Construction contractors as service innovators

As in the manufacturing and services industries, a mix of technological and non-technological innovation should be expected in construction. This study ascertains the relative importance of a set of internal and external factors for the intensity of technological and non-technological innovation among construction contracting firms. Seventeen types of contractor activities, associated with three levels of service content, are identified and a characteristics-based theory of service innovation with four innovation trajectories (material, informational, methodological, contractual or relational) is applied. Data collected from a questionnaire survey of 44 of the 50 largest construction contractors in Sweden indicate that 30 contractors had carried out research and development during 2003-2005 and that 11 had made at least one innovation new to the country. The lowest level of innovation intensity was mostly linked to the methodological trajectory (28 contractors), while the material trajectory dominated innovation 'new to the country' (eight contractors). Analysing data per activity where research and development or innovation had been reported shows that collaboration with another type of contractor is associated with a higher intensity of innovation, regardless of trajectory. The level of employee education is significant for relational innovation. The consequences for policies in firms and central government are identified.