Research on ethics in construction
an analysis of values-based leadership
William A. Moylan, PhD, PMP
Research on values-based leadership in the construction industry poses interesting challenges. Park (1992) performed an empirical study to investigate the perceptual process of top managers of U.S. construction firms and to examine its relationship with organizational commitment to innovation and internationalization. Kirk (2000) used a qualitative design to discover perceived leadership characteristics of construction project managers and relate the findings to literature review in several areas including leadership, psychology, and cognition. Lemark, Henderson, and Wenger (2004) used systems theory to explore organizational transformation among federal contractors. Welling (2003) did a case study on the history of public housing in Canton, Ohio, to measure the success of this social process as a means for community transformation. Research by Morris (2000) on values-based leadership skills, values, and concepts studied the potential to improve the southeastern Florida construction industry by using VBL. This quantitative study used the criteria of the Malcolm Baldrige National Quality Award (2004) to study the executive perceptions on delivering value to customers, customer satisfaction, and creating employee partnerships. A study by Bell and Elkins (2004) also used the Baldrige criteria as the scorecard to assess leadership performance, especially the upward influences of ethics. A quantitative survey by Doran (2004) on ethical practices in the construction industry considered issues that the industry executives claim have the greatest impact on their business.
Based on these previous research studies, the author (Moylan, 2005) performed dissertation research on the applicability of utilizing the values-based leadership (VBL) theory to improve the construction industry. The research considered several critical items, including the discovery and assessment of construction executive perceptions, the use of the theoretical VBL construct of leadership that would appeal to a pragmatic audience, and the difficulty of introducing social changes intended to assist the construction industry. Moreover, focusing on critical topics that interest the business sense of the respondents and using an accepted quality model to assess interest in a leadership construct, such as the Baldrige criteria, was demonstrated as essential.
The subject research demonstrates a strong correlation between values-based leadership concepts, values, skills, and sound ethical conduct as critical performance components in the astute managing of constructed facilities projects. The results of the mixed methods research (quantitative and qualitative) support the main question addressed in the study, “Can the application of values-based leadership skills, values and concepts improve the processes of project management, especially within the construction industry?” The research showed that values-based leadership traits of trust, integrity, and people-orientation are critical to success in the construction industry. In addition, the research exhibited the suitability of values-based leadership for improving the business partnerships within the construction industry (hypothesis) and the applicability of this approach to the leading of constructed facilities programs from concept through completion.
The paper summarizes the background, process, and conclusions of the research study conducted by the author in support of his doctoral dissertation entitled, “Building Ethics in Construction Partnerships: An Analysis of Values-Based Leadership” (Moylan, 2005).
Background to the Study
This section addresses important background information on values-based leadership (VBL) and its applicability to the construction industry.
Review of Literature and Research on Values-Based Leadership
The literature on leadership has evolved from a focus on the actions of a heroic leader to a broader view that considers leadership as an influential exercise in any interpersonal relationship and as a social function required to achieve organizational goals (Nirenberg, 2001). During the 1990s, the types of scholarly articles on leadership have transitioned from a strong emphasis on empirical research and some theoretical discussions to a balance of empirical and theoretical with some discussion on leadership methods. The concepts, values, and skills of Values-Based Leadership emerged from the path-goal theory and subsequently the transformational leadership approach that requires a strong trusting and ethical partnership between the leader and team members (Northouse, 2001).
Core Principles of Values-Based Leadership
Fairholm (1997) notes six centric principles of values-based leadership. The first principle relates to the leader’s role in stakeholder development to transform himself, his followers, and the organization to focus on accomplishing the vision with creativity and enthusiasm. The second principle considers the leader’s role in creating this vision that epitomizes the core values of the leader and helps target the follower’s actions. The third principle relates how the leader creates a culture supportive of the core values that contribute to the team achieving its personal and group goals. The fourth principle of this sextet correlates the leader’s preparation for the personalized relationships with his or her followers that amalgamate the personal values, self-purpose, and methods with each other in a council-like, two-way exchange (as opposed to a one-way counseling exercise). The next principle requires the values-based leader to be a teacher of his or her followers, coaching on improving personal relationships, work skills, and attitudes to enable, empower, and energize them to greater performance. The sixth principle concludes with the values-based leader’s dual goal of producing high-performance and self-directed followers with an inherent loyalty to the organization and the group mission. These six principles constitute the philosophical base for values-based leadership (Fairholm, 1998). Although values-based leadership is appropriate for many situations, it is most applicable to leading transformational change initiatives, which require changes in corporate culture and personal behavior to be effective.
