The Influence of Organizational Culture on Construction Risk Management among Kuantan Malaysian Construction Industry: A Partial Least Square Structural Equation Modeling Approach
Abstract
Organization culture in nowadays industry especially the construction industry has become something crucial in determining the success of the construction project. The unsuitable culture can have an impact on the organization itself, based on the project management perspective. As for the construction, it is likely to face a different problem such as the quality that did not meet the expectation, overbudget, delay in terms of scheduling, unsafe condition and dissatisfaction of the clients. These problems above show how risky the construction project is. There are a few characteristics that show that the construction industry is different from other industries. This is why understanding the organizational culture is crucial because of the differences that will be faced. To address these issues above, this study aims 1) to investigate the relationship between market culture and Management risk in Pahang Malaysia; and 2) to identify the relationship between the hierarchy culture and Management risk in Pahang Malaysia. The researcher collected data from 89 respondents among construction companies in Kuantan. In this research, the PLS-SEM technique was used to analyze both the measurement and structural models. The result shows that there is a significant positive relationship between market culture and Management risk among the construction industry in Pahang, Malaysia. Meanwhile, the relationship between hierarchy culture and management risk was statistically not significant. Implications for practice and future research were also discussed.
References
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Organizational External Factors on Construction Risk Management. International Journal of
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Adeleke, A. Q., Bamgbade, J. A., Salimon, M. G., & Lee, C. K. (2019). Project Management
Performance and Its Influence on Malaysian Building Projects. KnE Social Sciences, 313-
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Adeleke, A. Q., Windapo, A. O., Khan, M. W. A., Bamgbade, J. A., Salimon, M. G.,&
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Adeleke, A. Q., Bahaudin, A. Y., & Kamaruddeen, A. M. (2018). Organizational Internal
factors and construction risk management among nigerian construction companies. Global
Business Review, 19(4), 921-938.
Adeleke, A. Q., Nasidi, Y., & Bamgbade, J. A. (2016). Assessing the Extent of Effective
Construction Risk Management in Nigerian Construction Companies. Journal of Advanced
Research in Business and Management Studies, 3(1), 1-10.
Adeleke¹, A. Q., Bahaudin, A. Y., & Kamaruddeen, A. M. (2015). A Partial Least Square
Structural Equation Modeling (PLS SEM) Preliminary Analysis on Organizational Internal
And External Factors Influencing Effective Construction Risk Management among Nigerian
Construction Industries. Rev. Téc. Ing. Univ. Zulia, 38(143), 143-55.
Adeleke, A., Bahaudin, A., & Kamaruddeen, (2015) A Level of Risk Management Practice in
Nigeria Construction Industry-From a Knowledge Based Approach. Journal of Management
Marketing and Logistics, 2(1), 12-23.
Abulhakim, N., & Adeleke, A. Q. (2019). The Factors Contributing to Accident Occurrence
on Malaysia Building Projects through Partial Least Square Structural Equation
Modeling. Social Science and Humanities Journal, 1096-1106.
Acar, A. Z., & Acar, P. (2014). Organizational Culture Types and Their Effects on
Organizational Performance in Turkish Hospitals. EMAJ: Emerging Markets Journal, 3(3),
18–31. https://doi.org/10.5195/EMAJ.2014.47
Adnan, H., Rahmat, M. N., Mazali, N. F. N., & Jusoff, K. (2014). Risk Management
Assessment for Partnering Projects in the Malaysian Construction Industry. Journal of
Politics and Law. https://doi.org/10.5539/jpl.v1n1p76
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Construction Projects. Journal of Construction Engineering and Management.
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Albayrak, G., & Albayrak, U. (2014). Organizational Culture Approach and Effects on the
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organizational cultures. Construction Management and Economics, 23(6), 595–607.
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Arditi, D., Nayak, S., & Damci, A. (2017). Effect of organizational culture on delay in
construction. International Journal of Project Management, 35(2), 136–147.
https://doi.org/10.1016/j.ijproman.2016.10.018
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construction firms. Journal of cleaner production, 208, 1537-1545.
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6570.2006.00052_5.x
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techniques for build-operate-transfer projects. Ind Manage Data Syst. 104(4):334–346.
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support tools. In Khosrowshahi, F (Ed.), 20th Annual ARCOM Conference.
