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Article
Publication date: 1 February 2000

DAVID ARDITI, ALMULA KOKSAL and SERDAR KALE

The objective of the research presented in this paper is to explore the factors associated with company failures in the context of the construction industry. To that end, the four…

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Abstract

The objective of the research presented in this paper is to explore the factors associated with company failures in the context of the construction industry. To that end, the four quadrants of an ‘environment/response’ matrix developed by Boyle & Desai (1991. Journal of Small Business Management, 29, 33–42) are populated with Dun and Bradstreet's US business failure data for the construction industry. The study indicates that budgetary and macroeconomic issues represent 83% of the reasons for construction company failures. This implies that firms that take vigorous administrative measures to address budgeting issues and that react promptly to economic conditions by implementing appropriate strategic policies should be able to avoid failure. On the other hand, issues of adaptability to market conditions and business issues appear to have limited effects on company survivability (6% of the reasons for failure). This implies that administrative measures to fend off internal conflicts that originate for reasons beyond management's control and long‐term strategic decisions to regulate the firm's adaptation to market conditions can also help to prevent failure. An ‘input/output’ model appears to explain the business failure phenomenon better than the ‘environment/response’ one.

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Engineering, Construction and Architectural Management, vol. 7 no. 2
Type: Research Article
ISSN: 0969-9988

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Article
Publication date: 16 August 2018

Serdar Ulubeyli, Aynur Kazaz and Selim Sahin

This paper aims to present the effect of innovation on implementing competitive strategies (CSs) and to find their relationships on the survival of construction-related small- and…

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Abstract

Purpose

This paper aims to present the effect of innovation on implementing competitive strategies (CSs) and to find their relationships on the survival of construction-related small- and medium-sized enterprises (SMEs) in macroeconomic crises.

Design/methodology/approach

Data were compiled from construction SMEs in Turkey. The research used structural equation modeling to investigate the relationships between innovation, CSs and firm survival (FS).

Findings

Innovative construction SMEs may implement differentiation and focus strategies and survive without CSs, whereas innovation may be obtained through cost leadership strategy. Also, differentiation and focus strategies may play a role to survive. However, the cost leadership strategy may be implemented after survival. Finally, differentiation strategy may be triggered by innovation and focus strategies.

Research limitations/implications

The model may be applied on other construction organizations. Future studies may also examine the difference in findings concerning other industries and regions. Moreover, different factors may be added to the model. However, a larger group of samples could cause different results.

Practical implications

This study may be a roadmap for practitioners to plan their firms’ strategies, considering innovation, CSs and FS. In this context, they may pay attention to innovative production processes to survive.

Social implications

Survived SMEs may sustain their works through the prevention of crisis-based unemployment. Hence, this benefit may bring a wealthier society.

Originality/value

This research is first to propose a model connecting innovation and CSs for SMEs’ survival in macroeconomic crises. This is convenient for rivalry of SMEs planning to be long-lasting enterprises.

Details

Journal of Engineering, Design and Technology, vol. 16 no. 4
Type: Research Article
ISSN: 1726-0531

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