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QM Practices in Saudi Construction Market
Vision 2030 has entailed profound transformations in regard to the external factors within Saudi Arabia’s construction industry. Al Salti (2020) observers that the surge in competition becomes the leading factor, prompting companies to reconsider their paradigms of management. As per Vision 2030, the number of complex engineering construction tasks is equally on the increase, whereas the scale of building construction follows an opposing pattern. Al Salti (2020) places emphasis on this major tendency, which is justified, as the changing nature of the task introduces new requirements to companies and their management. A similar perspective has been supported by Assaf and Hassanain (2019), who argue that the construction industry in Saudi Arabia is experiencing a rapid growth. The specified perspective allows explaining how Saudi Arabia has managed to attract many international companies while also pointing out that the described outcome often leads to inefficiencies in the execution of large projects. Thus, while supporting a uniform stance on the matter at hand, these studies identify the presence of a potentially conflicting environment in the construction sector, namely, that one of the rapid growth imposing restrictions on the size and scale of projects. Sousa and Voss (2002), in turn, argue that there is room for addressing the scale and size of projects while retaining quality of performance. Salama (2021, para. 2) reports that several local companies violated competition laws to “increase prices in Al Lith Municipality’s tenders.” Aljobaly and Banawi (2020) support the specified perspective that the construction sector is currently unable to increase performance due to the poor connection of involved parties. These assumptions synthesize a conclusion that the transformation of the industry in Saudi Arabia represents a major challenge for local firms in competition with international actors.
Accordingly, the current representatives of the Kingdom’s construction industry face an overarching objective of addressing the emerging challenges through an in-depth analysis of the market. The described situation is highly demanding in terms of an effective strategy that would determine the adequate course of action in the face of increasing competitiveness. Ulutas Duman et al. (2017a) addresses this idea through the lens of Turkish contractors and their experience. More specifically, their decision-making processes are said to have diverged from the conventional practices engraved in the industry’s landscape. Through the recount of the strategic narrative infrastructure employed by the Turkish Contractors Association, Ulutas Duman et al. (2017b) address argue for the critical status of multi-actor and multi-level patterns of decision-making. This idea is essential for the formation of an effective strategy in an increasingly competitive environment. The authors provide solid empirical evidence that supports the potential of a modernized approach to decision-making. However, the discussion revolves around the specific case of Turkish contractors, implying that a certain degree of adaptation to the reality of Saudi Arabia is to be introduced for the development of informed practices.
The implementation of QM practices is likely to have a positive, lasting effect on the performance of construction firms. Patyal and Koilakuntla (2017, p. 22) confirm that QM practices “contribute to better financial, marketing, and even innovation performance by improving quality performance and/or operational performance.” The focus on QM practices is typically prioritized in construction, as the papers by Singh et al. (2019) and Pheng and Hong (2005) indicate, explaining the status of locating the opposite perspective as a challenging task. However, these results are not specifically relevant to the construction industry. Moreover, these findings relate to core QM practices, which are to be equally supported by infrastructure practices (Negron, 2020). This notion underlines the importance of QM for construction quality performance when its components interact in a nexus, as evidenced by Jong and Sim (2019). Khalfan and Said (2020) note that the enhanced supply chain management, combined with the creation of a quality culture, has a significant impact on operational performance. However, the study emphasizes that in the literature presented, there is a fragmentary understanding of the relationship between QM performance and the quality of projects in the construction industry (Khalfan and Said, 2020). Similarly, Duman Ulutas et al. (2017) encourage the reader to consider the complexity of a competitive advantage as a combination of inherent qualities and a marketing approach. Therefore, further research is needed to examine the connection between the implementation of QM and the management of projects within the target industry.
Determining the direct impact of QM practices on quality performance in the construction sector is challenging. Wawak and Ljevo (2020) note that despite the attention to this topic, there is no universal way to measure the impact of QM implementation on the final quality of the project. This assumption is supported by Panuwatwanich and Nguyen (2017), highlighting that there are distinguishing characteristics in the construction industry that can be viewed as barriers to the implementation of QM practices. However, the researchers note that the main reason for the failure of construction projects is the “disregard of the significance of the project planning process and project planning” (Panuwatwanich and Nguyen, 2017, p. 549). Researchers highlight the key influence of strategic planning on the quality of projects in the construction industry. This statement is supported by Aghimien and Aigbavboa (2019), who investigate the significance of various QM practices on performance in the implementation of civil engineering projects. However, consideration of factors was conducted on the basis of literature researching data relevant for countries such as the United States and Japan. Additionally, the described perspective is questioned by Powell (2001), who insists that a competitive advantage needs to incorporate QM practices while relying on a unique component distinguishing a company from others.
This aspect is of critical importance since QM and performance projects in developed countries differ significantly from those in the Middle East. In particular, Jong and Sim (2019) note that the significance of strategic planning for construction firms in countries such as Malaysia, India, and Turkey has a low level. This finding suggests that knowledge sharing must be promoted so that Turkey and other countries with low strategic planning rates could explore new perspectives. At the same time, Khalfan and Said (2020) cite a number of studies that indicate a direct and indirect relationship between the implementation of QM practices and project performance in Taiwan, Malaysia, and the UAE. However, Teece (2019) warns that the choice of a strategic approach to QM depends on the unique characteristics of a company, which means that homogeneity in QM techniques is not always possible. The paper by Khairul (2020) identifies an extremely positive correlation between Supplier Quality Management (SQM) practices and quality performance in Malaysia. Patyal and Ambekar (2020, p. 906) underline that there are significant differences in QM practices among “emergent culture clusters.” These findings allow concluding that the effect of different QM elements varies depending on the market in which they are implemented.