The hyper-competitive pressures, strains on resources, and emerging market requirements beyond the capabilities of many firms cause the nimble company to form closer relationships and alliances with its customers and suppliers. The benefits of improved coordination and information flow, disciplined product development, and system-wide solutions require access to vital knowledge and competencies not widely available. A web-like constellation of the necessary expertise, suppliers, distributors, and customers is essential to creating the extended enterprise, with its own set of core values that will meld all of the talents to satisfy the overarching vision (Lei, 2003). The emergence of the “value confederation” of networked companies based on their shared values allows each entity to specialize on its core competencies, leveraging its strengths, and gaining advantage for its weaknesses (Evans & Wurster, 1997). From a values-based leadership perspective, this construct of a value confederation affords each component firm the opportunity to satisfy its individual needs and desires (building personal esteem) while working toward the group vision, goals, and mission (shared values). Moreover, the protective umbrella of the networked enterprise allows the assembled project team to share in the glory (gaining intrinsic goal satisfaction) without having to suffer the risks entirely on its own (creating meaningful team work). Trustworthiness, the fifth element of values-based leadership, forms the defining culture for managing and leading complex organizations.
Development of Values in the Construction Industry
Research by Shaw (2001) on occupational segregation in the construction industry used both qualitative and quantitative techniques to explore both the social and the structural constraints of women entering apprentice programs. The study found that women who successfully entered the upper levels of their construction trades held to a “family of labor” core values set, which helped them to develop strong peer-support networks and to learn how to persevere despite obstacles. In contrast, the values of the male trade workers in the study showed their concern with job safety, employment security, and the opportunity to do quality work. Other research on the construction industry by Behrens (2002) studied innovative union restructuring and the use of modern management strategies in Germany. The research found that leadership-driven values among the members of German construction trade unions helped ferment the successful adaptation of business administration techniques in improving the union membership organization and in the collective bargaining.
A reader survey (Schuler, 2004) of 410 remodelers on their sense of ethical practices in their sector of the construction industry noted the sample having varying degrees of independence in applying ethics in their business practices. Further, an analysis of the results showed “no broad outline, no umbrella, no format or system of ethics by which remodelers throughout the county agree to operate” (p. 95). This industry acceptability on the variations of valuing ethics in construction is prevalent in a study of construction arbitration cases (Rooley, 2001a). The design professionals (i.e., architects and engineers) follow established professional codes of conduct to retain their professional licensure granted through their state boards, serve the needs of their client over themselves, and satisfy the broader societal needs over the client position. On the other hand, the construction contractors, who obtain their work through competitive bidding, operate independently through an arms-length relationship with the owner and the designer. The study finds that the functions of the competitive business arena - dictated by contract language, governmental regulations, and industry practice - establish an efficient yet adversarial environment fraught with liability and litigation.
In the face of this opposing values structure, the Construction Users Roundtable (2004) conducted a tripartite initiative to study ways to improve the “cost effectiveness of the organized construction industry through meaningful dialogue, collaboration, and mutual commitment to positive change” (p. 1) for all members of the construction industry. The initial recommendations of the CURT Tripartite Initiative which address extended overtime, absenteeism, and work disruptions shows a collaborative interest to form meaningful goals (values development) based on member interest and mutual satisfaction (shared values confederation). Another example of a recent construction industry initiative addressing issues that are problematic for owners and contractors alike (shared values confederation) is on the use of internet reverse auctions for construction services (Mechanical Contracting Education & Research Foundation, 2004). The improvements in construction procurement that will better serve the needs of all involved, according to the MCERF study, include well-defined scope of work, use of best-value pre-qualification criteria, transparency of auction procedures, adequate procedures, adequate procedures for redress of errors, adequate safeguards against other abuses, and policy reservations.