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Hair Jr., J. F., Matthews, L. M., Matthews, R. L., & Sarstedt, M. (2017). PLS-SEM or CB-
SEM: updated guidelines on which method to use. International Journal of Multivariate Data
Analysis, 1(2), 107. https://doi.org/10.1504/ijmda.2017.10008574.
Hassan, A. K., & Adeleke, A. Q. (2019). The Effects of Project Triple Constraint on
Malaysia Building Projects. Social Science and Humanities Journal, 1222-1238.
Hassan, A. K., Adeleke, A. Q., Hussain, S., & D.M, T. (2019). Partial Least Square Structural
Equation Modeling : An Approach to the Influence of Project Triple Constraint on Building
Projects among Malaysian Construction Industries. Social Science and Humanities Journal
Partial.
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Malaysia Vision 2020: Developed Nation Status. Procedia - Social and Behavioral Sciences,
109(January 2014), 507–513. https://doi.org/10.1016/j.sbspro.2013.12.498
Kimbrough, R. L., & Componation, P. J. (2009). The relationship between organizational
culture and enterprise risk management. EMJ - Engineering Management Journal, 21(2), 18–
26. https://doi.org/10.1080/10429247.2009.11431803
Liu, J., Li, B., Lin, B., & Nguyen, V. (2007). Key issues and challenges of risk management
and insurance in China’s construction industry: An empirical study. Industrial Management
and Data Systems, 107(3), 382–396. https://doi.org/10.1108/02635570710734280
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Risk among Malaysian Construction Industries. Journal of Advanced Research in Applied
Sciences and Engineering Technology, 10 (1), 34-40.
Muller, K., & Cohen, J. (1989). Statistical Power Analysis for the Behavioral Sciences.
Technometrics. https://doi.org/10.2307/1270020.
N.D Jamil, A.Q. Adeleke (2018). The relationship between team competency and design risk
management among construction industries in Kuantan. Journal of Advanced Research in
Applied Sciences and Engineering Technology, 10 (1), 77-81.
Naqshbandi, M. M., & Kaur, S. (2014). Do managerial ties support or stifle open innovation?
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Communication and Construction Risk Management among Kuantan Malaysian Construction
Industries. Journal of Advanced Research in Applied Sciences and Engineering Technology,
10 (1), 18-24.
Riley, M. J., & Clare-Brown, D. (2001). Comparison of Cultures in Construction and
Manufacturing Industries. Journal of Management in Engineering.
https://doi.org/10.1061/(ASCE)0742-597X(2001)17:3(149).
Sabodin, N., & Adeleke, A. Q. (2018). The Influence of Government Regulation on Waste
Reduction Among Kuantan Malaysian Construction Industry. Journal of Advanced Research
in Applied Sciences and Engineering Technology, 10 (1), 72-76.
Sambasivan, M., & Soon, Y. W. (2007). Causes and effects of delays in the Malaysian
construction industry. International Journal of Project Management, 25(5), 517–526.
https://doi.org/10.1016/j.ijproman.2006.11.007.
Šandrk, N. I., & Matotek, J. (2014). Importance and trends of organizational culture in
construction in Eastern Croatia. Ekonomski Vjesnik - Econviewsw, 27(1), 25–40.
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Construction Industry. Journal of Surveying, Construction & Property, 3(1), 1–15.
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https://doi.org/10.1016/j.ijproman.2013.03.004.
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attitude from Malaysia construction industry perspective. Social Science and Humanities
Journal, 1281-1298.
Taofeeq, D. M., Adeleke, A. Q., & Hassan, A. K. (2019). The Moderating Role of
Government Policy on Contractors’ Risk Attitudes in Malaysia Construction
Companies. Social Science and Humanities Journal, 1261-1280.
Taofeeq, D. M., & Adeleke, A. Q. (2019). Factor's Influencing Contractors Risk Attitude in
the Malaysian Construction Industry. Journal of Construction Business and
Management, 3(2), 59-67.
Taofeeq, D. M., Adeleke, A. Q., & Lee, C. K. (2020). The synergy between human factors
and risk attitudes of Malaysian contractors’: Moderating effect of government policy. Safety
science, 121, 331-347.
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contractors’ risk attitudes among Malaysian construction industries: the moderating role of
government policy. International Journal of Construction Management, 1-20.
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Adeleke, A. Q., Bamgbade, J. A., Salimon, M. G., & Lee, C. K. (2019). Project Management
Performance and Its Influence on Malaysian Building Projects. KnE Social Sciences, 313-
329.
