An integrated competitive advantage model for indigenous construction firms in the Ghanaian construction industry

Owing to the notable cost and technological advantages that have characterized the operations of foreign firms in developing countries, among others, foreign construction firms in developing nations have been able to create a niche for themselves and most major projects are won and executed by them. This is to the detriment of indigenous firms in the construction industry, and the economies of developing countries at large, and Ghana is no exception to this. Nonetheless, there is a dearth of empirical studies that investigate and develop models to aid indigenous construction firms in obtaining a competitive advantage. Thus, this research investigates and develops a cohesive model that will aid indigenous construction firms to obtain a competitive advantage in the Ghanaian construction industry. Primarily, the research modelled the extent that firms’ strategies and structures, internal factors, demand factors, competitive intelligence, corporate social responsibility, and the entrepreneurial competencies of firm owners (which were classified as the exogenous variables) predict indigenous construction firms’ competitive advantage. A conceptual integrated holistic competitive advantage model was developed based on the theory developed from the literature review and the findings of the Delphi study. A questionnaire survey was conducted in Ghana to validate the conceptual model. Indigenous construction firms’ competitive advantage is the set of attributes (factors) that will aid indigenous construction firms to outperform their foreign counterparts. Results from the investigation pertained to three broad areas. Firstly, the results related to theory on firms’ competitive advantage studies. The findings were that the study addressed the lack of theoretical information about which factors are most significant in predicting indigenous construction firms’ competitive advantage in the construction industry. Further, the findings revealed the theory that indigenous construction firms’ competitive advantage in the construction industry is multi-faceted and that the latent variables lead to firms’ competitive advantage outcome variables which could be used for the measurement of firms’ competitive advantage. The second set of findings related to the Delphi Study. The findings from the Delphi study indicated that indigenous construction firms’ competitive advantage could be a six-factor model defined by the influence of firms’ strategies and structures, internal factors, demand factors, competitive intelligence, corporate social responsibility, and the entrepreneurial competencies of firm owners. The last set of results related to the field questionnaire survey. Generally, the findings were that the hypothesis could not be rejected. It was found that firms’ strategies and structures, internal factors, demand factors, competitive intelligence, corporate social responsibility, and the entrepreneurial competencies of firm owners, predicted indigenous construction firms’ competitive advantage. More so, the structural equation modelling results on the model’s goodness-of-fit and the statistical significance of parameter estimates met the cut-off criteria for the hypothesised model’s fit to the sample data. The study’s contribution to the body of knowledge is significant because it addresses the lack of theoretical information (historical literature data) about which factors are most significant in predicting indigenous construction firms’ competitive advantage in the construction industry in developing countries. The current integrated model advances that indigenous construction firms’ competitive advantage is a six-factor construct, with the inclusion of two new variables, namely firms’ corporate social responsibility and the entrepreneurial competencies of firm owners. Previous studies have tried to model competitive advantage using other variables without the inclusion of the present two additional variables. Thus, this study has shown that there is more than one factor that influences the competiti e advantage of firms. The study recommends that governmental and non-governmental organizations, as well as construction industry policy makers should consider the empirically tested constructs as they plan for, and implement competitive advantage and capacity-building programmes designed to enhance the competitive advantage of indigenous construction firms in the Ghanaian construction industry. Likewise, the validated conceptual model of indigenous construction firms’ competitive advantage will provide a reference for researchers who may study competitive advantage in the future.