Suitability of VBL for the Construction Industry
A values-based leadership approach was found to be suitable for the residential construction industry (Morris, 2000). The overall construction industry is very keen on developing and maintaining a high degree of professional ethics in the variety of business dealings between all of the players (i.e., owners, architect/engineers, constructors) involved. This includes but is not limited to the bidding and award scenarios, in meeting contractual obligations, and in resolving disputes (Rooley, 2001). This interest extends to developing ethics education in the construction education programs at the college level (Robertson, 1987). Industry trade groups, such as the Associated General Contractors (AGC), and professional associations, such as the American Institute of Constructors (AIC), actively participate in ethics in construction programs for their memberships (Gonchar, 2003). These construction ethics programs mirror the tenets of values-based leadership, including stressing the need for shared business and ethical values, integrity in the bidding and contracting processes, a common understanding of industry professional practice, partnering, the balancing of risks with financial rewards, and the building of long-term trusting relationships (Gill, 2004). Moreover, a values-based leadership approach melds with the “integrity chain” of James (2002) that links integrity in the process, trust amongst the members, and repeat business based on satisfactory performance and quality, and a profitable relationship between each of the parties. Although technical knowledge and management expertise is important, it is essential for construction managers to exhibit the innate ability to interact effectively with people to execute the project (Rubin, et al., 2002). These values-based leadership traits of trust, integrity, and people-orientation are critical to success in the construction industry.
The Research Study
The main research question addressed in the study was “Can the application of values-based leadership skills, values and concepts improve the processes of project management, especially within the construction industry?” A follow on to this research question was the hypothesis of “Values-based leadership skills, values, and concepts are highly applicable to the processes of project management, in particular, in the leading of constructed facilities programs from concept through completion.” The criteria for performance excellence embodied in the Malcolm Baldrige National Quality Award (2004) offered a framework to develop the list of questions, both qualitative and quantitative. Leadership, one of the seven categories that make up the core values and concepts, “examines how the organization’s senior leaders address values, directions, and performance expectations, as well as a focus on customers and other stakeholders, empowerment, innovation, and learning” (Baldrige, p. 13). (The other categories include strategic planning, customer and market focus, measurement, analysis and knowledge management, human resources focus, process management, and business results.)
From the Baldrige (2004) criteria on the interrelated core values and concepts, the writer developed a list of the respondent items that addressed the skills, values, and concepts of values-based leadership. These items include the following quantitative elements: (1) visionary leadership, (2) customer-driven excellence, (3) organizational and personal learning, (4) value of employees and partners, (5) agility, (6) focus on the future, (7) management for innovation, (8) management by fact, (9) social responsibility, (10) focus on results and creating value, and (11) systems perspective. From the Baldrige (2004) category on organizational leadership, especially on senior leadership direction, the author developed a list of qualitative research questions that cover the elements of values-based leadership. The list of discussion items addressed how senior leaders accomplished the following: (1) set and deploy organizational values, (2) create focus and balance for stakeholder expectations, 3) communicate values, (4) ensure two-way communications, and (5), (6), and (7) create an environment of empowerment, learning, and legal and ethical behavior.
The conducted research on values-based leadership (VBL), and the applicability to the construction industry, addressed and assessed the four critical elements of this topic. First, the conducted VBL-research evaluated the inherent values shared between the leader and her followers that are the major underpinning of ethical leadership. The VBL-research studies analyzed the values-base for the particular application, which the leader is either advocating or lacking for the subordinates’ benefit. Also on this point, the conducted VBL-research studied the leader’s own personal ethical values and determined if these values reflect the organization’s structure and systems (Daft, 1999). Second, the conducted VBL-research study addressed the presence of the six VBL core principles. This included assessing the leader’s role as mentor, vision target creation, supportive culture, personalized leader/subordinate relationships, the leader acting as inspiring teacher and empowering coach, and, the evidence of high-performing, self-directed followers loyal to the organization and group mission (Fairholm, 1998). Thirdly, the conducted VBL-research study addressed the situational application of this leadership construct. The conducted research analyzed the effectiveness of the values-based leadership involving transactional/exchange scenarios (Daft, 1999; Northouse, 2001). Lastly, the conducted VBL-research study evaluated the presence of specific value confederations in a particular industry (construction), an enterprise (construction management, design/build, general contracting), and a profession (construction project manager) (Evans & Wurster, 1997; Lei, 2003; Schwab, 1999). This cornucopia of research scenarios presented a formidable challenge in designing the research strategy, since the design needed to address each of these avenues.
