Structural Equation Model of the Factors Affecting Construction Industry Innovation Success

Year 2021, Volume: 32 Issue: 2, 10717 - 10738, 01.03.2021

Gökhan Demirdöğen Zeynep Işık

https://doi.org/10.18400/tekderg.567272

Cited By: 3

Abstract

Innovation is seen as one of the major factors to improve construction industry despite conventional structure of the industry impede implementation of its practices. A convenient solution to promote innovation or force the companies to adopt it, is the legal regulations that can be set forth by the decision makers of whom aware and prevailed of the macro benefits of innovation practices. However, the impact of innovation practices on industry indicators was not defined adequately to understand those benefits. This study aims to reveal the relationship between company-level innovation success measures and industry-level innovation success indicators. Therefore, a comprehensive literature review was performed to determine those success measures and indicators and the results were validated with an illustrative case study. The outputs of the case study was used to construct structural equation model exhibiting the interdependencies between factors. The study results approved that there is a significant relationship between the innovation practices of construction companies and construction industry innovation. According to the results, increase in competitive advantage among rivals and improved reputation were seen as the two highest indicators in the company-level. Additionally, the study showed that the most important innovation success indicator at the industry-level was found as “employment and new job opportunities”.

Keywords

innovation, structural equation modeling, building information modeling, construction industry

