Authors: Florence Crespin; Robert Salle
The aim of this paper is to identify mechanisms at play in the development of cooperation in industries characterized by a high level of purchase discontinuity. The paper concentrates on the construction industry. In the construction industry adversarial relationships between actors (customers, contractors, subcontractors, suppliers) are usually the rule on specific projects such as real estate projects, construction of plants. Several factors favor this kind of opportunistic behavior: the existing purchasing procedures based on competitive tendering, the industry fragmentation, the uniqueness of construction as a product, the distinction between design and execution, and the specific role of consultants. This paper is based on a case study. It analyzes the evolution of a relationship between a main contractor (SBP) and two subsidiaries (DRESS and CLOTH) of the same customer group over a 9 years period. The empirical study focuses on 7 projects (warehouse) with DRESS and CLOTH (SPB has been awarded 5 projects). Projects after projects the s/c relationship moves from an arm’s length approach (call for tender and lowest price bid, distinction between design phase and execution phase), to a cooperative and partnerial approach (no distinction between design phase and execution phase which are managed by the same company in relation with the customer). As a consequence of these changes, the nature of the relationships between the main contractor and the subcontractors and suppliers also evolve and become more cooperative.Taking a Market as Network perspective, we suggest 4 elements explaining the learning process: the individual project, the succession of projects in a given relationship (multi project perspective), the experience transferred between two interconnected relationships (DRESS and CLOTH are two subsidiaries of the same group), the developments generated on several projects in other s/c relationships.
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Publish Year: 2003
Conference: Lugano, Switzerland (2003)