2018, Volume 5, Issue 3
Frontiers of Engineering Management >> 2018, Volume 5, Issue 3 doi: 10.15302/J-FEM-2018021
Conceptualising the nexus of projects, finance and capacity in construction business
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Abstract
This paper addresses a research question on why construction companies fail in their business. Starting with the concept of growth and capacity underinvestment archetype, a new and operational systems thinking model is developed. The conceptual systems thinking model includes a set of causal structure that can explain various modes (including the growth and failure modes) of business performance of small and medium construction companies. Mainly the three components – projects, finance and capacity – and the understanding of their nexus (or causal inter-relationships) are found to be sufficient to reveal different performance modes in construction business. Further, the three operational aspects, namely, the business growth or decline process; the situation of financial and other capacity resource consumption; and the management of projects, finance and other capacity resources have been identified as the inter-related core and integral aspects of construction business. The three inter-related core aspects could actually include and explain different possible range of business situations, policies and practices in a construction company.
Keywords
performance of construction business ; projects ; finance ; capacity ; systems thinking
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