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Procurement in Construction Industry
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Procurement in Construction Industry

A special issue of Buildings (ISSN 2075-5309). This special issue belongs to the section "Construction Management, and Computers & Digitization".

Deadline for manuscript submissions: closed (20 November 2023) | Viewed by 30420

Special Issue Editors

Dr. Malik Khalfan

E-Mail Website
Guest Editor
School of Property, Construction and Project Management, RMIT University, Melbourne, VIC 3004, Australia
Interests: procurement; supply chain management; agile project management
Special Issues, Collections and Topics in MDPI journals
Dr. Farshid Rahmani

E-Mail Website
Guest Editor
School of Property, Construction and Project Management, RMIT University, Melbourne, VIC 3000, Australia
Interests: construction procurement

Special Issue Information

Dear Colleagues,

The application of electronic or digital means, primary through the internet, involves business processes in electronically purchasing and managing the supply chain, placing and tracking orders online, outsourcing customer service, and enabling virtual communications among business partners. E-procurement, a sector within e-business, is gaining popularity in business practice due to a series of benefits provided as a result of the redesign and reorganisation of the procurement process, including the automation of key activities (Fink 2006, Wen and Wei 2007) with a consequent reduction in transaction costs (Walker et al. 2008); the improvement of process efficiency; effective information sharing among buyer and supplier companies (Caniato et al. 2012); and improvement in the management of the supply chain (Timmers 2000, Davila et al. 2003). The main driver behind e-procurement is the reduction in cost through process automation, reduced inventories, competitive market prices for commodities, and the better use of economies of scale (Walker et al. 2008). However, there are challenges in shifting the current procurement process to e-procurement, including the significant upfront cost of infrastructure and enablement, existing organisational cultures, ongoing management and updates, the standardisation of processes between differing systems and general interoperability issues as well as data security (Ibem and Laryea 2015, Walker et al. 2008).

The goal of this Special Issue is to publish technical, empirical, and review papers that make practical and theoretical contributions to the latest developments and challenges of designing, implementing and managing digital procurement or e-procurement in the construction industry. Topics may include, but are not limited to, the following:

  • Benefits and challenges of digital procurement/e-procurement in the construction industry;
  • Success factors in adopting e-procurement in the construction industry;
  • COVID-19 and the use of e-procurement within the construction industry;
  • Use of blockchain technology or distributed ledger technology (DLT) in construction and infrastructure development projects;
  • Public sector e-procurement for construction projects;
  • Sustainable and responsible e-procurement and sourcing;
  • Innovative procurement strategies within the construction sector.

Davila, A.; Gupta, M.; Palmer, R. Moving procurement systems to the internet: The adoption and use of e-procurement technology models. Eur. Manag. J. 2003, 21, 11–23.

Ibem, E.O.; Laryea, S. e-Procurement use in the South African construction industry. J. Inf. Technol. Constr. 2015, 20, 364–384.

Caniato, F.; Longoni, A.; Moretto, A. Effective eProcurement implementation process. Prod. Plan. Control. 2012, 23, 935–949.

Fink, D. Value decomposition of e‐commerce performance. Benchmarking 2006, 13, 81–92.

Timmers, P. Electronic Commerce: Strategies and Models for Business-to-Business Trading; Wiley and Sons: New York, NY, USA, 2000.

Walker, D.H.T.; Aranda-Mena, G. E-Business and Project Procurement. Procurement Systems-A Cross Industry Project Management Perspective; D. HT Walker and S. Rowlinson: Abingdon, UK, 2008.

Wang, W.; Liu, W. Decision-making analysis of e-procurement with the rough set theory. In 2007 International Conference on Wireless Communications, Networking and Mobile Computing; IEEE: New York, NY, USA, 2007; pp. 3812–3815.

