Do firm-level barriers to construction product innovation adoption vary according to position in the supply chain?
Authors: Rose Timothy , Manley Karen , Widen Kristian 
Published: April 2019

Purpose

The purpose of this study is to examine product innovation as a means of addressing infrastructure shortages in developed economies and to improve the sustainability of infrastructure. The obstacles to product innovation in the road industry are compared between different types of participants in the supply chain to provide guidelines for interventions to improve innovation rates.

Design/methodology/approach

This exploratory study uses descriptive data from a large scale survey of the Australian road industry. The three top-rated product innovation obstacles for the following four types of participants are examined: contractors, consultants, suppliers and clients.

Findings

The four groups were found to disagree about the relative importance of the obstacles. Contractors and suppliers ranked “restrictive price-only tender assessment” used by clients as their number one obstacle, while consultants thought there was too much emphasis by the clients on direct costs compared with whole-of-life costs. On the other hand, clients felt suppliers do not do enough thorough testing prior to proposing a new product and disagreed with suppliers about who should carry the risk of new product failure.

Research limitations/implications

The conceptual framework was found to yield novel insights with significant policy implications. The construction-specific contextual determinants that were integrated by the authors into a broad innovation diffusion process proved useful in categorising road product innovation obstacles across the four surveyed supply chain groups – without overlap or omission. The new framework also proved useful in ordering the key obstacles across groups for interpretation and discussion. In disaggregating product obstacles according to groups, these contextual determinants were proven to be mutually exclusive and to represent important focal points in promoting the uptake of product innovation in construction. Although the current study has usefully provided quantitative data concerning construction innovation obstacles, there are limitations due to its reliance on descriptive statistics. Future work by the authors is proposed to analyse the relationships between innovation obstacles and supply chain partners using inferential statistics to further develop and validate these early findings. The current study is an interim step in this work and an important contribution in identifying and addressing firm-level barriers seen to be constraining construction product innovation.

Practical implications

Results suggest there is a need for government clients to carefully consider the differing perspectives across the supply chain when developing strategies to encourage the adoption of mutually-beneficial innovative products on their construction projects. Inclusive focus groups examining the drivers, configuration and benefits of collaborative procurement systems are recommended to reduce innovation obstacles.

Social implications

Society relies on urban infrastructure for daily living and the current study contributes to stretching infrastructure investment dollars and reducing the environmental impact of infrastructure provision.

Originality/value

No previous study has compared the perception of product innovation obstacles across different road industry supply chain partners. This is a significant gap, as differences in opinions across the supply chain need to be understood to develop the shared expectations and the improved relationships required to improve product innovation rates. Product innovation is important because it has been shown to improve efficiency (potentially addressing the road investment gap) and reduce deleterious environmental impacts.