Publications
Publications
- March 2021
- HBS Case Collection
Competitive Strategy in International Construction
By: John D. Macomber and Emrah Ergelen
Abstract
Construction of buildings and infrastructure is one of the largest industries in the world in terms of volume. It is also one of the most physically risky, financially uncertain, and politically impacted. The industry is highly fragmented since there are few economies of scale, substantial location advantages, and almost all of the work is site built from unique plans. In order to achieve long term above average returns on effort and on invested capital, it's crucial that firms plan with intent with respect to markets and clients served, services provided, roles played in the industry value added system, and the matching of skills and assets to opportunities. The longest lived firms also determine which markets, products, customer types, and roles to avoid even when there might be attractive short term opportunistic contracts to be pursued. This note covers both the idiosyncratic nature of this industry that makes many classic strategic planning tools unhelpful, and also details the specific steps strategists should follow to gain the benefits and avoid the pitfalls of competition in this industry.
Keywords
Construction; Infrastructure; Strategy; Marketing Strategy; Competitive Strategy; Strategic Planning; Global Range; Construction Industry
Citation
Macomber, John D., and Emrah Ergelen. "Competitive Strategy in International Construction." Harvard Business School Technical Note 221-074, March 2021.