Dr. Malik Khalfan
Dr. Farshid Rahmani
Guest Editors

Manuscript Submission Information

Manuscripts should be submitted online at www.mdpi.com by registering and logging in to this website. Once you are registered, click here to go to the submission form. Manuscripts can be submitted until the deadline. All submissions that pass pre-check are peer-reviewed. Accepted papers will be published continuously in the journal (as soon as accepted) and will be listed together on the special issue website. Research articles, review articles as well as short communications are invited. For planned papers, a title and short abstract (about 100 words) can be sent to the Editorial Office for announcement on this website.

Submitted manuscripts should not have been published previously, nor be under consideration for publication elsewhere (except conference proceedings papers). All manuscripts are thoroughly refereed through a single-blind peer-review process. A guide for authors and other relevant information for submission of manuscripts is available on the Instructions for Authors page. Buildings is an international peer-reviewed open access monthly journal published by MDPI.

Please visit the Instructions for Authors page before submitting a manuscript. The Article Processing Charge (APC) for publication in this open access journal is 2600 CHF (Swiss Francs). Submitted papers should be well formatted and use good English. Authors may use MDPI's English editing service prior to publication or during author revisions.

Keywords

  • digital procurement/e-procurement
  • blockchain technology
  • innovative procurement strategies

Published Papers (8 papers)