Organization of the Research Study
The conducted research used a mixed methods approach to assess the critical elements of this topic. First, in researching values-based leadership as described by Daft (1999), a mixed methods approach was found appropriate to identify the values shared between the leader and followers (qualitative), review the values-base for the particular application (quantitative), and compare the leader’s ethical values with the organization (mixed methods). Second, the six core principles of values-based leadership listed by Fairholm (1998) were best assessed using a mixed methods approach. This included analyzing the leader’s effectiveness when including the leader as mentor, assessing her/his ability to create a vision for the team to target, developing a supportive culture, assessing the value of the leader/subordinate relationships, assessing the leader as coach, and evaluating the evidence of high-performing, self-directed follower (mixed methods). Third, the mixed methods approach was the preferred scheme to address the situational application of values-based leadership. In this study, the mixed methods research analyzed the effectiveness of the values-based leadership involving transactional / exchange scenarios (Daft, 1999; Northouse, 2001) and evaluated the presence of specific value confederations in the construction industry and the project management profession (Evans & Wurster, 1997; Lei, 2003; Rea & Parker, 1997).
In choosing an appropriate research method for the proposed dissertation, the author considered a mixed methods approach that combined both quantitative and qualitative methods for a dissertation topic on values-based leadership (Tashakkori & Teddlie, 2003). Importantly, a mixed methods approach best satisfied the desired design features for the subject values-based leadership study. The optimal design features included a robust research design with the ability to address pragmatic and constructivist assumptions, the ability to handle a broad research population, afforded flexibility in data gathering, and offered multiple modes of analysis and reporting. Moreover, a mixed methods research approach for the conducted VBL-study complied with the “form follows function” adage of the construction industry and offered a balance in the methodology that properly helped control researcher bias. Lastly, the mixed methods approach offered a sequential/concurrent strategy of inquiry that used open-ended questions help guide the writing of the closed-ended survey instrument (Cooper & Schindler, 2003; Creswell, 2003).
This “third methodology movement” of mixed methods research has evolved as a pragmatic way of using the strengths of both the quantitative and the qualitative approaches (Thomas, 2003). The author foresaw the need to approach the topic on values-based leadership from both research perspectives (Cooper & Schindler, 2003). Quantitative research methods allowed the author to analyze the presence and prevalence of leadership in managing the construction process from concept through turnover (Creswell, 2003). Qualitative research methods allowed the writer to approach the topic of values-based leadership using a process that is considered acceptable and appropriate by the project management community (Denzin & Lincoln, 2003a, 2003b).
Quantitative Data Review and Analysis
This section reviews the data collected from the quantitative survey and analyzes the results of each item and composite results for different scenarios.
Quantitative Survey Results
A total of 86 respondents completed the quantitative survey. This includes 55 responses from the 358 surveys sent to the construction management firms, design builders, and general contractors listed in the CAM 2004 Construction Buyers Guide. Another 17 responses were received from the 41 surveys mailed to the membership of the ESD-sponsored Construction and Design Summit. In addition, 14 persons who were part of the focus group discussions were allowed to complete the survey.
Analysis of the survey question responses was performed by aggregating the total number of responses for each of the 11 response categories. Then, this same criterion of aggregating the responses was used for series of particular data sorts. These data sorts included “years in the construction industry,” “position,” and “firm’s involvement in the construction industry.” The following subsections discuss each of these composite reviews. The composite of all 11 survey questions, as answered by the 86 respondents, and shows that 95.46% of all responses are in positive agreement. That is, 55.71% “strongly agree,” 32.35% “agree,” 7.4% “sort of agree,” while 3.07% are neutral, 0.85% “sort of disagree,” 0.21% “disagree,” and 0.42% “strongly disagree” as an aggregate of all the questions.
In sorting the responses by the respondents’ years of experience in the construction industry, nine separate cases were established. Separate cases were established at five-year intervals through 40 years of industry experience, with the last case as “40-plus” years. The average number of years’ experience was determined for each case. In sorting the responses by the respondents’ position level in the construction industry, three major cases were established. Separate cases were established for “executive,” “middle management,” and “project engineer” levels. The average number of years’ experience was included. In sorting the responses by the respondents’ involvement in the construction industry, seven major cases were established. This sort allowed for multiple levels of involvement for the constructors. Separate cases were established for “construction management,” “design build,” “general contractor,” “construction management / general contractor,” “design build / general contractor,” “construction management / design build / general contractor,” and “other.” The average number of years’ experience was included for each case. In addition, although a “construction management / design build” case is possible, no responses were received from this sector.
Analysis of Quantitative Results
The construction industry holds these values in the following order of importance. Strongly held beliefs (greater than 95% agreement) include a focus on results and creating value (100%); valuing employees/partners and a focus on the future (both 98.84%); organizational/personal learning and social responsibility (97.68%); management by fact (97.67%); and visionary leadership and management for innovation (95.35%). Well-held beliefs (greater than 90% agreement) include customer-driven excellence (91.86%) and agility (90.69%). A held belief (greater than 85% agreement) is systems perspective (86.04%).
