Chung-Chin Kao

Competitive strategy revisited: contested concepts and dynamic capabilities

Strategy is a contested concept. The generic literature is characterized by a diverse range of competing theories and alternative perspectives. Traditional models of the competitive strategy of construction firms have tended to focus on exogenous factors. In contrast, the resource‐based view of strategic management emphasizes the importance of endogenous factors. The more recently espoused concept of dynamic capabilities extends consideration beyond static resources to focus on the ability of firms to reconfigure their operating routines to enable responses to changing environments. The relevance of the dynamics capabilities framework to the construction sector is investigated through an exploratory case study of a regional contractor. The focus on how firms continuously adapt to changing environments provides new insights into competitive strategy in the construction sector. Strong support is found for the importance of path dependency in shaping strategic choice. The case study further suggests that strategy is a collective endeavour enacted by a loosely defined group of individual actors. Dynamic capabilities are characterized by an empirical elusiveness and as such are best construed as situated practices embedded within a social and physical context.

Emergent discourses of construction competitiveness: localized learning and embeddedness

Research is described that sought to understand how senior managers within regional contracting firms conceptualize and enact competitiveness. Existing formal discourses of construction competitiveness include the discourse of ‘best practice’ and the various theories of competitiveness as routinely mobilized within the academic literature. Such discourses consistently underplay the influence of contextual factors in shaping how competitiveness is enacted. An alternative discourse of competitiveness is outlined based on the concepts of localized learning and embeddedness. Two case studies of regional construction firms provide new insights into the emergent discourses of construction competitiveness. The empirical findings resonate strongly with the concepts of localized learning and embeddedness. The case studies illustrate the importance of de‐centralized structures which enable multiple business units to become embedded within localized markets. A significant degree of autonomy is essential to facilitate localized entrepreneurial behaviour. In essence, sustained competitiveness was found to depend upon the extent to which de‐centralized business units enact ongoing processes of localized learning. Once local business units have become embedded within localized markets the essential challenge is how to encourage continued entrepreneurial behaviour while maintaining a degree of centralized control and coordination. Of key importance is the recognition that the capabilities that make companies competitive transcend organizational boundaries such that they become situated within complex networks of relational ties.