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Research

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19 pages, 290 KiB  
Article
Social Procurement in the Chinese Construction Industry: Relevance, Drivers and Barriers to Implementation
by Martin Loosemore, Shang Zhang, Suhair Alkilani and Zihao Wang
Buildings 2023, 13(9), 2383; https://doi.org/10.3390/buildings13092383 - 19 Sep 2023
Viewed by 855
Abstract
This paper addresses the current imbalance in construction social procurement research toward Western countries with neo-liberal models of public governance. It does this by exploring the potential value of construction social procurement in the Chinese centralized unitary state and socialist market system. Findings [...] Read more.
This paper addresses the current imbalance in construction social procurement research toward Western countries with neo-liberal models of public governance. It does this by exploring the potential value of construction social procurement in the Chinese centralized unitary state and socialist market system. Findings from a survey of one hundred and sixty-four professionals from the Chinese construction industry are reported. They highlight the institutional foundations into which social procurement could be implemented and the significant untapped social value that could be created. However, they also show that for social procurement to achieve its full potential in the Chinese construction industry, such policies need to be underpinned by meaningful industry consultation, effective education and clearly mandated targets that create a market for social value. This paper contributes to the global advancement of social procurement research in construction by providing new insights into the implementation of social procurement beyond the narrow confines of the Western political and governmental orthodoxies where such research has hitherto been focused. Full article
(This article belongs to the Special Issue Procurement in Construction Industry)
22 pages, 4071 KiB  
Article
Financial Contract Administration in Construction via Cryptocurrency Blockchain and Smart Contract: A Proof of Concept
by Rowaid Ibrahim, Ahmed Alaa Harby, Mohamed Salem Nashwan and Ahmed Elhakeem
Buildings 2022, 12(8), 1072; https://doi.org/10.3390/buildings12081072 - 22 Jul 2022
Cited by 11 | Viewed by 3195
Abstract
The blockchain that uses cryptocurrency is a paradigm shift in the way of data storage, retrieval, and verification due to the concept of decentralization. This paradigm is essential to ensure the security of crucial data in any project. Adding a smart contract to [...] Read more.
The blockchain that uses cryptocurrency is a paradigm shift in the way of data storage, retrieval, and verification due to the concept of decentralization. This paradigm is essential to ensure the security of crucial data in any project. Adding a smart contract to the blockchain would facilitate the automation of various processes. Thus, the cryptocurrency blockchain that uses the smart contract can be considered a suitable platform for an ecosystem of many industries. The construction industry needs a highly secure automated management system due to its complex contractual relationships and transactions between parties. Therefore, integrating the blockchain with the smart contract creates the most appropriate ecosystem to be developed. This study introduces an ecosystemic prototype using a programmable smart contract within a novel cryptocurrency blockchain for construction. The purpose of the prototype is to guarantee a decentralized system as an independent economic environment for the construction industry. The system guarantees the security of financial transactions and focuses on the payment clauses in the construction contract as well. The results depended on three well-known hypothetical case scenarios from the construction site and were displayed in the form of extracted access data tables. The prototype proved the efficiency of the decentralized system for the construction industry by minimizing human-factor interference in the transaction process and thus reducing time waste and cost. Full article
(This article belongs to the Special Issue Procurement in Construction Industry)
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18 pages, 868 KiB  
Article
Lean Integrated Project Delivery for Construction Procurement: The Case of Sri Lanka
by Nadeesha Hettiaarachchige, Akila Rathnasinghe, KATO Ranadewa and Niraj Thurairajah
Buildings 2022, 12(5), 524; https://doi.org/10.3390/buildings12050524 - 21 Apr 2022
Cited by 7 | Viewed by 3740
Abstract
The choice of proper procurement methods has an impact on the overall productivity and sustainability of construction projects. The current procurement methods have alerted the construction industry (CI) due to the exacerbating fragmentation among parties and the resulting low level of productivity. Therefore, [...] Read more.
The choice of proper procurement methods has an impact on the overall productivity and sustainability of construction projects. The current procurement methods have alerted the construction industry (CI) due to the exacerbating fragmentation among parties and the resulting low level of productivity. Therefore, introducing a new procurement system to eliminate the above challenges is imperative to the CI. Therefore, this research investigated the applicability of lean integrated project delivery (LIPD) as a construction procurement system and developed a framework for its successful implementation. A qualitative exploratory approach was adopted, informing an interpretivism stance. Accordingly, semi-structured interviews with 15 Sri Lankan (SL) CI experts were conducted to determine the applicability of the LIPD concept in a real-life CI context. Qualitative content analysis was used to analyse the collected data. This research identified the significance of LIPD compared to existing procurement methods, which may contribute to the long-term planning and management practices in the CI. However, the findings elicited several barriers that could hinder successful LIPD implementation. As a result, some of the strategies discovered include providing LIPD training and awareness, obtaining expert support, and encouraging professionals. This is the first study of its kind to reveal a LIPD framework in a developing country like SL without restricting itself to a specific construction type. Therefore, this study is expected to impact the global CI by paving the way for LIPD as a new procurement system to improve the performances of similar CIs in developing countries across the world. Full article
(This article belongs to the Special Issue Procurement in Construction Industry)
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14 pages, 2268 KiB  
Article
Developing a Risk Management Process for General Contractors in the Bidding Stage for Design–Build Projects in Vietnam
by Duy-Hoang Pham, Dang-Huy Ly, Ngoc-Khue Tran, Yong-Han Ahn and Hyeongjae Jang
Buildings 2021, 11(11), 542; https://doi.org/10.3390/buildings11110542 - 15 Nov 2021
Cited by 6 | Viewed by 4441
Abstract
Design–build (DB) projects have become increasingly popular for construction projects in developing countries due to the cost and scheduling advantages and their design optimization ability. As a result, much research has been conducted on improving DB efficiency in terms of cost, scheduling, risk [...] Read more.
Design–build (DB) projects have become increasingly popular for construction projects in developing countries due to the cost and scheduling advantages and their design optimization ability. As a result, much research has been conducted on improving DB efficiency in terms of cost, scheduling, risk management, etc. However, the existing studies have mainly focused on the owner’s roles, whereas general contractors (GCs) must also take many risks on behalf of owners in DB projects. The adequate identification and assessment of risks before engaging a contractor can increase the likelihood of a project’s success, at least from a DB contractor’s perspective. Therefore, this study interviewed procurement experts to conduct a survey at the local level, then analyzed, developed, and proposed an additional risk management process (RMP) for use by GCs during the bidding process of DB projects. A case study was conducted with a large Vietnamese GC to evaluate the effectiveness of the process and find ways to optimize it in the future. The results of the study showed that risk management during a DB project is imperative. Nevertheless, preparing bids is time-consuming and increases the contingency costs, reducing the competitiveness of the bid prices for contractors. Therefore, depending on the specific project and risk management objectives, an RMP is recommended for adjusting the risk management target to reduce the risk, while still maintaining the competitiveness of the bid prices. Full article
(This article belongs to the Special Issue Procurement in Construction Industry)
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23 pages, 654 KiB  
Article
A Contractor-Centric Construction Performance Model Using Non-Price Measures
by Kasun Gunasekara, Srinath Perera, Mary Hardie and Xiaohua Jin
Buildings 2021, 11(8), 375; https://doi.org/10.3390/buildings11080375 - 23 Aug 2021
Cited by 8 | Viewed by 2926
Abstract
Selecting a better performing contractor at the procurement stage is crucial in achieving a successful outcome for a construction project. The construction industry lacks a systematic and purpose driven method to assess performance of contractors using objective metrics. There are many approaches to [...] Read more.
Selecting a better performing contractor at the procurement stage is crucial in achieving a successful outcome for a construction project. The construction industry lacks a systematic and purpose driven method to assess performance of contractors using objective metrics. There are many approaches to measuring construction performance, but most are complicated and have high dependency on data that is difficult to attain. This paper aims to create a model for evaluating construction contractors’ performance based on directly attributable measures that are quantitative and easy to gather. This makes such a model more attractive and easier to use. Initially, a detailed literature review revealed different categories of measures of performance (MoP) and corresponding critical measures of performance (CMoP). Through a series of Delphi-based expert forums, the set of measures were fine-tuned and shortlisted. Fuzzy analytic hierarchy process-based comparisons were then used for developing a contractors’ performance model to quantify their level of performance based on a limited set of organisation-specific and project-specific measures. The results indicate a shift from traditional measures and a higher preference towards non-price measures. The performance model can be further developed to systematically rank the prospective contractors at the procurement stage based on seven non-price measures. Full article
(This article belongs to the Special Issue Procurement in Construction Industry)
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Review

