Factors Affecting International Construction

TLDR

International expansion of construction firms requires a clear understanding of opportunities, threats, and the development of company strengths relative to overseas activities. The study assessed these factors by surveying executives of large U.S. contractors through two rounds of Delphi surveys, whose results fed into an analytic hierarchy process.

Abstract

A construction company's decision to expand into international markets must be based on a good understanding of the opportunities and threats associated with international business, as well as the development of company strengths relative to international activities. These factors were evaluated in this study by surveying the executives in charge of international construction of large United States based contractors. The information was collected by means of two rounds of a Delphi survey, the results of which were used as input in an analytic hierarchy process (AHP). The findings indicate that track record, specialist expertise, project management capability are the most important company strengths; loss of key personnel, shortage of financial resources, and inflation and currency fluctuations are the most important threats relative to international markets; and increased long term profitability, the ability to maintain shareholders' returns, and the globalization and openness of the markets are the most important opportunities available in international works. This study is of relevance to practitioners as it systematically highlights the factors that affect international construction for the benefit of executives of medium-to-large size construction companies who are considering expanding into overseas markets. It is of relevance to researchers too as it demonstrates the successful use of the combined Delphi and AHP.