for his efforts towards nation building.

Recently he was one of 29 people to be named as ‘Asian Heroes’ by Time Magazine.

The MD took the philosophical view that every officer needed to be responsible

for finishing their tasks on time14. He was extremely keen that the current project should

proceed as scheduled and had made public announcements in several of the leading

newspapers that the project would be open to the public by a certain date. He was

therefore completely committed to ensure that the project was completed on time. One of

the freelancers commented on the MD’s progress oriented attitude thus:

The MD there is all gung ho and he wants things moving fast and he doesn’t want details of the minute details.

14 From an interview available at http://muraleedharan.tripod.com/legends_sreedharan.html , accessed 3/4/05

254

The MD’s image on the project was legendary and he held an exalted status among the

other Indian government engineers. Many people agreed that he was probably the only

candidate who could overcome the Indian bureaucracy and help the project finish on

time. One mid-level civil engineer who had worked for the last ten years for the Indian

government said:

I feel that because of our MD, things were clearer. If you remove MD and put somebody else, the scenario would have been totally different. MD has made it clear that it is coming on time – target is clear. He is also like a god. He also knows how to handle because he is like god. All other team members are like normal human beings with idiosyncrasies. He has risen above that – or so it appears. Whenever he comes, his word becomes like a law. Nobody argues with him because nobody doubts his decision. Suppose you have a request by a man like me, then we may start asking, “Why.” This MD has no such problem – he is respected. So that way I feel that he is totally different and that’s why he is getting the success and nobody else is getting the success.

In the eyes of the Indians the MD’s decisions were always correct and needed to be

immediately accepted. The MD thus used his stature to persuade his subordinates to

perform along the lines of his goals and visions. Whenever he was confronted by an

impasse, he quickly communicated a decision to the parties involved in the disputes, as

he knew that delays in decision-making postponed the completion of the project. In most

cases, these decisions were implemented immediately. In some cases the MD instructed

his subordinates to be less bureaucratic, while in other cases his decisions went against

the contractors, who had no choice but to bow to the clients’ demands and continue

working. An Indian architect, who was from the private sector, described the MD’s

behavior thus:

Here the biggest difference is that the top man is much quicker in making decisions and he has a grasp of things and so that does make a difference. For

255

many things, if we don’t get a decision, then we know that if we reach that man, we will get a decision. So there have been incidences that we had to meander our way and finally reach the top and the decision is made in 5 minutes. Because what I have been able to gauge is that if the man who is your boss says, “Yes,” then it’s fine. So if somebody is willing to take the decision, then that’s his responsibility, he has taken the decision and we are ok so that’s fine.

The MD was successful in resolving impasses and helping the project advance for two

reasons. First, several conflicts were resolved as a result of the amount of respect the

Indian government employees had for the MD’s decisions and the power that he

possessed due to his seniority, in conjunction with his eagerness for the project to

progress. Second, most local representatives were reticent to make decisions since they

were afraid of ‘Vigilance’. Much like the freelancers authorizing their subordinates to

follow a certain course of action, the MD’s authorization also helped absolve the local

Indians of any responsibility. As a result of both these factors, the Indian engineers were

quite happy to implement the MD’s directives.

Several Indian engineers acknowledged the MD’s role in reducing their fears of

Vigilance. When Vigilance raised a question on whether the contractors and the clients

had colluded to save costs, the MD allayed Vigilance’s fears and confirmed that the

correct processes had been followed. Vigilance respected the MD to the extent that they

rarely questioned his word and seldom performed further investigations. An Indian

engineer, who had worked under the MD on several previous projects, and who was also

past retirement, put it thus:

Also, for us – anything you do, you may be hauled by vigilance In Site S, sometimes we are asked, “Did you get any of that cost savings?” Vigilance always catches on that. That’s why MD is good for us. No one will doubt him, and so to anyone he can say, “This is ok”, and so we never get hauled up.

256

Such incidents helped the Indian engineers gain confidence that they could shelter under

the MD’s orders and they took decisions that pushed the project forward. Another junior

electrical engineer also spoke about how Vigilance did not pursue an investigation if they

received assurances from the MD:

The MD does a lot. He is a very influential person. The normal perception of Vigilance is that it is an organization that is impeding the progress of the project. So instead of taking any issue from the clients, they first consult him, and only after they consult him and he is satisfied that there is a problem, some action is taken. That is only because he is a strong personality.

The deep-seated respect the MD commanded placed him in a position of strength in his

negotiations with Vigilance.

The contractors for their part also acknowledged and appreciated the MD’s role in

resolving client-contractor conflicts and clearing the way for the contractors. A German

site engineer spoke about the effect that the MD had on the project.

The client’s top management is not the typical Indian Railways. That’s why the project is moving forward – because of the MD and Mr X (his deputy), and that’s what’s keeping it running. A job of this magnitude in 5 years is a huge effort in any country and it’s a bigger effort in India since people are not used to getting things done on time. But the top management (of the client) has played a role in pushing things along. They do not fiddle around with small things.

Like many of his colleagues, this engineer was effusive in his praise of how the MD

handled the difficulties that arose on the project. This German engineer was often

frustrated by the constant objections that the Indian client representatives raised on the

documents that the contractors submitted. Without the MD’s progressive influence, he

felt that the project would have had great difficulties in being completed. Another

257

German engineer (a participant with much greater international work experience in

construction) seconded this view and said:

The client is still a little bit the Indian client. The Indian client is misbehaving. Of course under the strong guidance of the MD we are cutting down on this and streamlining the process, but there is still this behavior.

The MD’s intervention significantly reduced, but did not eliminate all the problems that

occurred. March and Simon’s concept of bounded rationality (March and Simon, 1958)

helps explain why conflicts were not completely eliminated. The MD was just one person

and had limited time available to deal with these issues, in addition to his other duties on

the project. Therefore he was unable to deal with every impasse or dispute that came up,

and as a result there were several cases where the MD was not able to intervene.

The dynamic of impasses being escalated to and being resolved by upper level

management is a commonplace occurrence in many organizations. Although I have laid a

lot of emphasis on this particular MD’s traits in this narrative, he did not perform a role

that was unique to the Indian projects. However, by focusing on the MD’s background

and character, I have attempted to contrast his progressive nature against the more

bureaucratic tendencies of his colleagues. It was only due to the presence of this anomaly

in the clients’ organization – a progress minded upper level executive in a sea of

entrenched bureaucrats – that the ‘escalation’ strategy was successful in India.

How was the MD brought into the picture? Certainly the contractors’

representatives had occasional meetings with him and were in a position to raise issues or

write letters to the MD. One British Electrical expert who was recruited as a freelancer by

the contractors said:

258

The setup within the clients – the lower engineers will not make a decision and they don’t feel comfortable making a decision. So at the end of the day we have to play it at their own game and say we need a meeting with the MD. Go in there with 10 items outstanding and after that you are probably left with 4 outstanding items.

In some cases the contractors themselves escalated the issues to a higher level within the

clients’ organization and facilitated the resolution of conflicts that they were involved in.

However such meetings were not very frequent and the contractors had few opportunities

to pursue such a strategy.

There was another more powerful group that helped ensure the MD’s involvement

on the project. This group was the community of freelancers who worked as consultants

for the clients. The freelancers made sure that they raised the important client-contractor

issues that they were unable to solve themselves, directly to the MD. The project director,

a freelancer who was the head of the clients’ consultants had weekly meetings with the

MD to discuss the state of the project. The MD respected and trusted this freelancer and

his team and often acted on the freelancers recommendations and made decisions that

helped the project progress. Therefore, in addition to the MD, the progress oriented

freelancers also played a key role in resolving these impasses as they were the agents

who raised issues to the MD’s attention at appropriate times.

I will now give a few examples of this process.

Escalation by the Freelancers

The consultants’ British design manager related the following story. Many local clients’

representatives hindered the installation of electrical and mechanical items by refusing to

259

approve documents. The freelancers used strategies of circumvention wherever possible,

to fight these issues on a case-by-case basis. Naturally, this consumed a lot of time and

effort. The design manager therefore came up with the following strategy:

We were talking about all the posturing that people put in the beginning and how the client wants everything certified and wrapped up and how things would change over the course of time. The project director (another British freelancer) went to see the MD last week and he asked me, “What should I ask the MD this week?” So what I told him was that people in the client’s organization are indulging in pedantry to the extreme. Client representative X wastes a lot of our time by saying, “Please check that the screws are stainless steel and have a cross pattern on the head instead of a straight line,” – its crap! So I said to the project Director, “We have to cut this short – can we just go ahead and start approving this without the client’s involvement?”

Initially the consultants only made recommendations and not authorizations. This

freelancer felt that if consultants took over the decision-making capabilities from the

bureaucratic Indian government employees, the project would proceed faster. The project

director raised this issue in his meeting with the MD. When the MD got to know that the

project was suffering due to the overly bureaucratic behavior of his underlings, he

immediately agreed to transfer the authority for making decisions regarding the approvals

of electrical and mechanical works to the consultants. The freelancers then either quickly

agreed to the contractors’ proposals or rejected them with good reason, and in that way

made sure that the project progressed in a smooth manner. In this way, the freelancers

and the MD were able to put an end to recurring delays and reduced the ability of the

bureaucratic Indian officers to intervene on the project.

In another instance, the contractors made very slow progress with the civil works

on the site, because the clients’ representatives continuously demanded various

documents and numerous details before they allowed the work to progress. The freelance

260

construction manager on the consultants’ side brought this matter to the attention of the

MD. The MD, who wanted the work to progress, then issued a directive to the Indian

clients’ representatives and asked them to be more lenient towards the contractors. This

edict acted like a charm and almost instantly, the Indian client representatives’ behavior

changed, and they were less strict with the contractors. Within a month, the contractors’

productivity had increased nearly threefold. Before the MD’s intervention, the contractors

poured 6000 cu.m of concrete every month. After the MD’s intervention, this figure

jumped to around 16000 cu.m.

The MD’s intervention was not restricted to issues where the Indian clients’

representatives were overly bureaucratic. The MD also intervened when the local project

personnel were being too dictatorial or abusive. In some cases, some of the high-ranking

officials from the clients’ side threatened and abused the freelancers who worked for the

consultants. This led to low morale and unhappiness within the clients’ organization,

which then led to lower productivity. The senior clients representatives were used to

behaving this way with consultants and contractors on local Indian projects and therefore

continued to act as they always had. The project director once again decided that the

MD’s intervention was needed in order to help raise morale and prevent this constant

abuse of his troops. He therefore went to the MD and explained the situation. The project

director described the outcome of his conversation thus:

Again not long after I’d taken over, a high ranking clients representative X threatened to have Freelancer P removed. And another guy – a senior inspector freelancer Q. But I was able to then, the following Wednesday, relate to the MD what happened and said, “Please sir. I hope you understand, particularly the expatriates with families here, it makes them feel insecure and my concern is that they will then be looking for other projects and that will be very bad for this project.” And the MD said that, “The trouble with these people,” he said, and at

261

first I thought he was talking about my expatriates – and obviously he could see the look of shock on my face and he said, “No no no – I don’t mean your expatriates – I mean the X’s – they never treat people properly.” And he said, “I will counsel them” – and he did! Because Mr X – he’s fairly thick-skinned Mr X, next I went in to see him he said, “Oh, I’ve been told I can’t shout at expatriates anymore.” So now we have – instead of saying, “Come see me,” Mr X says, “Can you come visit?”

The MD thus helped resolve the issues that the freelancers faced due to a dictatorial

clients’ representative. Apart from the MD there were a few other senior Indian officials

who to a lesser extent, also played this role of intervening with their subordinates and

helping the project move forward. Therefore, in some cases, issues were raised to these

other personnel as well. The project director said:

What I do believe is that within the Consultants organization, we have a flat enough structure such that if a decision needs to be made, and if we are reliant on client, it will get elevated to if necessary, my level, so I can get the decision done. What I do, I write my little notes to Mr X and to Mr Y (senior Indian representatives) asking for something, and then it happens, and if not I can raise it with the MD.

Although in practice the project director did raise most of the issues with the MD, in

some cases he first raised issues with some other senior representatives who also stepped

in and directed their subordinates to be less bureaucratic. This way the freelancers tried to

reduce the burden that they placed on the MD. However, since there were not too many

other senior Indian representatives who were progress oriented and willing to instruct

their subordinates to be less bureaucratic, I observed only a few issues that were raised to

other Indian officials, as compared to the number of issues that were escalated to the level

of the MD.

262

Concluding Comment

The freelancers tried to reduce the high transaction costs of client-contractor conflicts and

delays by escalating issues. However, by doing so they had to involve new actors (such

as the MD) and this created a new set of interactions and transaction costs. Although

these new transaction costs were not very high as compared to the costs that they helped

reduce, these new costs were certainly greater compared to the scenario where the

freelancers could resolve issues by circumventing the process themselves, without

involving external agents. As a result, the freelancers tended to try and resolve issues

through the strategy of circumvention and, only when this proved difficult, did they try to

escalate issues to the MD.

This concludes my discussion on the strategy of escalation. In the next chapter, I

will look at the remaining two strategies that were commonly employed by the

freelancers to help advance the project.

263

Chapter 16 – Conflict Resolution Strategies 3 and 4: Normative Suggestions and Changing the Forum

Normative Suggestions

In many cases, the clients summarily rejected proposals or documents sent in by the

contractors in a rather direct manner by merely pointing out the areas that were

unacceptable. There was no mention of what the contractors needed to do to get their

documents approved or why they needed to use a different approach. The contractors

were often angry at such a response and this led to client-contractor conflicts. In several

such cases, the freelancers working for the clients stepped in and advised one or both

parties about a possible course of action. For instance, the freelancers often recognized

that documents needed to be sent in a certain format to appease ‘Vigilance’. Therefore,

when the clients generically asked for more details, the freelancers identified specific

areas of information and educated the contractors on the need to provide such data. The

contractors respected the freelancers more than they did the local clients’ representatives,

and proceeded to implement the freelancers’ solutions so that their proposals could be

approved and the work could progress. In this manner, the freelancers often resolved

potential problems and heated arguments.

For instance an issue regarding a potential vendor/manufacturer of an electrical

item came up in one of the bi-weekly electrical and mechanical systems progress

meetings. The local clients’ representatives had rejected the contractors’ choice of a

vendor on the grounds that the proposed vendor did not meet the specifications. The

international contractors were both amazed and infuriated by this response, since they felt

that the manufacturer was in good standing and met all the clients’ requirements.

264

Furthermore, the real problem was unclear to them. In this meeting, the contractors

angrily raised this issue whereupon an Indian clients’ representative merely reiterated that

the proposed vendor did not meet the specification criteria. The project director – an

experienced British freelancer working for the clients’ consultants realized that although

the contractors had given in information about the proposed manufacturer’s factory, they

had not indicated the location of the factory. This missing piece of information had

caused their proposal to be rejected. He therefore pointed out that the contractors merely

needed to clarify the factory’s location. The contractors were not very pleased with this

since they had to spend some more time preparing extra documentation. However, the

project director convinced the contractors of the clients’ needs, and explained how by

doing a small amount of extra work they would be able to get the manufacturer approved

and advance the works. The contractors agreed and the issue was resolved.

In another case, in addition to specific requirements for each item, the contract

specifications had a generic ‘catch-all’ clause that stated that all items needed to conform

to ‘best international standards’. This was an ambiguous statement because there were no

clearly published sets of international standards. The contractors provided a switchgear

panel that they felt met all the specific conditions set forth in the contract. However, the

local Indian clients’ representatives wanted the more expensive and higher quality panels

that were used in the Hong Kong metro and justified this by claiming that these were part

of the ‘best international standards’. Since neither side was willing to relent, the

consultants called a special meeting to discuss this issue.

The entire discussion was conducted quietly and in very civil tones. The

contractors argued that if the clients considered the Hong Kong metro to be the gold

265

standard for metros, then the contractors could also have used other cheaper and less

reliable components that were used in Hong Kong. Furthermore, they pointed out that the

contract had some generic and specific conditions and that for this particular issue they

had chosen to follow the specific conditions as much as possible. The Indian clients’

representatives however maintained that the Hong Kong metro had a better panel, and

that the project had to conform to best international standards.

Two freelance expatriates working for the clients’ consultants – the project

director and the design manager – then took charge. They first sympathized with the

contractors and agreed that the contract was quite ambiguous. However, the project

director clarified that the contract did ask for all components to conform to best

international practices, and that in his vast experience this was a statement that would be

seriously considered in a court of law. He asked the contractors to review other

comparable projects that had been recently built or were being currently built in different

parts of the world to see if any other project used the panels that the contractors

recommended. If the contractors succeeded, they were then entitled to argue to a

mediating body that they had followed international practices. However, if this was not

the case, the contractors needed to provide the panels used in Hong Kong.

In this way, the freelancers accomplished several things. First, by conducting the

meeting with respect and diplomacy, they ensured that there were no heated emotions and

that the contractors constructively listened to their suggestions. Second, they clarified the

importance of the clause ‘best international practices’ and explained to the contractors the

difference between blindly following the Hong Kong practices versus following current

international practices. This distinction had not been made clear to the contractors, as

266

they had simply been told that their product did not conform to the Hong Kong standards.

Finally, they also offered the contractors a possible way out to help overcome the

problem that they faced with the clients.

Convinced of the merit of these arguments, the contractors agreed to investigate

projects in other parts of the world. They found that no contemporary project used the

type of panels they had recommended and therefore without showing much discontent

they proceeded to procure the more expensive panels that were used in Hong Kong, as

they now understood the spirit of the specifications and the needs of the clients. The

freelancers thus used a strategy of normatively providing direction to the contractors to

mitigate this client-contractor conflict.

The freelancers not only used this strategy to advise the contractors on which

course of action to pursue, they also attempted to influence the clients to be less

bureaucratic. In another instance that serves as an example of the latter, the consultants

helped evaluate a contract for the architectural works in one of the stations. The local

clients and contractors used a particular system of rates to value materials and to price

local architectural contracts. These rates contained information such as how much it

would cost to install say, one square meter of marble tiles on a station floor. The problem

in this case was that some of the materials and methods used for this project were quite

new and were therefore not incorporated in the rate listings.

The consultants therefore did their own research and determined the installation

cost for each of the new architectural features. However, the Indian clients refused to

accept the consultants’ more expensive calculations and dogmatically insisted that the

267

cheaper local rate schemes (called the DSR) be used. An architect working for the

clients’ consultants, described the issue:

Well – it all started off with the bill of quantities (BOQ). There is a rate to everything and there is what you call a rate analysis, which justifies how that rate has been arrived at – per square meter or whatever the unit is. So we were using that. We went out into the market and asked, “If you are doing this work, how much will you charge?” and so we went to various agencies and they said, “We will give you a quotation,” and based on that we figured out a bill of quantities and arrived at a rate analysis. They (the client) said, “No, no, no, the rates have to be comparable to DSR rates.” For them (the client) marble flooring or cladding in the DSR and the BOQ meant the same things. So we had to sit and explain that here this was very very different. It is much more highly specified (in this contract) than what is there (in the DSR) – and so they are absolutely two different things and that is why we have a much higher rate.

This architect justified the higher BOQ rate for some of the materials such as the marble

flooring on the basis that the quality requirements on this project were higher compared

to a normal Indian project. The clients had not considered this difference and difficulties

ensued.

The freelancers and other members of the consultants’ organization had to

convince the clients that their demands were excessive, as it was impossible that a high

quality piece of work be executed for the same rate as a lower quality piece of work.

They slowly and steadily educated the clients in great detail on what the problems were

with using the old DSR directly and why a newer system had to be used. The architect

described this process and the outcome that it led to:

Initially the clients’ response was, “Why? It should cost (only) this much. This is how the flooring is done.” So we had to sit down and explain it to them why is it going to cost them more, why are we saying we need to pick a stone, what is generally used, why do we want stainless steel inserts there, why do we want stainless steel systems for the cladding etc. Because there is water there, we are talking about underground stuff and if we are using something else, it will rust

268

and it will wear off and fall – and if it falls on someone then you are in big trouble, and with the stones, you may have to take it out and again redo it. Your stone instead of lasting 25 years will just last you 10 years. So at the time, there will be the cost of doing the same stone work again and so you have that much added cost in the long run. So that means that the project in the long run could be more expensive than what it appears to you right now. So slowly and slowly they were getting convinced and the top management in the client side was very clear that they wanted international quality stations so they decided, “Ya, ok (lets use the new rates).”

By systematically coming up with supplemental data and by making the clients

understand the costs involved in creating a high-quality product, the freelancers slowly

dispelled the clients’ dogmatic insistence on the DSR. The clients then agreed to use the

new rate system that the consultants had developed. The architect concluded his story

thus:

Finally we are going for market rate, because we could not compare it (with DSR) and they also soon realized that – but it took us quite some time and some convincing.

The freelancers thus played a key role in changing the clients’ thinking and allowing the

project to progress.

The project director gave another example of how the freelancers convinced the

clients to alter their behavior. One of the senior Indian officials had a short temper and

constantly shouted at and threatened to fire people who performed below expectations.

As a result, no one reported on-site accidents for fear of being yelled at. The project

director saw the need to educate the Indian official and convince him that his methods

were not beneficial to the project. He described his strategy thus:

When I first came there wasn’t an enlightened view – and you’ve heard the story of the first accident, Mr X (short tempered Indian official) wanted somebody’s

269

head off. We didn’t try to argue with Mr X. We got some extracts from the web, things you could read because he liked studying things, and we tried to educate him. In modern safety management you do not want a blame culture, you want an open culture where accidents are reported. And slowly he’s come around – he’s not there yet.

After reading the extracts that the project director gave him, the Indian official became

less vitriolic, although he did not change his behavior completely. Workers reported more

accidents and the management identified and fixed the problems. The freelancer thus

educated the clients’ representative and changed his behavior for the benefit of the

project.

Even in my brief visit to Taiwan, I observed some evidence of the freelancers

using this strategy of ‘Normative Convincing’. One of the freelancers described the

participatory nature of the meetings, where representatives from various stakeholder

groups assembled together and aired their views. The freelancers often logically

explained the issues and suggested possible courses of action.

Thus the freelancers did not always have to resort to circumvention and escalation

strategies to resolve conflicts. There were several situations where they logically outlined

the problem, helped the clients and the contractors identify a path of progress, and

successfully smoothed impasses.

Postponing or Changing the Forum

In some of the meetings where the freelancers were either completely absent or had only

a minor role to play, the disputes between the clients and the contractors often took on a

very adversarial tone. The Indian clients’ representatives often abused the contractors, by

picking on items that they had problems with. For instance, the contractors’ had

270

submitted supporting documentation for the purchase of motors, attenuators and fans and

were under the impression that these documents had been approved for purchase.

However, the clients had only approved the vendor for each of these items and not the

technical specifications of the item itself. In a subsequent meeting where no freelancers

were present, the clients informed the contractors that they wanted to see more of the

technical details before they granted their approval. The contractors protested this

decision, whereupon the clients launched into a series of deprecating comments aimed at

the poor quality of work that the contractors performed, and the poor qualifications of

their personnel. This argument continued for quite a few minutes, with neither party

concentrating on reaching a solution to the impasse. After a while, the group moved on to

the next item on the agenda, having wasted time on an issue without taking any steps

towards resolving it.