References

• Slaughter, E. S., Models of construction innovation, Journal of Construction Engineering and management, 124(3), 226-231, 1998.
• Seaden, G., Guolla, M., Doutriaux, J., Nash, J., Strategic decisions and innovation in construction firms, Construction Management and Economics, 21(6), 603-612,2003.
• Manley, K., McFallan, S., Kajewski, S.,Relationship between construction firm strategies and innovation outcomes, Journal of construction engineering and management, 135(8), 764-771,2009.
• Tatum, C. B.,What prompts construction innovation?. Journal of construction engineering and management, 110(3), 311-323, 1984
• Loosemore, M.,Construction innovation: Fifth generation perspective, Journal of management in engineering, 31(6),, 2015.
• Loosemore, M., Richard, J., Valuing innovation in construction and infrastructure: Getting clients past a lowest price mentality, Engineering, construction and architectural management, 22(1), 38-53, 2015.
• KPMG, Sektörel Bakış, 2018. https://assets.kpmg/content/dam/kpmg/tr/pdf/2018/01/sektorel-bakis-2018-insaat.pdf
• Utterback, J. M., Suárez, F. F. Innovation, competition, and industry structure Research policy, 22(1), 1-21, 1993.
• Pratap, A. (2018). “Apples’s staff size”. https://notesmatic.com/apples-staff-size/
• Toole, T. M.,Technological trajectories of construction innovation, Journal of Architectural Engineering, 7(4), 107-114, 2001.
• Laborde, M., Sanvido, V., Introducing new process technologies into construction companies, Journal of Construction Engineering and Management, 120(3), 488-508, 1994.
• Tatum, C. B., Potential mechanisms for construction innovation, Journal of Construction Engineering and Management, 112(2), 178-191, 1986.
• Tatum, C. B., Organizing to increase innovation in construction firms, Journal of construction engineering and management, 115(4), 602-617, 1989.
• Lockwood, W. D., Hensey, M., Managing Civil Engineering Innovation: An Interview, Journal of Management in Engineering, 6(3), 313-322, 1990.
• Nam, C. H., Tatum, C. B., Strategies for technology push: Lessons from construction innovations, Journal of construction engineering and management, 118(3), 507-524, 1992.
• Slaughter, E. S., Builders as sources of construction innovation, Journal of Construction Engineering and Management, 119(3), 532-549, 1993.
• Goodrum, P. M., Haas, C. T. Variables affecting innovations in the US construction industry, In Construction Congress VI: Building Together for a Better Tomorrow in an Increasingly Complex World, 525-533, 2000.
• Steele, J., & Murray, M., Creating, supporting and sustaining a culture of innovation, Engineering, construction and architectural Management, 11(5), 316-322, 2004.
• Park, M., Nepal, M. P., Dulaimi, M. F., Dynamic modeling for construction innovation, Journal of Management in Engineering, 20(4), 170-177, 2004.
• Bossink, B. A., Managing drivers of innovation in construction networks, Journal of construction engineering and management, 130(3), 337-345, 2004.
• Abbot, C., Jeong, K., Allen, S., The economic motivation for innovation in small construction companies, Construction Innovation, 6(3), 187-196, 2006.
• Na, L. J., Ofori, G., Park, M., Stimulating construction innovation in Singapore through the National System of Innovation, Journal of construction engineering and management, 132(10), 1069-1082, 2006.
• Ling, F. Y., Hartmann, A., Kumaraswamy, M., Dulaimi, M., Influences on innovation benefits during implementation: client’s perspective. Journal of Construction Engineering and Management, 133(4), 306-315, 2007.
• Kale, S., Arditi, D., Innovation diffusion modeling in the construction industry, Journal of Construction Engineering and Management, 136(3), 329-340, 2009.
• Shapira, A., Rosenfeld, Y., Achieving construction innovation through academia-industry cooperation—Keys to success, Journal of Professional Issues in Engineering Education & Practice, 137(4), 223-231, 2010.
• Esmaeili, B., Hallowell, M. R. Diffusion of safety innovations in the construction industry, Journal of Construction Engineering and Management, 138(8), 955-963, 2011.
• Na Lim, J., Peltner, F., Innovation performance of construction enterprises: An empirical assessment of the German and Singapore construction enterprises, Construction Innovation, 11(3), 282-304, 2011.
• Ozorhon, B., Analysis of construction innovation process at project level, Journal of management in engineering, 29(4), 455-463, 2012.
• Davidson, C., Innovation in construction–before the curtain goes up, Construction Innovation, 13(4), 344-351, 2013.
• Ozorhon, B., Abbott, C., Aouad, G., Integration and leadership as enablers of innovation in construction: Case study, Journal of Management in Engineering, 30(2), 256-263, 2013.
• Widén, K., Olander, S., Atkin, B., Links between successful innovation diffusion and stakeholder engagement, Journal of management in engineering, 30(5), 2013.
• Rundquist, J., Emmitt, S., Halila, F., Hjort, B., Larsson, B., Construction innovation: addressing the project-product gap in the Swedish construction sector, International Journal of Innovation Science, 5(1), 1-10, 2013.
• Na Lim, J., The Government as marketer of innovation. Engineering, Construction and Architectural Management, 21(5), 551-570, 2014.
