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rticle

Effective Project Management - Essential


Elements For Successful Projects
By H.T Ong
Editors note: This article is the conference paper presented by Mr.H.T. Ong at the Inaugural Construction
Conference 2007 Jointly Organised by CIOB Singapore and National University of Singapore on January 25, 2007
in Singapore.

n the context of the construction


industr y, many of us would
acknowledge that successful
construction projects are often
attributed to those that achieve
t h e c l i e n t s re q u i re m e n t s a n d
project objectives set out at
the outset of the project. Such
objectives may include delivery
within the stipulated TIME period,
construct within the budgeted
CO S T a n d m e e t t h e Q UA L I T Y
standard set. Other objectives,
equally important, may include
meeting functional requirements
and satisfaction of the clients and/
or end users. Notwithstanding
such requirements and objectives,
the construction industries
around the world still suffer from
numerous setbacks and problems,
in particular those associated with
the construction process.
The common issues and problems
associated with construction
process lie in the ill considered
procurement selection, traditional
separation of design from
construction, lack of integration/
organisation of the project
members and poor communication
channels, uncertainties in design
and construction, changing internal
and external environment, project
complexity and characteristics, as
well as contractual and commercial
matters. In order to overcome
those issues and problems so as
to achieve excellence in managing
construction project, it is therefore
paramount that the elements or
ingredients in project managing

12 essential elements needed in formulating and facilitating


effective project management to achieve project excellence
and success
1. A good understanding of the Client, its Objectives and
Priorities.
2. A detailed appraisal and understanding of the Project Nature
and Characteristics.
3. A proper and structured appraisal and management of the Project
Risks.
4. Selection of a suitable Project Team (Design/Construction).
5. Use of a suitable Building Procurement System.
6. Use of a suitable Contractual Arrangement.
7. Having an effective Organisation Structure that allows efficient
Communication Channel and is capable of adapting to changes.
8. Having proper and appropriate Planning.
9. Maintaining effective Monitoring and Control Systems capable of
identifying and responding to changes.
10. Maintaining proper Information Recording and Retrieval Systems.
11. Ability to adapt and Manage Change.
12. Emphasis on the importance of good Commercial/Business and
Human Relations.
Note: 6 & 10 (adapted)

effectively are well understood


and practised.

1. The Client and its Objectives


and Priorities

Project Management is defined as


the overall planning, co-ordination
and control of a project from inception
to completion aimed at meeting
a clients requirements in order to
produce a functionally and financially
viable project that will be completed
on time within authorised cost and to
the required quality standards4.

The first essential element in


effective project management is to
have a good understanding of the
client, its objectives and priorities
for its organisation and project,
specifically.

The 12 essentials elements for effective


project management are briefly
described and discussed, as follows;
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Whether the client is from private or


public sector, each client has its own
organisation and project objectives.
The former objectives can include
profit margin, growth/expansion,
strategic alliance, etc.

rticle

The latter objectives may include


delivery within the stipulated TIME
period, COST within budget, meeting
the required QUALITY standards or
FUNCTIONAL requirements, as well as
ensuring customer SATISFACTION.
Whichever the objective/s, it is
important to know and understand
clearly the clients requirements
and priorities. Whilst some clients
may place priority on aesthetic or
prestige, early or timely completion
or price certainty, others may place
emphasis on buildability or flexibility
to accommodate changes during
construction and/or operation of
the eventual completed building
or facility.
The objectives are essentially the
INPUT and the CONSTRAINTS can
be the priorities and requirements
on the project. In order to ensure
that the OUTPUT, which are the
deliverables, products and/or services
can be achieved satisfactorily and

successfully, the MECHANISMS,


which comprises people, resources,
etc must be adequate and timely
put in place and managed, properly.
That is to say, the management
of the project encompasses the
effective interaction and integration
of the four basic elements in the
project management process.
Diagram 1 illustrates the project
management process1

2. Project Nature and


Characteristics
A detailed appraisal and
understanding of the nature and
characteristics of the project is
crucial as every project exhibits
different nature and characteristics.
This is the second essential element
in effective project management.
For example, large and complex
projects such as airports, involve
various unique assemblies and

CONSTRAINTS
Time, cost, quality,
technical and other
performance parameters,
legal, environment, etc

