Construction Management & Economics

Smyth, Hedley; Fellows, Richard; Liu, Anita; Tijhuis, Wilco

doi: 10.1080/01446193.2016.1199370pmid: N/A

Ling, Florence Yean Yng; Li, Shan

doi: 10.1080/01446193.2016.1189585pmid: N/A

Many foreign firms are expected to enter China’s growing construction market. The objectives are to: (i) identify the extent to which Porter’s generic business strategies and practices are adopted by local Chinese architectural, engineering and construction firms (Chinese firms) and foreign firms offering construction-related consultancy services in China (foreign firms); (ii) investigate the extent to which Porter’s generic strategies contribute to firms’ competitiveness in China; and (iii) propose a business model framework for construction services in China. Using a structured questionnaire, data were collected via mail and face-to-face interviews. In total, 37 and 45 completed questionnaires were received from foreign and Chinese firms, respectively. Both foreign and Chinese firms adopt Porter’s differentiation and focus strategies to a significant extent. Foreign firms emphasize value offerings that incorporate superior design, technology and quality significantly more than Chinese firms. The findings show that Porter’s cost leadership and differentiation strategies are significantly correlated with firms’ competitiveness, especially the practices relating to cutting suppliers’ prices, reconfiguring the value chain, providing innovative services and offering comprehensive services. To help them succeed in China, it is recommended that foreign firms develop their business models based on the framework developed here.

Preece, Christopher Nigel; Mat Isa, Che Maznah; Saman, Hamidah Mohd; Che Ibrahim, Che Khairil

doi: 10.1080/01446193.2015.1084429pmid: N/A

The international market expansion process involves a combination of many strategic entry decisions. Most previous studies have dealt with entry location, entry timing and entry mode (ELETEM) decisions in an isolated way by considering one dimension or a combination of dimensions in particular. Although there have been various models relating to international market entry decisions, there is currently no model that attempts to integrate the factors linking the ELETEM decisions for construction firms. The purpose is to determine a linkage between the ELETEM decisions by incorporating the factors that are mutually inclusive and have significant influence on these decisions. Forty-five (45) Malaysian contractors undertaking projects in international markets responded to the survey. The findings suggested that the mutually inclusive and significant factors (MISFs) influencing the ELETEM decisions were: the firm’s ability to assess market signals and opportunities, the firm’s resources and the firm’s experience in similar works. It was observed that the firms had adopted long-term strategies, repositioned their knowledge from research and development activities and readapted their resources and experience in their global operations. The findings led to the development of the ELETEM decision model to guide interested firms in making better decisions for their future international ventures.

Murtagh, Niamh; Roberts, Aeli; Hind, Richard

doi: 10.1080/01446193.2016.1151063pmid: N/A

Environmental sustainability in construction is a pressing concern. Despite their importance to the industry, and evident differences from large organizations in business strategy, markets and challenges, the literature has little to say about how small architectural design firms view the marketing potential of improved environmental sustainability. The aim is to address this gap by examining practitioner experience of sustainability and marketing in small architectural design practices. Semi-structured interviews were conducted with 16 such practices. A critical interpretive stance was adopted in analysis, drawing on the theoretical framings of service-dominant logic (SDL) and relationship marketing. Sustainable design is part of the co-creation of value in architecture, enhancing the value proposition beyond a cost basis. Its inclusion contributed to business development through referrals. Taken together, co-creation of value and asymmetry of knowledge between professional and client drive the conclusion that the architectural designer has primary responsibility in guiding clients towards greater environmental sustainability. This responsibility and the role of sustainability in business development were not necessarily recognized by the designers. Insights from SDL challenge assumptions that cost and lack of client demand prevent greater sustainability in design.

Hellström, Magnus; Wikström, Robin; Gustafsson, Magnus; Luotola, Hanna

doi: 10.1080/01446193.2016.1151062pmid: N/A

Like services in general project execution services ought to be marketed and sold based on the value they add rather than the cost they accrue. Project services are typically complex and abstract, and hence their benefits are difficult to directly explicate. The aim is to investigate how contractors and suppliers can overcome this dilemma and exercise value-based selling in terms of the typical services they provide. A design science inspired study was used to create a service configurator addressing the dilemma. At the same time the configurator provided a means for studying the value identification and communication process in six sales projects. It is concluded that contractors and suppliers ought to approach customer value by looking for problems that create uncertainty in the underlying investment and to match them with suitable services. Key in communicating the value of the services is to focus on creating certainty as to the parties’ ability to cope with the uncertainty in the investment with the help of these services.

