BSBPMG411A: Quality Assurance and Improvement in Building Projects

This report provides an analysis of quality assurance and continuous improvement initiatives within building projects, with a specific focus on CPB Contractors, a major Australian construction company. The report examines the company's vision, goals, and organizational environment, including political, legal, economic, technological, and social factors influencing its operations. It identifies potential risks and their impacts on project quality. The report also details how CPB Contractors determines customer quality requirements, integrates quality management into its business operations and audits, and employs quality review measures to ensure compliance with standards. It also highlights the company's commitment to improving efficiency, reducing waste, and ensuring customer satisfaction. The report concludes by emphasizing the importance of project finalization reviews in maintaining quality standards.

Running head: QUALITY ASSURANCE AND IMPROVEMENT IN BUILDING PROJECTS
Quality Assurance and Improvement In Building Projects
Name of the Student
Name of the University
Author note

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QUALITY ASSURANCE AND IMPROVEMENT IN BUILDING PROJECTS
Table of Contents
Introduction:....................................................................................................................................1
Vision and goals of CPB Contractors:.............................................................................................1
Organisational environment, change effecting environment, risks their impacts:..........................2
Organisational environment of CPB:...........................................................................................2
Political and legal:...........................................................................................................................2
Economic and technological:...........................................................................................................2
Social:..........................................................................................................................................6
Determination of quality requirements of customers:.....................................................................9
Quality management and credibility to business:............................................................................9
Quality management activities as parts of projects including audits:............................................10
Quality review measures to determine meeting of quality standards:...........................................10
Money:.......................................................................................................................................10
Future:........................................................................................................................................10
Customer satisfaction:...............................................................................................................11
Improvement of efficiency and job effectiveness reduces wastes and rework:.............................11
Project finalisation review:............................................................................................................11
Conclusion:....................................................................................................................................12
References:....................................................................................................................................13

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Introduction:
Companies involved in building projects require assure superior quality and continuous
improvement in the building projects they undertake in order to ensure customer satisfaction.
The project managers in looking after building projects need to exhibit high rate of adaptation to
the environment within which the projects function and take appropriate decisions. The aim of
the project would be visiting quality management in the construction industry in Australia. The
company considered for the study would be CPB Contractors which is one of the largest
construction companies of Australia and a wholly owned subsidiary of CIMIC Group Limited
listed on ASX (Cpbcon.com.au. 2018). The terms ‘principles’ and ‘project owners’ would refer
to the clients on behalf of which the company performs projects. The terms ‘project management
company’ and ‘contracting’ would refer to CPB Contractors.
Vision and goals of CPB Contractors:
The vision of CPB Contractors is to serve customers with integrity, innovation and
deliver superior quality projects to its clients. Safety of the employees as well as clients also
form important components of the vision of CPB.
The goals or missions of CPB are to generate sustainable returns to the stakeholders by
delivering superior projects. The company also aims to provide secure, rewarding and effective
career development for its employees. Thus, the stakeholder concerns form the base of the both
the vision and missions of CPB.

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Organisational environment, change effecting environment, risks their impacts:
Organisational environment of CPB:
The organisational environment of CPB can be divided into macroeconomic environment
and microeconomic environment. The following are the macroeconomic environmental factors
which prevail in the construction industry of Australia in which CPB operates:
Political and legal:
The construction industry of Australia comes heavily under the control of Government of
Australia and the state governments. The industry is overseen by specific departments both at the
state level and central level. The Government of Australia has set up Australian Procurement and
Construction Council oversees the procurement of projects, construction and asset management
in the government bodies both at the central and state levels (Apcc.gov.au. 2018). Similarly,
Department of Treasury and Finance, Government of Victoria maintain construction supplier
lists which includes names of consultants and contractors. As far as Australia is concerned, two
areas which the government oversees the operations of the construction industry are work safety
and environment. The firms involved in the construction industry have to comply with the
SafeWok Act (Worksafe.vic.gov.au. 2018). Similarly, they have to comply with the Environment
and Biodiversity Conservation Act 1999 which is in power in Australia (Environment.gov.au.
2018). This shows that the construction industry in Australia comes heavily under the influence
of political influence.
Economic and technological:
The first economic factor which effects the construction industry in Australia is the gross
domestic product of the country which shows the economic development of the country. This is
because economic development creates demand for more construction of more civil structures

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like bridges and housing complexes which in turn pushes up the business generation of the
industry. The graph below shows that the GDP of Australia has increased manifold in 2017
compared to 2016 which has boosted the construction industry.
Figure 1. Graph showing GDP of Australia
(Source: Tradingeconomics.com. 2018)

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QUALITY ASSURANCE AND IMPROVEMENT IN BUILDING PROJECTS
Figure 2. Graph showing value of building work done
(Source: Abs.gov.au. 2018)
The graph shown above shows that values of residential and non-residential buildings in
month of June for five consecutive years. An analysis of the second figure shows that it is closely
related to the first graph. The fall of GDP in Australia in the year 2016 was reflected in the fall in
the value of buildings constructed in the year 2017. The rise of GDP in the year 2017 was
reflected in the increase of value of building works in 2018. Thus, it can be established from the
analysis that increase in GDP is one of the most important factors affecting the construction
industry.

