Paper info

Tensions in Project Purchasing within the Construction Industry

Anna Bengtson and Susanne Åberg

The paper was published at the 32nd IMP-conference in Poznan, Poland in 2016.

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Within industries where project-based activities are the norm, such as the construction industry, special challenges arise. One of these challenges within the construction industry concerns the trade-off between intra-project effectiveness and more long-term benefits such as relationship adaptations and innovations. These challenges are exacerbated by some of the characteristics of the construction industry, which has been described as slow-moving, conservative and cost-driven (Rundquist et al., 2013). Traditionally, the dependence on procurement routines has benefited arms-length relationships within construction, although new practices, such as partnering (Byggballe et al., 2010) are emerging. This paper adopts a dialectic view (Van de Ven & Poole, 1995) in order to analyse poles of tension in project purchasing within the construction industry. A specific construction project has a clear goal, whereas the suppliers within the network typically have both converging and contradicting goals. Furthermore, the project has clear boundaries both in time and space, unlike the network where there are no such boundaries in time or space. Other tensions that exist are, for instance, between centralization and decentralization: between stability and change: between routines and action: and between project and product (cf. Cameron & Quinn, 1988: Smith & Lewis, 2011). All these tensions affect business actions and their consequences. The aim of the paper is to explore the tensions that arise between the project and the supplier network: as seen both from the perspective of the buyer, the construction firms, and the (sub-) suppliers. The theoretical part draws on IMP literature as well as project literature. The paper is based on a case study, where the empirical base consists of three construction projects all procured by the same buyer. The projects share similar traits, but have been built by three different contractors. In the paper we focus specifically on one of these construction projects. The project is complemented with secondary data on an additional seven similar construction projects in order to further map the networks of sub-suppliers.