• Singh, V. BIM and systemic ICT innovation in AEC: perceived needs and actor’s degrees of freedom, Construction Innovation, 14(3), 292-306, 2014.
• Yepes, V., Pellicer, E., Alarcón, L. F., Correa, C. L., Creative innovation in Spanish construction firms, Journal of Professional Issues in Engineering Education and Practice, 142(1), 2015.
• Gledson, B. J., Greenwood, D., The adoption of 4D BIM in the UK construction industry: an innovation diffusion approach, Engineering, Construction and Architectural Management, 24(6), 950-967, 2017.
• Papadonikolaki, E., Loosely Coupled Systems of Innovation: Aligning BIM Adoption with Implementation in Dutch Construction, Journal of Management in Engineering, 34(6), 2018.
• Lim, J. N., Schultmann, F., Ofori, G., Tailoring competitive advantages derived from innovation to the needs of construction firms,Journal of construction engineering and management, 136(5), 568-580, 2010.
• Zhang, J., Xie, H., Schmidt, K., Li, H., A new systematic approach to vulnerability assessment of innovation capability of construction enterprises, Sustainability, 8(1), 17, 2016.
• Bygballe, L. E., Ingemansson, M., The logic of innovation in construction. Industrial Marketing Management, 43(3), 512-524, 2014.
• Zubizarreta, M., Cuadrado, J., Iradi, J., García, H., Orbe, A., Innovation evaluation model for macro-construction sector companies: A study in Spain, Evaluation and program planning, 61, 22-37, 2017.
• Brockmann, C., Brezinski, H., Erbe, A., Innovation in construction megaprojects, Journal of Construction Engineering and Management, 142(11), 2016.
• Tatum, C. B. Process of innovation in construction firm, Journal of Construction Engineering and Management, 113(4), 648-663, 1987.
• Tatum, C. B., Managing for increased design and construction innovation, Journal of management in engineering, 5(4), 385-399, 1989.
• Arditi, D., Kale, S., Tangkar, M., Innovation in construction equipment and its flow into the construction industry, Journal of Construction Engineering and Management, 123(4), 371-378, 1997.
• Vakola, M., Rezgui, Y., Organisational learning and innovation in the construction industry, The Learning Organization, 7(4), 174-184, 2000.
• Macomber, J. D., Follow the money: what really drives technology innovation in construction, In Construction Research Congress In Construction- Wind of Change: Integration and Innovation, 2003.
• Edum-Fotwe, F. T., Gibb, A. G. F., Benford-Miller, M., Reconciling construction innovation and standardisation on major projects. Engineering, Construction and Architectural Management, 11(5), 366-372, 2004.
• Manley, K., Implementation of innovation by manufacturers subcontracting to construction projects, Engineering, Construction and Architectural Management, 15(3), 230-245, 2008.
• Rutten, M. E., Dorée, A. G., Halman, J. I., Innovation and interorganizational cooperation: a synthesis of literature, Construction Innovation, 9(3), 285-297, 2009.
• Korman, T. M., Lu, N., Innovation and improvements of mechanical, electrical, and plumbing systems for modular construction using building information modeling. In Proceeding of the architectural engineering conference, Oakland, California 448-455, (2011, March)..
• Chan, I. Y., Liu, A. M., Fellows, R., Role of leadership in fostering an innovation climate in construction firms, Journal of management in engineering, 30(6), 2013.
• Rundquist, J., Emmitt, S., Halila, F., Hjort, B., Larsson, B., Construction innovation: addressing the project-product gap in the Swedish construction sector, International Journal of Innovation Science, 5(1), 1-10, 2013.
• Xue, X., Zhang, R., Yang, R., Dai, J., Innovation in construction: a critical review and future research, International Journal of Innovation Science, 6(2), 111-126, 2014.
• Murphy, M. E., Implementing innovation: a stakeholder competency-based approach for BIM, Construction Innovation, 14(4), 433-452, 2014.
• Pellicer, E., Yepes, V., Correa, C. L., Alarcón, L. F., Model for systematic innovation in construction companies, Journal of Construction Engineering and Management, 140(4), 2014.
• Ozorhon, B., Oral, K., Demirkesen, S., Investigating the components of innovation in construction projects, Journal of Management in Engineering, 32(3), 2015.
• Suprun, E. V., Stewart, R. A., Construction innovation diffusion in the Russian Federation: Barriers, drivers and coping strategies, Construction Innovation, 15(3), 278-312, 2015.
• Liu, A. M., Chan, I. Y., Critical role of the learning transfer climate in fostering innovation in construction, Journal of Management in Engineering, 33(3), 2016.
• Ozorhon, B., Oral, K., Drivers of innovation in construction projects, Journal of construction engineering and management, 143(4), 2016.
• Noktehdan, M., Shahbazpour, M., Zare, M. R., Wilkinson, S., Innovation Management and Construction Phases in Infrastructure Projects, Journal of Construction Engineering and Management, 145(2), 2018.
• Sariola, R., Utilizing the innovation potential of suppliers in construction projects, Construction Innovation, 18(2), 2018.