INPUT
Business
needs
and
requirements

OUTPUT
Project
deliverables,
products
and/or
services

MANAGEMENT
OF THE PROJECT

complications due to the high level of


services and specialist input, making
co-ordination and knowledge of such
works of paramount importance.
Consequently, there should be
emphasis on selection of a contractor
or builder who has the knowledge
and experience to provide the input
and expertise by partaking in the
pre-construction stage to ensure
buildability and proper co-ordination
of the works amongst the many
parties involved rather than only
during the construction stage.
In the case of mass housing or
industrial buildings, they often involve
repetitive construction works due to
the extensive use of standardised or
prefabricated components and/or
proprietary systems. Such systems
usually have sufficient construction
information and details for the
construction works to be carried
out and completed. Hence, works
can often start early and phased
completion is often possible. As for
refurbishment works, its nature and
characteristics are again different
due to the uncer tainty of the
extent of works as it is usually
messy and complicated, possibly
involving existing buildings with
unsecured site conditions. Works
are often required to be started as
soon as possible, with difficulties in
the measurement of quantities and
pricing of rates.

3. Project Risks
The third essential element is
to have a proper and structured
appraisal and management of
project risks.
BS 4478 defines Risk as a combination
of the probability, or frequency, of
occurrence of a defined hazard and
the magnitude of the consequences
of the occurrence. In construction
project terms, RISK is The likelihood
of negative occurrences adversely
affecting the project, so that its
objectives become more difficult

MECHANISMS
People, techniques
and tools, equipment,
organisation
Diagram 1
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or impossible to achieve. Due to


the inherent charac teristics of
construction projects and their
processes, they invariably give
rise to risks and must therefore
b e u n d e r s to o d a n d m a n a g e d,
effectively. Such characteristics
include changing environment
conditions (externally and internally),
traditional separation of design from
construction, lengthy design and
construction periods, diverse and
substantial resource requirements,
sub-contracting of works, multidisciplinary project team members,
multi-level communication channels
and multi-facetted co-ordination of
works.

Managing risks effectively facilitates


the achievement of project objectives,
improves projec t per formance,
increases productivity and the
eventual profitability. Hence, specific
considerations need to be given in
the appraisal of risks, namely;

Risks could stem from bad


ground and weather conditions,
inadequate design and construction
documentation, lack of resources
and/or skills/expertise, poor planning,
monitoring and/or control and lack
of teamwork and communication.
The effects arising from these
risks if not properly managed may
include disruption and delays to
the construction works, budget
and costs exceeded, poor quality
and standard of works, damage
to plant/equipment and/or injury
to construction personnel and
contractual or technical disputes.
Hence, having proper Risks Appraisal
and Management is an essential
element. It involves the systematic
application of strategies, policies,
methods and procedures by taking
positive, often proactive, steps in
identifying, assessing, mitigating and
managing the risks to eliminate or
reduce its exposure to the party/ies
concern.

Then, the management of the risks


appraised, which involves;

Proper and structured risks appraisal


and management can lead to a more
effective project or construction
management through better
awareness and understanding of
risks, systematic treatment of the risk
issues to reduce uncertainties and
hazards, as well as to ensure better
use of the available resources.

Identification of risks (the cause)


e.g. hazards - what, where, when,
how, why, etc.
Analysis of risks identified (the
analysis) e.g. likelihood and
nature of occurrences, etc.
Assessment of risks analysed
(the effects) e.g. consequences
and extent of injuries, damages,
disruptions, delays, etc

Planning and allocation of the


risks appraised (the planning and
control) i.e. to avoid, transfer, share,
reduction and acceptance.
Monitoring and feedback of the
actual risks occurrences (the
monitoring and feedback) i.e.
recording, checking, verifying,
comparing, reporting.

Further details on risk management


can be found in the authors paper on
Risks and Its Management, delivered
at the International Conference on
Construction Law & Arbitration,
April 2628, 2005, organised by
Kuala Lumpur Regional Centre for
Arbitration (KLRCA) & Malaysian
Institute of Arbitrators (MIArb) on
April 27, 2005.

