January 2012 Kaibo Group e-newsletter. Kaibo Group is a Chinese based international construction management firm.

1. 1
X W ELCOME TO KAIBO
Issue 1 Volume 1 2012
GROUP .......................... 1
X KAIBO CURRENT NEWS 1-1
X INDUSTY NEWS .......... 2-4
Kaibo
Group
Kaibo Group is an international project management
(EPCM/PMC) company. Where we provide project man-
agement and consulting services to owners and Chinese
construction enterprises.
2011 in focus for
Kaibo Group
2011 was a another successful the event as he focused on the
year for Kaibo Group where we cooperation model between
undertook engineering project contractors and engineering
management and consulting consulting firms.
works on projects in Australia, In 2011 we started an initiative
Africa, Europe and Asia at a in sponsoring disadvantaged
total value of over 4 Billion children in China and abroad
USD. These projects received a where we aim to provide a better
high degree of recognition from future through education. This
all people involved from Gov- initiative is one of several Cor-
ernment departments to the porate Social Responsibility
owners involved. projects we actively pursue for a
During the course of the year better future for people not only
CEO Mr. Sun delivered key in China but throughout the
speeches at various conferences world.
and events with one in particular All at Kaibo Group look for-
at 4th China International Con- ward to another challenging year
tractors Association (CHINCA) in 2012 and look forward to
which was widely heralded at working together with you.
Current Projects
Nigeria—We are the management contractor on a $162millionUSD railway contract where we are providing
a full range of EPC Project Management services.
Sudan—Providing project management services for a $500USD irrigation project where we oversaw the
whole project process including tendering, contract negotiation, assisting contractors and maintaining effec-
tive communication with the owner.
Mongolia— Project managing a housing development contract.
1

2. 2
Q UICK
N EWS
The Growing Influence of Chinese
Construction
“CHINESE CONSTRUCTION FIRMS
FACE SEVERAL PROBLEMS WHEN
EXPANDING OVERSEAS, INCLUDING
LACK OF RISK MANAGEMENT AND
POOR CONTRACT MANAGEMENT,
฀฀CNPC signed a deal in
THE PROFESSOR SAID. ONE EXAM-
Afghanistan to win the
PLE IS THE LIGHT-RAIL PROJECT IN country first ever Oil
THE MUSLIM HOLY CITY OF MECCA bid.
WHERE CHINA RAILWAY CON- ฀฀Qingdao Kingking
STRUCTION CORPORATION
Group to invest $100
million to develop
BOOKED A 1.39 BILLION YUAN
mines in Africa.
(HK$1.66 BILLION) LOSS. “
฀฀Pan-China Construc-
tion win contract in
Despite concerns about the US$1.81 billion in 2002 to are highly competitive, as no South Sudan to design
quality of their work, Chinese US$19.75 billion in 2008. other country has more than a and construct new
construction companies are Despite the tremendous in- 12 per cent share, said IDE- capital.
winning more valuable interna- crease in contracts, there have Jetro. However, Chinese firms ฀฀CCEC signed $1.2bil-
tional contracts to build every- been examples of poor-quality account for only three per cent
lion for railways in
thing from roads to railways. work or safety issues in certain of the equipment supply mar-
overseas projects by Chinese ket in Africa and are almost Ethiopia.
Richard di Bona, who runs a
Hong Kong transport consul- construction firms in Qatar, non-existent in construction
Ghana, Poland and Saudi Ara- consultancy in Africa.
tancy, said China had signifi-
bia, said an international engi- Chinese construction firms
cantly expanded its assistance neering executive. face several problems when
to developing countries, pre- Chinese construction firms expanding overseas, including
senting Chinese firms with an have been able to win overseas lack of risk management and
inside track into many projects. contracts because they offer
lower prices that come with
poor contract management, the
professor said. One example is
U PCOMING
Although the value of interna-
tional contracts won by Chi-
financial support from Chinese
state banks - such as China
the light-rail project in the
Muslim holy city of Mecca
E VENTS
nese firms dropped 6.5 per cent Exim Bank - which offer loans where China Railway Con-
year-on-year to US$82 billion on generous terms, said the struction Corporation booked a
in the first nine months of international engineering ex- 1.39 billion Yuan (HK$1.66
2010, the value of international ecutive. billion) loss.