Often freelancers present in such cases tried to use the strategies such as

circumventing the dictatorial Indians, escalating issues to the MD or suggesting ways in

which the contractors or the clients could resolve issues. However, in some cases, the

standpoints of both parties were not clear. In several cases, the contractors claimed that

the technical data they submitted met the standards set by the clients. However this fact

was not easily verifiable in a meeting. Furthermore, in some cases the key decision

makers from the clients’ or the contractors’ organizations were not present. In such cases,

it was impossible to resolve an impasse in a meeting and the parties often descended into

a shouting match and wasted time without achieving a resolution. The freelancers who

attended such meetings were very quick to postpone these issues and change the forum to

one where decisions were actually made.

271

As an example, in one of the bi-weekly meetings that were held to discuss the

electrical and mechanical issues, the contractors brought up the issue of fan coil units.

The clients had rejected the international contractors’ proposed vendor since they wanted

the vendor to provide stainless steel in the unit. The contractors felt that this was not a

requirement under the contract. An Indian official pointed out that the international

contractors on the other segment of the project had agreed to use stainless steel. However,

there were several missing pieces of information. First, it was not clear whether using

stainless steel would lead to extra costs. Further, the parties present did not have good

knowledge of the exact terms and wording of the contract, as well as the agreement

reached with the other international contractors. Just as the international contractors’

representative and the Indian official started to quarrel on this issue, a freelance manager

overseeing this meeting stepped in. He first asked the contractors to discuss this issue

with their design consultants to determine if there was any extra cost or effort involved.

He then set a date for a follow-up meeting, where the clients would be better prepared

with knowledge on what the contract actually said. The freelancer then moved on to the

next item on his agenda, having limited the altercations and having organized a forum

where the issue was likely to be resolved.

I observed a similar incident in another meeting where the issue of generators was

brought up. The clients contended that some of the contractors’ calculation assumptions

were slightly questionable. The contractors however claimed that they had used data that

came straight from the manufacturer and so had made virtually no assumptions. This item

was on the critical path and a resolution had to be achieved soon. Yet the Indian clients’

representatives refused to approve the contractor’s calculations. Since it was unclear as to

272

what kinds of assumptions the contractors had made and what data the manufacturer had

provided, the British design manager who was overseeing this meeting immediately set

up a meeting the next day, and asked the contractors to bring both a representative from

their manufacturer and a copy of their calculations. The freelancer asked the contractors

to demonstrate their method of calculation so that they could be given more direction on

any additional information that they needed to provide. By postponing the argument to a

new forum where relevant information was available, the freelancer ensured that there

was a high likelihood that this issue was resolved quickly.

The freelancers were not merely restricted to postponing issues and setting up

separate meetings for the resolution of these issues. In some cases where they dealt with

extremely aggressive and bureaucratic Indian officials, they not only postponed the issue,

but also changed the cast such that different and more progress oriented decision-makers

were present at the discussion table. In the words of the construction manager:

We’ve got to try and mediate and smooth the waters. It’s like pouring oil on troubled waters and there’s various ways of trying to do that. One is actually to try and keep people away. So in other words we actually try and arrange our meetings without (certain) client representatives, sort the problems out with the contractor, and then move along. We’ve done that in several areas.

Sometimes instead of including progress minded decision makers, the freelancers

convened meetings where they deliberately excluded some of the more bureaucratic

Indian officials. In this way, previously unresolved disputes were settled.

In some cases, the freelancers coupled this strategy of changing the forum and the

cast for negotiation, with a strategy of escalation. When a new meeting was convened or

when an issue was postponed for future discussion, the freelancers sometimes invited the

273

MD or another high-ranking Indian official to attend. This official often made a decision

that favored the project’s progress, thereby categorically resolving the impasse. In one

instance, the contractors and the clients disagreed on how to reduce the excess water

present in the soil. In an interview, the project director described how this was resolved:

So I thought, “How can I get round this one?” and I thought, “I’ll talk to the MD about this.” I know he’d be sensible so I talked to the MD and said, “This is the problem. But I do think that dewatering as the contractors proposed it is the best way, but Mr X from the client’s organization is talking about ground freezing.” “Ohhh” – (said the MD). So I said, “Exactly!! What I’d like to do is to get the contractor to give a presentation and I’d be very grateful if you could be there.” “Yes, no problem,” he said, and we did it last Tuesday. So in that case, the MD gives a seal of approval and that’s all!! Ha ha. So that was the only reason that I organized the presentation.

Mr X, an Indian representative was very dogmatic and impractical about a technical

issue, and impeded the progress of the works. However, the MD attended a meeting and

made a decision that favored the contractors’ viewpoints and allowed the project to

advance. The Indian officials had no choice but to accept the MD’s verdict.

In some cases the freelancers adopted a slightly different approach and postponed

the impasse, while they simultaneously helped the project advance. For instance when the

contractors were pressured to adopt a certain (more expensive) vendor of the clients’

choice, the freelancers asked the clients to issue a written document that contained this

directive. This document was sufficient for the contractors to start work. Even if the

clients did not eventually pay the contractor for the extra cost of their preferred supplier,

the contractors could use the written document to take the client to court. The dispute was

thus be postponed to the final ‘claims phase’ of the project while the contractors

proceeded with the work. As the construction manager pointed out:

274

Oh yes, but if we run into the situation where we made a recommendation and the client insisted on something, then I will insist on a letter from them clearly saying (what they wanted). It’s happened with rails on line 1. The contractor proposed one supplier P and they didn’t perfectly match the specs – it was 0.1% out of chromium content. The client wanted X – but they also didn’t match the specs. The client wanted us to approve X and reject P – and I said I couldn’t do that and so in the end we said both are approved. The client didn’t like that and so they wrote back in a letter saying please instruct the contractor to award the project to X – so our letter to the contractor said, “The employer has directed….”

All of the clients’ injunctions were in the form of formal documents. As a result, although

the problem itself was postponed to a later stage on the project, the freelancers were able

to help the project advance.

While the project’s progress was imperiled by the actions of the local bureaucrats,

the progress-oriented methods adopted by the freelancers ensured that the work continued

without undue delays. To be sure, this strategy was more a means to the resolution of an

impasse rather than an end, and was often coupled with other strategies such as escalation

to resolve problems that occurred on the project.

A Discussion of the freelancers’ use of the four strategies

The freelancers used their four strategies at varying rates to combat client-contractor

conflicts. In a set of 21 meetings involving the freelancers where comparable issues

regarding the design and progress of the project were discussed, I observed 72 discrete

instances where project participants (mainly the freelancers) used these strategies to

resolve impasses. Appendix A describes each of these incidents. This set includes only

incidents that I directly observed during my stay on the project and does not include past

incidents that informants described in interviews, or similar incidents that I did not

275

directly observe, but which happened while I was in India. Based on these observations,

figure 16.1 below shows the relative frequency of use of each kind of strategy.

25

9

22

16

0

5

10

15

20

25

30

Circumvention Escalation Convincing Postponement Strategy

Freq

uenc

y

Figure 16.1: Relative frequency of freelancers strategies

This table indicates that some strategies were used more often than others. Strategies of

circumvention and normative convincing were each used in approximately 30%-35% of

the cases, while the strategy of postponement was used a little over 20% of the time.

Escalation was the least frequently employed strategy and was used only in 12% of all

the cases.

A transaction cost perspective provides an explanation for these observations. The

freelancers were directly involved in resolving conflicts when they used the

circumvention and convincing strategies. In these cases they made decisions themselves

and controlled the outcomes, without needing to rely on other project participants. In

276

contrast, the strategies of escalation and postponement often involved higher transaction

costs in the form of extra coordination, communication and overheads, since the

freelancers either needed to convince additional actors such as the M.D to play a role in

these cases or needed to organize a new forum, invite other participants and so on. In

some cases the resolution of conflicts was delayed until the proper actors could be

assembled. As a result, the freelancers preferred to use the strategies of circumvention

and normative convincing as much as possible, and relied less on the strategies of

escalation and postponement. In particular, the M.D’s various other commitments and

consequently his limited attention span towards day-to-day project details ensured that

the freelancers only used the strategy of escalation to a limited extent. This is reflected in

the fact that this was the least frequently used strategy.

It is also instructive to analyze whether the freelancers’ strategies of intervention

varied by their position in the project structure. Only the freelancers on the clients’ side

effectively mediated conflicts. Although all these freelancers attempted to resolve client-

contractor conflicts at various stages of the projects, they were not all equally successful.

The three highest ranking freelancers – the project director (the senior-most freelancer),

the design manager and the construction manager (who both reported directly to the

project director) helped resolve approximately 95% (67 out of the 72 directly observed

incidents in my sample) of the conflicts that I observed. Although I heard a few anecdotes

of how the other freelancers had solved issues in the past, my observations and interviews

indicated that the three high ranking freelancers were more successful in mediating

conflicts compared to their colleagues. In the next chapter I illustrate some scenarios

where freelancers in middle-management where unable to resolve impasses.

277

Figure 16.2 below indicates the relative frequency with which the project director

and the design manager used the four mediation strategies.

7 9

10

5

13

11

8

0 2 4 6 8 10 12 14

Frequency

Project Director Design Manager

Actor

Circumvention

Escalation

Normative Convincing

Postponement

Figure 16.2: Relative frequency of use of mediation strategies by the project director

and the design manager

The project director and the design manager employed strategies of normative convincing

and postponement to an approximately equal extent. However based on my sample, the

project director – the senior-most freelancer – was solely responsible for using the

escalation strategy. Being the head of the clients’ consultants, the project director was the

only freelancer who regularly met with the MD. and the other senior Indian officials. As

a result, he had the greatest opportunity to escalate issues successfully. Although my

interviews indicate that there were incidents where the design and construction managers

had also successfully employed the strategy of escalation, the project director used this

strategy far more often than his colleagues. Therefore, in addition to having higher

transaction costs, another reason for why the strategy of escalation was not used as

278

frequently as the other intervention strategies was that all freelancers did not have equal

access to senior clients officials such as the MD, who could take decisions to resolve

issues. On the other hand, the design manager used the circumvention strategy almost

twice as often as the project director. This freelancer was directly in charge of

bureaucratic Indians in the design team and monitored the actual work done on site. As a

result, he was often faced with the need to circumvent bottlenecks so that the design

could proceed.

The design manager and the project director resolved several conflicts in

scheduled meetings. Of the 21 meetings that I observed, the design manager attended

eighteen and led ten meetings while the project director attended ten meetings and led all

of them(both them attended some meetings together). I was therefore able to compare

these two actors. The construction manager however attended very few of these meetings

but was often called out on to the site in an ad-hoc fashion to mediate issues. As a result,

although I learnt of several of these incidents during my interviews, I did not actually

observe many of them. Therefore I did not explicitly include the construction manager in

my analysis of how frequently the freelancers used each of their mediation strategies.

However, anecdotal data and my interviews suggest that the construction managers’

adoption of the mediation strategies was quite similar to that of the design manager. The

construction manager most frequently used the circumvention strategy, rarely employed

the escalation strategy and in several cases gave suggestions or postponed the issues. The

construction manager and the design manager came from almost identical backgrounds,

managed teams that were quite similar in their composition of Indians and expatriates,

279

dealt with similar issues and were in charge of similar scopes of work. As a result, it is

not surprising that they behaved similarly.

Fig 16.3 shows the distribution of the freelancers’ strategies based on the type of

issue that needed to be resolved.

0

5

10

15

20

25

Bureaucracyvs Craft

Dictatorial vsPartner

Rules vsResults

Issue Category

Freq

uenc

y

Normative Convincing

Circumvention

Postponement

Escalation

Figure 16.3: Variation of intervention strategy based on the issue

This figure includes only those issues from the 21 observed meetings that fell within the

main categories of client-contractor conflicts as discussed in part 3. Some types of issues

which occurred infrequently over the course of the project, and which did not fall into

these main categories have been omitted from the analysis. Issues relating to rules vs.

results orientation, a dictatorial vs. partner orientation or a bureaucratic vs. craft

administration orientation occurred with almost equal frequency. The freelancers used all

four of their mediation strategies on issues in each of these categories and as a result, for

the most part did not base their choice of strategy greatly on the category of issue that

280

needed to be resolved. The postponement strategy was evenly adopted across all three

categories. However, although all four strategies were used with almost equal frequency

to solve dictatorial vs. partner orientation or bureaucratic vs. craft administration

orientation problems, the freelancers used the circumvention strategy more often to

resolve rules vs. results conflicts as compared to the other issue categories. The

freelancers resolved 60% of the issues in this category using just the circumvention

strategy. In addition, they seldom adopted the escalation or normative convincing

strategy for this category. The fact that in my sample, more than half of the occurrences

of the circumvention strategy coincided with the resolution of rules vs. results conflict

indicated that the freelancers preferred this strategy for mediating such conflicts. A major

reason for the local Indians being rules oriented was due to their fear of Vigilance, an

organization that virtually paralyzed the locals but did not affect the freelancers. As a

result, in order for the project to advance in a timely fashion, the freelancers often needed

to take responsibility and overcome the bottlenecks, thus explaining the predominance of

the circumvention strategy in this context.

The strategies used by the freelancers thus varied mainly on the basis of their

position within the project structure. Within the clients’ organization, it was only those

freelancers who were in a position of power who acted as effective conflict mediators.

Even within this group, the freelancers’ strategies of intervention varied according to

their position, the people that they interacted with as well as the issues that they dealt

with.

281

Freelancers as Mediators

Many of the freelancers’ strategies and approaches were very similar to those used by

professional mediators who were trained in resolving disputes. In her study of mediators,

Kolb identifies two broad roles that mediators are likely to play – the role of the

“orchestrator” and the role of the “dealmaker” (Kolb 1983). Orchestrators adopt a ‘hands

off’ approach and specialize in simply bringing parties together and allowing them to

resolve disputes through their own discussions. These mediators therefore primarily help

convene a meeting between two parties involved in a dispute, but do not play a

significant role in resolving the dispute itself. In contrast dealmakers attempt to mediate a

dispute proactively and provide suggestions that would help the parties at the table

overcome their differences and find a solution. In this study, mediators also primarily

used two patterns of arranging the mediation forum – “Intervention” and “Negotiation”

(Kolb 1983). In the intervention pattern, mediators often met separately with both parties

on the project, while in the negotiation pattern, mediators often brought both parties

together to the negotiation table. The freelancers in my study functioned more as

“Dealmakers” than as “Orchestrators”, and tended to adopt more of a Negotiation pattern

in bringing parties together. Strategies such as normative convincing involved a lot of

freelancer interaction with the different parties, while by using strategies such as

circumvention and escalation, the freelancers proactively played a hand in solving

problems and dissolving impasses.

Trained mediators use the approaches of “Building” and “Narrowing” to resolve

disputes. Some mediators attempt to identify priority issues around which an acceptable

package or deal can be formed. They then use their powers of persuasion and pressure to

282

resolve these issues. This is referred to as the “Building” approach. Other mediators tend

to favor a “Narrowing” approach where they orchestrate the continual exchange of

proposals in such as way that the parties successively reduce the differences that exist

between them. Powers of persuasion and pressure are not often used (Kolb 1983). The

freelancers definitely preferred an overarching “Building” approach to a “Narrowing”

strategy. They first attempted to understand the problem. Then they applied their powers

of persuasion and pressure in the form of mechanisms such as circumventing a bottleneck

or convincing the MD to intervene, in order to resolve disputes that occurred on the

project. These findings are consistent with those of Kolb in that there was a significant

correlation between a “Dealmaking” role and a “Building” approach to dispute

resolution.

A dispute can be conceptualized as two parties locked in a temporary impasse. In

order to resolve this dispute, one or more of these parties will need to “move” (without

necessarily compromising) from their positions in order for the impasse to end and for

progress to be achieved. Simkin identifies three basic types of strategies that trained

mediators use to incentivize or affect “movement” (Simkin 1971). These strategies are

categorized as

1. Communication strategies – wherein mediators allow parties to communicate

better with each other

2. Substantive strategies – wherein suggestions or recommendations are provided by

the mediator

3. Procedural strategies – wherein processes are introduced that facilitate the

resolution of disputes

283

Using this framework for analysis, the freelancers primarily used procedural strategies.

Since the existing processes did not work, they often changed the process flow

(circumvention), changed the forum for negotiation or brought in new actors into the

process (escalation to the MD). To some extent, substantive strategies were indeed used,

where the freelancers provided tips and suggestions to the contractor and the client on

how to overcome the observed problem (Normative Suggestions). I seldom observed the

use of communication strategies. The entrenched stances opted for by the clients and the

contractors on many issues implied that resolving disputes by facilitating better

communication would be a lengthy process. Due to the short timeline of the project, the

freelancers opted for the other, more action-oriented strategies where they played a

proactive role in helping influence the outcome of the disputes.

Despite being trained as engineers and being thrust into a role wherein they were

responsible for solving disputes that arose between clients and contractors, the freelancers

exhibited several actions that are characteristic of professionals trained in the art of

mediation. The efficacy of the freelancers and the micro-level tactics that they used might

be different compared to other professional mediators. However, their roles, strategies

and approaches certainly indicate that the freelancers played a role similar to that of

‘professional dispute mediators’ on these projects.

There were also some differences between the actions of the freelancers and those

of professional mediators involved in dispute resolution cases. A general observation

drawn in the existing discourse on mediators is that mediators act as catalysts or go-

betweens, who influence but have very little control over the outcomes of a dispute

resolution process (Kressel 1972; Kochan and Jick 1978; Gerhart and Drotning 1980).

284

This was true for some cases on the projects in India. For instance, the freelancers raised

issues up to the MD and helped bring about a resolution, but had no control over what

that resolution might be. In other cases, they changed the forum of discussion in order to

facilitate a resolution to an impasse, but were not in complete control over what the

outcome would be. On the other hand, unlike traditional mediators the freelancers were

not completely neutral parties to the project. Since they had an official position and

certain responsibilities on the project, they were able to employ strategies of

circumvention in order to control proactively the outcome of disputes between the clients

and the contractors. By taking responsibilities upon themselves, they determined the

outcomes of impasses. The freelancers therefore did differ in some respects from typical

dispute mediators as represented in popular discourses in the literature.

Similarly, some scholars posit that aggressive mediation strategies such as the use

of threats or strikes are more likely to help resolve disputes (Kochan and Jick 1978;

Gerhart and Drotning 1980). Although freelancers did sometimes use aggressive tactics

such as circumvention through the use of authority, they also used several less aggressive

tactics (such as Normative Suggestions). The fact that in most cases, all parties were

content and satisfied with the resolution of the conflicts indicates that the freelancers used

these less aggressive and less contentious strategies equally successfully. This finding is

consistent with Kolb’s findings in her study of mediators (Kolb 1983).

The apparent success of the projects in India was partially due to the fact that the

freelancers functioned as ‘pseudo dispute resolution mediators’. Several unavoidable

delays would have occurred without their presence. In Chapter 17 I turn to an

285

investigation of what occurred in cases where the freelancers were not present to mediate

disputes.

Frame Alignment and Mobilization Strategies used by the freelancers

The literature on Social Movements discusses the cognitive mechanism of framing in

resolving disputes (Snow et al 1986; Snow and Benford 1992). As Campbell (2004)

describes, frames are metaphors, symbols and cognitive cues that position issues in a

particular light and suggest appropriate response strategies. Framing involves the

strategic creation and manipulation of shared understandings. Social Movements theorists

focus on the processes and ways by which issues are framed with regard to a set of

constituents, and the effect of this framing on the corresponding mobilization or action

that is undertaken.

Snow et al (1986) delineate four distinct types of frame alignment processes.

Frame Bridging is a process where two or more ideologically congruent but hitherto

unconnected frames are linked together. For instance, individuals who share the same

grievances but do not have a common forum to express them can be brought together

through a process of frame bridging (McCarthy 1986). Frame Amplification refers to a

process of clarification and reinvigoration of existing beliefs and values through which

different constituents form a shared identity. Frame Extension involves expanding the

umbrella of shared understandings to incorporate wider programs and beliefs so as to

attract a larger following for the issue under question. Frame Transformation refers to the

jettisoning of old values and meanings in favor of new ones so that participants who were

previously unable to resonate with a social movement organization can now do so. Snow

286

and others posit that actors employ one or more of these processes to position a debate or

a conflict and to gather support and participation for this frame, so that a debate can be

resolved or a movement can obtain momentum to go forward.

The freelancers in India were also in a position wherein they needed to obtain

movement towards a consensus in order to resolve the conflicts on the projects. In some

cases the strategies that they used to resolve disputes and advance the projects were

similar to some of the frame alignment processes discussed above. The strategy of

Escalation involved a Frame Bridging approach. In many cases, the clients’ senior

representatives (in most cases the M.D) had the same viewpoints as the freelancers in

terms of quickly advancing the work. Despite possessing the same mental frame, the

officials such as the MD were unable to directly influence the outcomes of incidents on

the project as they were unaware of these incidents. By raising these issues to the MD,

the freelancers were able to bring the two congruent frames together, and provide a forum

wherein the MD and his aides were able to resolve disputes.

The strategy of Normative Convincing often involved a Frame Amplification

strategy. The Indian clients and the international contractors were often unclear about

whether or not they should accept the freelancers’ suggestions. However, in several cases

the freelancers provided explanations, further clarified their suggestions and positioned

them in such a manner that the other stakeholders to the dispute saw the merits of

accepting the freelancers’ suggestions. The freelancers thus used the Frame

Amplification strategy to generate participation towards their viewpoints and were able to

overcome the initial conflicts.

287

As this discussion indicates, the freelancers at times employed frame alignment

strategies to resolve disputes. However, I did not observe the application of Frame

Extension and Frame Transformation strategies. In fact, as I will elaborate further in

chapter 19, existing frames were rarely changed or transformed as the freelancers did not

have adequate time at their disposal to change entrenched beliefs and values over the

course of the projects.

In addition, the freelancers did not employ frame alignment processes when they

used strategies such as circumvention and changing the forum. In several cases conflicts

arose between extremely inflexible and disparate frames. Frame alignment in such

instances was not a trivial process. Given the short duration of the projects, the

freelancers did not have adequate time at their disposal to align these frames and such a

process would have been extremely costly from the overall project’s perspective. This is

consistent with Armstrong’s (2004) observation that the ease of framing and frame

alignment varies from situation to situation depending on various environmental factors

such as the stability of the environment, or, in this case, the duration of the process. The

freelancers therefore resorted to unilateral intervention strategies such as circumventing

processes and changing the forum, and obtained movement towards resolution of the

disputes even without gathering complete consensus from various stakeholders. As a

result, although an analysis of frame alignment processes helps shed light on the

freelancers’ actions, their conflict resolution strategies went beyond merely attempting to

reconcile differing frames or sets of values, beliefs and understandings.

