Modeling Competitiveness Factors and Indexes for Construction Companies: Findings of Chile

TLDR

Globalization and intense competition demand effective competitive strategies, prompting a need to understand how factors interrelate to measure and improve competitiveness in construction firms. The study aims to identify the critical variables that define competitiveness for general contractors and to support decision‑making for improving competitiveness. An interrelationship model of competitiveness variables was proposed and evaluated with partial least squares path modeling. Leadership has the strongest impact on competitiveness indexes, followed by contract management and health and safety management, indicating managers should prioritize these factors to improve specific indexes.

Abstract

Globalization and the highly competitive environment have led to an urgent need to create effective competitive strategies in order to survive. Therefore, companies require a better understanding about the interrelationships between the factors that determine competitiveness and indexes to measure it. Considering that strategic planning within the construction industry has had documented challenges, this research provides support for decision making associated with improving competitiveness. This paper first provides the critical variables that define the competitiveness of general contractors according to top managers for general contractors’ companies. Then, an interrelationship model has been proposed to describe how these variables are interrelated based on well-known business models and other relationships found in the literature. The proposed model was evaluated using the partial least squares path modeling technique. The results show that leadership has, in general, the strongest impact on the competitiveness indexes, which means that whatever the goal set by the construction company, close attention should be placed on leadership. The other factors, following leadership, that mostly affect the indexes were contract management and health and safety management. The results intend to support strategic planning in construction companies by helping managers to orient the company’s efforts with those factors that contribute to the specific indexes that need improvement.