Sunway Construction: Value Creation Business Model Analysis Report

This report provides a comprehensive analysis of value creation within Sunway Construction, a Malaysian construction company. It begins with an executive summary and then delves into a detailed examination of Sunway's business model, including a situational analysis and assessment of its core status. The report evaluates current value-based inadequacies, assesses risk exposure, and proposes changes to the business model to enhance value creation and delivery, particularly for financial value. It suggests a value chain-based solution to capture incremental value-added results and explores the strategic initiative impacts on the organization's strategic positioning and future business sustainability. The report also includes a comparative analysis with Jetson Construction to highlight differences in value creation models. Furthermore, it features an evidence review with a critical analysis of selected literature themes and supporting perspectives from other organizational evidence. Finally, the report concludes with a reflection on employability enhancement, including critical thinking, core capabilities, and leadership skills required for future personal development. The report emphasizes the importance of integrated reporting and stakeholder relationships in value creation, aiming to provide meaningful managerial insights and conclusions from a generic perspective.

Running head: VALUE CREATION
Value Creation
Student’s name:
Name of the University:
Author’s note:

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Executive Summary
This paper explores the concept of value creation for the organization. In order to continue the
study, Sunway Construction Company has been chosen which a famous construction
organization is and it is in Malaysia. This study has three parts, in the first part, Sunway
Company Report has been depicted, in the second part, the Evidence Report has been explained
that is mostly a literature review and in the third part, a critical reflection has been given based
on the paper. In addition, Sunway Construction follows the model of Integrated Reporting
framework in value creation and in the first part of the study, the model has been explained with
finding the issues in it. A better model has been suggested with making some basic changes in
the model. Moreover, a sharp contrast has been made with another company Jetson Construction
in order to distinguish the value creation model. Moreover, a financial value creation is the aim
of the organisations along with the goodwill. Value is mostly created through organisation's
model of business and it takes inputs from the capital. These inputs transform into the values
through business activities in order to produce outputs. In the evidence report, a short literature
review has been discussed with perspectives with other contemporary organisational evidence
deemed relevant to achieve meaningful managerial insights and conclusions for value creation
from a generic perspective. In the final part of the study, a learning log of employability skills
readiness has been given through self-reflection on the current practice of value creation.

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Table of Contents
Introduction......................................................................................................................................3
Part 1: Company Report..................................................................................................................4
1.1 Framework of business model with situational analysis to assess the core status of Sunway
Construction.................................................................................................................................4
1.2 Current value based inadequacies over a future specified with an assessment of risk
exposure.....................................................................................................................................10
1.3 Changes to the business model to achieve to value creation and value delivery for financial
value...........................................................................................................................................12
1.4 Proposing a value chain based solution to capture incremental value-added results...........16
1.5 Strategic initiative impacts the organisation’s strategic positioning and future business
sustainability..............................................................................................................................19
Conclusion.................................................................................................................................21
Part 2: Evidence Review................................................................................................................22
1. A critical analysis of the selected literature theme................................................................22
1.1 Supporting the perspectives from other modern organizational evidence...........................25
1.2 Concluding thoughts............................................................................................................28
Part 3: Reflection of Employability Enhancement........................................................................30
1. Critical thinking & core capabilities needed to achieve the consultancy task.......................30
2. Evaluating the self-competencies in completing such tasks..................................................31

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3. Leadership skills required for future personal development & career accession...................32
Conclusion.....................................................................................................................................33
Reference List................................................................................................................................34

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Introduction
Value Creation is one of the main aims for a business entity. The organisations need to
create value for the consumers and creating values help the customers to sell the services and
products. The organisations can create values for shareholders as they can increase the stock
price in order to ensure the future availability. Value creation can be considered as separate from
of traditional financial method. However, traditional method is not adequate for an organisation
to follow in such economic condition. In recent time, value creation is enhancing as it is being
recognised better management objective than financial measures to perform hard. The
organisations are following cost-cutting measure in order to have short-term results of the
business. The pressure is mainly gathered from the two sources, from the internal management
and from the financial markets. In short-term value creation or investment can provide negative
impact financial figures of the organisation (Valdes-Vasquez and Klotz 2014). The companies
should not focus on the short-term values only, however future long-term investing can bring
long-term values. In this study, first part talks about value creation process and measurement of a
business and the chosen organisation is Sunway Construction. Moreover, this organisation's
business model will be compared to another organisation in order to understand the basic
difference. Through analysis of value creation, current inadequacies can be recognised and risk
assessment of the organisation can be carried down. Moreover, new route of business will be
suggested through this model assigning value chain analysis of the organisation. In the second
part of the study, evidence review will be conducted preparing an individual critique of literature.
In addition in the third part of the study, a reflection for employability enhancement has been do

