Organizing to Increase Innovation in Construction Firms

Abstract

Driving forces in the construction industry indicate that the ability to innovate is quickly becoming a competitive necessity. Changes in owners' demands and more complex facilities require new approaches in both design and construction. Investigations of other industries reveal organizational characteristics of innovative firms, but construction's institutional framework, products, and technology differ significantly from manufacturing. Based on investigations of successful examples, this paper describes elements of organizational structure and culture that appear to foster construction innovation. These common elements include supportive policies and priorities, flexibility in unit size and grouping, intra‐ and interorganizational coordination, and staffing to satisfy specific requirements for key positions. This paper describes each of these elements and gives examples from a study of innovations. The descriptions of these elements include recommendations for managers seeking to organize for increased innovation, and the conclusions include research insights and needs.