In review of the “years in the construction industry” cases, the data shows a balanced increase up to an ultimate plateau, or Gaussian distribution, of complete agreement with the Baldrige (2004) ethical values. In review of the composite responses for the “position level in construction industry” cases, the distribution is an inverted “V” shape. The Project Engineer experience-level case (98%) dips by 6% to the Middle Management level case (92%) then rises up by 4% to the Executive level case (96%). By visual inspection, the survey responses show the greatest dispersion in the replies among those who hold middle management positions and are “new” to the construction industry - for example, a human resources manager for a general contractor. Those positions with the tightest affinity (i.e., all responses at “strongly agree”) to the ethical leadership values are distributed somewhat evenly throughout the position classifications and by years of experience.
The review of the composite survey results for the “involvement in the construction industry” cases showed the greatest difference between a single case and all the other cases. The construction management firms, with 80% of the responses in positive agreement, are radically different from the other cases. The data shows a 15% difference with the construction management / general contractor case (at 95%), a 16% difference with the general contractor and the CM/DB/GC cases (both at 96%), and a 18% difference with the design build, DB/GC and other cases (each at 98%). The author attributes this situation as causation with the nature of the different entities’ involvement with the construction process. The “sole” construction management firm typically functions only on an agency basis for the facility owner. The other involvement cases include elements that have a stronger affinity to the ethical leadership values. These are the companies that make up the design build, the design build/general contractor, and the other cases (many of which were architectural/engineering firms), each of which has a 98% “creative” element of design genres. The general contractor, construction management /general contractor, and the construction management / design build / general contractor firms all have the “business acumen” of competitive bidding, as found in the general contractor firms.
Qualitative Data Review and Analysis
This section reviews the data collected from the qualitative interviews and focus group sessions and analyzes the results of each discussion question.
Qualitative Interview Results
A total of 16 people participated in the qualitative portion, seven in a focus group session, and nine in individual intense interviews. Five of the participants worked for construction entities, three with architectural/engineering firms, three represented facility owner companies, three with university/training organizations serving the construction industry, and, two were executive director level with construction trade/industry organizations. The interview participants from both the focus group and individual interviewees, who had not been solicited previously for the quantitative survey, were invited to do so.
Although there were some misconceptions on the proper definitions of “morals” and “ethics” within the focus group discussions, the author noted these distinctions to the respondents: morals are the values people chose to guide the way they ought to treat each other and ethics provides a systematized framework for making decisions where values conflict. In addition, the values that establish the ethical framework for decision-making requires all participants to equally share in its application and enforcement. The values of profitability, integrity, and trust seemed to be the most often noted among the respondents in addressing their organizations’ values.
Analysis of Qualitative Results
The results of the focus group discussions and the in-depth interviews (i.e., qualitative portion of the research) show strong although not absolute support of the author’s hypothesis of “values-based leadership skills, values and concepts are highly applicable to the processes of project management, in particular, in the leading of constructed facilities programs from concept through completion.” The interviewee and focus group responses to the discussion questions, developed from the Baldrige (2004) category on organizational leadership, relate, for the most part, to the principles of values-based leadership postulated by Fairholm (1997, 1998).
The qualitative results show a strong correlation between the VBL principles and most of the leadership requirements. The leadership requirement for deploying organizational values, directions, and performance expectations relates to the second principle of values-based leadership, which considers the leader’s role in developing and deploying a vision based on core values of the organization. The balancing of value for stakeholders relates to the first VBL principle concerning the leader’s role in stakeholder development while focusing on accomplishing the vision. Communicating organizational values, directions, and expectations to all correlate to the third VBL principle relative to how effective leaders create a culture supportive of the core values that help contribute to the team members achieving their personal goals. Ensuring two-way communications aligns with the fourth VBL principle that correlates leader preparation for personalized relationships with followers and reinforces personal values, self-purpose, and a two-way exchange in a council-like setting.
