EXPLORING THE POTENTIAL TO DEVELOP COLLABORATION AND PARTNERS FOR SUSTAINABILITY DURING AUSTERITY

misbe2011 Tracking Number 29

The last period of economic growth was characterised by continuous improvement initiatives in construction, of which alliances, partnering, integrated teams were advocated as a major component of facilitating improvement (e.g. Egan, 1998). This type of collaboration was a move away from adversarial markets towards markets theoretically underpinned relational contracting (e.g. Macneil, 1980; Williamson, 1985). The era could also be conceived in terms of a focus upon (service) differentiation (Porter, 1985) and opportunity to develop relational contracting experiences into embedded practices that form the basis for core competencies (e.g. Hamel and Prahalad, 1996) and dynamic capabilities (Teece et al, 1997). In practice, initiatives largely fell short of original expectations. Improvements generally remained project specific (Smyth, 2010), hence embedding these as owned by main contractors as part of market positioning and competitive advantage were lost opportunities. The current market is austere and has shifted from being focused upon differentiation to focused upon cost. Cost savings and driving prices down are the primary client drivers. Whilst this is likely to remain the prevalent agenda, there are two significant underlying trends. First, some main contractors are minded to retain as many of the benefits, especially collaborative practices. These have shifted the culture and residual benefits remain in main contractors, absorbed as informal and formal routines (cf. Chambers et al, 2009; Nelson and Winter, 1982). Second, the sustainability agenda is long-term and in its various dimensions is likely to increasingly drive factors affecting construction in and beyond the current era of austerity (Edkins et al, 2009). Linking these two trends – the residual routines of collaborative practice and sustainability as it affects construction – creates conceptual space to normatively theorise what could, perhaps should, occur to generate partnering and collaboration towards meeting future sustainability agendas, manifested at inter-organisational and project levels of construction operation. The paper theorises the potential by bringing together two conceptual areas. The first is relationship marketing and management, which has become established amongst some contractors (Smyth and Fitch, 2009) at the project front-end, whereby B2B relationships are forged to improve project execution. The second is the effectual marketing (e.g. Sarasvathy, 2001), which entrepreneurially builds alliances through a series of iterative commitments. It is through combining these conceptual principles in practice that contractors can add value to meet sustainability agendas. Marketing is the starting point as it takes time to develop relationships with substantive commitments at the contractor-client interface and at the contractor-supply chain interface (Keki and Smyth, 2010a; 2010b). The paper articulated the processes to achieve added value to meet the sustainability agendas. The conclusion focuses upon the extent to which the building blocks are in place in practice, how these can be integrated and recommendations to industry to convert potential to reality. The reality is likely to impact certain market segments of clients and contractors, but these are also likely yield the greatest growth opportunities for leading contractors.