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The second economic factor which effects the construction industry is the availability of
building materials and building contracts. This is where the bilateral agreements of the
Government of Australia comes into play. Department of Foreign Affairs and Trade.
Government of Australia clearly mentions that the Government of Australia invests in overseas
projects (Dfat.gov.au. 2018). It can be pointed out that the foreign construction projects of the
government allows the construction companies in Australia to acquire projects overseas which
enables them to earn revenue in form of foreign currencies. The construction companies are also
able to import machinery and technology from foreign countries which enable them to take up
complex and expensive projects. The construction industry is Australia is highly advanced owing
to availability of modern construction plants and project management methods (Spalek
2016). This brings into the light the next organisational environmental factor as far as economic
conditions are concerned, international currency rates.
Figure 3. Five year exchange rate of AUD against five international currencies

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QUALITY ASSURANCE AND IMPROVEMENT IN BUILDING PROJECTS
(Source: Bloomberg.com. 2018)
The above graph shows five years trend of AUD against five international currencies
namely, USD, GBP, JPY, EU and INR. The graph that the position of AUD is strengthening
against INR and GBP. The power of AUD shows weakening trends against EU, USD and JPY.
This means that the construction companies based in Australia can important materials and
plants from India and the United Kingdom. Similarly, they can prefer taking up projects in the
USA, Europe and Japan. This investment of resources on currencies having varying power
against AUD would allow the Australian construction companies to hedge in the international
and diversify their business risks.
Social:
The social factors in Australia have great influences on the construction company. The
table below shows that the population in Australia has increased steadily in all the states
particularly New South Wales and Victoria.
Figure 4. Table showing population of Australia in different states

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QUALITY ASSURANCE AND IMPROVEMENT IN BUILDING PROJECTS
(Source: Abs.gov.au. 2018)
Figure 5. Graph showing GDP per income of Australia
(Source: Tradingeconomics.com. 2018)
The graph above shows that the GDP per capita income of the Australians have also
increase. The increase in population along with increasing per capita income means that more
people have sufficient disposable income to afford premium accommodations, which means
there would demand for more housing complexes. Moreover, the government would also float
more tenders to building infrastructure like roads, bridges and housing projects for the increasing
population. This would create immense business opportunities for construction industry and
boost its income generation.
It can also be pointed out from an analysis of the above mentioned environmental factors
that the Australian construction industry faces several risks which have profound impact on the
industry. The following are the risks faced by the construction industries in Australia and their
impacts on the industry:

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QUALITY ASSURANCE AND IMPROVEMENT IN BUILDING PROJECTS
Environmental
factor(s)
Risk Impact(s)
Political Terrorism and extortion threats from
local groups
Halting of projects, wastage of
resources, budget and time overrun
Entry of foreign construction company
into Australia
Increased competition and revenue
risks
Economic
factors
Volatile currency rates Increased import and exports
expenses.
Asian construction markets gaining
more importance
Scarcity of resources in Australian
projects and shifting them to serve
Asian projects
Legal Increasingly strict environmental laws
and OHS laws
Construction companies are
required to comply with these
laws. Failure to comply with laws
attract penal charges from
governments.
Increasing stringency in international
laws
More complex operations and
increase in legal compliance
expenses.
Environmental Increasing risk of environmental
disasters
Loss of resources, loss of staff,
cost and budget overrun
Technological Increasing chances of data theft Loss of business data.

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QUALITY ASSURANCE AND IMPROVEMENT IN BUILDING PROJECTS
Determination of quality requirements of customers:
CPB ensures that the projects which the company delivers to the project owners are
marketable, are capable of serving the purpose for long tenure and cause convenience to
the users. Serpella, et al.(2014) mentions in this respect that quality refers to the capability of
the products or projects to serve the purpose of end users for a longer span of time and cause
value addition. The construction company performs civil construction projects for the
governments and also for the private housing firms. CPB in order to determine the quality
expectations of the clients hold meetings with the representatives of the latter to ensure plans,
designs, expected time within which the projects are to delivered, cost of the projects and
materials to be used. This is followed by a signing of contracts and documentation between the
principle and the project management company. This detailed process followed by CPB
ensures that the company adheres to the quality expectations of the clients (Hia.com.au.
2018).
Quality management and credibility to business:
The strict quality management system of CPB Contractors lends superior quality to the
project the Australian construction company undertakes. The company complies with the
AS/NZS ISO 14001:2016 Environmental Management Systems which encompasses areas like
employment, health and safety, risk management, safety management and even seasonal
standards. The company by adopting ISO 9001 benefits stakeholders like consumers or usres,
buyers of the projects, suppliers, regulatory bodies at the government level, research and
development organisations, technical firms and the society in general. This ensures that the

