Relationship between Construction Firm Strategies and Innovation Outcomes

Abstract

Survey results provide a preliminary assessment of the relative contribution of a range of tactical business strategies to innovation performance by firms in the Australian construction industry. Over 1,300 firms were surveyed in 2004, resulting in a response rate of 29%. Respondents were classified as high, medium or low innovators according to an innovation index based on the novelty and impact of their innovations and their adoption of listed technological and organizational advances. The relative significance of 23 business strategies concerning (1) employees; (2) marketing; (3) technology; (4) knowledge; and (5) relationships was examined by determining the extent to which they distinguished high innovators from low innovators. The individual business strategies that most strongly distinguished high innovators were (1) investing in R&D; (2) participating in partnering and alliances on projects; (3) ensuring project learnings are transferred into continuous business processes; (4) monitoring international best practice; and (5) recruiting new graduates. Of the five types of strategies assessed, marketing strategies were the least significant in supporting innovation. The results provide practical guidance to managers in project-based industries wishing to improve their innovation performance.