International Construction Contractors Research Articles

What drives the fulfillment of social responsibility among international construction contractors? Stakeholder perspective

Corporate social responsibility (CSR) is important for the growth of the construction industry; hence, the factors that influence construction contractors to implement CSR should be understood. Using government supervision as a moderator and CSR strategy as a mediating variable, the influence of stakeholders on the fulfillment of CSR by international construction contractors (ICCs) was explored in this study. ICC managers’ completed online questionnaires, and partial least squares structural equation modelling (PLS-SEM) were used to analyze the survey data. The results revealed that CSR strategies are influenced by customer expectations, partners expectations, and employee participation in CSR. Local community pressure had no direct effect on CSR strategies, and government supervision had a positive moderating effect on the relationship between customer expectations and CSR strategies. The findings of this study allow policymakers and practitioners to understand the elements driving CSR implementation and establish a win-win situation for society, stakeholders, and corporations.

How to predict the entry mode of international construction contractor: a case-based reasoning approach

PurposeThis study aimed to identify a specific taxonomy of entry modes for international construction contractors and to develop a decision-making mechanism based on case-based reasoning (CBR) to facilitate the selection of the most suitable entry modes.Design/methodology/approachAccording to the experience orientation of the construction industry, a CBR entry mode decision model was established, and based on successful historical cases, a two-step refinement process was carried out to identify similar situations. Then the validity of the model is proved by case analysis.FindingsThis study identified an entry mode taxonomy for international construction contractors (ICCs) and explored their decision-making mechanisms. First, a two-dimension model of entry mode for ICCs was constructed from ownership and value chain dimensions; seven common ICC entry modes were identified and ranked according to market commitment. Secondly, this study reveals the impact mechanism of the ICC entry mode from two aspects: the external environment and enterprise characteristics. Accordingly, an entry mode decision model is established.Practical implicationsFirstly, sorting out the categories of entry mode in the construction field, which provide an entry mode list for ICCs to select. Secondly, revealing the impact mechanism of ICC entry mode, which proposes a systematic decision-making system for the selection of ICC entry mode. Thirdly, constructing a CBR entry mode decision-making model from an empirical perspective, which offers tool support and reduces transaction costs in the decision-making process.Originality/valueThe study on entry modes for ICCs is still in the preliminary exploratory stage. The authors investigate the entry mode categories and decision-making mechanisms for ICCs based on Uppsala internationalization process theory. It widens the applied scope of Uppsala and promotes cross-disciplinary integration. In addition, the authors creatively propose a two-stage retrieval mechanism in the CBR model, which considers the order of decision variables. It refines the influence path of the decision variables on ICCs' entry mode.

The Aid-Contracting Nexus: The Role of The International Contracting Industry in China’s Overseas Development Engagements

Commercial interests in China’s foreign aid projects are widely recognised in the literature. Yet, the role of the Chinese companies involved in such activities remains understudied. Piecing together information from primary sources, this article retells the story of China’s overseas development engagements from the perspective of China’s international contracting industry, the history of which is closely intertwined with China’s foreign aid practices. Identified by the state to be a strategic vehicle for exporting Chinese labour, industrial products, technology, management skills, and capital, international construction contractors (ICECs) have received substantial policy support and have grown into prominent multinational corporations with global footprints. I use the concept of the “aid-contracting nexus” to highlight the linkage between China’s economic diplomacy and domestic economic development strategy. The “aid-contracting nexus” provides a critical lens for analysing China’s overseas development engagements, including why it has focused primarily on infrastructure, and the conceptual confusion over China’s development finance. This analysis also speaks to the popular accusations that Chinese lending practices are predatory or “debt-trapping” by underscoring mercantilist logic as an alternative explanation. The evolving business model if ICECs is likely to pose new challenges for China’s foreign relations.

External Factors of Delay That Affect the Performance of International Construction Contractors in Kuwait

As the construction industry in Kuwait develops, the need for international contractors to handle and manage these projects rises as well. Currently, 70% of the projects in Kuwait get delayed, some by internal factors, and some by external ones. Thus, the purpose of this research is to provide a framework for international construction contractors in Kuwait regarding the external factors of delay that they might face in their projects. External factors of delay are a newly generated type of delays that represent all the delays that are beyond the contractor’s control and cannot be anticipated in the project. In this research, the most important and frequently occurring external factors of delay were extracted and discussed with 15 project management professionals to elaborate their perspectives and construct a survey to evaluate the impact and frequency of these delaying factors in the construction industry in Kuwait. This survey was distributed to 80 project management practitioners; then, the outcomes were analyzed by using the Relative Importance Index methodology to rank the effect of the examined delaying factors. Hence this research will provide international construction contractors with an illustration of the delaying factors that they should focus on and the ones they can pay less attention to them.