Adeleke, A. Q., Windapo, A. O., Khan, M. W. A., Bamgbade, J. A., Salimon, M. G.,&
Nawanir, G. (2018). Validating the Influence of Effective Communication, Team Competency and Skills, Active Leadership on Construction Risk Management Practices of Nigerian Construction Companies. The Journal of Social Sciences Research, 460-465.
Adeleke, A. Q., Bahaudin, A. Y., & Kamaruddeen, A. M. (2018). Organizational Internal
factors and construction risk management among nigerian construction companies. Global
Business Review, 19(4), 921-938.
Adeleke, A. Q., Nasidi, Y., & Bamgbade, J. A. (2016). Assessing the Extent of Effective
Construction Risk Management in Nigerian Construction Companies. Journal of Advanced
Research in Business and Management Studies, 3(1), 1-10.
Adeleke¹, A. Q., Bahaudin, A. Y., & Kamaruddeen, A. M. (2015). A Partial Least Square
Structural Equation Modeling (PLS SEM) Preliminary Analysis on Organizational Internal
And External Factors Influencing Effective Construction Risk Management among Nigerian
Construction Industries. Rev. Téc. Ing. Univ. Zulia, 38(143), 143-55.
Adeleke, A., Bahaudin, A., & Kamaruddeen, (2015) A Level of Risk Management Practice in
Nigeria Construction Industry-From a Knowledge Based Approach. Journal of Management
Marketing and Logistics, 2(1), 12-23.
Abulhakim, N., & Adeleke, A. Q. (2019). The Factors Contributing to Accident Occurrence
on Malaysia Building Projects through Partial Least Square Structural Equation
Modeling. Social Science and Humanities Journal, 1096-1106.
Acar, A. Z., & Acar, P. (2014). Organizational Culture Types and Their Effects on
Organizational Performance in Turkish Hospitals. EMAJ: Emerging Markets Journal, 3(3),
18–31. https://doi.org/10.5195/EMAJ.2014.47
Adnan, H., Rahmat, M. N., Mazali, N. F. N., & Jusoff, K. (2014). Risk Management
Assessment for Partnering Projects in the Malaysian Construction Industry. Journal of
Politics and Law. https://doi.org/10.5539/jpl.v1n1p76
Al‐Bahar, J. F., & Crandall, K. C. (2007). Systematic Risk Management Approach for
Construction Projects. Journal of Construction Engineering and Management.
https://doi.org/10.1061/(ASCE)0733-9364(1990)116:3(533)
Albayrak, G., & Albayrak, U. (2014). Organizational Culture Approach and Effects on the
Turkish Construction Sector. APCBEE Procedia, 9, 252–257.
https://doi.org/10.1016/j.apcbee.2014.01.045
Ankrah, N. A., & Langford, D. A. (2005). Architects and contractors: A comparative study of
organizational cultures. Construction Management and Economics, 23(6), 595–607.
https://doi.org/10.1080/01446190500126973
Arditi, D., Nayak, S., & Damci, A. (2017). Effect of organizational culture on delay in
construction. International Journal of Project Management, 35(2), 136–147.
https://doi.org/10.1016/j.ijproman.2016.10.018
Arshad, N. H., Mohamed, A., & Mansor, R. (2009). Organizational Structural Strategies in
Risk Management Implementation : Best Practices and Benefits Faculty of Information
Technology and Quantitative Science, 6(6), 885–894.
Azman, N. A. S. M., & Adeleke, A. Q. (2018). Effect of Time Overruns on Apartment
Building among Kuantan Malaysian Construction Industries. Journal of Advanced Research
in Applied Sciences and Engineering Technology, 10 (1), 41-47.
Azreen, R., & Hayati, M. D. (2013). Mediating Effect of Enterprise Risk Management
Practices on Risk Culture and Organisational Performance. International Conference of
Social Science Research.
Bamgbade, J. A., Salimon, M. G., Adeleke, A. Q., & Nasidi, Y. (2019). Contractor’s
Technology Acceptance for Firm Sustainability Performance. KnE Social Sciences, 1084-
1101.
Bamgbade, J. A., Nawi, M. N. M., Kamaruddeen, A. M., Adeleke, A. Q., & Salimon, M. G.
(2019). Building sustainability in the construction industry through firm capabilities,
technology and business innovativeness: empirical evidence from Malaysia. International
Journal of Construction Management, 1-16.
