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Thuesen, C, Koch, C and Nielsen, J S (2010) Strategy and business development practices in Danish constrution industry SMEs. In: Egbu, C (Ed.), Proceedings 26th Annual ARCOM Conference, 6-8 September 2010, Leeds, UK. Association of Researchers in Construction Management, Vol. 2, 919–28.
- Type: Conference Proceedings
- Keywords: strategy; business development; innovation; SME
- ISBN/ISSN: 978-0-9552390-4-5
- URL: http://www.arcom.ac.uk/-docs/proceedings/ar2010-0919-0928_Thuesen_Koch_and_Nielsen.pdf
- Abstract:
The paper presents a qualitative study of strategy and business development practices in Small and Medium Sizes Enterprises (SME) in the Danish construction industry. Theoretically the paper draws upon theories on how strategy is developed and practiced as in integrated part of everyday management practices. 19 qualitative interviews have been conducted in total representing architects, engineering companies, contractors and subcontractors. Based on an in-depth analysis of this empirical material, the study finds: (1) he market is characterized by a typical “red ocean” environment, where the companies compete on their overhead rather than their ability to reduce production cost and create value. (2) the companies have a reactive practice towards development, where they try to follow the development in the market rather than shaping their own market. (3) their approach towards strategy development is characterized by being unstructured, undocumented and non-reflexive. This is interpreted as a sign of unprofessional management practices in the businesses, which reproduces the existing institutionalized division of labour in the construction industry. The paper concludes that business development represents an important but unacknowledged practice for innovation of the building industry and suggests that strategy processes should be facilitated and subject to more detailed research in order to escape the present unhealthy market practices in the construction industry.