4. Project Team
The fourth essential element is in the
selection of a suitable project team,
both for design and construction.
The Project Manager plays the all
important role to lead and manage
the project team towards successful
project completion. His or her
duties will vary depending upon the
clients experience and requirements
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for the project. An effective Project


Manager, usually a suitably qualified
professional, must be competent
enough to plan, organise, co ordinate, monitor and control the
project. His major task in project
management is predominantly about
leading, managing, delegating and
motivating the project team and the
workforce, in addition to advising
his/her Client and liaison with other
relevant parties in connection with
the project.
The Project Manager needs to
s e l e c t o r gi ve a d v i ce o n t h e
selection of a suitable project team
for the project. In selecting the
team for design and construction,
several factors such as selection
criteria and its process, scope
of services/works, commitments,
responsibilities, experience,
teamwork, communication, action
plan, etc need to be assessed and
considered properly. The selection
process will be very much governed
by the type of building procurement
system to be used for the project.
The CIOB Code of Practice4 provides
a number of checklists and forms
for the selection of the design and
construction teams.

5. Building Procurement
System
The fifth essential element to
effective project management is
to ensure the use of a suitable
procurement system in managing
the construction process.
The building procurement systems
include traditional/conventional,
management contracting, design
and build/construct, project
management, pack age deal or
turnkey, etc. Each system exhibits
its own characteristics and benefits/
disbenefits.
Any selection should consider them
together with the project nature and

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characteristics properly, in addition


to the elements described above.

The Chartered Institute of Building,


Malaysia. December 16, 2000.

Fur ther details on the aforesaid


systems can be found in Construction
Contract Administration/Management
in Practice10.

7. Organisation Structure

6. Contractual Arrangement
The use of a suitable contractual
arrangement, which is the
contractual and legal framework
for the construction process is
the sixth essential element to
successful project management.
The contractual arrangement
leading to contract documentation
establishes the contractual rights,
obligations, responsibilities and
liabilities of the contracting
par ties. Such ar rangement or
documentation includes contract
b a s e d o n b i l l s o f q u a n t i t i e s,
drawings and specification, schedule
of rates, cost reimbursement,
design and build, etc.
In selecting a suitable contractual
arrangement, various factors
such as the elements described
p re v i o u s l y, p l u s c h a n g e i n
requirements, design completeness,
cost fluctuations, etc., need to be
considered accordingly, instead of
merely using a standard forms of
contract.
Further details on the contractual
documents and arrangement can
be found in the Authors paper on
Construction Contracts in Malaysia
a paper presented at Construction
Conference 2002 ~ A One -D ay
Conference jointly organised by
The Chartered Institute of Building,
Malaysia (CIOBM) and Master
Builders Association, Malaysia
in-conjunction with MALBEX and
International Construction Week
2002, September 12, 2002 and
Effective Contracts Management a
paper delivered at the Construction
Management Seminars organised by

Organisation structure is about


framework, hierarchy, authority,
control, rules, procedures, formal
relationships, for the people in the
organisation and/or the project.
This seventh essential element,
which is a suitable organisation
structure, allows effective and
efficient communication channels
to take place and be capable of
adapting to the project environment
and changes.
Any structure adopted, be
it functional, project or matrix
organisation can affect the project
teamwork, work efficiencies and
the eventual project outcome.
Each type of organisation structure
has its own benefits/disbenefits.
Criteria such as clear objectives and
priorities, policies and procedures,
roles and responsibilities, flexible
work structure, people relations,
motivational issues, leadership,
teamwork, capacity to change,
p e r fo r m a n ce, e tc n e e d to b e
properly considered when choosing
a suitable organisation structure for
the construction project.
Common organisation structures
used in the construction industry
are shown in Diagram 2.

8. Planning
All successful projec ts do not
happen without proper planning.
Effective planning is an essential
element in project management. In
todays construction projects, too
much emphasis has been placed
on sophisticated planning tools
and scheduling programmes rather
than whether they are suitable and
appropriate for the project concern.
Indeed, the CIOB Code of Practice4
commented that There is a wide
range of projec t management
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software packages available, however


there is not a single package which
is ideal for projects and budgets.
Notwithstanding, the use of bar
charts and critical path methods
are still common in the construction
industry.
The Association of Project
Management (APM), in its book
on Project Management Body of
Knowledge 1, recommends the use of
a Project Management Plan as the
key agreed document in the overall
planning, implementing, monitoring
and controlling of a project. The
said Plan should include objectives,
strategies, programmes, policies,
etc.
Essentially, the said Plan should
answer the why, what, who, where,
when, how and how much of the
project. Such holistic planning
should encompasses not only time
scheduling, but also resources such as,
management, manpower, machines,
materials, money. A typical project
management plan requirements
abstracted from BS6079-1:2002 is
shown in Appendix 1.