288

Concluding comment: Unintended consequences of the freelancer’s actions

The discussion thus far has indicated that Indian project greatly benefited due to the

presence of freelancers. There were however some disadvantages. Several Indian clients’

representatives often resented the strategies that the freelancers used and felt that the

freelancers were being biased towards the international contractors. In my morning coffee

sessions with them, some clients’ representatives would accuse the freelancers of

spending evenings drinking and cutting deals with the contractors’ representatives.15

Although the freelancers who worked for the clients’ consultants made decisions both in

favor of and against the contractors, some of the Indians felt that the verdict always went

against them. In some cases, they were also a little upset that their responsibility had been

undermined when freelancers took issues into their own hands or escalated problems to

the MD. This led to some animosity between the freelancers and the Indians within the

clients’ organization, and to potential intra-organizational conflict. Although I did not

observe any direct effect on the outcome of the project as a result of this dynamic, it was

nevertheless clear that some Indians did not readily cooperate with the freelancers,

constantly questioned their decisions and slowed down the clients’ internal meetings.

The presence of the freelancers also inhibited cross-cultural learning between the

international contractors and the local participants. Since the freelancers resolved many

of the conflicts that occurred, the local clients’ representatives for instance, had fewer

opportunities to understand the exact nature of the problems at hand and the rationale

behind the contractors’ behavior. As a result, the local representatives were never in a

15 My interviews and observations failed to uncover proof of this view. Although some freelancers from the clients’ and the contractors’ side occasionally had a beer together at the British embassy, freelancers usually mingled socially only with people from their own organization. I attended a going-away party for a clients’ side freelancer and out of the twenty or so freelancers present, only two were from outside the clients’ organization.

289

position where they considered changing their behavior or educated the contractors on

their needs. They continued to behave as before. Although the project that I observed was

successful, a future global project in India built without freelancers could well be

compromised, since the clients and the international contractors would not have had any

experience in dealing with each other. As a result, they would be likely to incur extra

institutional costs as they encounter more conflicts of the rules vs. results or the

bureaucracy vs. professional administration variety. A steeper learning curve on the

current projects in the presence of the freelancers could help avoid this potential issue.

Several of my Indian informants felt that once they completed the current project and

learnt the technical details from the freelancers, they did not need to recruit freelancers as

consultants any longer. In their opinion, although they would hire international

contractors, they would manage the project themselves. If this sentiment were to prevail

in a future project, the absence of the freelancers coupled with the lack of global project

management experience on the part of the Indian clients’ could well prove disastrous.

Thus, by trying to do their very best for the success of this particular project, the

freelancers’ approach might well have some unintended negative consequences for future

global projects in India.

290

Chapter 17 – Conflict Resolution in the absence of the freelancers

The freelancers who worked on the clients’ side were not always available to play a

mediating role on the project. In some cases they were simply not a part of the team that

was engaged in a client-contractor dispute, and thus did not have a physical presence. In

other cases, they were present, but found themselves overruled and outvoted by other

senior Indian officials. In this chapter I will investigate the situations when the

freelancers were not present to handle client-contractor problems.

Absence of Freelancers

The clients held a valuable bargaining chip as they controlled the flow of money into the

pockets of the contractors. In the absence of freelancers, the Indian clients’

representatives forced the contractors to accept the clients’ terms. The contractors had no

choice but to do so, since they stood to lose more money by delaying the project works,

and would not receive further payments from the client. This dynamic of the clients being

able to force their views on to the contractors is consistent with the views of several

scholars who submit that access to capital and control over resources continues to wield

considerable power at the bargaining table and is able to control the bargaining agenda

(Hyman and Brough 1975; Hill 1981; Fox 1974; Pfeffer 1981, 1992).

The freelancers, when present, managed to achieve resolutions that satisfied

almost all the parties on the project. In their absence however, the contractors often

grudgingly accepted the clients’ dictates, but typically planned to file a claim for more

money at the end of the project. Thus although the clients won the battle in the short

term, the issues were not completely resolved.

291

An Indian architect discussed this dynamic further:

So you have to get them convinced, and if you are not convinced then you follow our wording and if you don’t agree with it then later on we can go to arbitration or court. So there are some things that they have not agreed on and we know they will go for arbitration later. They stand to lose much more if things are delayed and things are not completed on time. So there is what we call L.D’s (liquidated damages) which if they miss certain key dates – like this work has to be done by this much time – if they miss those then they stand to lose much more right in the beginning than they can ever hope to extract out of us, even if they go to arbitration. So they agree to us for some things and they say we will later go to arbitration – so we said fine, we’ll go to arbitration but now you do it the way we want it.

In case of a dispute, the clients first briefly tried to convince the contractors that the

clients’ arguments were justified. If this did not work (and in most cases it did not), they

proceeded to force their opinion on the contractors who had no option but to obey the

clients. The clients were quite happy with this outcome despite the prospect of litigation

at the end of the projects.

As an example, an Indian clients’ representative who was one of the construction

engineers on the project described an incident where the clients had asked the contractors

to perform a piece of grouting work that the contractors felt was over and above what was

expected of them as per the contract. The contractors’ pleas fell on deaf ears however and

the Indian construction engineer recalled:

The client wants to grout – but that will cost a lot of money and they (the contractor) will resist, and we say, oh – it has collapsed. So then we have to bully them. They will talk and give explanations – and in the end he (the contractor’s representative) will have to say that he has not budgeted it. If you bully him, he may put it in a claim. What can he do? He will do it (the work). If you insist they will do it and they will send you a claim.

292

The international contractors resisted performing the extra grouting work and there was a

temporary dispute. Clients-side freelancers were not present in these interactions and as a

result, the clients used their leverage to ‘bully’ the contractors and categorically told them

to do the extra grouting.

The contractors had to weigh a set of costs. On the one hand if they continued to

protest, they were likely to incur large transaction costs in the form of delays and

arguments with the clients, since the clients would not easily modify their stance. In

addition the contractors would also incur direct costs in the form of reduced payments,

liquidated damages, and an inability to pay their workforce both on the project and in the

home office. The alternative available to the contractors was to acquiesce to the clients

demands thereby avoiding these costs, and to institute legal proceedings at the end of the

project. Although the legal proceedings also involved a set of direct, coordination and

transaction costs (litigator fees, setting up the forum, arguing, providing claims

documents etc), several issues could be discussed in the same litigation session, thus

reducing the per-issue costs of resolution. Although my data does not indicate the direct

and indirect costs of these legal proceedings, the contractors felt that temporary

acceptance of the clients’ demands resulted in lesser overall transaction costs. As a result,

in this case when the activity approached the critical path, they went ahead with the

grouting and intended to institute claims proceedings at the end of the project.

The clients were not unduly concerned about this. The Indian architect summed

up the situation in the absence of freelancers and said:

There in the end, we have won the argument because we control the money. So in the end the client wins. Generally.

293

This simple algorithm summed up many of the incidents that I observed when the

freelancers were not present.

Presence of Freelancers with low levels of influence

I also observed several incidents where freelancers were present, but were not able to

exert a mediating role over a client-contractor dispute. In these cases, the presence of

several high ranking Indian client representatives left the freelancers powerless and their

decisions were often overruled.

One such incident involved the selection of a factor of safety for the design of an

underground station. The Indian building codes had not previously considered the

building of underground structures, and so there was no official figure that could be

adopted as a factor of safety. The international contractors who had built several

underground structures before, used a factor of safety that had been validated on various

other projects to come up with a design for the station. An experienced freelance

structural expert – a British expatriate – working for the clients’ consultants reviewed the

contractors’ drawings and found them to be satisfactory. He therefore recommended that

the Indian clients’ representatives approve the contractors design. He commented on this

process thus:

What happened was that the contractors came and presented their view for not doing it extremely conservatively, which when I listened to it, seemed reasonable, and so I, perhaps naively (laughs) said, “This seems to be reasonable – yes ok do it.”

294

Based on their large experience, the contractors had submitted a structurally sound design

that incorporated safety factors and was practical but not overly conservative. However,

the Indian clients refused to accept this and wanted an even more conservative design

with more conservative factors of safety. There were several reasons behind this. First,

the Indian clients’ representatives wanted to assure Vigilance that they had not

compromised on the integrity of the structure. Therefore they wanted all possible safety

and load factors to be included in the design. In fact, the Indian building codes could be

interpreted in such a way that they justified the use of larger safety factors for

underground structures. Furthermore, since the contract was a lump-sum agreement, the

clients stood to gain if they received a more conservative and safer design for the same

amount of money paid. The Indian officials who reviewed these documents were quite

senior and were positioned above the structural expert in the clients’ organizational

hierarchy. Therefore they overruled the freelancer. The freelancer continued his story:

Now then what happened, and here the cultural factors came in, the client got rather annoyed and upset with that! You have this foreign consultant coming in and just agreeing with the contractor, which is not following the sort of the custom or practice of the interpretation of the code in India, which in fact is quite true.

The Indian clients’ representatives went straight to the contractor and instructed them to

use a more conservative design. The contractors protested, but had no choice but to

follow the client’s dictates in the face of the client’s bargaining advantage in terms of

financial cash flows. The structural expert continued:

In this case, I don’t think anybody did come to a compromise – they (the contractor) were told in effect by the client that this is what the client was prepared to accept – and if they didn’t want to do it that way, then client would

295

not accept it – and so in order to get on with their job, they put in their designs like that (the way the client wanted it).

Once the contractors redesigned the station with the clients’ views in mind, the clients

granted the contractors approval to proceed with the construction process.

Building a more conservative structure was more expensive, and the contractors

did not feel that they should be made to bear these expenses. They planned to ask the

clients to release a variation or a change order legitimizing this as a change in design, so

that the contractors could get extra compensation. The freelancer concluded his story:

I think that the contractor recognized the importance of getting on with the job, so when it came to a point where they felt that this was going to be a sticky point, they didn’t spend a long time having a stalemate and they said, “Ok we’ll do it” –Now if they (the contractor) were instructed to do it a more conservative way, and if they had to redo some of the work, then they tend to consider that as a sort of a variation, for which they could seek payment later via a claim.

I observed this dynamic in quite a few other cases that involved mid-level freelancers

such as structural or electrical experts, who were part of functional teams and reported to

senior freelancers such as the design or the construction manager. Since such freelancers

typically had less authority over the clients-side bottlenecks, they could not use the

circumvention strategy and design a mechanism to go around them. In several cases,

when some senior Indian officials were causing a bottleneck, these freelancers did not

have ready access to other senior officials such as the MD who were sympathetic to the

project’s progress and to whom these issues could be escalated. As a result these

freelancers were unable to resolve several client-contractor difficulties that arose.

In some cases, the contractors vehemently protested and refused to obey the

clients’ dictates until the task that they were arguing on became a critical path activity.

296

The contractors had some leverage over the clients, since the MD had publicly declared

that the project was going to be completed on time. Any delays therefore reflected badly

on the clients as well. As deadlines approached, the contractors attempted to tell the

clients that bureaucratic or dictatorial behavior would delay the project. However, such

subtle threats did not seem to have any effect on the clients and the freelancers felt that

the Indian officers were just as bureaucratic as ever, even when deadlines approached.

The clients rarely deviated from their position. In an interview, the freelance design

manager said:

So you look every direction, it’s a no win situation. Plus the delays are affecting his program as well. This is just a case of the client saying ‘might is right’. There is nothing that the contractor can do – 99 times out of a 100 he does what he doesn’t want to do, and then submits a claim.

After my return from the field, this design manager sent another email shortly after the

completion of the first stage of the project, and mentioned that the clients’ behavior had

not changed very much as the opening date neared.

In some rare cases, the contractors ‘loosely coupled’ their activities and avoided

some of the clients demands. For instance they used walkie-talkies to alert their personnel

as soon as the clients’ representatives set foot on site for an inspection. The site personnel

immediately attempted to follow the exact rules and specifications laid out in the

drawings for the duration of the inspection. Once the client representatives left, the

contractors reverted to a more progress-oriented approach. An Indian construction

engineer knew about this and talked about it thus:

Initially he (the contractor) appeases your ego – when you are fussy for nothing. I am very fussy about curing. So you fire them and abuse them: “How come this is

297

there,” so they know he is fussy about curing. So when I am there they will shout at their people, but they do not believe in it – therein lies the problem. So it is only just to appease me – whenever he is there – because of walkie talkie they also have this system.

In this manner the contractors appeared to appease the client, but in reality only spent a

brief time doing so, and thereby saved extra costs that they would have otherwise

incurred if they had permanently adopted the clients’ rules-oriented attitude.

In truth I did not observe too many instances of such strategies on these projects.

When the freelancers were absent or when they had a reduced role to play, the clients

were usually able to force a decision on to the contractors. However, there were some

situations in the absence of freelancers, where some public-sector Indian engineers

themselves acted as mediators.

Local Dispute Mediators

Almost all freelancers who worked for the clients tried to act as mediators at some stage

of the project (although only half of these freelancers were able to do so effectively). On

the other hand, of more than 100 Indian government employees on the project in India, I

observed only four employees (apart from the MD) who consistently tried to diffuse

client-contractor tensions much in the manner of the freelancers. Although the freelancers

were more likely to mediate and solve client-contractor problems, the fact remains that

there were a few Indians who performed this function as well.

In one incident, a local crane supervisor inspected one of the cranes on site and

declared that since one of the ropes on the crane did not match the specifications, the

crane was not to be used until the crew found the appropriate type of rope. The crane

298

operator, a laborer who had operated cranes for a long period of time, was certain that

there was absolutely no problem with the crane even if the rope was slightly deviant from

the specifications. The Indian site manager in charge of this site – an engineer who had

worked for the government for around 10 years – spoke with the parties concerned and in

the interests of advancing the project, overruled the inspectors’ decision since he felt that

the rope was not a safety hazard. This behavior contrasted sharply with the behavior of

most of his colleagues who were highly rules-focused and would have stopped the project

until the crane had been refitted with rope that conformed to the specifications.

Another Indian construction manager who was at the same rank as the site

manager mentioned above, occasionally used strategies of circumvention to get around

bottlenecks on the project. In one instance, one of his junior engineers did not have the

confidence to approve some of the contractors’ submissions. This engineer’s hesitation

delayed the approvals process, and consequently the project’s progress. The contractors

believed that their submissions were quite comprehensive The Indian manager then took

over. He related his strategy thus:

Initially engineer S was having more inhibition. One day I went and talked to him – and he said, “Sir I have never done this before – if there are five people in a group, then my responsibility would be 20% – now it is 100%,” and so I said, “Your responsibility is 0 – you take me as the responsible person – you do the exercise, and after you are happy, tell me, I will sign it – you will not have to sign it – and without seeing I will sign it.”

The Indian engineer was afraid of putting his name behind the approval for the

submission, since he did not want to be caught out by Vigilance. Just as the freelancers

reacted to similar situations, the Indian manager took the responsibility upon himself.

299

With the responsibility off his shoulders, the junior Indian engineer quickly came up with

a decision and the contractors moved forward with the project.

Some of these broad-minded Indian officers also occasionally used a strategy of

escalation and raised contentious issues to higher ranking, progress-oriented officials. In

several interviews, these Indian officers who acted as mediators accused their colleagues

of being highly rules-oriented and denounced their behavior as being detrimental to the

project. In client-contractor meetings that they led, they tried to press for the overall

progress of the project, and supported different parties on a case by case basis without

dogmatically pressing for the clients’ interest.

The construction site manager described himself thus in an interview:

Earlier we were bureaucratic. But for me, I will not say that. (Right from) day one I said, “You (contractor) quote an example, and then you convince me and say this is also done abroad and I will accept it.”

This official accepted the contractors’ methods and approach even if they were different

from what was found in the contract or what he would have chosen, as long as the

contractors could logically justify them. Another Indian construction manager said:

If the client wants something (extra) then we will say that it is from the client. But the underlying thing was that we wanted to be reasonable. If the contractor must get some money (for the extra work), then he must.

This construction manager did not believe in being dictatorial and asking for more than

what was written in the contract without remunerating the contractors.

Finally, an Indian electrical expert who had around eight years of experience and

also acted as a mediator spoke about the expected quality of the contractors submissions:

300

Grossly the design should be ok, but there is no need to fine tune the thing. If you delay (by) fine tuning, it might delay the project schedule and the disadvantage there may be more than the advantage that we get from fine tuning.

This government official realized the dangers of an overly rules-based approach, and in

the interests of the project’s progress he accepted submissions that had minor omissions.

The views of these few Indian government officials were quite different from the

majority of their colleagues. These few Indian engineers were very concerned about the

timely progress of the project, and did not believe in blocking the contractors progress by

being excessively controlling, rules oriented or dictatorial. Such an outlook helped them

use strategies and make decisions that enabled the contractors to continue work on the

project without impasses or stoppages. The fact that they played such a role was not lost

on the contractors. One German engineer was all praise for some of these Indian officials.

Speaking about an Indian construction manager he said:

R is a good catalyst. He understands the problems and searches for a solution – in fact the previous chairperson (of this task group) was not making progress with this variation, but now they have put R as the chairperson for this. There are many controversial opinions, but he can lead discussions and takes these different opinions and tries to get to a resolution. He is one of the few people from the client whose opinions we can respect.

Concluding Comment

I directly observed a total of 118 instances of client-contractor conflicts in meetings on

the projects. On 68 occasions(57%), the freelancers used one of the strategies discussed

in the previous chapters to successfully resolve the issues that were raised. However,

there were 46 cases (40%) where the freelancers were either absent, or proved to be

ineffective mediators. I observed only 4 instances (3%) where Indian officials mediated

301

disputes. Although there were several other anecdotal instances where a few Indian

officials acted as dispute mediators, the likelihood of an Indian official playing this role

was much lesser than the likelihood of any given freelancer being a mediator since only a

very small proportion of the Indian officers were inclined to be fair and progress oriented.

Thus far I have discussed client-contractor conflicts in India and ways in which

these were resolved. An interesting corollary to all of these discussions is the question of

what happened to the projects in India over their lifetime. How much of an impact did the

freelancers have in smoothing the progress of the project? Did the intensity of conflicts

on the project reduce over time or were there always new client-contractor conflicts that

came up? Were there any differences in responses between different groups on the

project? In the next chapter, I will take a holistic view of the projects in India over their

life cycle, and briefly analyze how these projects differed from one another despite

having similar problems, and how each project evolved over time.

302

Chapter 18 – Narratives of the Projects in India

The conflicts and their resolution mechanisms discussed in previous chapters were

unevenly distributed along the course of the projects. Although the problems were quite

similar on both projects, the narratives behind how these issues were resolved told very

different tales. For the sake of convenience, I will refer to the project that involved

Japanese, Swedish and Indian contractors as project X, and the project that involved

German, Korean, Japanese and Indian contractors as project Y. I will first describe the

lifecycle of project X, identify factors and parameters that contributed to the sequence of

events and then proceed to repeat this analysis for project Y. I will then conclude with a

comparison of both these projects.

Lifecycle of project X

In the initial stages of this project, the contractors often readily accepted the clients’

bureaucratic or dictatorial edicts and performed additional work. The freelance

construction manager who worked for the clients’ consultants described a typical

example:

The contractors are slightly different. On project X they’ve written some really good method statements, but they are so compliant that (when the client asks the contractor for more details), every time he (the contractor) will bend over backwards. And the more he produces, the more our people ask him to produce and he’s churning these papers, something to hang himself with. In the early days our people would get them to produce all these things, which surprised me.

The clients wanted as much extra documentation as possible so that they could

comprehensively prove to Vigilance that the contractors had followed the specifications.

303

Even if the contractors had already submitted an exceptionally comprehensive method

statement, they meekly hopped and skipped to the clients’ tune every time the clients

wanted more information. As a result, there were very few conflicts in the initial stages of

this project. However, as the clients continued to make greater demands on the

contractors’ resources, the project slipped behind schedule since the contractors were

unable to make quick progress. Eventually, the project reached a point wherein the

contractors were so far behind schedule, that they were faced with the possibility of being

charged liquidated damages for late completion of work. As accommodating as they

wanted to be, it was no longer in their interests to submit meekly to the clients’ whims.

The construction manager for the clients’ consultants said:

After a while he (the contractor) says, “Stop – I’m going to write a work procedure with my pencils and if you don’t understand it, then tough luck.” I think it started to change when there was some pressure to get the works completed and things started to slip and people understood that this was causing delays and disruptions; and the frustrations on the contractors’ side had reached the boiling point. On a lot of other projects, the frustration would have been reached a lot earlier and people would have said, “Sorry, I’m not going to do that (extra work),” but (here it was), “Yes yes, I’ll do it is what he’s saying.”

There arose a point where the contractors refused to obey the clients’ dictates and

perform more work than what the contractors thought was necessary. They intended to

stop work if their submissions were not approved as submitted. At this juncture, the

freelance expatriates working for the clients stepped in to resolve this impasse. They used

strategies of Circumvention – they took on some of the approval responsibilities

themselves; Escalation – they raised issues to the MD and asked him to influence the

senior Indian officials on project X to be less demanding; and finally Normative

Suggestions – they held training sessions and educated junior and mid-level Indian

304

engineers on the virtues of supporting the contractors; in order to help the project

progress forward. Most of the overly bureaucratic Indian engineers were either bypassed

or influenced to be more progress-oriented. One of these Indian engineers spoke about

the effect that these measures had on the project:

The contractors could not go beyond (concrete production of) 6000 (cu. meters per day). They really put their sincere effort, but due to stringent control by us, they started feeling frustrated – that is the time that they became frustrated. That was too much intervention and that was the peak. I would say from Jan 2003 to May 2003 the client was at their peak forcing the international contractor to fall in line fully. Then we have relaxed. The moment we have relaxed, their motivation level has come up and their output has gone double.

As a result of the intervention from the freelancers and the MD, the project moved

forward rapidly and was recently completed on schedule. One of the contractors’

representatives, who was of Indian origin but worked for the Swedish JV partner,

summed up the evolution of client-contractor conflicts on the project thus:

We did face a lot of situations like that (client contractor impasses) in the early days. So more recently, we haven’t had problems like that. But certainly we had problems in the early days. In the beginning there was a lot of interference from the client side and they wanted to check everything. But what also happened is they came to realize that there was going to be a point soon where if they went on with their approach, you could not do the works and you could not get the project on schedule. So when they started getting to understand that and when they started getting pressure from their management as to why things are not happening, things started to change a little bit.

Project X thus followed three broad phases – a phase of slow progress and no conflicts, a

phase of conflict and impasse, and a phase of conflict resolution and improved progress.

My data indicate that project X followed such a trajectory due to three main

305

reasons. First, the contractors adopted an initial strategy of compliance that backfired and

led to an increased amount of work being thrust on them. The contractors felt that

meeting the demands of the clients (however excessive they might be) might help build

up a good relationship that would benefit them and the smooth progress of the project in

the long term. They hoped that once they had built trust with the clients, the clients would

reduce their demands. However quite the opposite happened – the clients continued to

make greater demands on the contractors’ resources, and the project slipped behind

schedule. In hindsight, the contractors’ representatives regretted this strategy and their

Swedish project manager lamented thus:

We should have been a lot firmer on the client from day 1. We were in a position where when the client (would) say jump, we jump. We don’t ask why, and that’s really because the JV believes that at the end of the day the client are their best friends. Indian clients will take as much as they can get and until you say, “Stop” they will keep taking – and that’s the thing – you have to say, “Stop.”

The contractors felt that they should have been more forceful in the beginning stages of

the project, so that they could have established a better understanding with the clients a

lot earlier as to what each party’s roles were, thereby saving themselves the need and the

time to create extra documentation.