The leadership requirement for creating an environment for organizational and employee learning squares precisely with the fifth VBL principle that requires the values-based leader to be a teacher of his followers, coaching on improving personal relationships, work skills, and attitudes to enable, empower, and energize them to greater performance. Creating an environment for legal and ethical behavior correlates clearly with the sixth VBL principle of the leader’s dual goal of producing high performance and self-directed followers with inherent loyalty to the organization and group mission. In regard to creating an environment for empowerment, innovation, and organizational agility, the results of the interviews and the focus group discussions were not consistent with the philosophical base for VBL (Fairholm, 1998), in which leaders act with consistency, trustworthiness, and enthusiastic support to empower their followers. On this aspect, the qualitative research results do not show strong adherence to the VBL principles by constructors.
Conclusions and Recommendations
This section addresses the conclusions drawn by the author based on the results of the quantitative survey and the qualitative discussions concerning building ethical partnerships in construction using values-based leadership concepts, values, and skills. The results of the quantitative survey are used to test the research question, and the consensuses on the responses from the qualitative discussions (interviews and focus groups) are related back to the author’s original hypothesis.
Conclusions from Quantitative Research Results
The quantitative research data show strong but not overwhelming support of the main research question, “Can the application of values-based leadership skills, values, and concepts improve the processes of project management, especially within the construction industry?” The quantitative survey results, with an average composite 95+% agreement with the 11 survey questions, show strong but not overwhelming support of the values-based leadership construct by the construction industry. The following sub-sections evaluate, in rank order, each of the Baldrige (2004) criteria on interrelated core values and concepts of leadership, which were used as the basis for the 11 survey questions, and discuss the author’s conclusions.
Focus on Results and Creating Value
The survey data show 100% agreement by all respondents with a unanimous belief that their organizations’ performance measurements need to focus on key results. This research result shows conclusively that construction people value pragmatic, practical, and results-driven leaders. Likewise, the research results strongly imply that successful construction project managers would be considered astute in design and construction operations, shrewd in contract negotiations, and no-nonsense in business dealings.
Valuing Employees and Partners / Focus on the Future
The survey data show almost a 99% agreement by respondents with both of these beliefs. The research results show a very strong belief that a construction organization’s success depends increasingly on the diverse knowledge, skills, creativity, and motivation of all of its employees and partners. That is, constructors consider the diversity of the industry workforce, in general, and the membership of the particular construction project team crucial to project and company success. In addition, the research results show an equally, very strong belief that, in today’s competitive environment, a focus on the future requires an understanding of the short- and longer-term factors that affect an organization’s business and marketplace. Although projects do end, construction leaders must consider the immediate situation, as well as the long-term implications and the ultimate effects on all project stakeholders, when making critical decisions.
Organizational and Personal Learning / Social Responsibility / Management by Fact
The survey data show nearly a 98% agreement by the respondents with these three beliefs. First, the research results exhibit a very strong belief by constructors that achieving the highest levels of business performance requires a well-executed approach to organizational and personal learning. Implementing formalized training programs to improve job skills and developing a learning organization are highly valued by the construction industry. Second, of equal value, the research results show a very strong belief that a construction organization’s leaders should stress responsibilities to the public, ethical behavior, and the need to practice good citizenship. Constructors value ethical conduct by their members and being a good business neighbor within their communities. Thirdly, of nearly equal value, the research results conclude a very strong belief by constructors that their organizational successes depend on the measurement and analysis of performance. Success of both construction projects and their respective company organizations is based on their ability to plan the work and then work the plan.
Visionary Leadership / Managing for Innovation
The survey data show that over 95% of the respondents agree with these tenets of leading and managing. The research results show a strong belief that the senior leaders must set the directions of their construction/design organization, create the proper customer focus, articulate clear and visible organizational values, and establish high expectations for everyone to follow. These transactional leadership traits of direction setting, customer focusing, setting values, and establishing clear expectations are considered as the most important visionary duties of a construction/design organization’s executives. In tandem with the visionary leadership requirements, the research results show an equally strong management belief that innovation means making meaningful change to improve a construction organization’s products, services, and processes in order to create new value for the organization’s stakeholders. Although the architect/engineer designs their “product”, the constructors innovate in their “methods and means” (processes) in bringing the facility to completion within cost budget, schedule, quality, and performance requirements (services).
The survey data show that almost 92% of the respondents have a well-held belief that the construction organization’s customers are the judge of quality and performance. These research results exhibit a strong desire by constructors to meet the needs and expectations of the facility owner (customer) as a measure of their success. Conversely, the research result implies a guarded skepticism by some constructors (over 8% of the survey respondents) in the ability and sophistication of the facility owner to assess properly the quality and performance of a constructor’s work.