9. Monitoring and
Control Systems
The ninth essential element is to
maintain effective monitoring and
control systems, which are capable
of identifying and responding to
changes to ensure project objectives
can be met. Proper monitoring
and control systems enable timely
provision of information/details,
smooth progress of works, costs
within the budget, identification
of changes/variations, timely
supervision, testing and inspection
of works, etc.
I ncreasingly, the projec t team
should adopt quality assurance
programmes such as ISO 9001:2001
to ensure consistency and systematic
approach in organisations work
processes and procedures. Quality is

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FUNCTIONAL
Director

Management Level

Operations

Tendering

Sales

Marketing

Department Level

Administration

Functional responsibility

PROJECT
Director

Marketing

Finance

Project
Manager A

Construction

Administration

Project
Manager B

Project
Manager C

Procurement/
Purchasing

Contract

Tender

Construction

Construction

Contract

Procurement/
Purchasing

Procurement/
Purchasing

Contract

MATRIX
Director

Project
Manager A
Project
Manager B
Project
Manager X

Functional responsibility

Tender &
Contracts

Marketing

Finance

Purchasing

Others

Project responsibility

not just about achieving technical


requirements, but also the various
elements in Project Management.
There must be greater emphasis
on meeting clients requirements
and customer satisfaction, which
demands continuous improvements
in delivery and products. Such
quality practices and improvements
enhance competitiveness through
better organisational effectiveness
and per formance efficienc y in
construction projects. There is also
a broader and more encompassing
philosophy, often known as Total
Quality Management 1 , which is
aimed at identifying the clients
wa nt s, o rg a n i s at i o ns m i s s i o n ,
measuring performance to meet
required standards throughout the
whole construction process, thereby
involving the whole organisation
in a system of continuous
improvements.
Masters Builders Association
Malaysia (MBAM) has adopted a
group quality scheme using ValueManaged Quality System (VMQS)
to facilitate contractors and subcontractors in Malaysia to achieve
their ISO 9001:2000 certification,
accordingly. This is in line with the
Associations aspiration to promote
and encourage contractors, subcontractors and others to deliver
quality works for their building
and construction projects, both in
Malaysia and overseas.
In essence, VMQS, which incorporates
Value Management is Doing the
R I G H T t h i n g s R I G H T i n o rd e r
to enhance the efficienc y and
effectiveness of the quality delivery
process to ensure that the end
product or service can satisfy the
customers or clients requirements.
A typical outcome of using the FAST
approach on the work environment
is shown in Diagram 3.
VMQS is an innovative quality
m a n a g e m e n t a p p ro a c h a i m e d
at changing the traditional

Diagram 2
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HOW

WHY

OBJECTIVES
Efficient Working
Tools

Invest in ICT

Improve ICT &


Networking

NEEDS

Provide Area &


Personnel for Storage
Larger Working
Storage & Library
Better Working
Space & Layout

Facilitate People
Movements
Minimise Physical
Hindrance

Provide Confortable
Working Area

Improve
Productivity

Land Scaping
Safe Work Area

Conducive
Environment

Security

Project Good Image

Proper Space /
Relocation
Good Communication
& Interaction
Promote Staff
Interaction

Prevent Eating on
Working Area

Improve Interpersonel
Relatives

Confortable & Relax


Atmosphere

Boost Employee
Spirit

Reduce Noise
Interference

Diagram 3

organisational mindset into dynamic


companies capable of delivering
quality construction and performance
excellence at international quality
standard. Such value achievements
and improvements should allow
sustainable competitive advantages
to be realised.

recording and retrieval systems.


Good records are like snapshots of
the events or actions taken at the
particular moment, often referred to
as contemporaneous records. And,
good retrieval systems are like going
into a library to find the information
required.

