Globalization of the Engineering and Construction Industry >> Content Detail

Lecture Notes

Lecture Notes


Course Introduction

Moavenzadeh, Wolff
Introduction to course content. The forces of change impacting the architecture, engineering and construction (AEC) fields in the global economy; a historic review and future vision of the worldwide economy and marketplace; the emerging importance of environment; the rise of trade in services with a special focus on outsourcing; the role of the WTO and other international organizations and regional trading blocs; mergers and acquisitions. Discussion of reading material and course assignments and identification of teams to work on specific topics.

Vision for the Future of the AEC Field

A look 20 years into the future; a review of past, present, and future influences which have or may dramatically reshape the AEC field and impact the way we need to manage professional and construction services in the global marketplace; a discussion of the Engineering News Record's "Greatest Construction Projects" over the past 125 years; and the future of the Built Environment. This session will conclude with a discussion of the rise of anti-global forces. (PDF)

The Growing Globalization of the Architecture, Engineering and Construction Fields

A historic review of A/E/C international markets; the three dimensions of globalization, namely geographic, procurement, and outsourcing of services; strategies for market penetration including merger and acquisitions both vertically and laterally; emerging importance of partnership with clients and suppliers; valuation of construction companies. (PDF)

Impact of Globalization of Financial Markets on Construction Industry

The rise of the private financing of large scale infrastructure projects; the importance of public/private partnership; the private finance initiative; emergence of underperforming assets and creation of equity; market backed by real assets. Creation of liquidity in construction finance; vehicles for financing of infrastructure in both developing and emerging markets.

International Markets, Networking/Marketing and Selecting the Appropriate Project Delivery System

The need to network well beyond the traditional architectural, engineering and construction fields to develop complex teaming arrangements and build personal and corporate credibility. With the growing shift of economic risk from governments to the private sector, it is necessary to further expand traditional partnership approaches from the design and construction fields to encompass other sectors and industries, including material and equipment suppliers, manufacturers, vendors, operators, legal and financial institutions, etc., as well as building and maintaining traditional relationships with clients and owners, other consultants, contractors and subcontractors, bilateral and multi-lateral donors, etc. (PDF)


Importance of marketing in construction industry; differentiation between marketing and sale; current state of marketing in construction industry; suggestions concerning new approaches to marketing by construction firms.

The New Technologies and New Markets

The role of IT will be discussed at three levels of activity: the project level in terms of project delivery, project control and project management; the firm level in terms of substituting for several labor intensive activities and its use for strategic planning and management of the firms; the industry level in terms of developing more rational policies for development and implementation of mega-projects. New markets such as environment with its opportunities and challenges to the construction industry; its emerging importance in terms of green building and facility management.

Risk Management Opportunities, Parochialism, and Other Barriers to Overseas Involvement

Review of traditional and non-traditional risks from differing perspectives — the owners, financiers, concessionaires, contractors, consultants, etc.; risk allocation matrices and appropriate management responses and practices; risk management strategies, the role of alternate funding mechanisms, and public/private and multilateral agencies in risk transfers.

Fear of the unknown, international competition, cultural and historic differences — real and perceived — and the need to overcome distance and time barriers; U.S. government attitudes, Foreign Corrupt Practices Act, OPIC, ExIm Bank, USAID and TDA; and the impact on international A/E/C activities. (PDF)

Delivery Systems

A description of 15 alternate project delivery systems, the need to tailor delivery systems to particular needs, a discussion of Design/Bid/Build, Multiple Primes, Design/Build, Turnkey, BOO, BOT, DBOM in the international field, the risks and advantages of alternate systems and likely future systems, and the growing role of financial interests, system integrators and operators. (PDF)

Establishing a Foreign Office

Targeting an appropriate market, preparing country profiles, assessing history, culture, market potential by significant segments, evaluating your own firm's strengths and weaknesses, and developing the most appropriate strategy and choices including establishing a national company, branch office, project office, joint venture, public or private sale of stock, etc.; data needs and likely sources for information on business climate, growth potential, incentives and constraints; type of local partner or participation, local funding sources, legal and tax implications, developing a support network within the country and within your company, including corporate and technical staff, the role of local and foreign nationals, ownership restriction, taxation, currency and political risks, etc.; the need for specialist consultants and appropriate intradivisional or inter-enterprise billing rates, risk and opportunities; strategies to increase success, and the pleasures and rewards of international work. The class will break up into three-person teams during this session to select target countries, markets and strategy. (PDF)

Productivity, Competitiveness and Innovation

Trends in education, the role of R&D innovation and technology through demand pull and technology push in construction. Importance of automation, remote sensing and advanced materials in construction productivity and competitiveness.

Report to Board of Directors

Moavenzadeh, Wolff
Each team will make a presentation to the "Board of Directors" justifying the proposed target country or service, mode of operation, range of services, scale, funding and support requirements for the new initiative.


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