The Quality-Coordination Dilemma and Coordination Capabilities in the Construction Design Ecosystem

Abstract

In this article we report on our findings from a case study that examines and compares the Finnish and Russian construction design ecosystems to answer the research question how transaction costs and firm capabilities interact with customers’ decisions on choosing between competing ecosystems. The central result of our study is that there are several generic ecosystems in the construction design industry and that the specific ecosystem is chosen by the customer based on considering the trade-off between reducing the costs of coordination on the one hand and achieving the desired quality through contracting with specialists on the other hand. We find that this trade-off, which we call the “quality-coordination dilemma”, may be mitigated through coordination capabilities, which may be located either at the supply or the demand side. We show that the institutional context influences the quality-coordination dilemma and thus the choice of ecosystem through three factors: the level of trust, the legal requirem...