The survey data show that almost 91% of the respondents have a well-held belief that their organizations’ success in globally competitive markets demands agility. These research results demonstrate that a construction organization’s capacity for rapid change and flexibility is a prime determiner of success on projects where the constant is change. On the contrary, the research result implies an attitude by some constructors (almost 9% of the survey respondents) that adhering strictly to the original terms and conditions of the construction contract is appropriate in executing their work.
The survey data show just over 86% of the respondents hold a belief that the successful management of their organizations’ overall performance requires organization-specific synthesis, alignment, and integration. These research results underscore the decentralized nature of construction project execution, in which each project team operates as its own business entity and functions independently from the other construction projects undertaken by the “home” construction organization. Moreover, the research results imply that a fair number of construction project managers (that is, about 14% of the respondents) prefer to “go with their gut” in making decisions and manage by “the seat of their pants,” even though modern project management systems are available for their use. Old warriors can be rather die-hard.
The next section addresses the author’s conclusions based on the qualitative results.
Conclusions from Qualitative Research Results
The results of the focus group discussions and the in-depth interviews (i.e., qualitative portion of the research) show strong although not absolute support of the author’s hypothesis that “values-based leadership skills, values, and concepts are highly applicable to the processes of project management, in particular, in the leading of constructed facilities programs from concept through completion.” The following subsections evaluate the responses to the discussion questions developed from the Baldrige (2004) category on organizational leadership and relate the consensus results to the principles of values-based leadership postulated by Fairholm (1997, 1998).
Deploying Organizational Values, Directions, and Performance Expectations
The focus group and interview results noted a consensus on its organizations’ leaders using a top-down approach in the development and deployment of corporate values and their leaders’ use of multiple communication channels to spread these organizational values, short- and long-term directions, and performance expectations. This leadership approach is in direct agreement with the second principle of values-based leadership as postulated by Fairholm (1997), which considers the leader’s role in developing and deploying a vision based on core values of the organization.
Balancing Value for Stakeholders
Common discussion responses to the balancing of customer/stakeholder value noted that the principle was embodied in their company’s formal business and organizational development processes, stakeholder expectations are recognized and articulated early in the planning process, and these formalized expectations are made a critical part of the construction team’s performance measures. These common steps in the planning process by construction companies are in concert with Fairholm’s (1997) first principle of values-based leadership that relates to the leader’s role in stakeholder development while focusing on accomplishing the vision.
Communicating Organizational Values, Directions, and Expectations to All
The results of the interviews and focus group discussions noted several common methods of educating employees in their organizations’ corporate values, directions, and expectations, including candidate screening; new employee orientation, as a part of regular employee training; and regular postings on company media. These communication techniques correlate to the third Fairholm (1997) VBL principle relative to how effective leaders create a culture supportive of the core values that help contribute to the team members achieving their personal goals.
Ensuring Two-Way Communications
The interview and focus group participants noted “town hall” meetings conducted several times throughout the year and open dialogues between the supervisor/employee and executive management / project manager as common methods for two-way communications. These methods are in alignment with the fourth Fairholm (1997) principle of VBL that correlates leader preparation for personalized relationships with followers and reinforces personal values, self-purpose, and two-way exchange in a council-like setting.
Creating an Environment for Empowerment, Innovation, and Organizational Agility
The results of the interviews and the focus group discussions were not consistent on this topic, with a high level of divergence in replies among the participants. The results showed several with agile organizations with constant encouragement from their senior leaders to empower, innovate, and act entrepreneurial. Other respondents noted their leaders reacting to short-term market pressures and acting accordingly to save themselves and positions. In between, several of the organizations use “thinking outside of the box” as part of the long-range planning process conducted every five years. These variations of leader behavior are not consistent with the philosophical base for VBL (Fairholm, 1998), in which leaders act with consistency, trustworthiness, and with enthusiastic support to empower their followers. On this aspect, the qualitative research results did not show strong adherence to the VBL principles by constructors.
Creating an Environment for Organizational and Employee Learning
A strong consensus from the interviews and focus group discussions noted the high importance placed by all of the respondents’ organizations on employee and organizational learning, professional development, and formal training for all employees. This consistent value for creating learning environments within the construction industry squares precisely with the fifth Fairholm (1997) VBL principle that requires the values-based leader to be a teacher of her followers, coaching on improving personal relationships, work skills, and, attitudes to enable, empower, and energize them to greater performance.
