The role of e-commerce systems for the construction industry

The use of e-commerce systems has increased substantially in the past five years, and now a number of companies in the construction industry have joined consortiums to develop e-commerce portals. These new systems encourage companies to review the way in which existing processes are undertaken, and often re-engineered process are introduced. It is important to understand the difference between the terms e-commerce and e-business, e-commerce refers to buying and seeling transactions which use some form of electronic media, while e-business suggests a review and redefinition of business models linked to the greater use of IT. It is argued that the greater use of the internet and e-commerce, and the move towards the integration of applications will compel construction companies to re-engineer processes and introduce e-commerce systems. A series of business drivers and business designs are discussed in later sections of this paper. There are many benefits associated with the introduction of e-commerce systems, and these include increases in GDP, real wages and employment together with reduced transaction costs. It has been forecast that there will be more than 400,000 companies in Australia using e-commerce systems by 2005 (NOIE 2000). For the construction industry, the benefits will include increased project efficiencies, communications, control, and reduced design and construction times as well as reduced costs (BuildOnline 2000). In the past year, two local consortiums have been formed to develop and offer e-commerce applications, and this heightens the need for all companies to reflect on how they might engage with these new technologies.