Classifying the Business Model Types of International Construction Contractors

AbstractAs the construction business environment becomes increasingly complex and competitive, business model innovation is being accepted as an essential factor in sustaining competitive advantage...

Application of home-country joint venture (HJV) for international construction contractors

Home-country joint venture (HJV) is one of the strategies contractors can use to venture into the international construction market. In this method, contractors from the same country join to undertake a project in a host country. However, this method is not common among contractors compared with other methods. For instance, among many overseas construction projects executed by Malaysian contractors, less than 1% of projects were completed as HJV. The purpose of this paper is to understand why this method is not common and to determine its potential benefits. For this purpose, qualitative interviews were conducted with experts from Malaysian international contractor companies. The findings highlight the reasons why HJV is not common and the factors that facilitate HJV application among contractors. Factors facilitate the application of HJV include develop strategy for partnering, plan for HJV and risk, select the right partner and others. These factors are categorized into three main project management processes, which are HJV planning, HJV execution and HJV monitoring and control. The findings of this paper can promote the application of joint venture among contractors for successful construction projects and sustainable business in the international market.

Communicating the corporate social responsibility (CSR) of international contractors: Content analysis of CSR reporting

Corporate social responsibility (CSR) is gaining importance for international construction contractors and corporate reports are an effective tool in communicating their CSR efforts. However, CSR communication is a rare topic of discussion within the construction research field. This study establishes a systematic content analysis approach to compare CSR communication among contractors in different regions. It selected a sample of 310 international contractors from the Engineering News-Record list from 2009 to 2014 and collected data from their CSR-related reports. Significant disparities were found in CSR communication among the contractors in the four regions. European contractors showed the highest levels of CSR communication in both dimension- and issue-levels, while Chinese contractors ranked the lowest in CSR communication. Another interesting finding is that all four regions gave the highest priority to one CSR dimension, i.e. community involvement and development. This study serves as a starting point for research on CSR communication by construction contractors, including comparisons with companies in other industries. In addition, this study provides a useful tool for companies or scientific researchers to assess the status of CSR communication.

An empirical study on the relationship between sustainability performance and business competitiveness of international construction contractors

With expectations for resource efficiency and climate change adaptation in the construction industry, there is an increasing need for contractors to implement sustainable practices. Such action will burden contractors with additional costs that will lower their economic performance. There are few research studies on how sustainability relates to a firm's competitiveness. This paper represents an empirical study of the relationship between sustainability performance and business competitiveness of international construction contractors. An inverse U-shape relationship between contractors' sustainability performance and their international revenue, and a U-shape relationship between contractors' sustainability performance and their international revenue growth was discovered. The findings can help international contractors have a better understanding of the relationship between sustainability performance and business competitiveness, evaluate their current position in the relationship, optimize their resource allocation on sustainable development and integrate sustainability into their strategic planning. Therefore, contractors with high sustainability performance can expect higher international revenue growth, and sustainability performance is likely to become an opportunity for competitive advantage in the international construction market.

Niche Width, Competitive Positioning, and Performance of International Construction Contractors (1992–2009)

AbstractOver the past few decades, the international construction industry has proven a dramatic development. However, the unstable international circumstance has enhanced the risks of this industry, where proper strategies are critical for the survival of international contractors. Based on organizational ecology theories, which initially stemmed from ecology and then introduced to business management and economics field, proper competitive positioning for international construction companies are investigated in this study. Niche width has been introduced as an indicator to reflect the resource utilization of international construction companies while location is defined as the contractors’ distance from the market center. Using Engineering News-Record data on top 225 international contractors from 1992 to 2009, the U-shaped relationship between niche width and performance of contractor is proven in both product and geography dimensions, indicating the performance of contractors enhance with the expansio...

Niche comparisons: toward a new approach for analysing competition and organizational performance in the international construction market

Over the past few decades, studies on competition and organizational performance in the international construction market have been prolific. Construction companies are founded, then grow, compete, evolve, and die in the international landscape, a common process from an ecological perspective. However, few studies have considered the international construction market from this perspective. Using niche theory, which was initially populated in the field of natural bio-ecology and then introduced to business management and economics, a NW/O-L (niche width/overlap and location) framework is established in this study. With this framework, the niche evolution of the top 225 international contractors is explored along two dimensions—product and geography. The effects of a proper niche on an international construction company’s performance are also investigated using the cluster analysis method. It was discovered that, despite fluctuations over time, the contractor’s niche is highly related to its performance in the international construction market. The most appropriate niche for international construction contractors is a wide niche width, with a small niche overlap and with its location near to the market centre with comparatively more market resources. However, only a few contractors can survive in this niche, as the majority of contractors are in a narrow niche width, with a comparatively large niche overlap and far from the market centre. Contractors which do not fit either of these two niches have proved to be poor performers in this study.

