Chen, X; Wang, G; Cao, D and Hu, Y (2024) Influence of organization environment on contractor's inter-regional market entry practice in China: An industry-level approach based on Bayesian logistic regression model. Construction Management and Economics, 42(7), pp. 640-655. ISSN 01446193
Abstract
Inter-regional market entry poses a complex challenge for contractors, particularly in the construction industry with its unique characteristics. Existing research predominantly focuses on an international scale and target markets, often overlooking the influence of the organizational environment, especially the home market. This study aims to fill this gap by analyzing how the construction organizational environment affects contractors' inter-regional market practices. Grounded in theories of organizational management, we developed a theoretical model with seven hypotheses examining the impact of organizational environment. We tested hypotheses with Bayesian logistic regression model based on data from 426 construction organizations in China. Our findings reveal that a contractor’s size significantly impacts the practice compared to other attributes like ownership and experience. Additionally, a thriving local economy strongly supports contractors in exploring other geographical markets. Interestingly, while local competition intensity and protectionism create barriers for external firms, they do not significantly affect the diversification activities of local contractors. These insights contribute to understanding the dynamics of inter-regional market entry in the construction industry and can guide practitioners in strategizing for sustainable growth. Future research could explore more detailed strategies such as market selection and entry mode, enhancing the depth of understanding in this area.
| Item Type: | Article |
|---|---|
| Uncontrolled Keywords: | organizational environment; inter-regional strategy; Bayesian logistic regression; construction market; market diversification |
| Index terms: | practitioner, competition, organizational environment, China, local contractor, local economy, organizational management, strategy, ownership, entry mode, diversification, dynamics, construction market, construction industry, market entry, markets, logistic regression, construction organization |
| Subjects: | economic analysis, business, organization, practitioner, market analysis, sociology, industry analysis, systems engineering, statistical analysis, management, economics, Geography |
| Topics: | Business Strategy, Engineering Principles, Research Practice, Geographical Context, Roles and Professions, Organizational Design |
| 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