A Framework to Analyze International Competitiveness: The Case of Construction Firms of China

Abstract

With the rapid development of the Chinese construction industry, increasing support from the government, and China’s internationalization, Chinese construction firms have gained great opportunities in venturing abroad. Though Chinese construction firms played an important role in the international market, Chinese contractors’ share of the international market is still smaller in comparison with their competitors. As an important participant in the international market, Chinese construction firms are confronted with the tasks of keeping themselves competitive. The paper stated the development stages of Chinese construction firms, analyzed the current situation and challenges of Chinese construction firms in the international construction market. Drawing on the resource-based view and industry organization approach, this research builds a conceptual model to investigate the relationship among core capability, competitive strategy and market entry mode strategy within Chinese construction firms, and focuses on strategic analysis in affecting Chinese construction firms’ international performance. The conceptual model presented herein was a generic framework that allowed industry practitioners and academic researchers to understand, sustain and extend the international competitiveness of Chinese construction firms. To help construction firms maintain and improve their competitiveness, the conceptual model implied that Chinese construction firms’ international competitiveness depends upon the identification of appropriate strategy and industry structure as well as developing and creating core capability in order to exploit opportunities and neutralize the threats presented by competition.