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Part 1: Company Report
1.1 Framework of business model with situational analysis to assess the core status of
Sunway Construction
Sunway Construction Group is fully-integrated construction organisation that provides a
full range of construction and design services. This organisation mainly works in civil
engineering, mechanical, infrastructure and electrical services including pre-cast concrete
products. Sunway Construction’s building division gives services of various types, designing,
construction, completing of residential apartment and institutional building
(Sunwayconstruction.com.my 2017). Value creation of this construction company is to produce
benefits to all stakeholders. Sunway Construction believes to be as their economic activities and
it is common for the organisation as to view the strategy, technologies, practice, products,
services and process in terms of creating values for the organisation. Sunway Construction
Company makes building and design and these create greater values for the market than the costs
of inputs like raw materials, labour, capital and energy. For Sunway Construction creating value
is more important than accumulated earnings in money for the business. As stated by Allee
(2011), creating value is rational objective for any business and when the organisation sells the
products or service, the buyers’ assessment may not match with seller’s values.
Current products and services: Sunway Construction provides services to the property,
design, construction, retail, commercial, leisure, trading and manufacturing, quarry, materials,
real estate and investment trust. Sunway Construction provides a special design for the public
sectors and also for the government works.

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Competitors: Competitors of the Sunway Constructions are Kumpulan Jetson,
Construction Research Institute Malaysia, Sunway Construction and TBTC constructions.
Among all these companies, Sunway Construction is the largest of all. In Malaysian construction
sector, the companies have been experiencing intense competition among the existing companies
and big-cap diversified contractors have been increased by 58% (Sunwayconstruction.com.my
2017).
Market share: In the Malaysia, most of the large organisations are from the construction
industry, Sunway Construction takes the largest market share, almost 17% of the market share.
In the ASEAN community, the share of the construction is largest in the Philippines. In case of
Malaysia, construction industry takes the 69.3% of market share of overall industry sector.
Strategy Review: Business activities of Sunway Construction are related to the four
basic strategies. Sunway Construction takes the strategy of value creation and they evaluate the
current positioning of themselves. At present, Sunway Construction is one of the largest
construction companies of Malaysia. The management of company is focusing to create more
values through where the company could get to after the new strategies will prepare. In addition,
Sunway Construction needs to understand where they want to go. In this perspective, the
company needs to take the strategies to go to the desired objectives. In this process, the
understanding the business activities is necessary and value proposition has been developed in
the first three stages of the review. The values Sunway Construction is vested upon the quality of
work, previous projects and financial conditions. However, the model of value creation could be
changed in order to attain more value through the business process. The requirement of
development is needed in process, people and innovation.

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Innovation: In innovation, Sunway Construction has been facing the issue of operational
benefits that are related to the failure to meet the costs or quality. The management of the
organisation must make the innovation in such a way that can create value for the organisation.
Sunway needs to start with cost and scheduling of the construction project with commercial
benefits. Innovation needs to attract the customers and values must provide financial benefits
through innovation. For Sunway Construction, each of the projects is singular prototype for
configuring the changes. In construction works, different and constant changes in innovation are
needed in order to understand the machinery and personnel factors (Sunwayconstruction.com.my
2017). Sunway organisation is trying to bring changes in improvement of organisation activity,
improvement in organisational competitiveness and client satisfaction issues.
Since a long time, Sunway Construction has grappled with a business model that gives
the benefits of value creation through financial information advantages from their knowledge and
professional insights. Sunway Construction acknowledges that financial information always
creates an opportunity to improve the value creation method for the business. Sunway
Construction mainly focuses on integrated thinking and reporting and the primary objective of
Sunway Construction's value creation process is to omit the traditional financial reporting.
Sunway Construction spends a lot in creating value and it has a critical structure in finance.
However, the business model of Sunway Construction provides effective welfare and health and
more importantly, the business model of Sunway Construction give the chance of value creation.
The model enhances the organisation to have better scrutiny, a working environment and
constraint on resources and time. Financial information cannot alone make the values of the
organisation; however, it is needed to create values with integrated reporting. Sunway
Construction takes the policy of decision-making that needs the management to have a holistic

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view of organisation's business model. The management needs to view on resources as well as
stakeholders' relationship that can impact on organisation's service delivery (Cameron and Quinn
2011). Sunway Construction mainly focuses on six capitals, financial, human, social, intellectual,
natural capital and manufactured. Through these six capitals, Sunway Construction organisation
can transform the organisational strategy, governance and business process. Regulatory authority
of the organisation need to remove the obstacles in long-term investment and it could provide
positive impact on the organisation. Long-term investing of money and farsightedness can
increase the organisation’s long-term values with risk-adjusted returns and could lessen the
potential adverse effects (Tantlo and Priem 2016). Sunway Constructions has been facing the
issue from the political landscape, social media preset and new product cycle; these issues
provide hindrance to get the long-term value creation. The organisation focuses the strategic
framework in order to create long-term value creation.

