Proceedings of Symposium on Technology Management and Logistics (STMLGoGreen), 8-9 December 2015, Universiti Utara Malaysia CRITICAL SUCCESS FACTORS IN HOUSING INDUSTRIES IN KUBANG PASU, KEDAH Nurzaini binti Mohamad, Humithra Devi Suguna A/P Vikneswaran, Halimatun Shazwani binti Yahya , Tan Kah Yen, Teoh Yi Fung, & Fadhillah Mohd Zahari University Utara Malaysia, College of Business,School of Technology and Management and Logistics,University Utara Malaysia, Sintok, 06010, Kedah [email protected], [email protected], [email protected],[email protected], [email protected], Supervisor’s Email, [email protected] ABSTRACT The housing industry is a vital sector both to country economy and the citizenship welfare. However, there are many issues of the housing industry limiting the growth of the industry. For instance, income of the housing industry decreases day by day due to some issues compared to other sectors. Reflecting through differences in market segments, there are many factors that influence the success of housing industries which mostly circle around economics, demographic, geographic and many more. For that, this research investigates the five existing critical success factors on housing industry in KubangPasu. This research will use a survey to gather potential customer perceptions and perspectives into the analysis. It is expected that the findings could contribute towards greater understanding in view of housing industry. This research is also expected to provide good insights on managerial applications. Keywords: Housing industry, Affordability, Accessibility, Economic, Customer Customization, Kubang Pasu. INTRODUCTION Nowadays, many responsible families are financially stressed where they are trapped by economic trends that drive up living costs faster than incomes. According to REHDA’S Datuk Ng Seing Liong (2015), the depreciation of the Malaysian ringgit, and low oil prices have affected the economy. Thus, this is primarily reflected housing prices rose about 6.7 per cent on average annually (Vanitha, 2015). Besides that, market research indicates that a growing number of households want affordable, accessible housing, lower-priced where residents can rely on affordable travel modes such as walking, cycling and public transit (Litman, 2015). Next, the demographic factor is an important issue in housing industry. The increase of the crime rate in Malaysia enhance the awareness of the buyers put safety as priority when buy a house. According to our Minister of Home Affairs (2010), 6,000 above confiscations and arrests from National Operations aimed at preventing house break-ins. Thus, the security becomes one of the major issues in housing industry. This is because when the crime case increases buyers will demand houses with good security control. Therefore, 779 Proceedings of Symposium on Technology Management and Logistics (STMLGoGreen), 8-9 December 2015, Universiti Utara Malaysia the Kubang Pasu housing industry should take this issue serious in order to achieve their company goals. In addition, regarding accessibility, sustainability demands that houses be built in a higher quality, have access to green space, close to good public transport, using design techniques to increase energy efficiency of dwelling, provide facilities that promote social contact and have a clean and safe residential environment (Winston, 2010) as cited by Nazirah Zainul Abidin, Noraini Yusof,Ayman A.E. Othman, (2013). In terms of geographic, the flash flood frequently happened in Kubang Pasu area causes many inconvenient to residents. For example, according to The Sun Daily news (2014),flash floods hit several areas in Kubang Pasu following heavy rain. The flood waters have inundated six houses at Kampung Lembah Keriang, 30 in Kampung Sungai Petani, 15 in Kampung Belukar and eight in Kampung Baru. Finally, the customization of house designs. Low level of customization is an issue that needs to be considered in Kubang Pasu area because buyers have to spend more money in designing their houses (KPKT, 2009) as cited by (Rostam Yaman, Hamimah Adnan, Mohd Reza Esa, and Norishahaini Mohamed Ishak, 2012). As a conclusion, these issues have motivated us to carry on this research so that the government and house developers in Kubang Pasu will be aware of these CSFs and take relevant actions in order to fulfil their customers request in buying house. Overview of the Industry Our research topic is about critical success factors in housing industry in Kubang Pasu, Kedah. The reason we selected Kubang Pasu as our focused area is because the housing industry over there facing some problems. Therefore, we decided to conduct our study in Kubang Pasu area as it is also nearby to our campus UUM. This topic has been selected in order to study the five major critical success factors (CSF’s) that flaming in housing industry especially in Kubang Pasu recently. Research Objective The aim of this study is generally to study the critical success factors in housing industry in Kubang Pasu. Specifically the objective of our studies is as follow: 1. To study the five external CSFs in housing industry in Kubang Pasu. 2. To investigate potential buyers’ perception on properties in Kubang Pasu housing. 