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19 pages, 1364 KiB  
Review
Risk Identification, Assessment, and Allocation in PPP Projects: A Systematic Review
by Nasir Rasheed, Wajiha Shahzad, Malik Khalfan and James Olabode Bamidele Rotimi
Buildings 2022, 12(8), 1109; https://doi.org/10.3390/buildings12081109 - 27 Jul 2022
Cited by 16 | Viewed by 5555
Abstract
Public private partnerships (PPPs) have gained widespread adoption as an innovative way of procuring public infrastructure projects over the last two decades. Risk identification, assessment, and allocation have received considerable attention from researchers due to the risk heavy nature of PPP projects. Adoption [...] Read more.
Public private partnerships (PPPs) have gained widespread adoption as an innovative way of procuring public infrastructure projects over the last two decades. Risk identification, assessment, and allocation have received considerable attention from researchers due to the risk heavy nature of PPP projects. Adoption of PPPs has triggered a sudden increase in research interest in the area in recent years. This study attempts to provide an updated systematic review of literature related to risks in PPPs using a PRISMA flowchart. The results of the study offer some valuable insights into the future and current state of research. The study found that the focus of research on PPPs has shifted from an overall risk identification and assessment approach to individual risk analysis. Moreover, this research trend is on the rise in developing countries, and that quantitative methods for risk management in PPP research and qualitative methods in practice are preferred. In developed economies, due to negative public sentiments, transparency concerns, and arguments of value for money not being achieved, PPPs are becoming less popular. For these reasons a shift to availability-based payment mechanisms such as in Design-Build-Finance-Maintain (DBFM) from traditional revenue-based mechanisms as in Build-Operate-Transfer (BOT) has been observed. These shifts in research trends and practice offer researchers future opportunities to investigate these relatively newer approaches. Full article
(This article belongs to the Special Issue Procurement in Construction Industry)
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22 pages, 12332 KiB  
Review
Evolution of Electronic Procurement: Contemporary Review of Adoption and Implementation Strategies
by Albert P. C. Chan and Emmanuel Kingsford Owusu
Buildings 2022, 12(2), 198; https://doi.org/10.3390/buildings12020198 - 9 Feb 2022
Cited by 5 | Viewed by 4992
Abstract
Since the advent of the first form of electronic procurement (EP), the procurement process (i.e., the stages and underlying activities) has evolved to transform the world of commerce significantly. In the construction industry, EP has revolutionized the operational schema of traditional procurement and [...] Read more.
Since the advent of the first form of electronic procurement (EP), the procurement process (i.e., the stages and underlying activities) has evolved to transform the world of commerce significantly. In the construction industry, EP has revolutionized the operational schema of traditional procurement and has paved the way for the development, advancement, and application of more intelligent tools for handling and executing procurement activities of infrastructure-related works. Although the development or adoption of EP-related tools has not been encouraging due to the industry’s conservative nature, in this study, we review the evolution and developments of EP to date. It explores the adoption and implementation strategies of extant and projected EP developments and develops a conceptual framework to explicate the developmental transitions of EP. While there are many studies on EP, there is still a long way to transition into a more intelligent execution of EP-related activities. A total of 64 EP-related manuscripts and other valuable studies were examined to realize the stipulated objective as well as identify the thematic constructs developed under the subject matter. The explorations conducted in this study are intended to contribute to the understanding of the extant discussion on both EP and smart procurement (SP), their adoption strategies, implementation, and applications in infrastructure projects. It elucidates the significant constructs that define and underpin the theoretical implications of EP and SP adoption and implementation. Lastly, the framework highlights the projected developments and transition phases of EP to intelligent procurement (IP). Full article
(This article belongs to the Special Issue Procurement in Construction Industry)
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Other