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Figure 1: IR (Integrated Reporting) model followed by Sunway Construction
(Source: Cipfa.org 2017)
Sunway Construction needs to have a look at strategic focus that can pose the future
orientation to the business. This future orientation strategy can create an insight into company's
strategy and ability to make the value in short and long-term.
Connectivity of information in the business model sets a holistic picture that makes
interrelation and dependencies among the factors and combination of external factors can affect
the organisation.
Stakeholders' relationship is a very important factor for the organisation that can create
insight into the nature and quality of company's relationship with the stakeholders. The
stakeholders of Sunway Constructions are customers, employees, suppliers, logistics partners
and government; moreover, they need to understand the organisation to respond to legitimate
needs.
Materiality is the information about various subjects that substantively impact on
organisation's ability to make value on a long-term basis.
In addition, reliability and completeness that disclose all materials both negative and
positive in a balanced method.
All the six capitals in the business model of Sunway Construction can bring sustainable
outcomes that can deliver the requirements to various stakeholders over time.
Value creation for Sunway Construction is related to the accumulation of earning, the
growth of earning and creation of goodwill. On the other side, Jetson Construction Company

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uses another business method that starts with ‘accumulation of earning' and it talks about making
money of owner. Jetson Construction is particularly smaller organisation than Sunway
organisation and the main business goal of the organisation is making money and management
body of the organisation can distribute earnings in order to earn value. The values can create
future earning and it can also create liquidity of the firm. Growth in earnings is another element
in value creation of Jetson Construction and the management of the business creates a business
in a way that can create value for the organisation (Jetson.com.my 2017). Jetson Construction
does the work in construction in a way that buyer will pay multiple earning of the business. In
growth in earning, method can give Jetson Construction a worth three to five times compared to
pre-tax earnings. Growth in earning method can bring back goodwill as this process can provide
asset value Jetson Construction creates the goodwill that makes the unsaleable products saleable.
Multiple earnings bring higher profit for the business.
As compared with two companies, the business model of Sunway focuses mainly on the
integrated thinking and reporting, not just only financial value creation. However, this business
model lacks the construction companies' goodwill that liquidates value by collecting goodwill.
Construction organisations that offer or exchange to employees for the most part they can make
an incentive for their proprietor accumulating earning. There are two strategies, deal with an
outsider could be at resource esteem or more prominent. Once more, it could utilize any of the
three techniques. The ramifications of these measurements are that relatively few designing and
development organisations make goodwill; however, most collect profit (Chemmanur et al.
2014). The thinking behind this may have a comment on the basics of the development business.
Buying advantages of interest for building and development change generally, as providers will

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regularly bolster the neighbourhood business to abstain from being excessively subject to the
national or provincial business.
1.2 Current value based inadequacies over a future specified with an assessment of risk
exposure
Value creation model of Sunway organisation faces the inadequacy in mainly financial
value that has manifested with various ways. Sunway Construction has got value creation
benefits with a context and the organisation got the value that has been created from tangible and
intangible assets. Moreover, the organisation has made values for themselves and for the
stakeholders of the organisation. Sunway Construction organisation has its resources that made
the business effective for them; however, they use the private and public resources to make the
context of business efficiency. The organisation Sunway Construction uses the six capitals in
order to make the value of the organisation. However, the inadequacies of the business lie in:
Financial values are relevant for the organisation; however, they are not sufficient for
Sunway. The financial value of an organisation can be manifested in various ways that can
include organisation's profits, stock prices, organisational growth and balance sheet. Sunway
Construction can create value through capital investing from the investors that can help the
organisation to generate cash in future. The companies in generating financial values can grow
the revenues from the capital with attractive rates (Cohen et al. 2017). Value creation can be
extended beyond the benefits of the company with financial values and company can check
exchange the values in the market. The values can be expressed by the company in profit and
loss statement, organisational growth and balance sheet.