For details of this approach and


workshop examples, please refer to
the Authors paper on Value-Managed
Quality System (VMQS) Towards A
Value-Added Quality Management
System a paper presented at 6 th
International Value Management
Conference at Hong Kong International
Convention Centre organised by Hong
Kong Institute of Value Management,
Nov 26 & 27, 2003

Going back to basics, records such


as tender/contrac t documents,
drawings register, correspondence
files, programmes, progress reports,
site diaries, instructions, dayworks,
claims, etc should always be up todate and maintained, properly. The
use of ICT software in systematically
organizing, recording and retrieval
of the said documents have reduced
the time taken to undertake such
tasks, effectively and efficiently.

10. Information Recording and


Retrieval Systems
This is an essential element concerned
with maintaining proper information

Practical examples, various forms and


checklists on information recording
and retrieval systems can be found
in the Appendices of the CIOB Code
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WANTS

of Practice 4 and in the Practical


Construction Contract Administration/
Management8

11. Managing Change


The eleventh essential element
involves effective change management
to ensure that changes are properly
introduced/ordered and effectively
monitored and controlled. Change
occurs not only in organisations, but
also in projects.
According to the CIOB Code of
Practice4, change in a construction
project is any incident, event,
decision or anything else that affects
any of the following:
The scope, objectives, requirements
or brief of the project.
The value (including project
cost and whole life cost) of the
project.
The time milestones (including

rticle

design, construction,
occupation).
Risk allocation and mitigation.
Working of the project team
(internally or externally).
Any projec t process at any
project phases.
All construction projects go through
a progressive transformation from
inception to the assembly of raw
materials, components and elements
under often different environment
into its planned outcome. Indeed,
projects are the engine of
change3.
In undergoing such transformation,
changes, both internally and
externally, desirable or not, may be
inevitable. Change therefore needs
to be managed, effectively if the
project is to be successful.

relations is about understanding


and fostering of interpersonal
relationships with another individual
or group. For human relations to be
effective and harmonious, criteria
such as people selection, team
commitments, meeting organisation
and project objectives, sharing
common objectives and values,
motivational issues, improvements
and skills development need to
be taken into account seriously.
Failure to manage the construction
project effectively and amicably can
lead to problems such as disputes
or conflicts and the contracting
parties may end up in arbitration or
court proceedings to resolve their
disputes.

Construction industries around the


world suffer from numerous setbacks
and problems, in particular those
associated with the construction
process. There is therefore the
need to ensure that the setbacks
and problems are eliminated or
mitigated by effective management
of the construction process in order
for the projects to be successful.

12. Commercial/Business and


Human Relations
Emphasis on the importance of
good commercial/business and
human relations is the twelfth and
final essential element, if not most
important element, in effective
project management to achieve
excellence and success in managing
construction projects.
Commercial or business relations
is about fostering business links/
relations and communication
with other organisations. Human

There is a need to strike a balance


between contractual and commercial
routes to ensure the successful
outcome of a construction project,
which essentially means to be able
to achieve a win-win outcome
for all the parties involved in the
construction project. In this regard,
Partnering, which promotes win-win
solutions, has been adopted at the
outset of construction projects in
many countries.

Summary/Conclusion

The said Code lists the change


management process as:
Identification of requirement for
change.
Evaluation of change.
Consideration of implications and
impact including risks.
Preparation of change order.
Review of change order client
decision stage.
Implementation of change.
Feedback including causes of
change.

To go down the commercial route


virtually opens up a wider and
borderless scope for negotiation
and settlement of the disputes/
conflicts without/par tly relying
on contractual/legal route. This is
called the soft approach. Neither
approach should be followed to
the extreme.

Construction in progress

Not all contractually or legally


correc t ac tion is commercially
right. Neither is commercially
sound decision contractually wrong.
Whilst it is important to know and
understand the contractual rights,
responsibilities, powers and liabilities,
it does not necessarily mean that
every contract provision must be
followed and enforced in the strictest
sense. To go down the contractual
route usually means having to rely
on the provisions expressed/implied
under the contract i.e. needing to
work or resolve matters within the
ambit of the contract. This is known
to be as the hard approach.
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In order to achieve excellence in


the management of construction
projects, it is paramount to
appreciate, understand and practice
the twelve essential elements or
ingredients necessary in formulating
and facilitating effective project
m a n a g e m e n t fo r c o n s t r u c t i o n
projects.
Effec tive Projec t Management,
which essentially is about managing
the people in the project, ensures
that the planning, organizing, coordination, monitoring and control
of the project from inception to
completion will satisfy the clients
requirements and project objectives
to achieve project success.

