Critical success factors militating against competitive advantage of indigenous construction firms in developing countries

Abstract

Though a plethora of studies has suggested indigenous construction firms in developing countries are competitively disadvantaged and risk being marginalized in the competition posed by their foreign counterparts, little is known of studies that empirically investigate the critical success factors militating against indigenous construction firms’ competitive advantage in developing countries to adduce empirical findings towards policy direction and formulation. Thus, this paper seeks to determine the critical success factors militating against competitive advantage of indigenous construction firms in developing countries using Ghana as a case study and suggest measures to curb them. The use of principal component analysis, varimax rotation in data analysis aided in reducing the large set of militating factors to four principal factors. Using a questionnaire survey, 667 respondents were invited to rate the 21 militating factors identified from literature based on their knowledge and experience. The correlations between the 21 variables showed that four key components underpinned the critical success factors militating against competitive advantage of indigenous construction firms in developing countries, namely market, firms’ internal, government and technology factors. Findings and recommendations of this study may be useful to construction stakeholders who are seeking innovative ways to enhance indigenous firms’ competitive advantage and policy direction.