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company maintains very high parameters for the projects it undertakes and gives high credibility
to the business operations (Standards.govt.nz. 2018).
Quality management activities as parts of projects including audits:
Quality management forms a significant part of the audits of CPB Contractors Pty
Limited and also its mother company CIMIC, which is a listed organisations. The Auditing
Standards ASA 250 mandates audit of financial statements of the companies in Australia. The
laws clearly mentions that the auditing body should also take into account the degree of
compliance of the companies in Australia with the laws and legislation in power supported by
appropriate documents (Legislation.gov.au. 2018). CPB holds quality management as an
indispensable part of audit which is evident from the audit financial results published by its
mother company CIMIC. The audited reports clearly mention the stand of CPB in important
quality parameters like safety and community development while commencement of projects.
The reports mentions the details of the contracts awarded and its CSR initiatives (Cpbcon.com.au
2018). All these point out that the construction while operating in the market consider quality as
an important parameters and publishes quality reports in its audited financial reporting
documents.
Quality review measures to determine meeting of quality standards:
CPB takes into account the following parameters to determine meeting of quality review
measures to determine compliance with quality parameters:
Money:
The company takes into account cash inflows and expenditures towards specific projects,.
Then it measures the rate of time and cost overrun which took place in case of projects.

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Future:
The company takes into account the future projects it would take up to generate more
revenue. The company also acquires suppliers, sub-contractors and labour contracting firms to
support each project. The company operates in markets like Australia, New Zealand and Asia. It
takes into account quality acquisition of these partners in each of its markets in the light of its
quality standards to measure the success of its operations.
Customer satisfaction:
CPB takes into account customer satisfaction rates while measuring its quality
performance standards. The company in working with several project owners like government of
various countries and body corporates. New projects awarded in existing principles means that
the customers’ satisfaction rate is high which indicates high quality performance by the
company.
Improvement of efficiency and job effectiveness reduces wastes and rework:
CPB takes into account two parameters to improve efficiency and overall job
effectiveness. The company time to time measures the competencies of its current work forces
and takes initiative to train them. Secondly, the company acquires resources like funds and
plants which it require in the future projects. These two steps ensure that CPB maintains its
efficiency and improves it to ensure greater customer satisfaction.
Project finalisation review:
CPB takes into account two aspects of the completed project to recognise lessons learnt
and bring about further improvement. The first parameter is whether the project completed
complies with the designated standards procedures of operations. Secondly, it measures the

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actual quality of the project completed. The company takes steps to rectify defects it recognises
in a projects in future projects.
Conclusion:
CPB should take steps to improve its project management methods and comply with the
laws to a higher degree. It should expand its operations in new markets. As far as the
environmental factors are concerned, the company should expand more in the emerging markets
like China to bank on the boom in demand for civil projects to support the latter’s infrastructure
development.

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References:
Abs.gov.au. 2018. Abs.gov.au. [online] Available at:
http://www.abs.gov.au/ausstats/abs@.nsf/0/13ABDBADFD4D140ACA2568A9001393D7?
Opendocument [Accessed 30 Oct. 2018].
Apcc.gov.au. 2018. APCC Home - Home. [online] Available at:
http://www.apcc.gov.au/SitePages/Home.aspx [Accessed 29 Oct. 2018].
Bloomberg.com. 2018. Bloomberg - Are you a robot?. [online] Available at:
https://www.bloomberg.com/quote/AUDUSD:CUR [Accessed 30 Oct. 2018].
Cpbcon.com.au. 2018. Cpbcon.com.au. [online] Available at: http://www.cpbcon.com.au/about-
us/our-structure/ [Accessed 29 Oct. 2018].
Dfat.gov.au. 2018. Dfat.gov.au. [online] Available at:
https://dfat.gov.au/about-us/publications/Pages/international-investment-australia.aspx [Accessed
30 Oct. 2018].
Environment.gov.au. 2018. Environment.gov.au. [online] Available at:
http://www.environment.gov.au/resource/local-government-and-australian-environment-law
[Accessed 30 Oct. 2018].
Hia.com.au. 2018. Hia.com.au. [online] Available at:
https://hia.com.au/business-information/legal-information/contracts [Accessed 30 Oct. 2018].
Legislation.gov.au. 2018. Legislation.gov.au. [online] Available at:
https://www.legislation.gov.au/Details/F2017L01172 [Accessed 30 Oct. 2018].

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Serpella, A.F., Ferrada, X., Howard, R. and Rubio, L., 2014. Risk management in construction
projects: a knowledge-based approach. Procedia-Social and Behavioral Sciences, 119, pp.653-
662.
Spalek, S., 2016. Traditional vs. Modern Project Management Methods. Theory and Practice.
Standards.govt.nz. 2018. Environmental management systems. [online] Available at:
https://www.standards.govt.nz/search-and-buy-standards/standards-information/environmental/
[Accessed 30 Oct. 2018].
Tradingeconomics.com. 2018. Tradingeconomics.com. [online] Available at:
https://tradingeconomics.com/australia/gdp [Accessed 30 Oct. 2018].
Worksafe.vic.gov.au. 2018. Worksafe.vic.gov.au. [online] Available at:
https://www.worksafe.vic.gov.au/ [Accessed 30 Oct. 2018].