Recommendation on reconstruction methodology

In October 2006, I attended a workshop held by the BRR. The workshop, which focused on contractors and construction contracts, was interesting to me. Many of the attendees shared their Catch-22 situation with their contractors. The performance of contractors who did the construction jobs was a big issue then. In the opening remarks, Ray Benson from BRR shared a problem experienced by an NGO. The NGO already paid a big down payment to one of their contractors, but the contractor never showed up with their work. When the NGO pursued the contractor to work, the contractor, on the contrary, threatened the NGO guy with serious intimidation. Ouch!

Due to the enormous house needs, Aceh reconstruction is a big business for contractors. More than 100,000 houses are to be built, and this should be as soon as possible. The tsunami victims became impatient since they had been in tents for almost 2 years. The donors were irritated due to the slow progress of reconstruction. They were chasing the NGOs, who received their funding to fulfill what the NGOs had been promised. These were a perfect chemistry to drive a rush and messy construction job. In the next paragraph, I will explain how bad the situation was.

A bigger part, or almost all NGOs who work in the reconstruction work, are relief NGOs. Their experience is in mobilizing food, medicine, paramedics, water-sanitation work, and temporary shelter. But building a permanent house is a different story. Then, in the end, the work of building a permanent house on a massive scale becomes out of context. This job becomes irrelevant since there are two things that most of these NGOs do not possess. First, if they have this kind of experience, they should have all policies, procedures, and project management systems. All of these systems should be embedded in their org-ware, enabling them to move fast to respond to all the needs on the ground. Second, they don’t have human resources capable enough to handle the job. Come to Aceh merely because of humanity is not enough. Reconstruction people should have project management skills if they want to succeed.

This reconstruction job is a fiesta and a heavy meal from the contractors' side. No wonder they were flooded by BRR with requests for prequalification. In mid-March 2006, 3,088 companies took the prequalification document. There were 2,885 contractors and 203 consultants. It would be unbelievable to compare the number of the same kind of company in Jakarta with many continuous construction jobs. A notary whom we hire for our legal works mentioned that a week before the company profile submission, she received abundant requests for company legal documents. This was miserable. These newborn companies are intended for the sake of winning a contract. They don’t have a past record, which shows they have the capacity to work. And their capability to supply the working capital is a big question mark. It was a common tale that if they could win the contract, they would subcontract to another company to create the 2-tier or even worse. At that time, many NGOs became sitting ducks in front of nasty contractors.

Someone asked me which one is better, using a contractor for the construction or direct implementation using skilled labourers? Both are fine. This is my recommendation; we have to use a contractor and direct implementation using skilled laborers simultaneously. The contractor and the skilled labourers can be like Dr Jeckyl and Mr. Hyde. Sometimes they are good, and sometimes they are corrupt. They can be nice, but they can be ill-behaved at other times. Let say, your contractor done something nasty, you can switch them off and turn the job to skilled labours, and vice versa. The project management discipline can do that. You have to have a strong system and quite some experience to make this kind of move. If you can’t take immediate corrective action supported by the system and enough resources, you can be fooled by the contractors or your skilled laborers. I have shared my best practices for managing skilled laborers (click here) and managing contractors (click here). But merely depending on using just skilled laborers or only using contractors is not enough. We have to combine it. This methodology can increase our productivity and reduce overhead and has already been proven in my work on completing the 4,600 permanent houses in Aceh reconstruction.

Arwin Soelaksono - Disaster Response & reConstruction