Such actions create conflict of interest as well as

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Such actions create conflict of interest, as well as imbalanced staff turnover among the local businesses. Fifth, local UAE companies may be left vulnerable to Aldar’s business cycles leaving little opportunities for diversification. This is likely to happen if the job and training project is based at a remote location meaning that the underlying demand is determined by a single entity. Business cycles change from boom to bust within duration of many years. The changes in international demand may cause strains on Aldar’s business cycle leading to reduced income, employment and investments. The performance of local businesses and communities that rely heavily on Aldar’s activities may suffer severely. Lastly, the development of a skilled and educated labor market in UAE is likely to have an impact on ‘sense of community’. This is likely to arise due to labor movements from one location to another, for employment. The effect of such actions on Aldar’s project is that they may lead to increased unstable operations arising from high staff turnover (Esteves et al. 2012). Question no. 5: The issues that would need to be considered by the client (Aldar) when deciding who can offer the most attractive proposition Aldar’s construction project is expected to cost US$200 million within a duration of 24 months. However, with two contractors in place, Aldar Properties has to decide to which contractor it should award the project. There are several issues that the client (Aldar) would need to consider before deciding which contractor can offer the most attractive proposition.
9 The contractor’s budget figure versus quality According to the Indian contractor, the entire construction project would cost 30% less than the projected cost of US$200 million (US$140 million). On the other hand, the Turkish contractor has suggested that could undertake the construction project for 20% less than the budget. Sustainable construction considers the structure’s initial cost of capital against running costs. The main economic benefits that come with sustainable construction are reduction in utility, maintenance and operation costs. Other factors considered are improved efficiency and performance of a given building ( NAHB Research Center 2001). However, there is a perception that the short term costs arising from sustainable practices are too heavy to warrant their adoption in a vastly competitive market. This perception arises from low demand from clients and the belief that sustainable practices are more costly than traditional methods of construction. For instance, cost consultants can increase capital costs of constructions by a major margin of 10% in order to accommodate more sustainable solutions (Dobson 2013). Similarly, the assumption in our case is that the Indian and Turkish contractors will apply the costly but sustainable practices during the construction project. Therefore, in order to meet efficiency and performance requirements of the project, it is expected that the contractors will incur high construction costs. Reducing this cost by 30% will therefore not be economically feasible for the

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