Second, this particular project had more than its fair share of Indian clients’

representatives who wanted to show a firm hand in controlling the contractors. The three

senior officials who were assigned solely to this project were considered to be extremely

difficult to work with and were affectionately labeled as the ‘troika’ or the ‘trio’ by the

freelancers working for the clients. One of the freelancers described their behavior thus:

306

In project X you have the trio sending the contractor through rings and hoops for the first two years. We have a situation where you had them hauling the contractors through red-hot embers when he so much as took a breath. Now they have gone and so other people are taking over and so the mindset has changed.

The troika was extremely strict on the contractors, and their innumerable inspections and

requests for rework or resubmissions took their toll on the project. Through the

intervention of the freelancers and the MD their role was marginalized, and recently the

government had staffed these officials on other projects. As a result, participants felt that

project X was now progressing far more smoothly.

A third reason for such a narrative was the relative absence of freelancers on

project X. The technology used to build project X was rather standardized and simple.

Therefore most of the freelancers that the clients’ hired were staffed primarily on project

Y, which was technologically more challenging. The British construction manager for the

clients’ consultants confessed for instance, that he had rarely paid attention to project X

since his skills were required more on project Y. As a result, the freelancers were seldom

physically present on project X to identify potential issues proactively and intervene.

Since they acted only after major problems had flared up, conflicts were exacerbated later

on in the course of project X and were not solved in the earlier stages.

Changing deep-seated and institutionalized beliefs can take a long time (Townley

2002), and there were several problems that arose even during the later stages of project

X. However, compared to the early stages there was a marked improvement in progress

towards the end of the project.

307

Life cycle of Project Y

In contrast to project X, the contractors on project Y were far more aggressive from the

start. If they encountered a situation where they thought the clients were being too

difficult, they immediately protested. An Indian clients’ representative had the following

view of the international contractors on project Y:

One thing with the contractors – if they are convinced that this is not an issue, then, whatever you say, they will not do it; and vice versa. Example – in the concrete work, our specification says 2 hours covering is required – but (in reality) it’s ok if it is 3 hours. There will be no change in quality. So they will go all the way to prove this.

A freelancer who worked for the clients compared the international contractors thus:

One of the things that we noticed was that project Y contractor was more on the ball trying to save costs than project X was at the early stages.

Thus, the client-contractor conflicts came to a head right at the beginning of project Y.

The freelancers intervened with their tactics and strategies right at the start. Once again,

they used strategies of circumvention and escalation to overcome some of the bottlenecks

that the clients posed. In addition, the freelancers gave several educational and normative

suggestions to both the clients and the contractors, and helped reduce the gap between

their views on how projects were to be organized and executed. The freelance

construction manager describes the outcome of this process:

Our people understand that the work has to proceed, even though the drawing is not available with everybody’s signature on it. There is a certain amount of flexibility, and we have tried to counsel our people that even if something does get built wrong, there is some way it can be recovered. For instance in Station S they cast some slabs and there were some couplers with the rebar that the station manager decided not to put in and it was a real screw-up. And in previous days

308

our inspectors would have raised hell and said, “No you can’t cast and stop the job,” but this time they just recorded it: “We have comments. You haven’t done this properly but you’re in charge of quality so you do what is right,” (they said).

Over a period of time the freelancers successfully changed the client’s mentalities and

influenced the clients’ representatives on this project to be somewhat less bureaucratic.

One of the Indian clients-side engineers spoke about this change in attitude:

The contractor requires that any contract more than R rupees, requires approval by the client. We made a decision that unless the subcontractor was really bad, we wouldn’t come in the way of the contractor – it is his job. Here project director’s (A British freelance expatriate) coaching was very good. He would say, “Let them do it.” So we chose consciously that we would not interfere and we stuck to it.

By serving as a teacher and as a role model, a freelance expatriate influenced this clients’

representative and his team not to interfere with the work of the contractor. Thus, after

the initial set of impasses, project Y proceeded quite smoothly.

Project Y therefore went through two broad phases – an initial phase

characterized by a large amount of client-contractor conflict, and a subsequent phase

where the intensity and frequency of these conflicts slowly decreased. Although in

contrast to project X several senior clients’ representatives on project Y became less

bureaucratic, not all the Indians were able to change their behavior to be more progress

oriented. Several client-contractor issues persisted throughout the course of the project.

There were two reasons why project Y followed such a trajectory. First, right

from the start the contractors aggressively stood up for what they felt was right, and often

went ahead and tried to prove their point of view against any of the clients’ rule-oriented,

micro-managing or dictatorial suggestions. The second reason is related to the

composition of the clients’ team that was in charge of monitoring project Y. Several

309

freelancers were present on this project due to its technological challenges and therefore

played a major role in helping solve client-contractor conflicts. Also, there were some

Indians on this project who had worked on other global projects, and were generally

progress-oriented in their outlook. All the Indians who exhibited tendencies to act as

mediators (as discussed in the previous chapter) were staffed on project Y. The project

director described the Indian representatives on the two projects thus:

One of the reasons that people are loathe to let the contractor proceed is that they don’t have the experience and they are scared that someone or the other is going to come along and say, “Why did you allow this?” But I think on project Y, either because of the experience of the staff or because of the guidance we gave them, they felt better able to make these decisions. They see things which are not exactly as per the drawing – they know that some things are ok and don’t really matter – and other things are not ok – so I think the staff on project Y were more able to handle this and there weren’t so many problems, while the staff on project X – the scope for personal decision making was very much less and so it led to a lot of issues being blown up. Perhaps on project Y the documents were not so comprehensive (as on project X), but also the staff on site applied a little more commonsense and said that you can start there and by the time you get here, you can finish it off.

Therefore, due to the presence of aggressive international contractors, flexible clients’

representatives and freelancers who played both a mediating and a guiding role, project Y

started off by having several client-contractor problems that reduced over time.

Conclusion – Comparing project X and project Y

Project X and Y exhibited certain similarities. Both projects featured clashes between the

clients and the contractors over similar sets of issues. The freelancers stepped in and

played a mediating role on both projects. Over time, the progress on both projects

310

improved and there were fewer conflicts, although these conflicts were not completely

eliminated and continued to crop up.

There were, however, some key differences between these projects. The

contractors on project X was more compliant initially than the aggressive contractors on

project Y. Client-contractor problems therefore occurred at a later stage on project X than

on project Y. Also, most of the clients’-side employees, particularly the freelancers

agreed that the difficulties and disputes were more intense on project X than on project Y

and that project Y never became as contentious as project X did. The primary reason was

the nature of the people involved. As one of the freelancers stated:

Project Y never got as bad as Project X – probably because personalities were different and probably because it was a tunneling contract and so T (the freelance construction manager) was devoting a lot of time in Y, and he was I suppose leading by example for our guys. We’ve got a couple of (Indian) guys who were also ex-Singapore – V (for example), and so he had a little bit of exposure and he knew how to treat people. So I think that’s why it went reasonably well.

In comparison to project X which was run by the overly bureaucratic Indian ‘troika’,

project Y was fortunate enough to have several freelancers as well as several local

representatives who were experienced and/or flexible and progress oriented. As a result

the process of conflict resolution was much smoother on project Y.

In the final analysis projects X and Y took different paths. The process of

problem recognition and resolution varied based upon the agency or the strategies of

the parties involved, as well as the nature of the personnel involved. In one case, a

contractors’ strategy of initial compliance and late resistance coupled with the existence

of inflexible clients’ representatives, led to a project narrative where the problems were

recognized only in the later stages of the project and were quite severe in nature. On the

311

other hand, aggressive contractors coupled with flexible and progress minded client

representatives led to earlier recognition and easier resolution of conflicts.

Although the freelancers played a key role in helping the projects advance, they

did not eliminate client-contractor conflicts. They temporarily circumvented or

influenced problematic individuals in order to find solutions, but very rarely permanently

altered the clients’ and the contractors’ norms and beliefs over how to manage such

projects. As a result, similar types of issues and arguments continuously reared

themselves over the course of the projects.

This concludes a discussion of the events that I observed on the global projects. In

the next and final part of this dissertation I will examine how my observations and

findings contribute both to existing theoretical knowledge and to practice.

312

Part 5 – Contributions and Conclusion

313

Chapter 19 – Contributions and Conclusion

Theoretical Contribution 1: Ethnographies of Global Projects

A primary driver behind my entering the field to collect data was the fact that very little

‘rich’ data existed that could help us understand institutional dynamics on global projects.

Apart from some anecdotes, I found very little existing theoretical literature or empirical

work in the form of detailed case studies or ethnographies that dealt with institutional

conflicts on global projects. Therefore, I was forced to observe and describe the issues

arising from institutional differences on global projects in the form of ethnographic case

studies to understand them better before I began to analyze them. As a result, one of the

main contributions of my research is a set of ethnographic case studies of global projects

that provide thick descriptions of the micro-behaviors present between various parties

(Geertz 1973). The record of these empirical observations begins to fill a gap in the

existing academic knowledge of global projects.

I have attempted to tell a story that reflects ‘local knowledge’ and local

perspectives from having spent extended time in the field. The roles played by various

participants—in particular the freelance expatriates whose presence in the current

literature is virtually nonexistent—can best be understood through such ‘deep-dive’

studies. Quotes from project participants and the stories of conflict that I both heard and

observed can now serve as data for other researchers to delve deeper into the types of

conflicts that are present on global projects. Although I chose to look at this data through

an institutional lens, it might be possible for other researchers to examine other questions,

such as the impact of a charismatic leader on global projects, Hence, simply by

presenting a corpus of micro-data (mainly on the Indian projects but also on the projects

314

in Taiwan), that describes the incidents that occur on global projects in rich detail, I hope

to contribute to knowledge in this field by providing an empirically grounded base for

researchers to analyze better, discuss and understand the issues on global projects.

Theoretical Contribution 2: Answering my research questions – Insights into the

problems that beset global projects

Very little existing work has been done towards systematically identifying the relevant

institutions and institutional conflicts that occur on global projects. The three research

questions that I proposed attempt to fill parts of this large gap in the literature. These

questions were:

What are some of the kinds of institutional conflicts that occur on Global

Projects?

How are these conflicts resolved?

How can we better organize and manage global projects?

The first question was intended to identify the relevant institutions that were pertinent to

the study of global projects. From my study I found the following institutional conflicts

to be most prevalent on global projects:

Institutional conflicts regarding safety and quality: Conflicts between high-safety

and high-quality oriented international contractors and less-safety and less-quality

oriented local subcontractors and laborers

♦

♦ Institutional conflicts regarding conformance of the works: Conflicts between

rules-oriented clients and pragmatic, progress-oriented international contractors.

315

Institutional conflicts regarding administration of the works: Conflicts between

bureaucratic forms of administration on the part of the Indian clients and

decentralized craft forms of organization on the part of the international

contractors.

♦

♦ Institutional conflicts regarding Client-Contractor relationships: Conflicts

between ‘master-slave’ oriented Indian clients and ‘equal partner’ oriented

international contractors.

I observed very few conflicts that resulted purely due to cross-national differences in

values and beliefs between the various international contracting organizations on the

project. Most conflicts arose due to work practice differences and from differences

between professional vs. bureaucratic institutional orientations of the local clients and the

international contractors. This answer to my first research question contributes to

knowledge by identifying constructs that appear to have a more significant impact on the

outcomes of these global projects as compared to factors such as Hofstede’s (1991)

dimensions of national values and beliefs. In order to help mitigate unintended costs and

challenges on such global projects (infrastructure projects in developing Asian countries

with experienced international contractors and clients who had relatively little experience

on global projects), it might thus be advisable to pay more attention to professional and

work practice differences between local clients, international contractors and local

subcontractors, as opposed to pure national or societal-level differences in beliefs and

values among the international contracting agencies. My research has identified some of

the salient conflicts that arise, given the existence of a set of actors, organizations and

systems on the projects. Different types of conflicts might arise in the presence of a

316

different set of parameters on other kinds of projects and not all kinds of conflicts will

manifest themselves on all projects. More research is needed to detail systematically, the

relationships between project parameters and the types of conflicts that they might

trigger.

Having determined the types of conflicts that are most prevalent on global

projects, my second research question attempted to then shed some light on the processes

behind these conflicts, how they were enacted, by whom, under what circumstances, and

how they were overcome. Identifying these processes contributes to a better

understanding of how conflicts occur and strategic interventions that might be taken to

reduce these conflicts. The following diagram provides a conceptual framework for

addressing my second research question:

Institution 1

Institution 2

Institutional Conflict

Impasse/ObservedProblem

Is there a mediator?

Accepted Temporary Settlement Yes

Forced temporary Settlement

No

Unresolved Conflict

Figure 19.1: Process of Resolution of Institutional Conflicts on Global Projects

As this diagram indicates, there were various ways in which different institutionalized

views collided— such as a clash between a bureaucratic, controlling mentality on the part

of the Indian clients and a more professionalized and decentralized view of operating on

the part of the international contractors. These clashes led to an observed problem or an

impasse wherein the project came to a temporary halt, as both sides failed to reconcile

317

their differences in order to advance the works. In some cases, if a mediating agent, such

as the freelance expatriates or some of the more enlightened clients’ representatives were

present, then the dispute was resolved in a manner that all parties found acceptable. This

resolution was usually an ad-hoc agreement tolerated by both parties as opposed to a

more permanent one where fundamental beliefs that participants held were changed. The

settlement arrived at enabled the project to be satisfactorily completed but did not alter

any of the existing institutional arrangements. As a result, there was a likelihood that

similar problems would arise on future projects. On these projects the institutional

differences themselves persisted leading to several similar problems over the projects’

lifetime.

In the absence of these mediators, the party that had greater leverage and

bargaining power (usually the clients) forced a resolution that was more consistent with

their own interests. Due to time constraints, other parties on the project followed these

mandates for the time being, but threatened to institute legal proceedings at the end of the

project. Solutions to conflicts in such cases were thus both temporary as discussed above,

as well as forced, obtained without the agreement of all stakeholders.

When considering a generic model of conflicts on these projects, a third option

also exists—that of an unresolved conflict. On the projects that I observed, most issues

that arose were resolved due to time constraints and the fact that all stakeholders were

negatively impacted in the case of significant project delays. However, several projects

do encounter situations of project breakdown and failure, where irrespective of the

presence of a mediator, the participants are not able to reach an agreement on key issues.

318

This generic framework contributes to knowledge on how conflicts are resolved

on global projects by identifying and analyzing relevant parameters, their interactions and

the processes involved. The sections on practical contributions below contain a

discussion of my third research question viz. how my findings can be used to manage

global projects better. The types of conflicts on global projects and the ways in which

they are resolved are topics that have not been systematically studied thus far. In addition

to providing insights into the substantive domain of global projects, my findings also

provide insight into theoretical domains— one of which is institutional theory. As part of

my next contribution, I will address how my findings support, contradict and extend the

existing discourse on institutional conflict and change.

Theoretical Contribution 3: Empirical Validation of existing literature on

Institutional Conflicts

Although the literature on institutional conflicts is relatively young it is fast-growing, and

considerable work has been done in this area over the last decade. The set of processes

that I observed, wherein clients were able to enforce their interests in the absence of

mediators, empirically supports and validates several theoretical propositions from the

literature on institutional conflicts.

Friedland and Alford (1991) point to the existence of several competing

institutional logics in society at any given point of time. Actors must then rationalize

these conflicting views in some way and select one of many possible approaches. This

work indicates that institutional conflict is implicit in most complex societies. Phillips,

Lawrence and Hardy (2000) discuss the issue of competing logics in an environment

where two firms collaborate, and posit that power plays a large role in the way such

319

conflicts are resolved. In their view, actors who control various sources of leverage such

as formal authority or critical resources, and who possess discursive legitimacy, have the

ability to influence the resolution of conflict between competing logics. The resolution of

institutional conflict is thus likely to result in a mode of operation that is favorable to

such actors. Fligstein (1996b) also considers institutional conflicts as eliciting a political

process with variables such as resources (money), dependence etc contributing to an

endgame. Gray and Yan (1994) posit that bargaining power influences the outcomes of

conflicts. They point out that the higher the context- and resource-based leverage that a

group of actors have, the more likely they are to influence the resolution of a conflict in

their favor. Even when competing institutions and logics collide in the transnational

space, there is an indication that the logics backed by more powerful actors are likely to

be adopted (McNichol and Bensedrine 2003; Djelic and Quack 2003).

Similarly to many of these studies, my findings also suggest that power and

leverage played a key role in determining the outcome of institutional conflicts on global

projects. There were several conflicts that occurred in the absence of influential

freelancers or other mediators, where the views of the clients conflicted with the

institutional logics of the contractors. For instance, in several cases the clients tended to

be more bureaucratic and insisted on specific rules being followed, while the contractors

adopted a more nuanced, professionalized stance, felt that they were responsible for

making decisions, and focused more on results as opposed to rules. The clients controlled

the finances of the project and the flow of money into the coffers of the contractors. As a

result, they threatened to not pay the contractors unless the contractors agreed to execute

the works in a manner that satisfied the clients. As the contractors were dependent on

320

timely payments, they were forced to abandon their views temporarily and obeyed the

clients. In this manner, the clients were able to exercise their leverage on the contractors.

In most cases where there was a client-contractor conflict in the absence of a mediator,

the clients used the power that accrued to them as a result of their structural position in

the client-contractor relationship, to influence the settlement of such conflicts in their

own favor—at least in the short term. The contractors generally made it clear that they

reserved their right to seek legal redress for these perceived injustices later in the project.

There are other empirical studies that support this notion that institutional views

backed by powerful entities are most likely to gain acceptance when multiple views

compete. Haveman and Rao (1997) note that when there is a conflict between which sets

of rules should determine the design of organizations and institutions, the design with the

most support will be privileged. They show that in the thrift industry, demographic

change led to a shift in support from entities with a different institutional view and hence

a change in the logics of the industry, due to the political clout exerted by this view.

Schneiberg and Bartley (2001) study issues relating to regulations in markets and

conclude that dynamic political processes shape action and organization when

institutional views contest. As they show, powerful public forces can successfully

influence governments to change current institutional practices. Rao (1998) also points

out that new institutional forms will arise when actors with sufficient resources realize

new interests that they value highly. He considers political power as being a key to the

determination of institutional conflicts. Campbell and Pederson (1996) also endorse this

view that more powerful institutional views are likely to prevail.

321

Much of the work on institutional conflict is non-empirical and highly theoretical

in nature. For instance, DiMaggio (1994) theorizes that political power is salient when it

comes to resolving conflicting institutional forms. Brint and Karabel state that ‘when

multiple frames and forms vie with each other, why one form is chosen and why other

roads are not pursued hinge on larger constellations of power and social structure’ (Brint

and Karabel 1991), while Hannan and Freeman (1989) posit that when rival institutional

blends vie for dominance, politics determine which frame is chosen and how boundaries

are imposed on organizational activities. McAdam asserts that the coalition that gathers

the greatest political support will find that its frame will be privileged (McAdam 1994).

My research thus makes a contribution to theories about institutional conflict. My

findings primarily agree with and validate a set of views proposed by several researchers

on how institutional conflicts are resolved. I provide empirical justification to the

popularly held views that logics with more powerful backing are more likely to prevail,

and describe the ways by which the process of resolution is enacted. The claim that more

powerful logics prevail could be tautological. I provide objective evidence from multiple

instances that the institutional logics of the parties who have more formal and resource

power are the ones that will prevail. My empirical data also allow us to operationalize the

parameters that relate to institutional conflict and help us better understand these

processes. Although my research is not the first or the only study on institutional

conflicts, my findings help fill a gap in the literature on institutional conflicts.

My findings also indicate that even in project settings that are non-repetitive and

exist only over a short time frame and in the absence of a mediating influence, there is a

high likelihood that the dominant institutional form is likely to persist. While scholars

322

have indicated other possible outcomes such as a negotiated settlement between

institutional forms (e.g. Djelic and Quack 2003) my data suggests that on projects there is

a higher likelihood of the dominant institutional form prevailing, as opposed to

innovations or negotiated settlements. This might be due to the fact that the time frame

required to negotiate institutional settlements is usually longer than project time frames.

As projects have not usually been considered as a unit of analysis by institutional

theorists, my findings extend the existing body of knowledge by describing the outcomes

to institutional conflicts on short-term (less than ten-year) projects, in the absence of

mediating influences. In ‘Theoretical Contribution 5’ I deal with my contributions to

institutional conflicts on projects in greater detail.

Theoretical Contribution 4: Advancement of theoretical knowledge on institutional

conflicts

Although the dynamics of client-contractor conflicts in the absence of mediators validates

existing theoretical propositions on institutional conflicts, the presence of freelancers and

their role in resolving issues offers some new insights into the resolution of institutional

conflicts. The freelancers were able to manipulate conflict situations strategically such

that the project progressed without strong dissatisfaction to the parties involved. In many

cases, the dominant institutional logic or the logic espoused by participants with the most

bargaining leverage was not the set of logics that project participants followed. The

freelancers influenced the project participants strategically to resolve their differences in

a manner that best benefited the progress of the project.

323

In many cases, the views of the weaker party (the international contractors) were

followed, if these views were broadly in line with project objectives. Nelson and Winter

(1982) propose that for organizational routines to operate, a comprehensive truce between

the parties involved is required. The freelancers were able to achieve such a ‘truce’

between the parties such that the project could progress Thus, in the case of a conflict

between two competing institutional views in a project situation, third party ‘mediators’

(freelancers in my case) influenced the outcome of these conflicts by strategically

championing a view that best promoted project progress. The set of actions adopted by

other project participants at the behest of the freelancers were in many cases those of the

less dominant faction.

Some literature exists on the concept of ‘institutional entrepreneurs’. These actors

typically arise in situations of institutional conflict or turmoil and help shape and create

new institutional forms (Clemens and Cook 1999; Rao 1998; Becker 1963; Stinchcombe

1997; Fligstein 1996b; DiMaggio 1998). For instance, as globalization increases and as

institutional forms conflict, entrepreneurs emerge who help forge and create transnational

institutions for trade etc (Djelic and Quack 2003). This body of literature views

institutional entrepreneurs as creators of new forms through a highly political process of

resolving which institutional form to adopt from a set of potential options. The

freelancers bear some similarity to these institutional entrepreneurs in that both groups

have to resolve conflicting institutional logics and create new pathways for progress. Yet,

the similarity seems superficial. Unlike the institutional entrepreneurs, the freelancers do

not create regulative or normative institutional forms that project participants will then

324

follow. They merely resolve conflicts temporarily for the project to progress forward,

thereby differentiating themselves from institutional entrepreneurs.

The theoretical discourse on institutional intermediaries also bears a slight

resemblance to the roles played by the freelance expatriates. In his essay on institutional

carriers, Scott discusses the role and the importance of institutional intermediaries.

Intermediaries act as go-betweens who play an active role in helping select and diffuse

institutional forms (Scott 2003). Work by Cole (1989) on the role of wider-level

infrastructures such as trade associations in shaping institutional forms, a study by

Suchman and Cahill (1996) on the role of lawyers in Silicon Valley in creating templates

for organizational forms, and Zuckerman’s (1999) work on the role of security analysts in

determining company value, are some empirical studies that highlight this notion of

institutional intermediaries who are instrumental in constructing and shaping institutional

logics in a given field. Appadurai (1996) also considers the movement of people and the

roles that they play in institutional transmission. Freelance expatriates on global projects

cannot be credited with creating or shaping institutional forms; however, they do bear

some similarities to institutional intermediaries in that the freelancers were also

instrumental in shaping solutions when faced with conflicting goals and worldviews from

project participants.

