Eriksson, Per-Erik and Pesämaa, Ossi (2007): Modelling procurement effects on cooperation. Published in: Construction Management and Economics , Vol. 25, No. 8 : pp. 893-901.
Download (234kB) | Preview
Cooperative arrangements, such as partnering, have received increased interest in recent years. Several studies show however that cooperative relationships are not easily achieved in construction. Implementation of cooperative relationships requires changes in several elements of the traditional procurement procedures. The purpose of this paper is therefore to propose and test a sequential model regarding clients’ cooperative procurement procedures. We especially ask: what elements in clients’ procurement procedures facilitate the establishment of cooperation and trust in their relationships with contractors? The model was tested through structural equation modelling. The empirical data required for the test were collected through a survey responded to by 87 Swedish professional construction clients. The empirical results show that cooperative procurement procedures are triggered by clients’ wish to involve contractors early in specification, which has a simultaneous effect on procedures regarding bid invitation and compensation. Furthermore, these simultaneous effects breed a certain kind of partner selection based on task-related attributes, which also has a direct positive effect on trust and above all on cooperation in client–contractor relationships. Besides these implications from the model, the improvement of measurements for future modelling is discussed.
|Item Type:||MPRA Paper|
|Original Title:||Modelling procurement effects on cooperation|
|Keywords:||Construction; cooperation; procurement;|
|Subjects:||C - Mathematical and Quantitative Methods > C1 - Econometric and Statistical Methods and Methodology: General > C12 - Hypothesis Testing: General
C - Mathematical and Quantitative Methods > C2 - Single Equation Models ; Single Variables > C21 - Cross-Sectional Models ; Spatial Models ; Treatment Effect Models ; Quantile Regressions
|Depositing User:||I Pesämaa|
|Date Deposited:||13. May 2008 05:04|
|Last Modified:||17. Mar 2014 08:19|
Adler, P. (2001) Market, hierarchy and trust: the knowledge economy and the future of capitalism. Organization Science, 12(2), 215–34.
Akintoye, A., McIntosh, G. and Fitzgerald, E. (2000) A survey of supply chain collaboration and management in the UK construction industry. European Journal of Purchasing and Supply Management, 6, 159–68.
Aulakh, P., Kotabe, M. and Sahay, A. (1996) Trust and performance in cross-boarder marketing partnerships: a behavioral approach. Journal of International Business Studies, 27(5), 1005–32.
Bajari, P. and Tadelis, S. (2001) Incentives versus transaction costs: a theory of procurement contracts. Rand Journal of Economics, 32(3), 387–407.
Barlow, J. (2000) Innovation and learning in complex offshore construction projects. Research Policy, 29(7–8), 973–89.
Barlow, J., Cohen, M., Jashapara, A. and Simpson, Y. (1997) Towards Positive Partnering, The Policy Press, Bristol.
Bayliss, R., Cheung, S., Suen, H. and Wong, S.-P. (2004) Effective partnering tools in construction: a case study on MTRC TKE contract in Hong Kong. International Journal of Project Management, 22(3), 253–63.
Bresnen, M. and Marshall, N. (2000) Building partnerships: case studies of client–contractor collaboration in the UK construction industry. Construction Management and Economics, 18(7), 819–32.
Briscoe, G.,Dainty, A.,Millett, S. and Neale, R. (2004) Clientled strategies for construction supply chain improvement. Construction Management and Economics, 22(2), 193–201.
Brown, D., Ashleigh, M., Riley, M. and Shaw, R. (2001) New project procurement process. ASCE Journal of Management in Engineering, 17(4), 192–201.
Chan, A., Chan, D. and Ho, K. (2003) An empirical study of the benefits of construction partnering in Hong Kong. Construction Management and Economics, 21(5), 523–33.
Cheng, E. and Li, H. (2002) Construction partnering process and associated critical success factors: quantitative investigation. ASCE Journal of Management in Engineering, 18(4), 194–202.
Cheung, S.-O., Lam, T.-I., Leung, M.-Y. and Wan, Y.-W. (2001) An analytical hierarchy process based procurement selection method. Construction Management and Economics, 19(4), 427–37.