Creating an Environment for Legal and Ethical Behavior
All discussion respondents’ organizations were adamant about conducting their business in the utmost legal and ethical manner possible, with the common response that failure to exhibit legal and/or ethical behavior by an employee at any level would result in termination. This unanimous agreement on the value of utmost legal and ethical behavior correlates clearly with the sixth Fairholm (1997) VBL principle of the values-based leader’s dual goal of producing high performance and self-directed followers with inherent loyalty to the organization and group mission.
In this section, the author offers suggested recommendations to the construction industry on building ethics in construction partnerships and identifies additional areas for future research.
Suggestions Drawn From General Conclusions
The principal conclusion the author draws from the results of the research, both the quantitative survey and the qualitative interviews, is that values-based leadership offers the construction industry a comprehensive leadership methodology to pursue building just, participatory, and sustainable partnerships. The most prevalent values among the major stakeholders in the construction industry are the requirements of trustworthiness in developing harmonious business relationships, the opportunity to earn a just profit for the associated risks, and the need for integrity and trust in collaborating. The author recommends that the construction industry embrace values-based leadership concepts, values, and skills as the foremost leadership construct in building ethical partnerships among stakeholders of constructed facilities projects.
A second general conclusion that the author found is that organizations and companies that were ISO-9000 certified considered both the quantitative survey items and the qualitative interview questions to be straightforward and did not have difficulty in responding. Conversely, some of the “off page” comments made by a few of the survey respondents showed a lack of understanding of basic quality management and ethical leadership principles. The author surmises that the ISO-9000 certification process requires an inherent understanding of values-based leadership. Moreover, the writer concludes that ISO-9000 certification signifies the particular construction/design entity’s adherence to developing ethical-based partnerships and the organizations’ conscious intent on conducting themselves in the utmost ethical manner possible in serving their clients and in partnership with their fellow subcontractors, suppliers, and associates. The author suggests that the owner organization and/or the project’s contracting agency, desirous of ethical collaborating on the design and construction of the facility, should require ISO-9000 certification as a pre-qualification requirement of the potential bidders.
A third general conclusion drawn from the results of the research study is that the strength of the ethical beliefs and values of all those involved is a function of their proximity to the “epicenter” of the construction action more than any other criteria. That is, those stakeholders most involved with working “in” the business of construction, as opposed to those in various supporting roles working “on” the business of construction, hold the strongest beliefs concerning ethics and values-based leadership. The author recommends that the construction industry partners actively engage in training and professional development programs that include leadership and ethics as core topics.
The strongest held values amongst the constructors are a focus on results and creating value (quantitative survey results) and ensuring that the organization has well articulated values that are made well known throughout the entity (qualitative interview results). The lowest held belief with the greatest dispersion is the systems perspective (quantitative survey results) and the creating of an environment for empowerment, innovation, and organization agility (qualitative interview results). This situation is consistent with the conservative nature of the construction industry. There is a strong focus on completing the specific project scope per the specified time, cost budget, and quality constraints, to meet the expectations of the client. The construction project team may exhibit creativity in project execution as long as it sticks to the project constraints and stays within the established parameters, which is a very transactional leadership environment. The author suggests that the construction industry explore the melding of a systems approach to the achievement of project outcomes and the consideration of “team empowerment” as a company value.
One final insight is that the construction industry values highly values-based leadership and the need for strong ethical practices by the members. However, the participants generally seemed unaware of the formal process of ethical leadership and exhibited a subconscious competence in leading based on shared values and common satisfaction of mutual goals. In an industry that is very dependent on trust among the participants for mutual satisfaction, leadership based on shared values is essential. The author recommends that constructors continue to strive to exhibit “walking the talk” concerning ethical conduct.
Suggestions for Future Research
In researching these topics on ethics in construction and values-based leadership, two major areas emerged that require additional study. First, the author suggests that expanding the mixed methods research study on the applicability of values-based leadership to other project-driven industries would be valuable. Suggested project-driven industries include information systems / telecommunications, new product development, and manufacturing. The quantitative surveys should continue to use the Baldrige (2004) criteria on interrelated core values and concepts of leadership, so that industry comparisons can be made.
The second major topic that the author found to be in dire need of research concerns workforce diversity and professional development in the construction/design industry. Quantitative research is needed to develop a comprehensive workforce profile of those currently working in the construction industry in order to understand the present state of diversity. Qualitative research is necessary to gain a comprehensive understanding of the professional values that lead to career success for those interested in construction and design.
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