Oliver (1991) has hypothesized five different strategic responses that

organizations may employ, when confronted with institutional pressures. Organizations

can Acquiesce to the demands of external institutions; Compromise and reach a

settlement; Avoid external pressures altogether by ‘loosely coupling’ (Meyer and Rowen

1977) their activities or buffering against institutional demands; openly Defy institutional

325

pressures; or try to Manipulate and influence external institutions. For the most part, the

freelancers attempted to reconcile institutional differences between two other sets of

actors – the clients and the contractors – as opposed to responding to external institutional

pressures themselves. As a result, the strategies that they used to resolve institutional

conflicts are different from Oliver’s strategies on how an organization might directly

respond to institutional forces that it encounters. The international contractors on the

other hand constantly responded to institutional forces in the Indian environment, and

often chose a ‘Defy’ or a ‘Manipulate’ strategy to combat these forces head-on. This led

to the types of conflicts that I have enumerated in this dissertation. When such conflicts

arose, the freelancers, when present and able, used their repertoire of strategies to resolve

disputes. My research thus extends Oliver’s arguments by indicating some of the

processes that ensue once an organization adopts a certain response to external

institutional pressures – in particular a ‘Defy’ or a ‘Manipulate’ response in a project

setting.

As this discussion implies, the existence of freelancers as mediators of conflicts

on projects bears a faint — but not strong — resemblance to existing literature on

institutional conflicts. Thus, the roles and strategies used by these freelancers in resolving

conflict, the processes by which conflicts were resolved and the fact that such third party

mediators could resolve conflicts in such a manner that the dominant institutional form

does not always prevail, are contributions to the literature on institutional conflict. These

can be viewed as contributions to the resolution of conflicts in a one-off or project

setting. In a following section, I will summarize my contributions to institutional theory

in project settings.

326

Contributions to Organizational Studies and Social Movements Research:

Several scholars have pointed out the similarities between the literatures on

Organizations and Social Movements (McAdam and Scott 2005, Campbell 2004) and

have identified the fact that these streams of research compliment each other (McAdam

and Scott 2005). Researchers maintain that the studies of social settings can be enhanced

by combining concepts from both disciplines (Fligstein 1996b, Clemens 1997, Davis and

McAdam 2000, Rao, Morrill and Zald 2000).

Campbell (2004) points out that scholars in both spheres have focused on issues

such as path dependence, the salience of network ties, political structures, leadership etc

in order to explain social and organizational processes. However, there are some

differences in the approach to these topics. As McAdam and Scott (2005) note, the

Organizational Studies literature has tended to focus on informal and formal structures in

organizations, while the Social Movement theorists tend to take a process-oriented view

and emphasize phenomena such as the mobilization of resources, building of alliances etc

(e.g. Zald and McCarthy 1987). Students of Social Movements tend to focus more on the

‘challengers’ or emergent organizations at a society-wide level, while the Organizational

theorists focus on sector-specific established organizations and ways in which

institutionalized forms persist in these sectors. When dealing with power and conflict,

Organizational scholars have chiefly considered institutionalized power reinforced

through formal structures and regulative frameworks as well as societal norms and

values. In contrast, Social Movement theorists have discussed more explicit and direct

uses of power and politics (e.g Gamson 1975; Zald and Berger 1978; McAdam, Tarrow

and Tilly 2001).

327

In sum, scholars have pointed out that in addition to analyzing structural issues

such as the effects of political structures (e.g. Hamilton and Biggart 1988; Djelic 1998),

political and structural power (Havemen and Rao 1997; Scheiberg and Bartley 2001),

resource dependence (e.g. Pfeffer and Salancik 1978) etc, cultural arguments such as the

framing of conflicts (Snow et al 1986; Benford and Snow 2000) must also be

simultaneously considered in order to create a broader framework that will strengthen the

analysis of social settings.

In my research, I look at the perspectives of both the established organization (the

Indian Government) as well as the challengers (the freelancers and the international

contractors). I show in chapters 14, 15 and 16 that in addition to the bargaining power

that the freelancers obtained as a function of their structural position in the project

hierarchy (an Organizational Studies perspective), an analysis of how the conflicts were

resolved in India is incomplete without considering the strategies that the freelancers

used, the ways in which they acted as mediators and how they obtained movement by

framing conflicts in such a manner that they could use strategies such as escalation and

giving normative suggestions. By showing how the freelancers used processes of frame

bridging and frame amplification to resolve some disputes, my research provides

anecdotal incidents that contribute to extant theory by both empirically validating and

further operationalizing some of Snow et al’s (1986) concepts of frame alignment and

mobilization. I also justify the faith that scholars have placed in combining Social

Movements and Organizational perspectives and provide data and an analysis wherein

the benefits of combining these two approaches into a broader framework can be seen to

provide a richer understanding of the setting under study.

328

In addition, my research identifies certain cases where the freelancers were unable

to ‘frame’ the conflicts in a manner in which they could be easily resolved. In these cases

the freelancers directly resorted to unilateral strategies of circumvention and did not

attempt to frame the conflict and facilitate movement. In part, this was due to the fact that

the work was performed in a project setting within a short time-frame. As a result, the

costs of spending time on the framing process were very high and the freelancers needed

to resort to alternative strategies to resolve conflicts. This observation is similar to

Armstrong’s suggestion (2004) and points to the fact that framing of conflicts is not a

universal occurrence, and is dependent on the cost of framing as opposed to the costs of

utilizing an alternative strategy. My research thus contributes to the existing discourse on

conflict resolution and framing by identifying a preliminary transactions cost-based

‘contingency model’ that determines when conflict framing strategies are likely to be

used and when they are not. My research also indicates an area of future study, wherein

scholars can perform more rigorous analysis to build theories and develop models that

identify when circumstances are conducive to conflict framing and when they are not.

Theoretical Contribution 5: Studying institutions in a project setting

Institutional theory has rarely been applied to the study of projects. Global projects where

multiple groups with differing backgrounds interact with each other for a short period of

time are arenas where differing and often conflicting views must be negotiated rapidly,

rather than being allowed to evolve slowly in order for the project to proceed. My

research contributes towards the understanding of how different institutional views

329

coexist on projects by providing a description of the process of conflict and conflict

resolution.

My most significant finding in terms of how conflicts are resolved on projects is

that the resolution of these conflicts was purely temporary. As Schneiberg and Soule

(2004) noted in their study of American fire insurance rates, the institutional settlements

arrived at were provisional affairs as opposed to establishing, once and for all, a single,

comprehensive and encompassing industrial model. Existing institutional views and

beliefs were rarely permanently changed or modified—they were merely temporarily

circumvented. Greater bargaining leverage held by some parties at different project

phases, as well as the influence of the freelance expatriates, served to bring about a

resolution to these conflicts. Project participants then followed the recommended course

of action for the remaining duration of the activity under question. However, similar

conflicts arose on other activities indicating that the participants’ beliefs and behaviors

had not undergone a permanent change. For instance, although local Taiwanese workers

adopted safety principles, project participants indicated that when they moved on to

another project, they would immediately revert back to their old unsafe ways. This shows

that the Taiwanese workers merely adopted safety routines as a result of coercion from

the international contractors. They persisted with these routines for the duration of the

project, but had not truly changed their views to embrace better safety practices on future

projects.

Similarly in India, when the clients insisted on strictly following the rules, the

freelancers influenced the situation such that a more results-oriented approach was

followed in a given case. However, this resolution of two different logics of performing

330

the work was merely temporary, since the Indian clients insisted on a bureaucratic, rule-

following approach on other activities within the same project as well as activities on

other projects. Project participants in general are rarely under the influence of ‘the long

shadow of the future’. Most participants were unlikely to work with their current partners

on future projects or even in the same country again. As a result, their main incentive was

to complete the current project rather than to build negotiated understandings on how to

work together in cases of conflicting views. Thus the resolution of conflicts on global

projects led to temporary solutions that allowed the project to progress relatively

harmoniously, as opposed to a permanent resolution of conflicting institutional views.

Some research indicates that institutional change in global partnerships can be

brought about only through a slow and measured process that may take a large amount of

time (Djelic and Quack 2003). As such, it would be virtually impossible to bring about

such changes on global projects as they last for only a few years. The organizational

forms disintegrate after these projects are completed, destroying any tacit learning at the

level of the organization, and making a permanent change in logics even more difficult to

sustain. Therefore, the observation that conflicts are not permanently resolved on projects

is in line with these propositions.

Most global projects are performed under intense time pressure with several

activities existing simultaneously on the critical path. In such situations, the participants

do not have a large amount of time to negotiate a settlement on institutional conflicts. In

many of the cases that I observed, one of the competing views prevailed over the others. I

observed very few cases of hybrid solutions. In the absence of mediators, the dominant

form prevailed over the weaker logics, while mediators were able to circumvent

331

processes to pick one form (e.g. results orientation) over another (e.g. rules orientation).

Thus, another contribution of this work towards theories of institutional conflicts on

projects is that fewer negotiated settlements arise on global projects. In contrast, in other

global theatres longer term, continuous relationships are expected to and do exist between

national and transnational players. In longer term relationships, there is evidence that the

prevalence of a dominant logic, a negotiated settlement and the emergence of a new

settlement are all quite probable (Djelic and Quack 2003).

Theoretical Contribution 6: Extension to the domain of global projects

There is very little extant literature on the dynamics of global projects. However, some

propositions on global projects have been made in that literature. The answers to my

research questions have contributed towards extending knowledge in this domain. My

findings validate some of these propositions and introduce new constructs that help

further advance knowledge in this field.

Most of the existing literature on global projects emphasizes the cultural ‘values’

dimension at the expense of work practices and other normative and regulative

institutional considerations. However, a small body of work on overseas projects

published by the Institution of Civil Engineers (ICE) in the UK bears some relevance to

my findings (ICE 1988). This work, which was the product of a conference on overseas

projects attended mainly by British expatriates, attempts to summarize (through anecdotal

experience as opposed to systematic research) the various types of problems that occur on

global projects. Similarly to my observations, problems due to national value differences

are not considered to have a large impact on these projects. Some mention is also given to

332

the problems arising due to “hands on” approaches taken by local governments,

particularly with respect to vendor selection, a concern that is also consistent with my

observations. The power of local governments to force international contractors to obey

their mandates is also considered.

While such incidents are acknowledged to have influenced the progress of global

projects, the main sources of problems that are identified are issues related to supply-side

problems (tardy delivery of goods and services), technological problems (structural

breakdowns) and financial issues (lack of funding on the part of local project sponsors).

While I did observe some supply-side problems, these were not the major causes of

challenges. Further, the ICE does not consider client-contractor relationships—a

dimension where I observed the majority of conflicts— to be a source of project risk.

Thus, although this small existing literature on issues that arise on global projects

corroborates some of my findings (e.g. the minor role played by national cultural

differences), several of my observations of the types of problems that occur on global

projects (e.g. client contractor conflicts) and the ways in which they are resolved, are

additions and extensions to this literature.

Another contribution is the exposition of the existence and the roles played by

freelance expatriates on global projects. Very little has been written about the role of

expatriates on global projects. Indeed, the existence of freelance expatriates and the roles

that they play have rarely been mentioned in the literature of global infrastructure

projects. The few articles that have been written on expatriates in international projects

focus on the entire community of international workers and not purely the freelancers.

Most of these works are in the forms of memoirs written by experienced expatriates and

333

enumerate various tips and strategies on bidding, procurement, planning etc (e.g.

Lorraine 1992; Richards 1999). Although they provide some helpful hints for the

challenges that expatriates are likely to encounter (and therefore issues that occur on

global projects), these works are not empirical, are highly normative and deal with

generic project management challenges on large engineering projects.

Expatriates (not merely expatriate freelancers) have been the focus of attention in

some other streams of literature. As Gong (2003) points out, a developing body of

literature in the field of international business focuses on expatriates from the parent

country in subsidiaries of multinational enterprises (e.g. Tung 1982; Kopp 1994;

Peterson, Napier and Shim 2000). Most of this work has focused on the effects of

expatriate staff on subsidiary performance (e.g. Gong 2003), criteria for expatriates to be

successful in overseas assignments (e.g. Tung 1987) and on questions relating to how

multinational firms should best deploy expatriate managers (e.g. Boyacigiller 1990). The

expatriates addressed by this literature are part of the parent firm and are staffed abroad.

Further, this literature concerns itself most with parent-subsidiary dynamics and the

effectiveness of expatriates in influencing these dynamics as opposed to the effectiveness

of expatriates on influencing project success. In most cases, the multinational firms

studied are engaged in routine production processes (such as manufacturing) as

opposed to working on non-routine projects with other multinational firms. Due to the

uncertain nature of future work in foreign markets, most construction firms of the sort

that we studied operate without local subsidiaries. Also, this literature does not directly

address the roles of freelance expatriates and the influence that expatriates in general

have on global projects.

334

As a result, the lifestyles of these freelance expatriates, the ways in which they

find employment on global projects, the strategies that they use, the critical role that they

play in resolving conflicts on these projects, and insights into the characteristics and

positions that help make some freelancers into successful mediators are all contributions

to current academic knowledge on global projects. Without these freelancers, the

dynamics of global projects would have been completely different and as a result the

identification of this community is a key extension to this field of study.

Practical Contribution 1: Contributions to Practitioners

My research findings also contribute to current practice on global projects. Several

categories of practitioners may garner valuable insights from these observations. I will

briefly discuss the benefits of my research to three categories of practitioners that are

typically present on global projects: multilateral financial institutions, host governments

and international contractors.

Multilateral financial institutions such as the World Bank, Japanese Bank for

International Cooperation, Asian Development Bank etc typically invest large sums of

money into infrastructure projects in developing countries. By providing large amounts of

capital in the forms of grants or loans to these projects, these institutions stand to lose a

great deal if the projects are delayed or are not built as intended. These financial

institutions are present during the planning phases of the projects and can influence the

organizational structures that are adopted. Based on the findings of my research,

multilateral institutions might benefit by insisting that the clients and contractors employ

freelance expatriates in key positions on the projects. If the multilaterals believe that there

335

could be a high likelihood of client-contractor problems, they could insist upon the clients

employing freelancers as consultants. The freelancers would then be able to resolve

some of the conflicts that arise, thereby leading to a more successful project. Since they

possess a large amount of leverage in the early stages of project planning, these financial

institutions could ‘shape’ the organizational structure of the project such that they could

implant intermediaries in key boundary spanning positions, e.g., contract administrators,

purchasing agents, to resolve potential conflicts. In this way, the multilateral banks could

try to mitigate some of the risks associated with global projects. The role of the

freelancers in reducing project delays, and hence project costs, should be an important

strategic consideration for multilateral institutions as they approach the issue of investing

in global projects.

Host country governments who are usually the clients for large global projects can

also benefit from my findings in much the same way as the multilateral banks. By

completing these infrastructure projects on time and per the specifications, local

governments can repay their loans more easily and can fulfill the political promises that

they have made to their constituents. As my findings have demonstrated, using

freelancers as consultants to these projects could help achieve these aims.

Most clients currently perceive the freelancers as technical experts. As a result,

the Indian government, for instance, does not currently see the value of using these

expatriates on a subsequent similar project since they believe that they have now

understood and documented the technical intricacies of complex railway infrastructure

through the current project. However, not employing freelancers could lead to several

336

client-contractor impasses that could severely delay and perhaps derail an upcoming

project.

The implications of my research to host-country governments are that the

freelancers contribute greatly to successful project operations in addition to bringing in

specialized technical expertise. Therefore, it is in the interests of host country officials

who are in charge of these projects to ensure that freelancers are recruited as independent

consultants in order to play the role of cross-institutional intermediaries who can help

mitigate conflicts and delays on projects. It must be noted that local clients might have to

relinquish some control to the freelancers in order to allow them to make decisions and

play a meaningful role on these projects. While clients might therefore meet this

recommendation with some displeasure, my findings strongly suggest that such an

approach will be beneficial to the clients and to the project as a whole.

Finally, international construction companies can also benefit through knowledge

of the roles and functions of these freelancers. Many international firms are aware of and

employ these actors. Several other firms that are planning to expand internationally will

benefit through being aware of the existence of these freelancers. They can bid for and

select projects with the knowledge that even if they do not have the required complement

of technical and managerial expertise, they can draw from this large pool of itinerant

expatriates who have a lot of experience in working internationally, in order to form

project teams. Further, rather than training their own employees to work internationally,

firms can hire experienced freelancers who have shown proven ability to manage large

global projects. This might prove particularly cost-effective for firms who do not have a

clear strategy about seeking future international work.

337

Practical Contribution 2: Implications for Policy

My findings also have implications for policymakers engaged in creating anti-corruption

provisions. As the example of the Vigilance Commission in India indicates, punitive

measures to root out corruption can result in unintended consequences. By not counting

the time while the investigation was ongoing toward their seniority —sometimes as long

as several years—for anyone even suspected of corrupt practices, the Indian government

influenced its civil servants to be excessively conservative. Afraid to give the Vigilance

commission any reason, no matter how flimsy, to investigate them, the Indian client

representatives became very reticent to make decisions, thereby causing project delays.

Thus, although Vigilance was designed to root out a social evil, my research delineates

the ways by which this led to unintended conflicts and delays. These findings should be

instructive to policy makers and induce them to consider alternative strategies.

Two potential strategies that they could consider are the following: First, anti-

corruption measures that are more normative or cognitive as opposed to coercive should

be evaluated. The best strategy to permanently root out corruption is to make people

aware of and accept the ills of corruption. Penalties are likely to result only in temporary

compliance. Second, the measures used to enforce anti-corruption statutes should be

transparent and fair. In India, one of the main reasons for extremely conservative civil

servant behavior was that officials would be penalized even without sufficient proof.

Since no attempt was made to differentiate between a corrupt practice and an honest

error, Indian government representatives were unlikely to make a decision unless they

had full information. In practice it is often very difficult to obtain complete information

about matters such as the status of completion of work, and therefore project delays

338

occurred. By following a process that assured government employees that they would be

penalized only if found guilty and not for an honest mistake that they had committed

while exercising reasonable judgment, the Vigilance commission could have improved

the inclination of the Indian public sector employees to make fair decisions while still

attempting to reduce corruption.

Practical Contribution 3: Contribution to Project Managers

The strategies and actions of the freelancers provide valuable guidelines for project

management in situations fraught with conflict. My findings and anecdotes provide

project managers of both local and international organizations with an understanding of

the challenges and the accompanying dynamics that they are likely to encounter on global

projects. They can thus better prepare themselves for the situations that they will face in

future projects. In addition, the strategies used by the freelancers such as circumventing

bottlenecks through redesigning the work flow, and escalating issues to senior managers

who were conscious of the need to make timely decisions, provide project managers with

some guidelines on how to mitigate contentious situations that might arise on these global

projects. By understanding and adapting to these processes, project managers can better

combat the unintended costs and conflicts that arise on global projects.

Summary of Contributions

My contributions fall into three broad categories – findings that contribute to institutional

theory, findings that contribute to theories of global projects, and findings that can guide

the work of practitioners. I summarize these contributions below.

339

Table 19.1 – Contributions to Institutional Theory

Contribution Description of key finding

An empirical validation of some of the existing literature on institutional conflict

In the absence of mediating influences, dominant institutional logics are likely to prevail in cases of institutional conflict.

Extension to the discourse on institutional conflict

Mediating influences in the form of freelancers can help shape the settlement of an institutional conflict. Although the dominant form may not always prevail, most settlements were instrumental in improving project progress.

Initial findings about inter-institutional conflict in project situations

The resolution of institutional conflicts on projects leads primarily to temporary resolutions – beliefs and logics are seldom permanently changed. Further, negotiated settlements between conflicting institutions on a project are relatively rare.

Table 19.2 – Contributions to a Theory of Global Projects

Contribution Description of key finding

Ethnographies of global projects A set of ‘thick descriptions’ that can be used as part of a database to understand and analyze the dynamics of global projects

An understanding of the types of conflicts that occur on global projects and the ways in which they are resolved.

Local clients vs. International contractor conflicts are the dominant mode of conflicts on global projects. In the absence of freelancers, the dominant clients’ views are enforced on the less powerful contractor stakeholders, leading to temporary acceptance and claims on the project. In the presence of freelancers, settlements are achieved that are accepted by all stakeholders.

An understanding of the roles of freelancers on global projects

Neutral third party freelancers play a major role in the successful completion of these projects by strategically resolving project conflicts in a timely manner.

340

Table 19.3 – Contributions to the Practice of Global Project Management

Contribution Description of key finding

Implications for clients and project financiers

Recruiting freelancers with both technical and institutional expertise as consultants can greatly help mitigate difficulties on global projects.

Implications for international contractors Experienced freelancers with large amounts of international experience exist who can be recruited to fill project positions where the contracting firm does not have relevant expertise.

Implications for policy makers Anti corruption programs that are coercively enforced can lead to negative unintended consequences that cause project delays. An “innocent until proven guilty” approach towards enforcement could help mitigate such problems.

Implications for project managers An awareness of the sources of special problems that are likely to occur on global projects due to institutional differences, and strategies by which they can be resolved.

Concluding Comment

This research can best be viewed as the starting point of a larger program of research on

global projects. My initial objective was to explain the conflicts and challenges that beset

global projects and to identify ways in which these unintended project costs could be

mitigated. Since there was very little available literature on this topic, I decided to

conduct detailed qualitative analysis on a few global projects to gain more insight and

shed some light on the problems that beset these projects.

After collecting data on four matched projects, I was able to identify the types of

problems that occurred on these global projects as well as the ways in which they were

resolved. Conflicts occurred due to differences in national institutions. However:

341

1. Conflicts did not arise from cross-national differences in values and beliefs

between international contractors from various countries (Hofstede 1991) at

the same level on the “supplier side” of the projects. This was due to the use

of standardized technologies influenced in part by longstanding British

Colonial standards, and the “institutional homogenization” of most

international participants as a result of prior exposure to varied cultural

environments.

2. Rather, conflicts arose from institutional differences between the local owners

and many of the international contractors over professional vs. bureaucratic

differences and between international contractors vs. local subs in terms of

differences in safety and quality norms on the projects.

Freelance expatriates who were hired by the clients as well as broadminded local

representatives used strategies of circumvention, escalation, convincing and

postponement to resolve the issues that arose. The freelancers in particular played a key

role in the successful progress of these projects.

My research contributes to theory and practice in several ways. First, my

anecdotes and findings contribute to a better understanding of the human and social

dynamics of global projects. Second, my research contributes to emerging research on

institutional conflicts and attempts to describe institutional dynamics in project contexts.

Third, practitioners can benefit from this research by gleaning insights that can help them

better plan and execute global projects.

However, research on global projects has barely started. Researchers in this area

have much to do. Several more detailed case studies must be compiled in order to obtain

342

a more complete understanding of the different types of conflicts that occur on global

projects. The projects that I studied were all public infrastructure projects (transit) in Asia

funded by multilateral lenders, and all had similar forms of project organization. Projects

of different kinds with different funding, ownership and management structures in other

parts of world should be studied and contrasted with the projects described here.