FIDIC에 의한 건설계약 분쟁 해결방안에 관한 연구

해외건설공사에서는 종종 예기치 않는 환경에서 공사를 시공하는 상황에 직면하게 되는 경우가 있다. FIDIC에 있어서 예기치 않는 상황이 발생할 시 건설계약의 변경을 행하기 위해 시공자는 감독자에게 클레임을 통보하는 권리를 가지며, 발주자와 시공자 간의 화해가 성립하지 않을 경우에는 분쟁이 발생한다. 시공자가 발주자 보다 상황변화에 관한 더 상세한 자료를 가지고 있고 정보의 비대칭성을 초래하여 감독자나 중재자의 판단오류와 교섭에 의한 화해이득을 기대한 분쟁이 발생할 가능성이 있다. 본 연구에서는 분쟁 발생원인과 시공자의 클레임 이동에 착안하여 제3자에 의한 분쟁조정의 방식과 비용부담률이 분쟁발생에 관한 기법을 게임이론을 이용하여 분석하였으며 또한 그 모델을 클레임에 관한 DAB/DGB의 영향도 분석하였다. 그 결과 제3자의 조정에 있어서 과오의 확률을 작게 하는 것이 분쟁을 효율적 해결할 수 있다고 판단된다. 이에 급속한 건설시장의 변화에 대처하기 위해 해외건설공사의 계약관리 강화방안을 제시하고자 한다. International construction contractors are often faced with the situation of working in an unfamiliar construction environment. Under FIDIC rules, the contractor has the right to make a claim requesting the consulting engineer for an adjustment to the contract price or the time for completion when a part or parts of the works have changed, or in the event of unforeseeable conditions. Contractors generally have more access to the costs and time implications of such a change or unforeseeable conditions than the consulting engineer or outside neutrals. Due to such an asymmetry of information, the contractor may be motivated to dispute frivolous claims of less merit, expecting erroneous judgments by the consulting engineer or the neutrals. In this paper, a claiming behavior model is presented by using game theory and experience data to study the manner in which frivolous claims develop into disputes. The model also analyzes the impacts of DAB/DRB upon the frivolous claims.

VERBAL ANALYSIS OF ENGINEERING AND CONSTRUCTIONAL SOLUTIONS

The construction contracts which meet the interests of all the sides involved are the core element of every successful constructural project. That is why the advise of how to sign the accurate and effective contract has growing importance. International construction contractors are often faced with the situation of working in unfamiliar construction environment. One potential source of risk is the contractual requirements embodied in the general conditions of contracts. Authors aim to analize construction contracts being used and to define their effectiveness using the method of verbal analysis.

VERBAL ANALYSIS OF CONTRACTS OF ENGINEERING AND DESIGN OF BUILDINGS

As Lithuania became a member of the International Federation of Consulting Engineers (FIDIC) in 2004 it is obvious that engineering consultancy activity will grow in the country in the nearest future. The constructural contracts which meet the interests of all the sides involved is the core element of every successful constructural project. That is why the advise how to sign an accurate and effective contract is of great importance. International construction contractors are often faced with the situation of working in unfamiliar construction environment. One potential source of risk is the contractual requirements embodied in the general conditions of contracts.Authors aim to analize constructural contracts used by FIDIC members and define the effectiveness of the contracts using the method of verbal analysis.

Bidding Considerations in Developing Countries

Developing countries pose greater challenges to international construction contractors because of inherent risks such as government instability, shortages of adequately trained craftsmen, difficulty in acquiring needed materials, and lack of adequate infrastructure such as roads, bridges, harbors, and power generation facilities. The international construction market is continuously growing, and there are many opportunities for U.S. contractors to obtain additional work and improve profits. This paper describes characteristics of developing countries that should be of interest to any contractor considering projects in these parts of the world. Additionally, results from a study identify the top information requirements in 15 key areas, which architectural, engineering, and construction (AEC) firms identified. A discussion of characteristics of the construction environment in Kenya is provided as an example of bidding considerations in a typical developing country.

Evaluating the general conditions of a construction contract

International construction contractors are often faced with the situation of working in an unfamiliar construction environment. One potential source of risk is the contractual requirements embodied in the general conditions of contracts. The paper presents a simple quantitative method for evaluating the general conditions of a construction contract. 11 attributes were used in this evaluation: clarity, conciseness, completeness, internal and external consistency, practicality, fairness, effect on quality, cost, schedule, and safety. The procedure can also be used to assess the risk level associated with the general conditions.