Change and continuity: making sense of marketization in the Chinese construction sector

Since the announcement of the Open-Door policy in 1978, a plethora of reform initiatives have been introduced into the Chinese construction sector, calling upon the contributors to the construction process to adopt new ways of conducting business. This is especially true for contracting firms. However, the processes by means of which contracting firms organise themselves in response to a rapidly changing operating environment is notably neglected in the existing literature. The current research aims to address this imbalance by adopting a sensemaking perspective. Contracting firms are viewed not as quasi-fixed entities but rather as organising processes through which managers continuously make sense of a changing operating environment. Therefore, the task of organising is seen to be synonymous with sensemaking, which comprises a combination of continuously interactive discursive and material practices. The primary research interest lies in accessing managers' sensemaking processes. Of particular importance are the ways in which managers appropriate the changing environment within which they operate and how this influences their socially constructed roles. Three case studies of state-owned contracting firms in the Chongqing City region are presented as a means of illustrating the ways in which managers make sense of the ongoing processes of marketization. Diverse voices are accessed through semi-structured interviews and documentary analysis. It is concluded that managers' sensemaking practices take place at the nexus between contracting firms and the broader operating environment. Informed by their past experiences, managers are seen to continuously establish their own personalised mental maps for the purposes of navigating through the changing environment. Managers from the same firm produce diverse, even contradictory, interpretations of the same event as they continuously respond to ‘reality in flight'. Chinese managers are seen to selectively mobilise a mixture of market-based terminologies together with remnants of quasi-military terminology for the purposes of legitimizing their actions. Policy initiatives, such as ‘bid and tender', ‘project management', ‘firm', ‘government' and ‘PPP' are found to be particularly relevant to Chinese managers. It is contended that managers in state-owned firms retain a partial self-identity as ‘cadres of the party' while at the same time reluctantly absorbing the notion of being an ‘employee'. It has further been demonstrated that construction activities have been subject to an ongoing process of projectification. However, despite the introduction of quasi-contractual relationships between market-based entities, the long tradition of guanxi and the dominant role of government are not easy to overcome. It is concluded that the processes of marketization in the Chinese construction sector are continuously shaped and re-shaped by the sensemaking practices of senior managers.