The Performance of Construction Firms: A System Approach

Abstract

Traditionally, construction firms assessed their performance solely in financial terms. However, changing stakeholders’ and shareholders’ requirements have put pressure on them to evaluate their performance more broadly, and also to understand the behavior of the business environment better. This has led to the need for a holistic identification of main factors or ‘forces’ which influence the performance of construction firms. A system model is used to present a holistic view of the construction environment showing the possi-ble interactions between these forces. System theory is proposed as being a means of modeling the complex interactions between the factors in order to provide the basis for a decision support system. Data was col-lected from a number of sources including industry, literature and academics. Difficulties encountered in obtaining this because of its complex nature are discussed and the solution adopted described. This data is used as the basis for a soft system model of the whole company and its interactions. The developed hard sys-tem models of specific areas are described. It is concluded that systems theory offers an opportunity to pro-duce realistic models which can form the basis for decision support in construction companies. Keywords: system thinking, construction environment, company performance