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REFERENCES/BIBLIOGRAPHY
1.
2.
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8.
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10.
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14.

15.
16.

Association of Project Management (APM), Project Management Body of Knowledge, 4th Edition, 2000.
BS ISO 10006:1997 British Standard, Quality Management Guidelines to Quality in Project Management,
BSI 06 - 2000.
BS 6079-1:2002 British Standard, Project Management Part 1 Guide to Project Management.
Chartered Institute of Building, Code of Practice for Project Management for Construction and Development,
3rd Edition, Blackwell Publishing, 2002.
Ong, H.T., Building Procurement, Tendering and Contractual Arrangement, Construction Management
Seminars/Workshops, CIOB Malaysia, November 16, 1996.
Ong, H.T., Effective Contracts Management Construction Management Seminars by The Chartered Institute
of Building, Malaysia. December 16, 2000.
Ong, H.T., Construction Contracts in Malaysia a paper presented at Construction Conference 2002 ~ A
One-Day Conference jointly organised by The Chartered Institute of Building, Malaysia (CIOBM) and
Master Builders Association, Malaysia in-conjunction with MALBEX and International Construction Week
2002, September 12, 2002.
Ong, H.T., Practical Construction Contract Administration/Management, 12-Modules Training Programme
Lectures and Workshops, March- September 2003.
Ong, H.T., Achieving Excellence through Value-Managed Quality System - A paper delivered at the
International Conference on Managing Excellence in Construction, Chongqing, China- Organised by
CIOB China, May 26, 2004
Ong, H.T., Construction Contract Administration/Management in Practice - Two Day Intensive Seminar/
Workshop organised by Entrusty Management Sdn Bhd, December 9 & 10, 2003.
Ong, H.T., Value-Managed Quality System (VMQS) Towards A Value-Added Quality Management
System, 6 th International Value Management Conference organised by Hong Kong Institute of Value
Management, Nov 26 & 27, 2003
Ong, H.T., Value & Risk Management, FIABCI-CIDB Brown Paper Bag Seminar, University Malaya, 2004
Ong, H.T., Risks and Its Management, International Conference on Construction Law & Arbitration, April
2628, 2005, organised by Kuala Lumpur Regional Centre for Arbitration (KLRCA) & Malaysian Institute
of Arbitrators (MIArb), April 27, 2005
Ong, H.T., Risks and Uncertainties in Construction Projects One Day Executive Workshop on Construction
Business Financing and Risk Analysis for Non-Construction Financial & Risk Managers/Executives organised
by Business & Advanced Technology Centre (BATC), Universiti Teknologi Malaysia, August 3, 2005
Pro-Value Management Sdn. Bhd/Applied Facilitation & Training, An Introduction to Risk Management for
KLCC Berhad, Training Manual/Materials, September 11, 2002.
Project Management Institute, PMI Guide to the Body of Knowledge, PMI 1996.

Mr. Ong Hock Tek BSc(Hons) MSc MBA DipM DipICArb MIVMA MIVM MMIArb FISM ICECA FCIOB FRICS FSIArb
FCIArb is a well qualified multi-disciplinary consultant, experienced in pre and post contract quantity surveying
duties, commercial and contractual administration/management of various types of construction projects,
gained from over 20 years of working for architectural practices, quantity surveyors, project managers, civil
engineering and building contractors and specialist consultants. Mr. Ong is a practicing Panel Arbitrator of
the Kuala Lumpur Regional Centre for Arbitration (KLRCA), an Accredited Mediator and Value Manager to
the Mediation and Value Management Panels of Construction Industry Development Board Malaysia (CIDB)
respectively, a Regional Convenor of Institution of Value Management Australia (IVMM), the past Deputy
President of Chartered Institute of Building Malaysia (CIOBM) and 1 st Treasurer-General of Institution of
Surveyors Malaysia (ISM). He is a certified Master Trainer and has organised and/or delivered papers in many
public and in-house conferences/seminars/workshops for professional institutions, private and public listed
companies on subjects such as construction contracts, ADR and value management. He has been actively
involved in consultation under various committees, including the review and drafting of the CIDB Standard
Form for Nominated Sub-Contract. Mr. Ong is currently the Managing Director of Entrusty Group, Director of
BK Burns & Ong Sdn Bhd and BK Burns Pte Ltd, Singapore.
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