Apart from conducting purely qualitative studies, researchers can also put forth

conjectures and propositions based on data already collected, and test these propositions

quantitatively. This process can then lead to the formation of validated theories that can

contribute to both academic knowledge and practice on global projects. Computational

models can then be built to simulate and predict outcomes on such projects.

Global projects are neither new nor are they a passing phenomenon. The coming

decades will see many more large projects of the sort described in this thesis. Our

understanding of the unique challenges of these projects, however, remains relatively

primitive. It is only by careful observations of other projects, and by inductive as well as

deductive reasoning about the growing body of empirical data thereby assembled, that we

can begin to understand these projects better.

Enhanced understanding of the causes of and remedies for institutional conflict on

global projects undertaken to provide drinking water, sanitation, transportation,

telecommunications and housing can help to enhance the welfare and security of mankind

in an increasingly interconnected and global world.

343

Appendix A List of Impasses in meetings in India that were solved using the four strategies

S. No Meeting Date Description of Conflict Type of Dispute Strategy Mediator

1 Monthly meeting with contractor X 10-Feb

Clients reject the contractors choice of vendor or equipment Bureaucracy vs.Craft Circumvention

Project Director

2 Monthly meeting with contractor X 10-Feb

Clients reject the contractors choice of vendor or equipment Bureaucracy vs.Craft Circumvention

Design Manager

3 Monthly meeting with contractor X 10-Feb

Clients want multiple approvals from contractors Bureaucracy vs.Craft

Normative Convincing

Project Director

4 Monthly meeting with contractor Y 11-Feb

Clients ask contractors to provide more information Bureaucracy vs.Craft

Normative Convincing

Project Director

5 Monthly meeting with contractor Y 11-Feb

Clients reject the contractors choice of vendor or equipment Rules vs.Results Circumvention

Project Director

6

Meetings to discuss a Variation order with contractor Y 16-Feb

Clients ask contractors to provide more information Bureaucracy vs.Craft Postponement

Design Manager

7

Meetings to discuss a Variation order with contractor Y 16-Feb

Clients ask contractors to provide more information Bureaucracy vs.Craft

Normative Convincing Other

8

Meetings to discuss a Variation order with contractor Y 16-Feb

Clients want contractors to do extra work Dictatorial vs.Partner Circumvention

Design Manager

9

Meetings to discuss a Variation order with contractor Y 16-Feb

Contractors claim that clients have not released payment Dictatorial vs.Partner Circumvention

Design Manager

10

Meetings to discuss commercial issues with contractor X 19-Feb

Clients reject the contractors choice of vendor or equipment Bureaucracy vs.Craft Escalation

Project Director

344

11

Meetings to discuss commercial issues with contractor X 19-Feb

Clients reject the contractors choice of vendor or equipment Bureaucracy vs.Craft Escalation

Project Director

12

Meetings to discuss commercial issues with contractor X 19-Feb Contract terms are ambiguous Bureaucracy vs.Craft Escalation

Project Director

13

Meetings to discuss commercial issues with contractor X 19-Feb Contract terms are ambiguous Dictatorial vs.Partner Escalation

Project Director

14

Meetings to discuss commercial issues with contractor X 19-Feb Contract terms are ambiguous Dictatorial vs.Partner

Normative Convincing

Project Director

15

Meetings to discuss commercial issues with contractor X 19-Feb

Contractors claim that clients have not released payment Dictatorial vs.Partner Escalation

Project Director

16

Meetings to discuss commercial issues with contractor X 19-Feb

Contractors claim that clients have not released payment Dictatorial vs.Partner suggestion

Design Manager

17

Meetings to discuss commercial issues with contractor X 19-Feb Contract terms are ambiguous Other Postponement

Project Director

18

Meetings to discuss commercial issues with contractor X 19-Feb Contract terms are ambiguous Rules vs.Results Escalation

Project Director

19

Meetings to discuss commercial issues with contractor X 19-Feb Contract terms are ambiguous Rules vs.Results Postponement

Project Director

20 Internal clients meeting 4-MarFreelancers want Indians to play new roles Bureaucracy vs.Craft Circumvention

Project Director

21 Internal clients meeting 4-MarDisagreement on how to train personnel Other

Normative Convincing

Project Director

345

22 Internal clients meeting 4-MarFreelancers want Indians to play new roles Other

Normative Convincing

Project Director

23

Electrical and Mechanical issues review meeting with contractor X 5-Mar

Clients ask contractors to provide more information Bureaucracy vs.Craft Postponement

Design Manager

24

Electrical and Mechanical issues review meeting with contractor X 5-Mar

Clients ask contractors to provide more information Bureaucracy vs.Craft Postponement

Design Manager

25

Electrical and Mechanical issues review meeting with contractor X 5-Mar

Clients reject contractors' calculations Rules vs.Results Circumvention

Design Manager

26 Monthly meeting with contractor X 8-Mar

Clients reject the contractors submissions Bureaucracy vs.Craft Postponement

Project Director

27 Monthly meeting with contractor X 8-Mar

Clients want contractors to do extra work Dictatorial vs.Partner Circumvention

Project Director

28 Monthly meeting with contractor X 8-Mar

Clients want contractors to do extra work Dictatorial vs.Partner Circumvention

Project Director

29 Monthly meeting with contractor X 8-Mar Clients direct the contractors' work Dictatorial vs.Partner Postponement

Design Manager

30 Monthly meeting with contractor X 8-Mar

Clients follow the exact wording of the documents Rules vs.Results Postponement

Project Director

31 Monthly meeting with contractor X 8-Mar

Clients follow the exact wording of the documents Rules vs.Results Postponement

Design Manager

32 Monthly meeting with contractor X 8-Mar

Clients want redundant submissions Rules vs.Results Circumvention

Design Manager

33 Monthly meeting with contractor Y 9-Mar

Clients want contractors to do extra work Dictatorial vs.Partner

Normative Convincing

Project Director

34 Monthly meeting with contractor Y 9-Mar

Contractors claim that clients have not released payment Dictatorial vs.Partner Escalation

Project Director

346

35 Monthly meeting with contractor Y 9-Mar

Contractors are accused of performing poor quality work Other Postponement

Design Manager

36 Monthly meeting with contractor Y 9-Mar

Clients follow the exact wording of the documents Rules vs.Results Circumvention Other

37

Electrical and Mechanical issues review meeting with contractor X 15-Mar

Clients ask contractors to provide more information Bureaucracy vs.Craft

Normative Convincing

Project Director

38

Electrical and Mechanical issues review meeting with contractor X 15-Mar

Clients delay reviewing the specifications Bureaucracy vs.Craft

Normative Convincing

Project Director

39

Electrical and Mechanical issues review meeting with contractor X 15-Mar

Clients reject the contractors choice of vendor or equipment Bureaucracy vs.Craft

Normative Convincing

Project Director

40

Electrical and Mechanical issues review meeting with contractor X 15-Mar

Clients want contractors to do extra work Dictatorial vs.Partner Circumvention

Project Director

41

Electrical and Mechanical issues review meeting with contractor X 15-Mar

Clients want contractors to do extra work Dictatorial vs.Partner Postponement

Project Director

42

Electrical and Mechanical issues review meeting with contractor X 15-Mar

Clients want contractors to do extra work Dictatorial vs.Partner

Normative Convincing

Design Manager

43

Electrical and Mechanical issues review meeting with contractor X 15-Mar

Clients follow the exact wording of the documents Rules vs.Results Circumvention

Project Director

44

Electrical and Mechanical issues review meeting with contractor X 15-Mar

Clients follow the exact wording of the documents Rules vs.Results

Normative Convincing

Design Manager

45 Internal clients meeting 16-MarClients follow the exact wording of the documents Rules vs.Results Circumvention

Design Manager

347

46 Internal clients meeting 16-MarClients follow the exact wording of the documents Rules vs.Results

Normative Convincing

Design Manager

47 Construction meeting 17-MarClients ask contractors to provide more information Bureaucracy vs.Craft Postponement

Construction Manager

48

Electrical and Mechanical issues review meeting with contractor Y 23-Mar

Clients ask contractors to provide more information Bureaucracy vs.Craft

Normative Convincing

Design Manager

49

Electrical and Mechanical issues review meeting with contractor Y 23-Mar

Clients want contractors to do extra work Dictatorial vs.Partner Circumvention

Design Manager

50

Electrical and Mechanical issues review meeting with contractor Y 23-Mar

Clients want contractors to do extra work Dictatorial vs.Partner Postponement

Design Manager

51

Electrical and Mechanical issues review meeting with contractor Y 23-Mar

Contractors are accused of performing poor quality work Other

Normative Convincing

Design Manager

52

Electrical and Mechanical issues review meeting with contractor Y 23-Mar

Contractors are accused of performing poor quality work Other

Normative Convincing

Design Manager

53

Electrical and Mechanical issues review meeting with contractor X 23-Mar

Contractors' calculations are unclear Other

Normative Convincing

Design Manager

54

Electrical and Mechanical issues review meeting with contractor Y 23-Mar

Clients follow the exact wording of the documents Rules vs.Results Circumvention

Design Manager

55

Electrical and Mechanical issues review meeting with contractor Y 23-Mar

Clients follow the exact wording of the documents Rules vs.Results Circumvention

Design Manager

56

Electrical and Mechanical issues review meeting with contractor Y 23-Mar

Clients follow the exact wording of the documents Rules vs.Results Circumvention

Design Manager

348

57

Electrical and Mechanical issues review meeting with contractor X 23-Mar

Clients reject contractors' calculations Rules vs.Results Postponement

Design Manager

58 Monthly meeting with contractor X 5-Apr

Clients want contractors to do extra work Dictatorial vs.Partner Postponement Other

59 Monthly meeting with contractor Y 6-Apr

Clients want contractors to do extra work Dictatorial vs.Partner Escalation

Project Director

60 Monthly meeting with contractor Y 6-Apr

Contractors are accused of performing poor quality work Other Circumvention

Construction Manager

61 Monthly meeting with contractor Y 6-Apr

Contractors are accused of performing poor quality work Other Circumvention

Construction Manager

62 Monthly meeting with contractor Y 6-Apr

Contractors are accused of performing poor quality work Other Circumvention

Construction Manager

63 Monthly meeting with contractor Y 6-Apr

Clients follow the exact wording of the documents Rules vs.Results Circumvention

Project Director

64

Electrical and Mechanical issues review meeting with contractor X 13-Apr

Contractors want to choose different vendors Bureaucracy vs.Craft Circumvention

Design Manager

65

Electrical and Mechanical issues review meeting with contractor Y 13-Apr Clients want a particular vendor Bureaucracy vs.Craft

Normative Convincing

Design Manager

66

Electrical and Mechanical issues review meeting with contractor Y 13-Apr

Clients want contractors to do extra work Dictatorial vs.Partner

Normative Convincing

Design Manager

67

Electrical and Mechanical issues review meeting with contractor Y 13-Apr

Clients want a more expensive foreign brand Dictatorial vs.Partner

Normative Convincing

Design Manager

68

Electrical and Mechanical issues review meeting with contractor Y 13-Apr

Contractors are accused of performing poor quality work Other

Normative Convincing

Design Manager

349

69

Electrical and Mechanical issues review meeting with contractor Y 13-Apr

Contractors are accused of performing poor quality work Other Circumvention

Electrical Expert

70

Electrical and Mechanical issues review meeting with contractor X 13-Apr

Clients follow the exact wording of the documents Rules vs.Results Circumvention

Design Manager

71

Electrical and Mechanical issues review meeting with contractor X 13-Apr

Clients follow the exact wording of the documents Rules vs.Results Circumvention

Design Manager

72 Coordination meeting with Systems contractors 22-Apr

Clients follow the exact wording of the documents Rules vs.Results Postponement Other

350

Appendix B List of Impasses in meetings in India that were not resolved

S. No Meeting Date Description of

Conflict Outcome Freelancer present

1 Electrical and Mechanical issues review meeting with contractor X 5-Mar

Clients want contractors to do extra work

No resolution achieved Design Manager

2 Electrical and Mechanical issues review meeting with contractor X 5-Mar

Clients want contractors to do extra work

No resolution achieved Design Manager

3 Electrical and Mechanical issues review meeting with contractor X 5-Mar

Clients reject the contractors calculations

No resolution achieved Design Manager

4 Monthly meeting with contractor X 8-Mar

Clients want contractors to provide more information

Contractors accept clients orders

Construction Manager, Design Manager and Project Director

5 Monthly meeting with contractor X 8-Mar

Clients want contractors to provide more information

Contractors accept clients orders

Construction Manager, Design Manager and Project Director

6 Monthly meeting with contractor X 8-Mar

Clients want contractors to provide more information

Contractors accept clients orders

Construction Manager, Design Manager and Project Director

351

7 Monthly meeting with contractor X 8-Mar Clients want contractors to do extra work

Clients bully the contractors into acceptance

Construction Manager, Design Manager and Project Director

8 Monthly meeting with contractor X 8-Mar

Clients want contractors to provide more information

Clients bully the contractors into acceptance

Construction Manager, Design Manager and Project Director

9 Monthly meeting with contractor X 8-Mar Clients want contractors to do extra work

Clients bully the contractors into acceptance

Construction Manager, Design Manager and Project Director

10 Monthly meeting with contractor X 8-Mar

Contractors are accused of performing poor quality work

Clients abuse the contractors

Construction Manager, Design Manager and Project Director

11 Monthly meeting with contractor X 8-Mar Clients want contractors to do extra work

Clients bully the contractors into acceptance

Construction Manager, Design Manager and Project Director

12 Monthly meeting with contractor X 8-Mar

Clients follow the exact wording of the documents

Clients bully the contractors into acceptance

Construction Manager, Design Manager and Project Director

13 Monthly meeting with contractor X 8-Mar

Clients follow the exact wording of the documents

Contractors accept clients orders

Construction Manager, Design Manager and Project Director

352

14 Monthly meeting with contractor X 8-Mar

Clients want contractors to provide more information

Clients abuse the contractors

Construction Manager, Design Manager and Project Director

15 Monthly meeting with contractor X 8-Mar

Contractors claim that clients have not released payment

No resolution achieved

Construction Manager, Design Manager and Project Director

16 Monthly meeting with contractor Y 9-Mar Clients want contractors to do extra work

Clients bully the contractors into acceptance

Construction Manager, Design Manager and Project Director

17 Monthly meeting with contractor Y 9-Mar Clients want contractors to do extra work

Clients bully the contractors into acceptance

Construction Manager, Design Manager and Project Director

18 Monthly meeting with contractor Y 9-Mar Clients want contractors to do extra work

Clients bully the contractors into acceptance

Construction Manager, Design Manager and Project Director

19 Monthly meeting with contractor Y 9-Mar Clients want contractors to do extra work

Clients bully the contractors into acceptance

Construction Manager, Design Manager and Project Director

20 Monthly meeting with contractor Y 9-Mar

Clients follow the exact wording of the documents

Clients bully the contractors into acceptance

Construction Manager, Design Manager and Project Director

353

21 Electrical and Mechanical issues review meeting with contractor X 15-Mar

Contractors want clients to do extra work

Clients bully the contractors into acceptance Project Director

22 Internal Meeting 16-Mar

Clients want contractors to provide more information

Clients bully the contractors into acceptance Deputy Project Director

23 Electrical and Mechanical issues review meeting with contractor X 23-Mar

Clients want contractors to provide more information

No resolution achieved Design Manager

24 Electrical and Mechanical issues review meeting with contractor X 23-Mar

Clients follow the exact wording of the documents

No resolution achieved Design Manager

25 Electrical and Mechanical issues review meeting with contractor X 23-Mar

Clients ask the contractors for more information

No resolution achieved Design Manager

26 Monthly meeting with contractor X 5-Apr

Clients follow the exact wording of the documents

No resolution achieved

Construction Manager, Design Manager and Project Director

27 Monthly meeting with contractor X 5-Apr

Clients follow the exact wording of the documents

Clients bully the contractors into acceptance

Construction Manager, Design Manager and Project Director

28 Monthly meeting with contractor X 5-Apr

Clients follow the exact wording of the documents

Clients bully the contractors into acceptance

Construction Manager, Design Manager and Project Director

354

29 Monthly meeting with contractor X 5-Apr

Contractors are accused of performing poor quality work

Clients abuse the contractors

Construction Manager, Design Manager and Project Director

30 Monthly meeting with contractor X 5-Apr

Contractors are accused of performing poor quality work

Clients abuse the contractors

Construction Manager, Design Manager and Project Director

31 Monthly meeting with contractor X 5-Apr Clients want contractors to do extra work

No resolution achieved

Construction Manager, Design Manager and Project Director

32 Monthly meeting with contractor Y 6-Apr

Clients follow the exact wording of the documents

No resolution achieved

Construction Manager, Design Manager and Project Director

33 Monthly meeting with contractor Y 6-Apr

Clients follow the exact wording of the documents

Clients bully the contractors into acceptance

Construction Manager, Design Manager and Project Director

34 Monthly meeting with contractor Y 6-Apr

Clients follow the exact wording of the documents

Clients abuse the contractors

Construction Manager, Design Manager and Project Director

35 Electrical and Mechanical issues review meeting with contractor Y 13-Apr

Clients follow the exact wording of the documents

No resolution achieved Design Manager

355

36 Electrical and Mechanical issues review meeting with contractor Y 13-Apr

Clients want contractors to do extra work

Clients bully the contractors into acceptance Design Manager

37 Electrical and Mechanical issues review meeting with contractor X 13-Apr

Clients want contractors to do extra work

Clients bully the contractors into acceptance Design Manager

38 Electrical and Mechanical issues review meeting with contractor X 13-Apr

Contractors are accused of performing poor quality work

Clients abuse the contractors Design Manager

39 Electrical and Mechanical issues review meeting with contractor X 13-Apr

Clients follow the exact wording of the documents

Clients bully the contractors into acceptance Design Manager

40 Electrical and Mechanical issues review meeting with contractor X 13-Apr

Contractors are accused of performing poor quality work

Clients abuse the contractors Design Manager

41 Electrical and Mechanical issues review meeting with contractor X 13-Apr

Contractors are accused of performing poor quality work

Clients abuse the contractors Design Manager

42 Electrical and Mechanical issues review meeting with contractor X 13-Apr

Clients want contractors to do extra work

Clients abuse the contractors Design Manager

43 Electrical and Mechanical issues review meeting with contractor X 13-Apr

Clients follow the exact wording of the documents

Clients abuse the contractors Design Manager

356

44 Electrical and Mechanical issues review meeting with contractor X 13-Apr

Contractors are accused of performing poor quality work

Clients abuse the contractors Design Manager

45 Electrical and Mechanical issues review meeting with contractor X 27-Apr

Clients want contractors to do extra work

Clients bully the contractors into acceptance Design Manager

46 Electrical and Mechanical issues review meeting with contractor X 27-Apr

Clients follow the exact wording of the documents

No resolution achieved Design Manager

357

Bibliography

1. Abeysekera, Vasantha. 2003. Understanding Culture in an International Construction Context. in Perspectives of Culture in Construction, CIB Publication 275, Pp 39-51.

2. Abzug, Rikki and Stephen J. Mezias. 1993. The Fragmented State and Due Process Protection in Organizations: The Case of Comparable Worth. Organization Science 4: 433-53.

3. Alexander, Victoria D. 1996. Pictures at an Exhibition: Conflicting Pressures in Museums and the Display of Art. American Journal of Sociology 101: 797-839.

4. Allinson, Christopher W and John Hayes. 1996. Transferring the Western mode of project organization to a bureaucratic culture: The case of Nepal. International Journal of Project Management 14, no. 1: 53-57.

5. Aoki, Masahiko. 2001. Toward a Comparative Institutional Analysis. Cambridge, MA: The MIT Press.

6. Appardurai, A. 1996. Modernity at large: cultural dimensions of globalisation. Minneapolis: University of Minnesota Press.

7. Armstrong, Elizabeth A. 2004. From Struggle to Settlement: The Crystallization of a Field of Lesbian/Gay Organizations in San Francisco. in Social Movements and Organization Theory. eds Gerald F. Doug McAdam W. Richard Scott Mayer N. Zald Davis, 161-88. New York: Cambridge University Press.

8. Arygris C. 1952. Diagnosing defences against the outsider. Journal of Sociological Issues 8, no. 3: 24-34.

9. Bakuli, Luvisia D. 1994. Pitfalls in Technology Transfer: Kenya's Construction Industry. World Development 22, no. 10: 1609-12.

10. Barley, Stephen R. 1990. Images of Imaging: Notes on Doing Longitudinal Field Work. Organization Science 1, no. 3: 220-246.

11. ———. 1986. Technology as an occasion for structuring: Evidence from observations of CT scanners and the social order of radiological departments. Administrative Science Quarterly 31: 78-108.

12. Barley, Stephen R., and Pamela S. Tolbert. 1997. Institutionalization and structuration: Studying the links between action and institution. Organization Studies , no. 18: 93-117.

358

359

13. Baron, James N. Frank R. Dobbin and P. Devereaux Jennings. 1986. War and Peace: The Evolution of Modern Personnel Administration in U.S. Industry. American Journal of Sociology 92: 350-83.

14. Baum, J. A. C., and C. Oliver. 1992. Institutional embededness and the dynamics of organizational populations. American Sociological Review , no. 57: 430-459.

15. Baum, Joel A. C. and Walter W. Powell. 1995. Cultivating and Institutional Ecology of Organizations: Comment of Hannan, Carroll, Dundon and Torres. American Sociological Review 60: 529-38.

16. Becker, Howard. 1963. Outsiders: Studies in the Sociology of Deviance. New York: Free Press.

17. Behrman, Jack N. 1975. The multinational enterprise and economic internationalism. World Development 3, no. 11-12: 845-56.

18. Benford, Robert D. and David A. Snow. 2000. Framing Processes and Social Movements: An Overview and Assesssment. Annual Review of Sociology 26: 611-39.

19. Berger, Peter L., and Thomas Luckmann. 1967. The Social Construction of Reality. New York: Doubleday Anchor.

20. Berk, Gerald. 1994. Alternative Tracks: The Construction of American Industrial Order, 1865-1917. Baltimore: Johns Hopkins University Press.

21. Biggart, Nicole Woolsey and Gary G. Hamilton. 1992. On the Limits of a Firm-Based Theory to Explain Business Networks: The Western Bias of Neoclassical Economics. in Networks and Organizations: Structure, Form, and Action. eds Nitin Nohria and Robert G. Eccles, 471-90. Boston: Harvard Business School Press.

22. Biggart, Nicole Woosley and Mauro F. Guillen. 1999. Developing Difference: Social Organization and the Rise of the Auto Industries of South Korea, Taiwan, Spain and Argentina. American Sociological Review 64: 722-47.

23. Biggs, Stephen and Grant Smith. 1998. Beyond methodologies: Coalition-building for participatory technology development. World Development 26 , no. 2: 239-48.

24. Blau, P. M. and Scott W. R. 1962. Formal Organizations: A Comparative Approach. San Francisco: Chandler.

25. Boyacigiller, N. 1990. The role of expatriates in the management of interdependence, complexity and risk in multinational corporations. Journal of International Business Studies 21, no. 3: 357-81.

360

26. Brautigam, Deborah. 1993. South-south technology transfer: The cae of China's Kpatawee rice project in Liberia. World Development 21, no. 12: 1989-2001.

