Liu, G.; Qin, Z.; Wu, H.; Jia, L. and Zhuo, J. (2026) Optimizing process efficiency in prefabricated building supply chain: The role of hybrid governance behaviors in reducing transaction costs. Engineering, Construction and Architectural Management, 33(5), pp. 3820-3842. ISSN 0969-9988
Abstract
Purpose – Prefabricated building (PB) has been a pivotal force in advancing global building industrialization and sustainability. However, the PB supply chain operation faces significant challenges of exhausting negotiations, poor communication and imperfect information, representing high transaction costs (TCs). Existing literature inadequately addresses governance behaviors to mitigate TCs. This study aims to explore PB supply chain inefficiencies through the lens of TC theory, examining the nuanced relationships between hybrid governance behaviors and TCs and exploring effective governance strategies. Design/methodology/approach – Based on the theoretical frameworks of governance behavior and TCs, this study employed semi-structured interviews and questionnaire surveys with PB experts in Anhui, China. Subsequently, integrated backpropagation neural network and ordered logistic regression analyses were conducted to identify critical governance behaviors and explore boundaries for TCs reduction. Findings – TCs of the PB supply chain are elevated (1) from communication and coordination; (2) during the construction and approval stages. Investigation of how governance behaviors influence the TCs indicated that (1) enterprises exert more influence than local governments; (2) governance effectiveness in the transaction and transaction environment dimensions outweighs stakeholder influence and (3) functional TCs exist in PB, associated with component manufacturing, PB contract negotiation and learning cost. Originality/value – This study extends understanding of TCs in PB by providing nuanced insights into the nature and timing of TCs and elucidates how governance structures shape TCs. Functional TCs intrinsic to PB were identified when exploring the optimization boundaries. These insights equip local governments and enterprises with actionable knowledge to prioritize effective governance behaviors and measures.
| Item Type: | Article |
|---|---|
| Uncontrolled Keywords: | governance structure; prefabricated building; process efficiency; transaction costs |
| Index terms: | strategy, neural network, negotiation, interview, industrialization, survey, methodology, approval, effectiveness, governance, transaction cost, questionnaire, contract negotiation, prefabricated building, China, coordination, logistic regression analysis, investigation, efficiency, face, boundaries, local government, dimension |
| Subjects: | psychology, administrative law, contractual role, building construction, conflict resolution, statistical analysis, business, contract management, health monitoring assessment and metrics, artificial intelligence, economic development, data collection methods, performance management, property law, research methods, management, financial analysis, Geography |
| Topics: | Governance, Digital Applications, Research Practice, Geographical Context, Quality Management, Cost Management, Contract Administration, Health and Safety, Organizational Design, Business Strategy, Stakeholder Management, Sustainability, Construction Technology, Legal Issues |
| Descriptive scope: | 5 PCTEA |
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