Mohammed, Miswan Abdul Hakim (1994) An investigation into firms' strategies and their financial performance in the UK construction industry. PhD thesis, University College London, UK.
Abstract
This study has two main objectives. The first objective is to identify the relationship between the construction firms' competitive strategies and their financial performance. The second objective is to observe the behaviour of the construction firms' strategies in three different economic periods, i.e. , boom (1986-89), recession (1990-93) and recovery (1994-onward). In order to achieve these objectives, the study was divided into two main phases. Firstly, the relationship between firms' competitive strategies and their financial performance was investigated. Four strategic variables were chosen to represent competitive strategies: type of activity; extent of diversification; extent of internationalisation; and level of gearing. Firms' financial performance was represented by five variables: return on capital employed; return on shareholders' funds; current ratio; quick ratio; and turnover. Secondly, the behaviour of the construction firms' strategies in the three different economic periods was investigated. The following main variables were chosen to represent the firms' strategies: direction; method; generic; diversification; internationalisation; functional; resources; financial performance measurements; and financial performance determinants. The findings of the first phase indicated that, there were significant relationships between firms' competitive strategies and their financial performance. Type of activity had relationships with firms' profitability and liquidity. Profitability was also influenced by the level of gearing. However, extent of diversification and extent of internationalisation had strong relationships with turnover, in the second phase, it was found that the construction firms considered that expansion by way of internal expansion and joint-venturing as their most important developmental strategies. Housing was regarded as the most important strategy for diversification purposes. Europe was considered as their most important market outside the UK. R&D and advanced technology were not considered as the important functional strategies. Management, skilled workers and cash capital were their three most critical resources. Cash flow was regarded as the most important financial performance indicator whilst market condition was perceived as the most important financial performance determinant.
| Item Type: | Thesis (Doctoral) |
|---|---|
| Uncontrolled Keywords: | construction firms; liquidity; market condition; recession; UK |
| Index terms: | construction firm, market condition, strategy, cash flow, turnover, housing, competitive strategy, financial performance, skilled worker, internationalization, Europe, recovery, liquidity, recession, determinant, construction industry, profitability, investigation, diversification |
| Subjects: | economic analysis, business management, operations management, economic and policy analysis, organization, risk assessment, construction type, data collection methods, industry analysis, market analysis, business analysis, physical geography and landforms, management, financial management |
| Topics: | Risk Management, Construction Technology, Business Strategy, Cost Management, Project Management, Geographical Context, Research Practice, International Construction, Human Resources |
| Descriptive scope: | 4 PCTA |
N.B. Descriptive scope is a count of how many of the five facets of empirical research are indicated by the words used in title, abstract and keywords. It is not intended as a judgement on the research; merely a count of the kind of word we would expect to indicate Phenomenon, Concepts, Theoretical framing, Empirical techniques, Analytical techniques. If all five are present, then a code of “5 PCTEA” will indicate this. If you feel the coding for this record is questionable, we welcome discussion around the terms we matched or the way we categorized them. The facet you would expect may not be coded, or a facet may be coded inappropriately. This can also bear on a larger question, of which facets should be treated as defining in construction management research. Please get in touch, and we will look at it. More details here