Strategic Management in CnP EnterprisesIntroductionThe construction industry has over the years served as a driving force for economic growth around the globe. This industry has played a significant role in developing the socio-economic capital of many countries around the globe. Nevertheless, the business environment surrounding the construction industry and its many players is dynamic and ever-changing. In order for organizations or companies operating in this industry to survive or maintain their competitive edge in the market, they need to be fully aware of what is taking place in the business environment surrounding the construction industry and understand the effect of relevant events taking place in this business environment (Arslan & Kivrak 2008).
CNP General Builders is a privately owned construction company based in Bristol, United Kingdom. The company is known for constructing athletics and recreational facilities, nonetheless, CNP General Builders undertake all types of building works (CNP General Builders 2009). As a company operating in the construction industry, the company’s performance in this business environment is determined by key business drivers that affect the construction industry. This report will critical analyse and examine some of the key drivers in CNP General Builders’ business environment, the construction industry.
In addition to this report will analyse the impact that these four key drivers have on the company’s business. Business Environment AnalysisThe construction industry is often considered as a fragmented industry. A fragmented industry is one in which no company has a substantial market share and is able to bring about considerable outcomes in the industry. Numerous small-medium-sized companies usually populate the fragmented industrial structure. Generally, this industry is fragmented for a wide range of reasons nevertheless, the underlying causes are based in the pre-determined, localised, project-based characteristics of construction (Langford & Male 1991).
Furthermore, the construction industry is geographical dispersed with markets in both the local and international level. Some of the complexities that characterise this industry include technology, project size and the market. The construction business environment is highly competitive and a contestable market where competition operates and where the risk of an entrant company constraints the behaviour of companies particularly when it comes to their pricing policy. In addition to this, the construction industry can also be viewed as a hierarchal industry that is determined by the size of the firm.
In this case, small companies tend to act as sub-contractors to big companies (Langford & Male 1991). Over the years, numerous studies have been conducted to determine success driving factors particularly in the project management area (Hyvari 2006). In the construction industry, traditional approach to success is based on the ability of a company to plan and implement projects (Abraham 2003). Research findings of Lussier (1995) and Strischek (1998) depict that some of the driving forces of success include; the company’s management practices and systems.
Other research studies show that some of the driving forces of success in the construction industry include the implementation of accounting systems, training and education, control of job-site safety and the regular review and monitoring of financial statements (Strischek 1998; Gerstel 1991; Bednarz, 1997). Based on the evidence depicted in various literatures some of the key drivers of the construction business environment include; technological capability, knowledge exchange, sales and marketing and strategic management.