Bamgbade, J. A., Kamaruddeen, A. M., Nawi, M. N. M., Adeleke, A. Q., Salimon, M. G., &
Ajibike, W. A. (2019). Analysis of some factors driving ecological sustainability in
construction firms. Journal of cleaner production, 208, 1537-1545.
Cameron, K. S., & Quinn, R. E. (2006). Diagnosing and Changing Organizational Culture.
The Jossey-Bass Business & Management Series. https://doi.org/10.1111/j.1744-
6570.2006.00052_5.x
Cavignac, J. (2009). Managing risk in a construction company [Internet]. Construction
Business Owner.
Chow, W. S., & Chan, L. S. (2008). The social network, social trust and shared goals in
organizational knowledge sharing. Information and Management.
https://doi.org/10.1016/j.im.2008.06.007.
Coffey, V. (2010). Understanding organizational culture in the construction industry.
Understanding Organisational Culture in the Construction Industry.
https://doi.org/10.4324/9780203933381.
Dey P. K, & Ogunlana S. O. (2004). Selection and application of risk management tools and
techniques for build-operate-transfer projects. Ind Manage Data Syst. 104(4):334–346.
Dikmen, I., Birgonul, M. T., & Arikan, A. E. (2004). A critical review of risk management
support tools. In Khosrowshahi, F (Ed.), 20th Annual ARCOM Conference.
Hair, J. F., Ringle, C. M., & Sarstedt, M. (2011). PLS-SEM: Indeed a Silver Bullet. Journal
of Marketing Theory and Practice. https://doi.org/10.2753/MTP1069-6679190202.
Hair Jr., J. F., Matthews, L. M., Matthews, R. L., & Sarstedt, M. (2017). PLS-SEM or CB-
SEM: updated guidelines on which method to use. International Journal of Multivariate Data
Analysis, 1(2), 107. https://doi.org/10.1504/ijmda.2017.10008574.
Hassan, A. K., & Adeleke, A. Q. (2019). The Effects of Project Triple Constraint on
Malaysia Building Projects. Social Science and Humanities Journal, 1222-1238.
Hassan, A. K., Adeleke, A. Q., Hussain, S., & D.M, T. (2019). Partial Least Square Structural
Equation Modeling : An Approach to the Influence of Project Triple Constraint on Building
Projects among Malaysian Construction Industries. Social Science and Humanities Journal
Partial.
Khan, R. A., Liew, M. S., & Ghazali, Z. Bin. (2014). Malaysian Construction Sector and
Malaysia Vision 2020: Developed Nation Status. Procedia - Social and Behavioral Sciences,
109(January 2014), 507–513. https://doi.org/10.1016/j.sbspro.2013.12.498
Kimbrough, R. L., & Componation, P. J. (2009). The relationship between organizational
culture and enterprise risk management. EMJ - Engineering Management Journal, 21(2), 18–
26. https://doi.org/10.1080/10429247.2009.11431803
Liu, J., Li, B., Lin, B., & Nguyen, V. (2007). Key issues and challenges of risk management
and insurance in China’s construction industry: An empirical study. Industrial Management
and Data Systems, 107(3), 382–396. https://doi.org/10.1108/02635570710734280
Malik, N. S. A., & Adeleke, A. Q. (2018). The Effect of Organizational Culture on Material
Risk among Malaysian Construction Industries. Journal of Advanced Research in Applied
Sciences and Engineering Technology, 10 (1), 34-40.
Muller, K., & Cohen, J. (1989). Statistical Power Analysis for the Behavioral Sciences.
Technometrics. https://doi.org/10.2307/1270020.
N.D Jamil, A.Q. Adeleke (2018). The relationship between team competency and design risk
management among construction industries in Kuantan. Journal of Advanced Research in
Applied Sciences and Engineering Technology, 10 (1), 77-81.
Naqshbandi, M. M., & Kaur, S. (2014). Do managerial ties support or stifle open innovation?
Industrial Management and Data Systems, 114(4), 652–675. https://doi.org/10.1108/IMDS-
10-2013-0407.
Räisänen, C. (2012). Culture in International Construction Wilco Tijhuis and Richard
Fellows, Spon Press, London, 2011 224 pp, ISBN 978 0 415 47275 3, £65.00 (HB).
Construction Management and Economics. https://doi.org/10.1080/01446193.2012.737469
Rahman, N. F. A., & Adeleke, A. Q. (2018). The Relationship between Effective
Communication and Construction Risk Management among Kuantan Malaysian Construction
Industries. Journal of Advanced Research in Applied Sciences and Engineering Technology,
10 (1), 18-24.