Mills, Grant R.W.; Razmdoost, Kamran

doi: 10.1080/01446193.2016.1187284pmid: N/A

Drawing on a longitudinal empirical study of an education capital programme/project, value interactions are investigated at the interface between programme customers, project stakeholders and construction providers. Empirical evidence is provided that value formation is not only associated with value co-creation, but also with value co-destruction. The case study showed that a mature and synergistic network relationship (that successfully aligned the expectations of a strong key account management team (KAM team), multi-headed customer and wider project stakeholders) could, if not well managed, turn into incongruent relationships, relationship uncoupling and resource withdrawal. These findings suggest that project managers must drive strong KAM team relationships, so that they can align and adapt to customer requirements, and control the response to often changing wider stakeholder expectations.

Swarts, Kevin M.; Lehman, Kim; Lewis, Gemma K.

doi: 10.1080/01446193.2015.1133919pmid: N/A

Despite its ever-increasing popularity with consumers and businesses, many organizations are still unsure how to effectively use social media in a marketing context. One way in which building firms can use social media is as a customer relationship management (CRM) tool to improve customer engagement and satisfaction (known as social CRM). In order to explore how social CRM (SCRM) can be used, and is being used by building firms, semi-structured interviews with accredited building practitioners were utilized to collect data on SCRM use in the sector. The data were analysed to determine the factors that influence social media use, the extent of SCRM use, and the ways in which building contractors are using SCRM. It was found that builders are using social media to manage client relationships, but to a limited extent due to the complex nature of the builder–client relationship and a lack of perceived trustworthiness. Building firms favoured a transactional approach to social media use, and preferred not to use formal social media strategies. Builders are also reluctant to use social media to assist them in segmenting customers by their value to the firm. For effective social media use, builders may consider two main issues: SCRM strategy and customer-value segmentation to develop profitable customer relationships.

Razmdoost, Kamran; Mills, Grant

doi: 10.1080/01446193.2016.1200106pmid: N/A

Project-based firms increasingly apply practices that are in line with relationship marketing (RM), which is a shift from individuality to mutuality, and service-dominant logic (SDL), which is a shift from a focus on goods exchange to an emphasis on service exchange. These firms also adopt value co-creation processes, benefiting from both RM and SDL views. However, their overall transition towards RM, SDL and/or both is not clearly understood. Therefore, the research aim is to explain how and why project-based firms have moved away from transitional marketing. A retrospective action research between 2002 and 2009 provides process data on how a single main contractor adapted their marketing approach over five publicly funded projects within the oil, gas and petrochemical industries. The findings show that the uniqueness and dynamics of projects necessitate the adoption of both SDL and RM, a view that is entitled the service-led relationship here. This transition occurs through services expansion, multi-level distributed interactions and process-oriented performance management in projects. The firm enabled the transition through the evolution of both institutional mechanisms such as contracts and organizational structure, and people attributes such as capabilities and culture.

Cheung, F.K.T.; Kurul, E.; Oti, A.H.

doi: 10.1080/01446193.2016.1200107pmid: N/A

Successful hybrid strategies adopt service marketing principles although the adoption of those principles by construction marketers is not apparent. Through an interpretive inquiry approach attempting to capture multiple views in a case of successful strategic programmes for the primary school market, various value co-creation elements of the programmes are assessed according to four axioms of service-dominant (S-D) logic. The strategic programmes were found to create value by (1) developing new skills and knowledge, building relationships to leverage skills and close the knowledge gaps; (2) enhancing interactions through customer engagement, dialogue creation and enrichment, the use of BIM technologies and social networks; (3) strengthening many-to-many relationships through supply chain integration; and (4) assisting individual customers to define their value propositions and to evaluate them through free self-service systems, and products and services inquiries. Further research is needed to assess how customers value the various co-creation elements identified in the paperevidence for applying the generic value co-creation principles to marketing in construction.