27. Brint, Steven and Jerome Karabell. 1991. Institutional Origins and Transformations: The Case of American Community Colleges. in The New Institutionalism in Organizational Analysis. Eds W.W. Powell and Paul DiMaggio , 337-60. Chicago: University of Chicago Press.

28. Brown, David. 1967. The Mobile Professors. Washington D.C.: American Council on Education.

29. Buckley, P. J. and Casson M. C. 1996. An economic model of international joint venture strategy. Journal of International Business Studies 27, no. 5: 849-76.

30. Burton, R. M., and B. Obel. 1995. Strategic Organizational Diagnosis and Design. 3rd Edition ed. New York: Kluwer.

31. Campbell, John L. 2004. Where do we stand? Comon Mechanisms in Organizations and Social Movements Research. in Social Movements and Organization Theory. eds Gerald F. Doug McAdam W. Richard Scott and Mayer N. Zald Davis, 41-68. New York: Cambridge University Press.

32. Campbell, John L. and Leon N. Lindberg. 1991. The Evolution of Governance Regimes. in Governance of the American Economy. Eds J. Rogers Hollingsworth and Leon N. Lindberg John L. Campbell, 319-55. Cambridge: Cambridge University Press.

33. Campbell, John L. and Pederson Ove K. 1996. Legacies of Change: Transformation of Postcommunist European Economies. New York: Aldine De Gruyter.

34. Campbell, Lisa M. 2002. Conservation Narratives in Costa Rica: Conflict and Co-existence. Development and Change 33, no. 1: 29-56.

35. Carpano, C. Chrisman J. J. and Roth K. 1994. International strategy and environment: an assessment of the performance relationship. Journal of International Business Studies 25, no. 3: 639-56.

36. Chen, Ping and David Partington. 2004. An interpretive comparison of Chinese and Western conceptions of relationships in construction project management. International Journal of Project Management 22, no. 5: 397-406.

37. Clemens, Elisabeth S. 1996. Organizational Form as Frame: Collective Identity and Political Strategy in the American Labor Movement. in Comprative Perspectives on Social Movements: Opportunities, Mobilizing Structures

361

and Cultural Framings. Eds J. McCarthy and M. Zald D.McAdam, 205-26. Chicago: University of Chicago Press.

38. ———. 1997. The People's Lobby: Organizational Innovation and the Rise of Interest Group Politics in the United States, 1890-1925. Chicago: University of Chicago Press.

39. Clemens, Elisabeth S. and James M. Cook. 1999. Politics and Institutionalism: Explaining Durability and Change. Annual Review of Sociology 25: 441-66.

40. Coase, Ronald H. 1937. The Nature of the Firm. Economica N.S. 4: 385-405.

41. Cole, R. E. 1989. Strategies for Learning: Small Group Activities in American, Japanese, and Swedish Industry. Berkeley: Universoty of California Press.

42. Commons, John R. 1970. The Economics of Collective Action. Madison: University of Wisconsin Press.

43. Construction Industry Institute (CII). 1993. Zero injury techniques. Austin, Texas.

44. Contractor, F. J. Kundu S. K. and Hsu C. C. 2003. A three-stage theory of international expansion: the link between multinationality and performance in the service sector. Journal of International Business Studies 34, no. 1: 5-18.

45. Cooley, Charles Horton. [1902]1956. Social Organization. Glencoe, IL: Free Press.

46. Covalski, Mark A. and Mark W. Dirsmith. 1988. An Institutional Perspective on the Rise, Social Transformation and Fall of a University Budget Category. Administrative Science Quarterly 33: 562-87.

47. D'Aunno, Thomas Robert I. Sutton and Richard H. Price. 1991. Isomorphism and External Support in Conflicting Institutional Environments: A Study of Drug Abuse Treatment Units. Academy of Management Journal 14: 636-61.

48. Dacin, Tina M., and Jerry Goodstein and W. Richard Scott. 2002. Institutional Theory and Institutional Change: Introduction to the Special Research Forum. Academy of Management Journal 45: 45-57.

49. Daft, Richard and Karl E. Weick. 1984. Toward a Model of Organizations as Interpretation Systems. Academy of Management Review 9: 284-95.

50. Das, S. K. 2000. Public Office, Private Interest: Bureaucracy and Corruption in India. Delhi: Oxford University Press.

362

51. Davis, Gerald F. and Doug McAdam. 2000. Corporations, Classes, and Social Movements. in Research in Organizational Behavior. eds Barry Staw and Robert I. Sutton, 195-238. Oxford : Elsevier Science.

52. Davison, Sue C. and Karen Ward. 1999. Leading International Teams. McGraw-Hill.

53. Dean J.P. 1954. Participant Observation and Interviewing. An introduction to Social Research. Ed. J.T. Doby, 225-52. Harrisburg, PA: Stackpole.

54. Diallo, Amadou and Denis Thuillier. 2005. The success of international development projects, trust and communication: an African perspective. International Journal of Project Management 23, no. 3: 237-52.

55. DiMaggio, Paul. 1994. Culture and Economy. in Handbook of Economic Sociology. Eds N. J and R. Swedberg Smelser, 27-57. New York: Russell Sage.

56. ———. 1988. Interest and Agency in Institutional theory. in Institutional Patterns and Organizations: Culture and Environment. Editor L. G. Zucker, 3-21. Cambridge Mass: Ballinger.

57. DiMaggio, Paul J. 1991. Constructing an Organizational Field as a Professional Project: U.S. Art Museums, 1920-1940. in The New Institutinalism in Organizational Analysis. eds Walter W. Powell and Paul J. DiMaggio, 267-92. Chicago: University of Chicago Press.

58. DiMaggio, Paul J. 1997. Culture and Cognition: An Interdisciplinary Review. Annual Review of Sociology 23, no. 263-287.

59. DiMaggio, Paul J. 1998. The New Institutionalisms: Avenues of Collaboration. Journal of Institutional and Theoretical Economics : 696-97.

60. DiMaggio, Paul J., and Walter W. Powell. 1983. The iron cage revisited: Institutional isomorphism and collective rationality in organizational fields. American Sociological Review 48: 147-60.

61. Dinc, S. 1996. "Bank competition, Relationship Banking and Path Dependence." Stanford University.

62. ———. 2000. Bank reputation, bank commitment and the effects of the competition in credit markets. Review of Financial Studies 13, no. 781-812.

63. Djelic, Marie-Laure. 1998. Exporting the American Model: the post-war transformation of European Business. Oxford, England: Oxford University Press.

363

64. Djelic, Marie-Laure, and Sigred Quack, Editors. 2003. Globalization and Institutions: Redefining the Rules of the Economic Game. Cheltenham, UK: Edward Elgar.

65. Dobbin, Frank R. 1994b. Forging Industrial Policy: The United States, Britain, and France in the Railway Age. Cambridge, UK: Cambridge University Press.

66. Doz, Y. and Prahalad C. K. 1984. 'Patterns of strategic control within multinational corporations'. Journal of International Business Studies 15, no. 2: 55-72.

67. Doz, Yves and C. K. Prahalad. 1993. Managing DMNC's: A search for a new paradigm. in Organization Theory and the Multinational Corporation. Eds Sumantra and D. Eleanor Westney Ghoshal, 24-50. New York: St. Martins Press.

68. Durkheim, Emile . [1893]1949. Division of Labor in Society. Glencoe, IL: Free Press.

69. Earley, P. C. and E. Mosakowski. 2004c. Cultural Intelligence. Harvard Business Review 82, no. 10: 139-46.

70. ———. 2004a. Toward cultural intelligence: turning cultural difference into a workplace advantage. Academy of Management Executive 18, no. 3: 151-61.

71. Earley, P. C. and Peterson R. S. 2004b. Elusive Cultural Chameleon: Cultural Intelligence as a new approach to intercultural training for the global manager. Academy of Management Learning and Education 3: 100-115.

72. Ebrahim. Alnoor. 1999. "The Making of NGO's: Global Influences and Local Responses from Western India." Stanford University.

73. Eccles, Robert. 1981. The quasi-firm in the construction industry. Journal of Economic Behavior and Organization , no. 2: 335-57.

74. Edelman, Lauren B. 2003. Constructed Legalities: The Endogeneity of Law. in How Institutions Change. Eds W. Powell and D. JonesChicago: University of Chicago Press.

75. ———. 1992. Legal Ambiguity and Symbolic Structures: Organizational Mediation of Civil Rights Law. American Journal of Sociology 97: 1531-76, 1401-40.

76. ———. 1990. Legal Environments and Organizational Governance: The Expansion of Due Process in the American Workplace. American Journal of Sociology 95: 1401-40, 1531-76.

364

77. Edelman, Lauren B. Christopher Uggen and Howard S. Erlanger. 1999. The Endogeneity of Legal Regulation: Greivance Procedures as Rational Myth. American Journal of Sociology 105: 406-54.

78. Eisenhardt, Kathleen M. 1989. Building theories from case study research. Academy of Management Review , no. 14: 532-50.

79. Elsbach, Kimberly D. and Robert I. Sutton. 1992. Acquiring Organizational Legitimacy Through Illegitimate Actions: A Marriage of Institutional and Impression Management Theories. Academy of Management Journal 35: 699-738.

80. Engwall, Mats and Anna Jerbrant. 2003. The resource allocation syndrome: the prime challenge of multi-project management. International Journal of Project Management 21, no. 6: 403-9.

81. Enshassi, Adnan and Roger Burgess. 1990. Training for construction site managers involved with multicultural work teams. 8, no. 2: 95-101.

82. Eriksson, M. J. Lillieskold N. Jonsson and D. Novosel. 2002. How to manage complex, multinational R&D projects successfully. Engineering Management Journal 14, no. 2: 53-58.

83. Escobar, Arturo . 1995. Encountering Development: The Making and Unmaking of the Third World. Princeton, New Jersey: Princeton University Press.

84. Evans, Peter. 2004. Development as Institutional change: The pitfalls of monocropping and the potentials of deliberation. Studies in Comparative International Development 38, no. 4: 30-52.

85. Fisher, Julie. 1998. Nongovernments: NGO's and the Political Development of the 3rd World. West Hartford: Kumarian Press.

86. Fligstein, Neil . 1996b. Markets as Politics: A political cultural approach to market institutions. American Journal of Sociology 102: 1-33.

87. ———. 1991. The Structural Transformation of American Industry: An Institutional Account of the Causes of Diversification in the Largest Firms, 1919-1979. in The New Institutionalism in Organizational Analysis. Eds Walter W. Powell and Paul J. DiMaggio, 311-36. Chicago: University of Chicago Press.

88. ———. 1990. The Transformation of Corporate Control. Cambridge: Harvard University Press.

89. Foster-Carter, Aidan. 1976. From Rostow to Gunder Frank: Conflicting paradigms in the analysis of underdevelopment. World Development 4, no. 3: 167-80.

365

90. Fox, A. 1974. Beyond Contract: Work, Power and Trust Relations. London: Faber and Faber.

91. Friedland, Roger, and Robert Alford. 1991. Bringing society back in: Symbols, practices, and institutional contradictions. In The new insitutionalism in organizational analysis. Editor Woody Powell, and Paul Dimaggio, 205-32. Chicago: Chicago University Press.

92. Gamson, William A. 1975. The Strategy of Social Protest . Homewood, Il: Dorsey.

93. Gardner, B. B and Whyte W. F. 1946. Methods for the Study of Human Relations in Industry. American Sociological Review 11: 506-12.

94. Gates, S. R. and Egelhoff W. G. 1986. 'Centralization in headquarters-subsidiary relationships'. Journal of International Business Studies 11, no. 2: 71-92.

95. Geertz, Clifford. 1973. The Interpretation of Cultures. New York: Basic Books.

96. Gerhart, P and Drotning J. 1980. Dispute Settlement and the Intensity of Mediation. Industrial Relations 19: 352-59.

97. Ghoshal, Sumantra and D. Eleanor Westney Eds. 1993. Organization Theory and the Multinational Corporation. New York: St. Martins.

98. Giddens, Anthony. 1979. Central Problems in Social Theory: Action, Structure and Contradiction in Social Analysis. Berkeley, CA: University of California Press.

99. Glaser, Barney M. and Anselm L. Strauss. 1999. The Discovery of Grounded Theory: strategies for qualitative research. Hawthorne, NY: Aldine de Gruyter.

100. Glick, William H., George P. Huber, Chet C. Miller, Harold D. Doty, and Kathleen M. Sutcliffe. 1990. Studying Changes in Organizational Design and Effectiveness: Retrospective Event Histories and Periodic Assessments. Organization Science 1, no. 3: 293-312.

101. Golden-Biddle, Karen and Karen D Locke. 1997. Composing Qualitative Research. Thousand Oaks, CA: SAGE.

102. Gong, Yaping. 2003. Subsidiary staffing in multinational enterprises: agency, resources and performance. The Academy of Management Journal 46, no. 6: 728-39.

103. Goodrick, Elizabeth and Gerald E. Salancik. 1996. Organizational discretion in responding to institutional practices: Hospitals and Cesarean births. Administrative Science Quarterly 41: 1-28.

366

104. Granovetter, Mark S. 1970. "Changing Jobs: Channels of Mobility Information in a Suburban Community." Harvard University.

105. ———. 1973. The Strength of Weak Ties. American Journal of Sociology 78, no. 6: 1360-80.

106. Greif, A. 2005. Institutions: Theory and History. Cambridge University Press.

107. ———. 1989. Reputation and Coalitions in medieval trade: Evidence on the Maghribi traders. Journal of Economic History 49: 857-82.

108. Greif, Avner. 1994. Cultural Beliefs and the Organization of Society: A Historical and Theoretical Reflection on Collectivist and Individualist Societies. The Journal of Political Economy 102, no. 5: 912-50.

109. Hall, Peter, and David Soskice. 2001. Varieties of Capitalism. New York: Oxford University Press.

110. Halliday, Terence C. Michael J. Powell and Mark W. Gransfors. 1993. After Minimalism: Transformation of State Bar Associations From Market Dependance to State Reliance, 1918-1950. American Sociological Review 58: 515-35.

111. Hamilton, Gary and Nicole W. Biggart. 1988. Market, Culture and Authority: A comparative analysis of management and organization in the far east. American Journal of Sociology 94 , no. Supplement: S52-S94.

112. Hannan, Michael T. and John Freeman. 1989. Organizational Ecology. Cambridge, Mass: Belknap Press.

113. Haro, Guyo O. Godana J. Doyo and John G. McPeak. 2005. Linkages Between Community, Environmental, and Conflict Management: Experiences from Northern Kenya. World Development 33, no. 2: 285-99.

114. Harris, Hodges Schur and Shukla. 2003. “Infrastructure Projects,” Public Policy for the Private Sector Note No. 252.

115. Haveman, H and Rao H. 1997. Structuring a Theory of Moral Sentiments: Institutional and Organizational Co-Evolution in the Early California Thrift Industry. American Journal of Sociology 102: 1606-51.

116. Haveman, Heather A. and Hayagreeva Rao. Forthcoming. Hybrid Forms and Institution/Organization Co-Evolution in the Early California Thrift Industry. In How Institutions Change. Eds Walter W. Powell and Daniel L. JonesChicago: University of Chicago Press.

117. Heimer, Carol. 1999. Competing Institutiona: Law, Medicine and Family in Neonatal Intensive Care. Law and Society Review 33: 17-66.

367

118. Hennart, J. F. 1982. A Theory of Multinational Enterprise. Ann Arbor: University of Michigan Press.

119. Herrigel, G. 1994. Industry as a Form of Order: A Comparison of the Historical Development of Machine Tool Industries in the United States and Germany. in Governing Capitalist Economies. Eds P. C. Schmitter and W. Streeck J.R. Hollingsworth, 97-128. New York: Cambridge University Press.

120. Hill, S. 1981. Competition and Control at Work. Cambridge, MA: MIT Press.

121. Hinze, J. 1997. Moral ethical obligations an issue for safety design. 16,23. Washington D.C: NSPE.

122. ———. 1997. Safety roles expanding in design. 16. Washington D.C.: NSPE.

123. Ho, Peter. 2001. Greening Without Conflict? Environmentalism, NGOs and Civil Society in China. Development and Change 32, no. 5: 893-921.

124. Hoffman, A. J. 1999. Institutional evolution and change: Environmentalism and the U.S. chemical industry. Academy of Management Journal 42, no. 351-71.

125. Hoffman, Andrew W. 1997. From Heresy to Dogma: An Institutional History of Corporate Environmentalism. San Francisco: New Lexington Press.

126. Hofstede, Geert. 1991. Culture and Organizations: Software of the Mind. New York: McGraw-Hill.

127. Holmberg, J. ed. 1992. Making Development Sustainable: Redefining Institutions, Policy and Economics. Washington D.C.: Island Press.

128. Homans, G. C. 1949. The Strategy of Industrial Sociology. American Journal of Sociology 54: 330-337.

129. House, Robert J., Paul J. Hanges, Mansour Javidan, Peter W. Dorfman, and Vipin Gupta. 2004. Culture, Leadership and Organization: The GLOBE Study of 62 Societies. Thousand Oaks, CA: Sage.

130. Hughes, Everett C. 1939. Institutions. in An Outline of the Principles of Sociology. Ed Robert E. Park, 281-330. New York: Barnes & Noble.

131. Hult, Karen M. and Charles Walcott. 1990. Governing Public Organizations: Politics Structures, and Institutional Design. Pacific Grove, CA: Brooks/Cole.

132. Hyden, Goran and Bo Karlstrom. 1993. Structural adjustment as a policy process: The case of Tanzania. World Development 21, no. 9: 1395-404.

368

133. Hyman, R and Brough I. 1975. Social Values and Industrial Relations. Oxford: Blackwell.

134. ICE (Institution of Civil Engineers). 1988. Overseas projects – crucial problems. London: Thomas Telford.

135. Irwin et al (Eds). 1997. Dealing with Public Risk in Private Infrastructure.

136. Jackell, R. 1988. Moral Mazes. New York: Oxford University Press .

137. Johanson, J., and J. E. Vahlne. 1977. The interantionalization process of the firm: A model of knowledge development and increasing foreign market commitments. Journal of International Business Studies 8: 23-32.

138. Johanson, J and Vahlne J. E. 1990. The mechanism of internationalization. International Marketing Review 7, no. 4: 11-24.

139. Johnson, Craig and Timothy Forsyth. 2002. In the Eyes of the State: Negotiating a "Rights-Based Approach" to Forest Conservation in Thailand. World Development 30, no. 9: 1591-605.

140. Kaplan, Marilyn R. and J. Richard Harrison. 1993. Defusing the Director Liability Crisis: The Strategic Management of Legal Threats. Organization Science 4: 412-32.

141. Kaplinsky, Raphael. 1976. Accumulation and the transfer of technology: Issues of conflict and mechanisms for the exercise of control. World Development 4, no. 3: 197-224.

142. Kedia, B and Bhagat R. 1988. Cultural constraints on transfer of technology across nations: Implications for research in international and comparative management. Academy of Management Review 13: 559-71.

143. Kelleher, David Katherine McLaren and Ronald Bisson. 1996. Grabbing the Tiger by the Tail: NGO's learning for Organizational Change. Canada: Canadian Council for International Cooperation.

144. Kelly, Erin and Frank Dobbin. 1999. Civil Rights Law at Work: Sex Discrimination and the Rise of Maternity Leave Policies. American Journal of Sociology 105: 455-92.

145. Khagram, Sanjeev. 2004. Dams and Development: Transnational Struggles for Water and Power. Cornell University Press.

146. Kleinman, Dallas and Steven Vallas. 2001. Science, Capitalism and the rise of the 'Knowledge Worker': The Changing Structure of Knowledge Production in the US. Theory and Society 30: 451-92.

369

147. Kochan, T and Jick T. 1978. The Public Sector Mediation process. Journal of Conflict Resolution 22: 209-41.

148. Koehn, Enno, and Rupesh K. and Pan Chih-Shing Kothar. 1995. Safety in Developing Countries: Professional and Bureaucratic Problems. Journal of Construction Engineering and Management 121, no. 3: 261-65.

149. Kolb, Deborah M. 1983. The Mediators. Cambridge, Massachusetts: MIT Press.

150. Kolk, Ans. 1998. From conflict to cooperation: International policies to protect the Brazilian Amazon. World Development 26, no. 8: 1481-93.

151. Kopp, R. 1994. International human resource policies and practices in Japanese, European, and United States multinationals. Human Resource Management 33: 581-99.

152. Kressel, K. 1972. Labor Mediation: An Exploratory Survey . Albany, NY: Association of Labor Mediation Agencies.

153. Kroeber, Alfred. 1925. Handbook of the Indians of California. Washington: Smithsonian Institution. Bureau of American Ethnology.

154. Kruglianskas, I. and H. J. Thamhain. 2000. Managing technology-based projects in multinational environments. IEEE Transactions on Engineering Management 47, no. 1: 55-64.

155. Laufer, Alexander, and Gordon Denkar and Aaron Shenhar. 1996. Simultaneous management: The key to excellence in capital projects. International Journal of Project Management 14, no. 4: 189-99.

156. Laux, Jeanne Kirk and Maureen Appel Molot. 1978. Multinational corporations and economic nationalism: Conflict over resource development in Canada. World Development 6, no. 6: 837-49.

157. Leeuwis, Cees. 2000. Reconceptualizing Participation for Sustainable Rural Development: Towards a Negotiation Approach. Development and Change 31, no. 5.

158. Leonard-Barton, Dorothy. 1990. A Dual Methodology for Case Studies: Synergistic Use of a Longitudinal Single Site with Replicated Multiple Sites. Organization Science 1, no. 3: 248-66.

159. Levi-Strauss, Claude. 1958. Structural Anthropology . Allen Lane: The Penguin Press.

160. Lin Bou-Wen and Daniel Berg. 2001. Effects of Cultural Difference on Technology Transfer Projects: An empirical Study of Taiwanese Manufacturing companies. International Journal of Project Management

370

19, no. 5: 287-93.

161. Lipton, Michael and John Toye. 1990. Does AID work in India? A country study of the impact of official development assistance. London: Routledge.

162. Loosemore, M and H. S. Al Muslmani. 1999. Construction Project Management in the Persian Gulf: inter cultural communication. International Journal of Project Management 17, no. 2: 95-100.

163. Lorraine, R. K. 1992. Construction Management in Developing Countries. London: Thomas Telford.

164. Maekilouko, Marko. 2004. Coping with multicultural projects: The leadership styles of Finnish managers. International Journal of Project Management 22, no. 5: 387-96.

165. March, James G., and Simon Herbert A. 1958. Organizations. New York: Wiley.

166. March, James G. and Johan P. Olsen. 1976. Ambiguity and Choice in Organizations. Bergen: Universitetsforlaget.

167. ———. 1989. Rediscovering institutions: The organizational basis of politics. New York: Free Press.

168. Martin, Joanne . 1992. Cultures in Organizations: Three Perspectives. New York: Oxford University Press.

169. ———. 2002. Organizational Culture: Mapping the Terrain. Newbury Park, CA: Sage Publications .

170. Martinez, J. I. and Jarillo J. C. 1991. Co-ordination demands of international strategies. Journal of International Business Studies 22, no. 3: 429-44.