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15 pages, 1782 KiB  
Systematic Review
A Systematic Review of Responsible Sourcing in the Architecture, Engineering, and Construction Sectors of the UK
by Sophie Ball, Colin A. Booth, Abhinesh Prabhakaran, Abdul-Majeed Mahamadu and Jacqueline Glass
Buildings 2023, 13(4), 889; https://doi.org/10.3390/buildings13040889 - 28 Mar 2023
Cited by 2 | Viewed by 1827
Abstract
In recent years, responsible sourcing and procurement (including green supply chain management) across the architecture, engineering, and construction (AEC) sectors have become notable contributors to sustainable construction strategies. This study aims to provide a systematic review of responsible sourcing literature across the AEC [...] Read more.
In recent years, responsible sourcing and procurement (including green supply chain management) across the architecture, engineering, and construction (AEC) sectors have become notable contributors to sustainable construction strategies. This study aims to provide a systematic review of responsible sourcing literature across the AEC sectors of the UK to identify a suite of opportunities and obstacles to adopting ethical and environmentally supportive practices and to highlight avenues for further investigation. The Preferred Reporting Items for Systematic Reviews and Meta-Analyses (PRISMA) review process was adopted to identify, screen, and select (n = 80) articles (from 2000–2020) for review. Analysis of these articles identified the most frequently reported opportunities: (i) stakeholder value (40%); (ii) improved supply chain performance (39%); and (iii) competitive advantage (30%). The most frequently reported obstacles relating to the uptake of responsible sourcing are the following: (i) cost (44%); (ii) industry constraints (28%); and (iii) lack of frameworks/information and lack of awareness (25%). Given the industry importance of these themes, it is proposed that there is a necessity to explore and unravel the perceptions of industry experts about these issues so as to clarify the progress and possibilities for more widely adopting responsible sourcing across the AEC sector and, moreover, for clarifying their contribution towards achieving national and international sustainability targets (e.g., UN Sustainable Development Goals). Full article
(This article belongs to the Special Issue Procurement in Construction Industry)
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