A Fresh Perspective

The specific aim of this component of the research was to access how strategy is enacted in practice; to develop a picture of how strategy has emerged over time and thereby to understand the relevant themes surrounding competitive strategy. The research recognised and welcomed contested points of view.

Enacting competitiveness

The research design has involved three in-depth case studies of regional constructions firms operating in the UK; including over 50 interviews, annual financial reports analysis, informal meetings, workshops, and feedback sessions with the case study firms.

The case studies provide new insights into the ways in which such firms strive to remain competitive in changing environments.

Key Emergent Themes are summarised below:

1. Reputation

• Constantly viewed as relevant, from SMEs right through to larger regional contractors
• Market specific: certain sectors more 'incestuous' than others
• Client specific: some firms have limited number of clients
• Often appears relevant up the supply chain rather than down toward the sub-contractors

2. Path dependency

• Current business activities are heavily shaped by past development trajectory
• Market positions evolved over time

3. Building capabilities

• Importance of developing new skills and capabilities (e.g. buying in new expertise, using knowledge from other divisions, training required capabilities, and recruiting the 'right type' of staff)
• Essential to allow the firms to adapt and respond to changes quickly

4. Client relationships and localised networks

• Need to building up a degree of empathy with the client and specific local players
• Staff interchange between the clients and the contractors
• Contractor employees spending time working with their consultants
• Client focussed personal service
• Importance of becoming part of local communities
• Aspirations for joint ventures or partnerships with clients and local players

5. Opportunistic behaviour and serendipity

• Firms less constrained by long term plans, allowing them to be more responsive
• There are a number of chance events that subsequently shape strategy
• Ability to 'turn on and turn off' business streams to suit the market demand
• Adaptable to move between regionally-based business and specialist- sectors business

Click the links below to find out more about the case studies:

• Case study 1: Forest Construction
• Case study 2: Southern Construction
• Case study 3: Northern Construction

The findings illustrate that construction firms operate in a state of continuous adjustment between a regionally-based model and specialist divisions. Each has its particular operations and staffing issues.

Firms need to operate unique versions of the two business models concurrently to make themselves adaptive to market changes. They are then less constrained by long-term plans and more able to respond opportunistically to emergent markets.

This presents challenges such as maintaining an appropriate balance between 'central control' and 'local autonomy'. The latter facilitates entrepreneurial behaviours and enables multiple business units to become embedded within local markets or specialist sectors. However, group boards also have to maintain some degree of central control and coordination.

Maintaining an appropriate, but changing, balance between responsive entrepreneurship and constrained risk exposure is central to remaining competitive.