Riley, M. J., & Clare-Brown, D. (2001). Comparison of Cultures in Construction and
Manufacturing Industries. Journal of Management in Engineering.
https://doi.org/10.1061/(ASCE)0742-597X(2001)17:3(149).
Sabodin, N., & Adeleke, A. Q. (2018). The Influence of Government Regulation on Waste
Reduction Among Kuantan Malaysian Construction Industry. Journal of Advanced Research
in Applied Sciences and Engineering Technology, 10 (1), 72-76.
Sambasivan, M., & Soon, Y. W. (2007). Causes and effects of delays in the Malaysian
construction industry. International Journal of Project Management, 25(5), 517–526.
https://doi.org/10.1016/j.ijproman.2006.11.007.
Šandrk, N. I., & Matotek, J. (2014). Importance and trends of organizational culture in
construction in Eastern Croatia. Ekonomski Vjesnik - Econviewsw, 27(1), 25–40.
Sekaran, U., & Bougie, R. (2009). Research method for business: A skill-building approach,
5th edition. United States: John Wiley & Sons Inc.
Sekaran, U. (2003). Research and Markets: Research Methods for Business - A Skill Building
Approach. John Wiley & Sons. https://doi.org/http://dx.doi.org/10.1108/17506200710779521.
Siang, L. C., & Ali, A. S. (2019). Implementation of Risk Management in the Malaysian
Construction Industry. Journal of Surveying, Construction & Property, 3(1), 1–15.
https://doi.org/10.22452/jscp.vol3no1.2.
Takim, R., & Akintoye, A. (2002). Performance indicators for successful construction
project performance. The University of Northumbria. Association of Researchers in
Construction Management.
Taroun, A. (2014). Towards better modeling and assessment of construction risk: Insights
from a literature review. International Journal of Project Management, 32(1), 101–115.
https://doi.org/10.1016/j.ijproman.2013.03.004.
Taofeeq, D. M., Adeleke, A. Q., & Hassan, A. K. (2019). Factors Affecting Contractors risk
attitude from Malaysia construction industry perspective. Social Science and Humanities
Journal, 1281-1298.
Taofeeq, D. M., Adeleke, A. Q., & Hassan, A. K. (2019). The Moderating Role of
Government Policy on Contractors’ Risk Attitudes in Malaysia Construction
Companies. Social Science and Humanities Journal, 1261-1280.
Taofeeq, D. M., & Adeleke, A. Q. (2019). Factor's Influencing Contractors Risk Attitude in
the Malaysian Construction Industry. Journal of Construction Business and
Management, 3(2), 59-67.
Taofeeq, D. M., Adeleke, A. Q., & Lee, C. K. (2020). The synergy between human factors
and risk attitudes of Malaysian contractors’: Moderating effect of government policy. Safety
science, 121, 331-347.
Taofeeq, D. M., Adeleke, A. Q., & Lee, C. K. (2019). Individual factors influencing
contractors’ risk attitudes among Malaysian construction industries: the moderating role of
government policy. International Journal of Construction Management, 1-20.
Wiewiora, A., Trigunarsyah, B., Murphy, G., & Coffey, V. (2013). Organizational culture
and willingness to share knowledge: A competing values perspective in the Australian
context. International Journal of Project
Management.https://doi.org/10.1016/j.ijproman.2012.12.014
Project Management Institute (2008). Guide to the project management body of knowledge
(PMBOK® Guide). 4th ed. Newtown Square: Project Management Institute.
Institution of Civil Engineers and the Actuarial Profession (2005). Risk analysis and
management for projects (RAMP). 2nd ed. Institution of Civil Engineers and the Actuarial
Profession. London: Thomas Telford Ltd.
Project Management Institute (2007). Construction extension to the PMBOK® Guide. 3rd ed.
Newtown Square: Project Management Institute.
Flanagan R, Norman G, & Chapman R. (2006). Risk management and construction. 2nd
ed.Oxford: Blackwell Pub.
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Authors
[1]
“The Influence of Organizational Culture on Construction Risk Management among Kuantan Malaysian Construction Industry: A Partial Least Square Structural Equation Modeling Approach”, Soc. sci. humanities j., vol. 4, no. 01, pp. 1693–1704, Jan. 2020, Accessed: Nov. 23, 2024. [Online]. Available: https://sshjournal.com/index.php/sshj/article/view/503
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