Validating a model of cooperative procurement in the construction industry

Project management in the construction industry involves coordination of many tasks and individuals, affected by complexity and uncertainty, which increases the need for efficient cooperation. Procurement is crucial since it sets the basis for cooperation between clients and contractors. This is true whether the project is local, regional or global in scope. Traditionally, procurement procedures are competitive, resulting in conflicts, adversarial relationships and less desirable project results. The purpose of this paper is to propose and empirically test an alternative procurement model based on cooperative procurement procedures that facilitates cooperation between clients and contractors in construction projects. The model is based on four multi-item constructs – incentive-based compensation, limited bidding options, partner selection and cooperation. Based on a sample of 87 client organisations, the model was empirically tested and exhibited strong support, including content, nomological, convergent and discriminant validity, as well as reliability. Our findings indicate that partner selection based on task related attributes mediates the relationship between two important pre-selection processes (incentive-based compensation and limited bid invitation) and preferred outcome of cooperation. The contribution of the paper is identifying valid and reliable measurement constructs and confirming a unique sequential order for achieving cooperation. Moreover, the findings are applicable for many types of construction projects because of the similarities in the construction industry worldwide.

Is globalisation an enabler of radical innovation in Toyota?

Prior evidence from the fields of innovation management and supplier relations predicts that Japanese firms should be naturally disadvantaged in developing and deploying radical innovations. But this conclusion is inconsistent with recent developments in the automotive industry. This paper presents secondary case study data focusing on fuel cell powered vehicles and hybrid cars to show that Toyota, one of Japan's largest and most influential corporations, is capable of developing radically new technologies, and is in several respects better at this sort of innovation than the rest of the global automotive industry.

What the hare can teach the tortoise about make-buy strategies for radical innovations

Purpose of this paper – The purpose of this investigation is to help establish: whether or not strong relationships between suppliers and customers improve performance; and if prescriptive frameworks on outsourcing radical innovations are dependent on industry clockspeed. Design/methodology/approach – A survey of UK-based manufacturers, followed by a statistical analysis. Findings – Long-term supplier links seem not to play a role in the development of radical innovations. Moreover, industry clockspeed has no significant bearing on the success or failure of any outsourcing strategy for radically new technologies. Research limitations/implications – Literature about outsourcing in the face of radical innovation can be more confidently applied to industries of all clockspeeds. Practical implications – Prescriptions for fast clockspeed industries should be applied more broadly: all industries should maintain a high degree of vertical integration in the early days of a radical innovation. Originality/value – Prior papers had explored whether or not a company should outsource radical innovations, but none had determined if this is equally true for slow industries and fast ones. Therein lies the original contribution of this paper.

Make-buy decisions in the face of technological change: does industry clockspeed matter?

Some evidence in the area of make-buy decisions for new technologies suggests that it is a good idea for a company to pursue a fairly rigorous ''make'' policy in the early days of a potentially disruptive innovation. Other studies prescribe exactly the opposite, promoting instead a ''buy'' strategy. This paper seeks to bridge the gap between these perspectives by suggesting that both strategies are valid, but that they are most successfully applied in different market environments. The ''make'' prescription may be more suited to either extremely fast or extremely slow rates of technological change, while a ''buy'' strategy might be more appropriate in market sectors where technologies evolve at a medium pace. This paper highlights the importance of industry clockspeed and supplier relationships in make-buy decisions for new technologies, and puts forward two new hypotheses that require empirical testing.

Outsourcing strategies for radical innovations: does industry clockspeed make a difference?

Purpose – To determine whether or not clockspeed is an important variable in outsourcing strategies throughout the development of radical innovations. Design/methodology/approach – An internet-based survey of manufacturing firms from all over the world. Findings – An industry's clockspeed does not play a significant role in the success or failure of a particular outsourcing strategy for a radical innovation. Research limitations/implications – Conclusions from earlier research in this area are not necessarily industry-specific. Practical implications – Lessons learned via previous investigations about the computer industry need not be confined to that sector. Vertical integration may be a more robust outsourcing strategy when developing a radical innovation in industries of all clockspeeds. Originality/value – Previous research efforts in this field focused on a single technology jump, but this approach may have overlooked a potentially important variable: industry clockspeed. Thus, this investigation explores whether clockspeed is an important factor.

The Long-Term Irrelevance of Trust in Outsourcing Decisions for New Technologies: Insights from an Agent-Based Model

Significant empirical data from the fields of management and business strategy suggest that it is a good idea for a company to make in-house the components and processes underpinning a new technology. Other evidence suggests exactly the opposite, saying that firms would be better off buying components and processes from outside suppliers. One possible explanation for this lack of convergence is that earlier research in this area has overlooked two important aspects of the problem: reputation and trust. To gain insight into how these variables may impact make-buy decisions throughout the innovation process, the Sporas algorithm for measuring reputation was added to an existing agent-based model of how firms interact with each other throughout the development of new technologies. The model�s results suggest that reputation and trust do not play a significant role in the long-term fortunes of an individual firm as it contends with technological change in the marketplace. Accordingly, this model serves as a cue for management researchers to investigate more thoroughly the temporal limitations and contingencies that determine how the trust between firms may affect the R&D process.

The extent of six sigma methodologies usage in services

The last two decades have seen the application of six sigma methodologies in many manufacturing and also some service industries. Six sigma’s success in manufacturing is well published. But the same cannot be said about its implementation in services. Applying six sigma to services is still limited to only a small number of services. This paper reviews the application of six sigma in service industries. Emphasis is given to application issues such as what are necessary critical success factors and key performance indicators in order for a project to be successful. A pilot study was carried out in order to highlight the issues discussed. Regardless of the service that is provided, a number of guidelines can be commonly applied to varying types of services. The aim of this paper is to help widen the scope of six sigma application in services.