171. ———. 1989. The evolution of research on coordination mechanisms in multinational research. Journal of International Business Studies 20, no. 3: 489-514.

172. Marx, Karl. [1844]1972. Economic and Philosophic Manuscripts of 1944: Selections. in The Marx-Engels Reader. Ed Robert C. Tucker, 52-106. New York: Norton.

173. McAdam, Doug. 1996. Conceptual Origins, Current Problems, Future Directions . in Comparative Perspectives on Social Movements: Political Opportunities, Mobilizing Structures, and Cultural Framings. Eds John D. McCarthy and Mayer N. Zald Doug McAdam, 23-40. Cambridge: Cambridge University Press.

174. ———. 1994. Culture and Social Movements. in New Social Movemements. Eds

371

Hank Johnston and Joseph R. Gusfield Enrique LaranaPhiladelphia: Temple University press.

175. McAdam, Doug and W. Richard Scott. 2005. Organizations and Movements. in Social Movements and Organization Theory. eds Gerald F. Doug McAdam W. Richard Scott and Mayer N. Zald Davis, 4-40. New York: Cambridge University Press.

176. McAdam, Doug Sidney Tarrow and Charles Tilly. 2001. Dynamics of Contention. New York: Cambridge University Press.

177. McCarthy, John D. 1986. Prolife and Prochoice Movement Mobilization: Infrastructure Deficits and New Technologies. in Social Movements and Resource Mobilization in Organizational Society. eds Mayer N. Zald and John D. McCarthyNew Brunswick, NJ: Transaction Books.

178. McNichol, Jason and Jabril Bensedrine. 2003. Multilateral Rulemaking – Transatlantic struggles around genetically modified food. in Globalization and Institutions. eds Marie-Laure Djelic and Sigrid Quack, 220-44. Cheltenham: Edward Elgar.

179. McPhee, Robert D. 1990. Alternate Approach to Integrating Longitudinal Case Studies. Organization Science 1, no. 4: 393-405.

180. Merton, Robert K. 1936. The Unanticipated Consequences of Purposive Social Action. American Sociological Review 1: 894-904.

181. Meyer, John W. 1994. Rationalized Environments. in Institutional Environments and Organizations: Structural Complexity and Individualism. eds W.Richard Scott and John W. Meyer, 28-54. Thousand Oaks, CA: Sage.

182. Meyer, John W. , and Brian Rowan. 1977. Institutionalized organizations: Formal structure as myth and ceremony. American Journal of Sociology 83: 340-363.

183. Meyer, John W. John Boli and George M. Thomas. 1987. Ontology and Rationalization in the Western Cultural Account . in Institutional Structure: Constituting State, Society and the Individual. eds John W. Meyer John Boli and Francisco O. Ramirez George M. Thomas, 12-37. Newbury Park, CA: Sage .

184. Mezias, Stephen J. 1990. An Institutional Model of Organizational Practice: Financial Reporting at the Fortune 200. Administrative Science Quarterly 35: 431-57.

185. Miles, Robert H. 1982. Coffin Nails and Corporate Strategy. Englewood Cliffs, NJ: Prentice Hall.

372

186. Milgrom, Paul, and Douglass North and Barry Weingast. 1990. The role of institutions in the revival of trade: The law merchant, private judges, and the champagne fairs. Economics and Politics 2: 1-23.

187. Miller, Jon. 1994. The Social Control of Religious Zeal: A Study of Organizational Contradictions. New Brunswick, NJ: Rutgers University Press.

188. Misra, B. B. 1986. Government and Bureaucracy in India, 1947-76. Delhi: Oxford University Press.

189. Morley, Samuel A. 1975. What to do about Foreign Direct Investment? A Host-Country Perspective. Studies in Comparative International Development 10, no. 1: 45-66.

190. Morrill, Calvin. 2003. Institutional Change and Interstitial Emergence: The Growth of Alternative Dispute Resolution in American Law, 1965-1995. in How Institutions Change. Eds W.Powell and D. JonesChicago: University of Chicago Press.

191. Morvaridi, Behrooz. 2004. Resettlement, Rights to Development and the Ilisu Dam, Turkey. Development and Change 35, no. 4: 719-41.

192. Nair, Jeevan and U. C. Jain. 2000. The Indian bureaucratic system. Jaipur, India: Pointer Publishers.

193. Nelson, R. 1994. The co-evolution of technology, industrial structure, and supporting institutions. Industrial and Corporate Change 3: 47-63.

194. Nelson, Richard R and Sidney G. Winter. 1982. An Evolutionary Theory of Economic Change. Cambridge Mass: Belknap Press.

195. North, Douglass. 1990. Institutions, Institutional Change, and Economic Performance. Cambridge: Cambridge University Press.

196. North, Douglass C. 1995. Five propositions about institutional change. in J. Knight and I. Sened, 15-26.

197. North, Douglass C., and Robert P. Thomas. 1973. The Rise of the Western World. Cambridge: Cambridge University Press.

198. Oliver, Christine. 1991. Strategic Respones to Institutional Processes. Academy of Management Review 16: 145-79.

199. Orren, Karen and Stephen Skowronek. 1999. Beyond the Iconography of Order: Notes for a 'New Institutionalism'. The Dynamics of American Politics. Eds Lawrence Dodd and Calvin Jillson, 311-30. San Francisco: Westview Press.

373

200. Orru, Marco, and Nicole Woolsey Biggart and Gary G. Hamilton. 1997. The Economic Organization of East Asian Capitalism. Thousand Oaks, CA: Sage.

201. Paterson, S. L. and Brock D. M. 2002. The development of subsidiary-management research: review and theoretical analysis. International Business Review 11, no. 2: 139-63.

202. Perkins, John. 2004. Confessions of an Economic Hit Man. San Francisco, CA: Berrett Koehler Publishers, Inc.

203. Peterson, R. B., N. Napier, and W. S. Shim. 2000. Expatriate management: Comparison of MNCs across four parent countries. Thunderbird International Business Review 42: 145-66.

204. Pettigrew, Andrew M. 1990. Longitudinal Field Research on Change: Theory and Practice. Organization Science 1, no. 3: 267-92.

205. Pfeffer, Jeffrey. 1992. Managing with Power: Politics and Influence in Organizations. Boston: Harvard Business School Press.

206. ———. 1981. Power in Organizations. Marshfield, MA: Pitman.

207. Pfeffer, Jeffrey and Gerald Salancik. 1978. The External Control of Organizations. New York: Harper and Row.

208. Phillips, Nelson, and Thomas B and Hardy Cynthia Lawrence. 2000. Inter-Organizational Collaboration and the Dynamics of Institutional Fields. Journal of Management Studies 37, no. 1: 23-43.

209. Pierson, Paul. 2004. Politics in Time: History, Institutions and Social Analysis. Princeton: Princeton University Press.

210. Powell, W. W. and DiMaggio P. 1991. The new institutionalism in organizational analysis. Chicago, IL : University of Chicago Press.

211. Ramaprasad, Arkalgud and A. N. Prakash. 2003. Emergent project management: How foreign managers can leverage local knowledge. International Journal of Project Management 20, no. 7: 497-505.

212. Rao, Hayagreeva. 1998. Caveat Emptor: The Construction of Nonprofit Consumer Watchdog Associations. American Journal of Sociology 103, no. 4: 912-61.

213. Rao, Hayagreeva Calvin Morrill and Mayer N. Zald. 2000. Power Plays: How Social Movements and Collective action Create New Organizational Forms. Research in Organization Behavior 22: 239-82.

374

214. Reina, Peter and Tulacz Gary J. 1996. The Top 225 International Contractors. 36-39. Hightstown, New Jersey: McGraw Hill.

215. ———. 2002. The Top 225 International Contractors. 26-35. Hightstown, New Jersey: McGraw Hill .

216. ———. 2004. The Top 225 International Contractors. 34-40. Hightstown, New Jersey : McGraw Hill.

217. ———. 2003. The Top 225 International Contractors: Avoiding Volatile Markets. 28-34. Hightstown, New Jersey: McGraw Hill.

218. Ricart, Enric Joan, Michael J. Enright, Pankaj Ghemawat, Stuart L. Hart, and Tarun Khanna. 2004. New frontiers in international strategy. Journal of International Business Studies 35, no. 3: 175-200.

219. Richards, Donald P. 1999. Engineering Overseas. Journal of Management in Engineering 15, no. 1: 24-29.

220. Richardson, S. A. 1953. A framework for reporting field relations experiences. Human Organization 12, no. 3: 31-37.

221. Roland, Gerard . 2004. Understanding Institutional Change: Fast-Moving and Slow-Moving Institutions. Studies in Comparative International Development 38, no. 4: 109-31.

222. Root, F. R. 1987. Entry Strategies for International Markets. Lexington, MA: Lexington Books.

223. Ruigrok, W. and Wagner H. 2003. Internationalization and performance: An organizational learning perspective. Management International Review 43 , no. 1: 63-84.

224. Sanders, Elizabeth. 1986. Industrial Concentration, Sectional Competition and Anti-Trust Politics in America, 1880-1980. Studies in American Political Development 1: 142-214.

225. Sanyal, Bishwapriya. 1991. Antagonistic cooperation: A case study of nongovernmental organizations, government and donor's relationships in income-generating projects in Bangladesh. World Development 19, no. 10: 1367-79.

226. Sanyal, Bishwapriya and Vinit Mukhija. 2001. Institutional Pluralism and Housing Delivery: A Case of Unforeseen Conflicts in Mumbai, India . World Development 29, no. 12: 2043-57.

227. Schein, Edgar H. 1985. Organizational Culture and Leadership. San Francisco: Jossey-Bass.

375

228. Schmitter, Philippe. 1992. Sectors in Moderin Capitalism: Models of Governance and Variations in Performance. in Labour Relations and Economic Performance. eds Renato Brunetta and Carlo Dell'Aringa, 3-39. Houndmills, UK: Macmillan.

229. Schneiberg , M and Bartley T. 2001. Regulating American Industries: Markets, Politics, and the Institutional Determinants of Fire Insurance Regulation. American Journal of Sociology 107: 101-46.

230. Schneiberg, Marc. 2002. Organizational Heterogeneity and the Production of New Forms: Politics, Social Movements and Mutual Companies in American Fire Insurance, 1900-1930. Research in the Sociology of Organizations 19: 39-89.

231. ———. 1999. Political and Institutional Conditions for Governance by Association: Private Order and Price Controls in American Fire Insurance. Politics and Society 27: 67-103.

232. Schneiberg, Marc and Sarah A. Soule. 2004. Institutionalization as a Contested Multilevel Process: The Case of Rate Regulation in American Fire Insurance. in Social Movements and Organization Theory. eds Gerald F. Doug McAdam W. Richard Scott and Mayer N. Zald Davis, 122-60. New York: Cambridge University Press.

233. Scott, W. Richard. 1965. Field Methods in the Study of Organizations. Handbook of Organizations. James G. MarchChicago: Rand McNally and Co.

234. Scott, W. Richard. 2003. Institutional carriers: reviewing modes of transporting ideas over time and space and considering their consequences. Industrial and Corporate Change 12, no. 4: 879-94.

235. Scott, W. Richard. 2001. Institutions and Organizations. Thousand Oaks, CA: Sage.

236. ———. 1998. Organizations: Rational, Natural and Open Systems. Englewood Cliffs, NJ: Prentice Hall.

237. ———. 1966. Professionals in Bureaucracies – Areas of Conflict. Professionalization.Englewood Cliffs, New Jersey: Prentice Hall Inc.

238. Scott, W. Richard., M Ruef, P. J. Mendel, and C. A. Caronna. 2000. Institutional Change and Healthcare Organizations: From Professional Dominance to Managed Care. Chicago: University of Chicago Press.

239. Selznick, Philip. 1996. Institutionalism ‘Old’ and ‘New.’ . Administrative Science Quarterly 41: 270-77.

240. ———. 1957. Leadership in Administration. New York: Harper and Row.

376

241. ———. 1949. TVA and the Grass Roots. Berkeley: University of California Press.

242. Sewell, William H. Jr. 1992. A Theory of Structure: Duality, Agency and Transformation. American Journal of Sociology 41: 270-77.

243. Shadlen, Kenneth C. 2004. Patents and Pills, Power and Procedure: The North-South Politics of Public Health in the WTO. Studies in Comparative International Development 39, no. 3: 76-108.

244. Sharp, Robin. 1992. Organizing for Change: People-Power and the Role of Institutions. in Making Development Sustainable: Redifining Insitutions, Policy and Economics. ed J. HolmbergWashington D.C.: Island Press.

245. Shore, Barry and Benjamin J. Cross. 2005. Exploring the role of national culture in the management of large scale international science projects. International Journal of Project Management 23, no. 1: 55-64.

246. Simkin, William. 1971. Mediation and the Dynamics of Collective Bargaining. Washington DC: Bureau of National Affairs.

247. Simon, Herbert A. 1945. Administrative Behavior: A Study of Decision-Making Processes in Administrative Organization. New York: Free Press.

248. Sine, Wesley D. and Robert David. 2003. Environmental Jobs, Institutional Change and the Creation of Entrepreneurial Opportunity in the US Electrical Utility Industry. Research Policy 32: 185-207.

249. Singh, Jitendra V. David Tucker and Robert J. House. 1986. Organizational Legitimacy and the Liability of Newness. Administrative Science Quarterly 31: 171-93.

250. Snow, David A. and Robert D. Benford. 1992. Master Frames and Cycles of Protest. in Frontiers in Social Movement Theory. eds Aldon Morris and Carol McClurg Muller, 133-55. New Haven: Yale University Press.

251. Snow, David A. E. Burke Rochfold Jr. Steven K. Worder and Robert D. Benford. 1986. Frame Alignment Processes, Micromobilization, and Movement Participation. American Sociological Review 51: 464-81.

252. Spradley, James R. 1979. The Ethnographic Interview. USA: Harcourt Brace Jovanovich College Publishers.

253. Stablein, Ralph. 1996. Data in Organization Studies . Handbook of Organization Studies. Eds Stewart R. Clegg, and Cynthia and Nord Walter R. Hardy, 509-25. London : SAGE Publications.

254. Stark, David. 1996. Recombinant Property in East European Capitalism.

377

American Journal of Sociology 101: 993-1027.

255. Stinchcombe, Arthur, and Carol Heimer. 1985. Organizational Theory and Project Management. Oslo: Norwegian University Press.

256. Stinchcombe, Arthur L. 1959. Bureaucratic and Craft Administration of Production: A Comparative Study. Administrative Science Quarterly 4: 168-87.

257. Stinchcombe, Arthur L. 1968. Constructing Social Theories. Chicago: University of Chicago Press.

258. ———. 1997. On the virtues of the Old Institutionalism. Annual Review of Sociology 23: 1-18.

259. ———. 1965. Social Structure and Organizations. in Handbook of Organizations. Editor James G. March, 142-93. Chicago: Rand McNally.

260. Strang, David and Dong-Il Jung. 2004. Organizational Change as an Orchestrated Social Movement: Recruitment to a Corporate Quality Initiative. in Social Movements and Organization Theory. eds Gerald F. Doug McAdam W. Richard Scott and Mayer N. Zald Davis, 280-309. New York: Cambridge University Press.

261. Strauss, Anselm and Juliet Corbin. 1998. Basics of Qualitative Research. 2nd Edition ed. Thousand Oaks, CA: Sage.

262. Streeten, Paul . 1987. Structural adjustment: A survey of the issues and options. World Development 15, no. 12: 1469-82.

263. Strohmeier, S. 1992. Development of interpersonal skills for senior project managers. International Journal of Project Management 10, no. 1: 45-48.

264. Stryker, Robin . 2000. Legitimacy Processes as Institutional Politics: Implications for Theory and Research in the Sociology of Organizations. in Research in the Sociology of Organizations. Eds S. Bacharach and E. Lawler, 179-223. Vol. 17. Greenwich, CT: JAI Press.

265. Suchman, M. C. and M. L. Cahill. 1996. The hired-gun as facilator: the case of lawyers in Silicon Valley. Law and Social Enquiry 21: 837-74.

266. Suchman, Mark C. 1995a. Localism and Globalism in Institutional Analysis: The Emergence of Contractual Norms in Venture Finance. in The Institutional Construction of Organizations: International and Longitudinal Studies . eds W. Richard Scott and Soren Christensen, 39-63. Thousand Oaks, CA: Sage.

267. ———. 1995b. Managing Legitimacy: Strategic and Institutional Approaches.

378

Academy of Management Review 20: 571-610.

268. Sui, Low and Christopher H. Y. 2000. Cross-cultural project management for international construction in China. International Journal of Project Management 18, no. 5: 307-16.

269. Sutton, J., F. Dobbin, J. W. Meyer, and W. R. Scott. 1994. Legalization of the work place. American Journal of Sociology 99: 944-71.

270. Sutton, John R. and Frank Dobbin. 1996. The Two Faces of Governance: Responses to Legal Uncertainty in US Firms, 1955-85. American Sociological Review 61: 794-811.

271. Swierczek, William. 1994. Culture and conflict in joint ventures in Asia. International Journal of Project Management 12, no. 1: 39-47.

272. Taylor, Serge. 1984. Making Bureaucracies Think: The Environment Impact Statement Strategy of Administrative Reform. Stanford, CA: Stanford University Press.

273. Thornton, Patricia H. 2002. The Rise of the Corporation in a Craft Industry: Conflict and Conformity in Institutional Logics. Academy of Management Journal 45: 81-101.

274. Thornton, Patricia H and William Ocasio. 1999. Institutional Logics and the Historical Contingency of Power in Organizations: Executive Succession in the Higher Education Publishing Industry, 1958-1990. American Journal of Sociology 105: 801-43.

275. Tolbert, Pamela S. and Lynne G. Zucker. 1983. Institutional Sources of Change in the Formal Structure of Organizations: The Diffusion of Civil Service Reform, 1880-1935. Administrative Science Quarterly 30: 22-39.

276. Townley, Barbara. 2002. The role of competing rationalities in Institutional Change. Academy of Management Review 45: 163-79.

277. Triandis, H. C. 1994. Cross-cultural industrial and organizational psychology. in Handbook of industrial and organizational psychology. 2nd ed., Eds M. D. Dunnette and L. M. Hough H.C. Triandis, 103-72. Vol. 4. Palo Alto, CA: Consulting Psychologists Press.

278. Trompenaars, Fons, and Charles Hampden-Turner. 1998. Riding the waves of culture. 2nd Ed. ed. New York: McGraw-Hill.

279. Tung, R. L. 1987. Expatriate assignments: Enhancing success and minimizing failure. Academy of Management Executive : 117-26.

280. Tung R.L. 1982. Selection and training procedures of U.S., European, and

379

Japanese multinational firms. California Management Review 25, no. 1: 57-71.

281. Tversky, A and Kahneman D. 1986. Rational Choice and the Framing of Decisions. Journal of Business 59, no. 4: 5251-78.

282. Tylor, Edward Burnett Sir. 1861. Anahuac: or, Mexico and the Mexicans, Ancient and Modern. London: Longman and Roberts.

283. Van de Ven, Andrew H. and Huber George P. 1990. Longitudinal Field Research Methods For Studying Processes of Organizational Change. Organization Science 1, no. 3: 213-19.

284. Van de Ven, Andrew H. and Raghu Garud. 1994. The Coevolution of Technical and Institutional Events in the Development of an Innovation. in Evolutionary Dynamics of Organizations. eds Joel A.C. Baum and Jitendra Singh, 425-43. New York: Oxford University Press.

285. Van Maanen, J. 1988. Tales of the field: On writing ethnography. Chicago: University of Chicago Press.

286. Van Maanen, John, and Stephen Barley. 1984. Occupational Communities: Culture and Control in Organizations. Research in Organizational Behavior 6: 287-365.

287. Vaughn, Diane. 1996. The Challenger Launch Decision: Risky Technology, Culture and Deviance at NASA. Chicago: University of Chicago Press.

288. Veblen, Thorstein B. 1909. The Limitations of Marginal Utility. Journal of Political Economy 17: 235-45.

289. Veblen, Thorstein B. 1919. The Place of Science in Modern Civilization and Other Essays. New York: Huebsch.

290. Warhurst, Alyson. 1991. Technology Transfer and the Development of China's Offshore Oil Industry. World Development 19, no. 8: 1055-73.

291. Weber, Max. [1924]1968. Economy and Society: An Interpretive Sociology. New York: Bedminister Press.

292. Weick, Karl E. 1995. Sensemaking in Organizations. Thousand Oaks, CA: Sage.

293. Wells, Louis. T. and Gleason. 1995. Is Foreign Infrastructure Investment still Risky? Harvard Business Review .

294. Westphal, James D. and Edward J. Zajac. 1994. Substance and Symbolism in CEO's Long-term Incentive Plans. Administrative Science Quarterly 39: 367-90.

380

295. ———. 1998. The Symbolic Management of Stockholders: Corporate Governance Reforms and Shareholder Reactions. Administrative Science Quarterly 43: 127-53.

296. 1992a. European Business Systems: Firms and Markets in their National Contexts. Ed. Richard WhitleyLondon: Sage.

297. Wholey, Douglas R. and Susan M. Sanchez. 1991. The Effects of Regulatory Tools on Organizational Populations. Academy of Management Review 16: 743-67.

298. Williamson, Oliver E. 1991. Comparative Economic Organization: The Analysis of Discrete Structural Alternatives. Administrative Science Quarterly 36: 269-96.

299. ———. 1985. The Economic Institutions of Capitalism. New York: Free Press.

300. ———. 1975. Markets and Hierarchies: Analysis and Antitrust Implications. New York: Free Press.

301. Wilson, Joe M. Jr and Koehn Enno Ed. 2000. Safety Management: Problems Encountered and Recommended Solutions. Journal of Construction Engineering and Management 126, no. 1: 77-79.

302. Wuthnow, Robert. 1987. Meaning and Moral Order: Explorations in Cultural Analysis. Berkeley: University of California Press.

303. Yan, Aimin, and Barbara Gray. 1994. Bargaining Power, Management Control, and Performance in United States-China Joint Ventures: A comparative case study. Academy of Management Journal 37, no. 6: 1478-517.

304. Yin, Robert. 1984. Case Study Research: Design and Methods. New York: Sage.

305. Zald, Mayer N. and John D. McCarthy. 1987. Social Movement Industries: Competition and Conflict among SMO's. in Social Movements in an Organizational Society: Collected Essays. eds Mayer N. Zald and John D. McCarthy, 161-80. New Brunswick, NJ: Transaction Publishers.

306. Zald, Mayer N. and Michael A. Berger. 1978. Social Movements in Organizations: Coup d'Etat, Insurgency and Mass Movements. American Journal of Sociology 83: 823-61.

307. Zucker, Lynne G. 1983. Organizations as Institutions. in Organizations as Institutions. ed S.B. Bacharach, 1-42. Greenwich, Conn.: JAI Press.

308. ———. 1977. The Role of Institutionalization in Cultural Persistance. American Sociological Review 42: 726-43.

381

309. Zuckerman, E. 1999. The categorical imperative: security analysts and the illegitimacy discount. American Journal of Sociology 104: 1398-438.

310. Zysman, John. 1994. How Institutions Create Historically Rooted Trajectories of Growth. Industrial and Corporate Change 3: 243-83.