Cheung, S., Ng, T., Wong, S.-P. and Suen, H. (2003) Behavioral aspects in construction partnering. International Journal of Project Management, 21(5), 333–43.
Cox, A. and Thompson, I. (1997) Fit for purpose contractual relations: determining a theoretical framework for construction projects. European Journal of Purchasing & Supply Management, 3(3), 127–35.
Das, T. and Teng, B.-S. (2001) Trust, control, and risk in strategic alliances: an integrated framework. Organization Studies, 22(2), 251–83.
Dubois, A. and Gadde, L.-E. (2002) The construction industry as a loosely coupled system: implications for productivity and innovation. Construction Management and Economics, 20(7), 621–32.
Egan, J. (1998) Rethinking Construction, Construction Task Force Report for Department of the Environment, Transport and the Regions, HMSO, London.
Eriksson, P.E. (2006) Procurement and governance management: development of a conceptual procurement model based on different types of control. Management Revue, 17(1), 30–49.
Geringer, J. (1991) Strategic determinants of partner selection criteria in international joint ventures. Journal of International Business Studies, 22(1), 41–62.
Ghoshal, S. and Moran, P. (1997) Bad for practice: a critique of the transaction cost theory. Academy of Management Review, 21(1), 13–47.
Gidado, K.I. (1996) Project complexity: the focal point of construction planning. Construction Management and Economics, 14(3), 213–25.
Grandori, A. (1997) An organizational assessment of interfirm coordination modes. Organization Studies, 18(6), 897–925.
Hagen, J. and Choe, S. (1998) Trust in Japanese interfirm relations: institutional sanctions matter. Academy of Management Review, 23(3), 473–90.
Hair, J.F., Black, B., Babin, B., Anderson, R.E. and Tatham, R.L. (1998) Multivariate Data Analysis, 6th edn, London, Prentice Hall.
Heide, J.B. and John, G. (1990) Alliances in industrial purchasing: the determinants of joint action in buyer– supplier relationships. Journal of Marketing Research, 27(1), 24–36.
Hakansson, H., and Snehota, I. (eds) (1995) Developing Relationships in Business Networks, International Thomson Business Press, London.
Kadefors, A. (2004) Trust in project relationships: inside the black box. International Journal of Project Management, 22(3), 175–82.
Korczynski, M. (1996) The low-trust route to economic development: inter-firm relations in the UK engineering construction industry in the 1980s and 1990s. Journal of Management Studies, 33(6), 787–808.
Love, P., Skitmore, M. and Earl, G. (1998) Selecting a suitable procurement method for a building project. Construction Management and Economics, 16(2), 221–33.
Love, P., Irani, Z. and Edwards, D. (2004) A rework reduction model for construction projects. IEEE Transactions on Engineering Management, 51(4), 426–40.
Ng, T., Rose, T., Mak, M. and Chen, S.E. (2002) Problematic issues associated with project partnering—the contractor perspective. International Journal of Project Management, 20(6), 437–49.
Parkhe, A. (1998) Building trust in international alliances. Journal of World Business, 33(4), 417–38.
Pietroforte, R. (1997) Communication and governance in the building process. Construction Management and Economics, 15(1), 71–82.
Rahman, M. and Kumaraswamy, M. (2002) Joint risk management through transactionally efficient relational contracting. Construction Management and Economics, 20(1), 45–54.
Saad, M., Jones, M. and James, P. (2002) A review of the progress towards the adoption of supply chain management (SCM) relationships in construction. European Journal of Purchasing & Supply Management, 8(3), 173–83.
Spekman, R. (1988) Strategic supplier selection: understanding long-term buyer relationships. Business Horizons, 31(4), 75–81.
Stump, R. and Heide, J.B. (1996) Controlling supplier opportunism in industrial relationships. Journal of Marketing Research, 33(4), 431–41.
Williamson, O. (1985) The Economic Institutions of Capitalism, The Free Press, London.
Wong, S.-P. and Cheung, S. (2005) Structural equation model of trust and partnering success. ASCE Journal of Management in Engineering, 21(2), 70–80.