3. To investigate factors that will motivate potential buyers to purchase properties in Kubang Pasu LITERATURE REVIEW Affordability is a major issue. According to REHDA’S Datuk Ng Seing Liong (2015), the depreciation of the Malaysian ringgit, and low oil prices have affected the economy. Thus, this is primarily reflected housing prices rose about 6.7 per cent on average annually (Vanitha, 2015). According to National House Buyers Association (2015), Malaysia needs a more 780 Proceedings of Symposium on Technology Management and Logistics (STMLGoGreen), 8-9 December 2015, Universiti Utara Malaysia structured and modernized construction industry. Therefore, low level of customization is also an issue that needs to be considered in Kubang Pasu area because buyers have to spend more money in designing their houses. Besides that, the security becomes an issue when the crime rates especially break-in house cases increase. According to Gibbons study in 2003, concluded that crime rates do affect housing industry. A part from that, (The Sun Daily, 2014) Kubang Pasu was affected with flash floods last year. This may also affect the housing industry in Kubang Pasu where many houses will be unsold due to the geographic factor. Last but not least, According to Lawrence Yun, chief economist for NAR, said transportation plays an important role in housing industry. Therefore, based on our readings and observations, poor transportation facilities in Kubang Pasu area is believed to give impact on housing industry over there. In our research CSFs was one of the most important variable in studying the external success factors in housing industry in Kubang Pasu. Developing CSFs has been an effective management tool used in the construction community for decades to ensure company objectives are met. The concept is to define tangible, achievable, and measurable CSFs around which decisions are made. Projects are then defined and managed based on the CSFs. In literature, several definitions of CSF exist. Representing one of the most frequently cited definition, Rockart (1979) uses ideas from Daniel (1961) and Anthony (1972) in defining CSF as the limited number of areas in which results, if they are satisfactory, will ensure successful competitive performance for the organization. Consequently, Rockart (1979) stresses, that these particular areas of activity should be constantly and carefully managed by a company. We understood that housing industry in Malaysia has factors that are critical to its success. In order to overcome the CSFs, housing industry in Kubang Pasu should find way to satisfy the buyers. For instance, house contractors in Kubang Pasu area should the CSFs and take relevant action to overcome the problems. This is because, we can see the theory is kept extended and will continue growing. This shows that CSFs is considered as an important element in order to give good quality houses to Kubang Pasu customers. In our study economy is one of the independent variable that affect the housing industry in Kubang Pasu. We can have a good idea about the nature and scope of economics by studying some of the important definitions of economics. Based on the definitions above we can say that the operational definition of economy sounds as man-made organization for the satisfaction of human wants. According to A.J. Brown (1959), an economy is a system by which people get living. The way man attempts to get a living differs in major respects from time to time and from place to place. Furthermore, under the new GST implementation, all building materials and services like house contractors will be subject to GST with a standard rate of 6%. This will invariably raise the production cost for house developers (Property Guru, 2015). Therefore, economy factor could be one of the CSFs that play an important role in housing industry in Kubang Pasu area. Next, accessibility is believed as one of the CSF of housing industry in Kubang Pasu area. According to Lakshmanan (2009), public transportation serves the development and growth of densely populated metropolitan areas by facilitating labor movement from outside or within the metropolitan area with better accessibility. Most generally, accessibility defined as the ease of movement between places. Accessibility measures how close one location is to 781 Proceedings of Symposium on Technology Management and Logistics (STMLGoGreen), 8-9 December 2015, Universiti Utara Malaysia another and what opportunities exist at these locations (Song & Kim 2015). The distance to work, accessibility to restaurants and bars, access to public transport is factor to be considered by buyers or customers when purchasing a house (Prime Location, 2015). Based on our readings and observations, we found that there is no public bus that direct goes to Kubang Pasu area. Therefore, we can say that the basic everyday needs public transport system like buses are needed to be improved so that more people will prefer to buy house in Kubang Pasu.