contracts won by Chinese Chinese construction firms are "The Chinese companies real-
firms in 2009 was 10 times highly competitive in Africa's ize they cannot indefinitely
civil works sector but not in expand overseas on the basis of
more than 2000, according to
equipment supply or construc- cheap work and cheap financ-
the China International Con- tion consultancy, said the Insti- ing alone," said the executive.
tractors Association. By the tute of Developing Economies
end of September 2010, the of the Japan External Trade
cumulative total of interna- Organization (IDE-Jetro). le fromro
This article is from
tional contracts won by Chi- From 2004 to 2006, Chinese scmp.com. Written by
mp.com.
mp.com Written
itte
www.scmp.com. Written by
firms accounted for 31 per cent n Shih
Shi
Toh Han Shih
nese firms was US$642 billion,
of civil works contracts in 3rd IIICF—24—25 of May.
according to the association. Africa awarded by the World
In Africa, the value of Chinese Bank and African Develop-
construction projects jumped SCET—May
ment Bank. Such a percentage
more than tenfold from indicates Chinese companies
2

3. 1
W ORKING
WITH K AIBO
G ROUP
PANAMA
CONTRACT
The China Communication Con- The Chinese company partnered , London-based ARUP at US$8.5
struction Company has won a with a U.S.-based engineering and a second U.S. firm, Ty Lin
contract from the Panama Canal consultancy, Louis Berger Group, International at US$9.6 million. We Endeavour to work
Authority to design a third bridge The Panama Canal Authority
headquartered in Morristown, with all stages of the con-
spanning the Panama Canal. estimates the new bridge will
New Jersey. struction project providing
The CCCC submitted the lowest double cross-canal traffic capac-
The five competitors were Pa- world class management,
bid for the project at US$4.66 nama’s TYPSA Principia with a ity when it is completed in 2014, consulting services, and
million, securing the contract bid of USUS$4.9 million, Puente scheduled to coincide with the project management.
over five competitors, according de Colon at US$7.2, U.S.-based completion of the canal expan- We also provide training
to Xinhua. URS Holdings at US$6.1 million, sion. sessions to help your com-
pany achieve the best re-
sults in dealing with Chi-
nese enterprises
C ONTACT
K AIBO
G ROUP
SINGAPORE
CONTRACT
China Railway 11 Bureau has elevated MRT viaducts. The Tuas West Extension is an
won the last two civil con- other is for the construction of extension of the East-West
tracts of Singapore’s Tuas the elevated Tuas Crescent Line from Joo Koon station,
West Extension mass rapid station and approximately consisting of a 7.5km twin- Address: B1502, Vantone
transit (MRT) project. The 2.4km of MRT viaduct, which tracked MRT viaduct, four Center, Chaoyang District,
contracts have a combined will be integrated with part of above-ground stations and a Beijing (100020)
value of US$390 million. a 4.8km of road viaduct. depot.
Tel: (+86)10-59073235
One involves the construction When completed, the road Construction will start in
Email: info@kaibogroup.com
of elevated stations at Tuas viaduct will provide motorists January 2012 and is targeted
Web: www.kaibogroup.com
West and Tuas Link stations an alternative to the busy Pio- to complete in 2016.
and approximately 2.2km of neer Road.
1

4. 4
Is project management a standard
or cultural process?
Does the emergence of an international stan- veloping and maintaining it. This gives him/ PMO fearlessly reporting schedule slippage or
dard, and the internationalization of other her a competitive advantage as well as the cost overruns at a meeting almost untenable.