• Meng, X., Brown, A., Innovation in construction firms of different sizes: drivers and strategies, Engineering, Construction and Architectural Management, 25(9), 1210-1225, 2018.
• Ulubeyli, S., Kazaz, A., Sahin, S., Survival of construction SMEs in macroeconomic crises: Innovation-based competitive strategies, Journal of Engineering, Design and Technology, 16(4), 654-673, 2018.
• Gerring, J., What is a case study and what is it good for?. American political science review, 98(2), 341-354, 2004.
• Barlish, K., Sullivan, K., How to measure the benefits of BIM—A case study approach, Automation in construction, 24, 149-159, 2012.
• Eisenhardt, K. M., Building theories from case study research, Academy of management review, 14(4), 532-550, 1989.
• Liu, H., Ran, Y., Study on BIM technology application prospect in engineering management industry. In 2013 6th International Conference on Information Management, Innovation Management and Industrial Engineering, 3, 278-280, 2013, November.
• Aranda-Mena, G., Crawford, J., Chevez, A., Froese, T., Building information modelling demystified: does it make business sense to adopt BIM?. International Journal of managing projects in business, 2(3), 419-434, 2009.
• Watson, A., BIM-a driver for change. In Proceedings of the International Conference on Computing in Civil and Building Engineering 30-2. Nottingham University Press Nottingham, 2010, June..
• Kassem, M., Succar, B., Dawood, N., Building information modeling: analyzing noteworthy publications of eight countries using a knowledge content taxonomy, American Society of Civil Engineers, 2015, January.
• Becerik-Gerber, B., Rice, S., The perceived value of building information modeling in the US building industry, Journal of Information Technology in Construction (ITcon), 15(15), 185-201, 2010.
• Chen, L., Luo, H., A BIM-based construction quality management model and its applications, Automation in construction, 46, 64-73, 2014.
• Azhar, S. Building information modeling (BIM): Trends, benefits, risks, and challenges for the AEC industry, Leadership and management in engineering, 11(3), 241-252, 2011.
• Qian, A. Y., Benefits and ROI of BIM for Multi-disciplinary Project Management, National University of Singapore, Mar, 2012.
• Yan, H., Demian, P. Benefits and barriers of building information modelling, 2008.
• Latiffi, A. A., Mohd, S., Kasim, N., Fathi, M. S., Building information modeling (BIM) application in Malaysian construction industry, International Journal of Construction Engineering and Management, 2(4A), 1-6, 2013.
• Innovation, C. C., Adopting BIM for facilities management: Solutions for managing the Sydney Opera House, Cooperative Research Center for Construction Innovation, Brisbane, Australia, 2007.
• Kline, R. B. Structural equation modelling, 1998.
• Xiong, B., Skitmore, M., Xia, B., Masrom, M. A., Ye, K., Bridge, A., Examining the influence of participant performance factors on contractor satisfaction: A structural equation model, International Journal of Project Management, 32(3), 482-491, 2014.
• Bielby, W. T., Hauser, R. M., Structural equation models, Annual review of sociology, 3(1), 137-161, 1977.
• Sohn, S. Y., Kim, H. S., Moon, T. H., Predicting the financial performance index of technology fund for SME using structural equation model, Expert Systems with Applications, 32(3), 890-898, 2017.
• Baumgartner, H., & Weijters, B. (2017). Structural equation modeling. In Advanced Methods for Modeling Markets (pp. 335-360). Springer, Cham
• Nunnally, J. C., Psychometric theory (2nd edit.) mcgraw-hill. Hillsdale, NJ, 416, 1978.
• Hair, J., Anderson, R., Tatham, R., Black, W., Multivariate data analysis4 Prentice-Hall Englewood Cliffs, 1998.
• Xiaolong, X., Zhang, R., Yang, R., Dai, J., Innovation in construction: a critical review and future research, International Journal of Innovation Science, 6(2), 111-126, 2014.
• Koellinger, P., The relationship between technology, innovation, and firm performance-Empirical evidence from e-business in Europe, Research policy, 37(8), 1317-1328, 2008.
• Podmetina, D., Smirnova, M., Väätänen, J., Torkkeli, M., Innovativeness and international operations: case of Russian R&D companies, International Journal of Innovation Management, 13(02), 295-3173 2009.
• Sideridis, G., Simos, P., Papanicolaou, A., Fletcher, J., Using structural equation modeling to assess functional connectivity in the brain: Power and sample size considerations, Educational and psychological measurement, 74(5), 733-758, 2014.
• Eastman, C., Teicholz, P., Sacks, R., Liston, K., BIM handbook: A guide to building information modeling for owners, managers, designers, engineers and contractors. John Wiley & Sons, 2011.
• Grilo, A., Jardim-Goncalves, R., Value proposition on interoperability of BIM and collaborative working environments, Automation in construction, 19(5), 522-530, 2010.
• Wong, K. D., Fan, Q., Building information modelling (BIM) for sustainable building design, Facilities, 31(3/4), 138-157, 2013.
• Fernandes, R. P. L., Advantages and disadvantages of BIM platforms on construction site, 2013.
• Eastman, C., Teicholz, P., Sacks, R., Liston, K., BIM handbook: A guide to building information modeling for owners, managers, designers, engineers and contractors. John Wiley & Sons, 2008.