standards including the dozen or more transla- ability to avoid conflict, both of which are The information needs to be subtly conveyed
tions of the PMBOK* Guide mean project beneficial to the outcome of the project.” and the actions agreed before the meeting to
management is a standard process across all But this is not just an East/West issue; we maintain the integrity of the group. Depending
cultures and societies, or do we need cultural experienced two very different approaches to on your viewpoint, nemawashi can be thought
versions of the PMBOK Guide similar to the safety management during a major project of as ‘dealing under the table’ western or as a
current industry extensions? review in Pakistan. The hierarchal and proce- type of smoothing ‘finding the root of the
I ask this question as the ISO committee final- dural culture of the Indian sub-continent was problem and using some Delphi technique to
izes the draft of ISO 21500, A Guide to Pro- quite different to the ‘team/group’ culture of circulate around the stakeholders to build
ject Management. The PMBOK Guide is pro- the Chinese engineering company building the consensus’ eastern. There is no right or wrong
duced in 12 official and several unofficial project. In this ‘culture clash’ the Pakistani in culture: the Chinese ran an incredibly suc-
translations but language is only one dimen- engineers were focused on documented safety cessful Olympics, Japanese industry domi-
sion of culture. To effectively manage pro- nates in many areas, and South Korea has a
jects within a specific culture do the long history of successful project delivery.
PMBOK’s processes need adaptation? The key question is how much additional
The original trigger for this column was the value could a cultural adaptation of PMBOK
collapse of a series of ‘binding agreements’ in Guide contribute to the development of pro-
2004 between Fortescue Metals Group Ltd ject management in these and other cultures?
(FMG), and some Chinese engineering com- There are advantages to a standardized world
panies to build a new iron ore mine, railway wide view of project management and there
and port (worth billions of dollars). The deal are advantages to developing culturally rele-
fell through when parallel negotiations around vant adaptations. The approach favored by
an equity stake in Fortescue collapsed and the Robert Higgins (another contributor
final appeal to the High Court over the matter “GUANXI CAN to Advising Upwards) is to clarify and sim-
is due shortly. plify the PMBOK to transform it into a dia-
In an Western context, there were separate
RATE AS HIGHLY mond of knowledge. Like a diamond it needs
negotiations and the collapse of one should AS TECHNICAL to be discreet, clear and hard. The ideas in a
not have impacted the other. In a Chinese robust, clarified, PMBOK can be translated
context, the relationship is what matters and COMPETENCE” easier. Clear ideas spread naturally by com-
the failure of one aspect of the relationship munication, and because culture is a shared
damages all aspects of the relationship. What procedures, the Chinese engineers and build- system of beliefs or values based on a com-
this case does highlight though, is the impor- ers were focused on developing a group un- mon understanding of these ideas, having one
tance of ‘culture’ when dealing with stake- derstanding of the risk through discussion and robust and clear PMBOK is the greatest
holders. observation to make sure no one in their strength for creating a global project manage-
Khor Soon Kheng, founder of Asia ICT Pro- closely knit team was put at risk of injury; ment culture. From this base, project manag-
ject Management Malaysia, believes they saw the paperwork as superfluous. Both ers can use the baseline culture of project
good Guanxi (a philosophy dealing with any sides took safety seriously; the approach em- management to create common ground in a
network of relationships among various par- bedded in culture to achieving the ‘safe out- multi-national teams and adapt to the other
ties who cooperate and support one another in come’ was quite different. aspects of culture in any location.
the Chinese business/project world) is criti- Similarly managing issues effectively is cul- An alternative perspective suggests processes
cally important to the successful delivery of turally sensitive. In Japan, the concept of ne- that are not culturally effective get ignored or
projects involving Chinese organizations from mawashi (pre-arrangements) moves conten- bypassed, devaluing the overall value of the
bidding through to handover. tious items forward so there are no disagree- ‘body of knowledge’. With both the 5th Edi-
“Guanxi can rate as highly as technical com- ments in meetings. Even making a decision tion of the PMBOK Guide and ISO 21500 in
petence and price in decision making and has can be seen as a failure; decisions should development, I feel we need to have more
a significant influence on procurement, Khor emerge from the group rather than be imposed discussion around implementation of the
says. “Guanxi is intensely personal: while it on the group by a project manager. ‘knowledge’ within cultures. Can one size fit
can be shared and reflected onto the organiza- As the Japanese proverb says, ‘the nail that all?
tion a person works for, the individual ‘owns’ sticks up gets hammered down’. Conse- This article was taken from www.cio.com.au,
his/her Guanxi and has to invest time in de- quently, nemawashi makes ideas such as a written by Dr. Lynda Bourne.
4