The context of the SA construction industry incorporates additional features that must be taken into account to assess the effectiveness of QM. Abazid and Gökçekuş (2019a, p. 42) note that QM is “capable of achieving time management, meeting client’s requirements/needs, profit increasing, cost reduction, reaching safety regulations.” Despite the fact that QM practices can improve coordination, reduce costs, as well as improve quality and productivity, many construction firms do not have a sufficiently developed information system to implement a QM system (Abazid and Gökçekuş, 2019b). These studies highlight the potential benefits of implementing practices to increase competitive advantage in the construction industry. At the same time, they identify barriers that currently prevent this from being fully done. In combination, these findings identify that there is a threat of loss of competitive advantage in the context of competition between local and international firms.
The adoption of QM practices prompts local firms to increase their levels of competitive advantage in the industry. Likita and Zainun (2018) emphasize that in Saudi Arabia, there is a link between QM culture and contractor’s competitiveness in the construction industry. Alofi and Younes (2019, p. 46) emphasize that the key factors in the implementation of QM in the construction sector are “working with employees, ensuring top management commitment, and having a customer focus.” This assumption is supported by Abd-Elwahed and El-Baz (2018), stating that involving top management in creating a quality culture is essential. However, the idea of communication as the foundation for implementing QM is heavily debated by Patyal and Koilakuntla (2017), who insist on the consistency of QM standards and practices instead. The implementation of QM will eliminate the problem of the quality of buildings and significant waste of the industry, which are currently the main challenges (Sarhan and Xia, 2017). Abazid and Gökçekuş (2021, p. 28) report that the implementation of QM practices will help “maintain management and reliability within the fundamental constraints, which are time, cost and quality of a project.” At the same time, the authors report significant obstacles associated with the inability of the management to introduce the necessary changes. These findings identify that QM practices can be a source of sustainable competitive advantage (SCA) in local construction companies through quality culture creation.
QM and QM Practices in General
Research on QM in project-based industries such as construction is currently focusing on more specific applications of the concept. Carnerud and Bäckström (2019) identify that the number of studies in this area decreased from 2000 to 2012 but is now actively growing. The main focus of research in recent years is the expansion and deepening of knowledge about the directions and techniques of quality management (Wawak, Rogala, and Dahlgaard-Parkal, 2020). However, some studies mention that the issue of QM is not as important in the construction industry as the promotion of innovation, particularly the use of disruptive innovation tools, particularly in marketing (Vorhies and Morgan, 2005). Researchers also note that the QM field is currently “mature, and at the same time constantly developed” (Wawak, Rogala, and Dahlgaard-Parkal, 2020, p. 14). Existing research is also involved in considering the application of QM to achieve sustainability (Wawak et al., 2020). Performance, as well as a study of the influence of various QM factors on the QM process (Nguyen and Phan, 2018). It is noteworthy that the studies reviewed are characterized by a significant number of limitations, particularly time-related constraints, which emphasizes the complexity of QM practices.
The contemporary body of knowledge equally focuses on investigating the achievement of SCA through QM applications. Simani (2017), in his research findings, notes a strong positive correlation between competitive strategies and QM practices. The combination of QM tools with competitive strategies (such as cost leadership, particularly, reduction of prices by minimizing costs for supplies, as well as performing differentiation) has a significant impact on the performance of manufacturing firms (Simani, 2017). Swalehe and Odock (2020) report that Sustainable Operations Management Practices also have a direct link to competitive advantage. This strategy, in turn, includes improving product quality and focusing on customer service. Thus, these findings can be identified as the correlation of QM practices with SCA achievement. However, other studies, such as the paper by Wawak et al. (2020), oppose the idea of focusing solely on QM and promote the need for innovation and marketing. However, the studies reviewed are based on studies of manufacturing firms in Kenya, which makes the results rather limited. Firman and Thabrani (2018, p. 170) confirm these assumptions by stating that QM “can develop and maintain the competitive advantage by increasing efficiency through cost reduction and increasing consumer satisfaction.” Researchers cite evidence from previous research, making the results relevant and relevant. QM practices have a positive effect on project quality performance, which in turn improves a number of key metrics that can lead a company to achieve SCA (Negron, 2020).
Cudney and Gillis (2016, p. 224) identify that QM practices allow “to capture the voice of the customer and translate it into engineering characteristics.” Research by Shirandula and Kisimbii (2018) provides more specific insights into the impact of QM practices on a company’s performance. The paper notes that the involvement of management and employees, as well as continuous improvement and focus on customer needs, are the main components of the transformation of QM practices in improving the quality of construction projects (Shirandula and Kisimbii, 2018). These findings are supported by Androwis and Sweis (2018), stating that QM practices are translated into projects through the development of a long-term strategy based on customer needs and management adaptation. However, existing research does not focus on civil engineering projects, which makes the results less relevant to this research. In the construction sector, QM techniques are used to document key processes accordingly and ensure that all changes are recorded and tracked down. Thus, continuity in managing the key tasks is ensured.
At the project level, researchers focus on planning and monitoring the implementation of QM practices. In particular, Oyebisi and Ede (2019) underline that overall project performance and specific project results are the key indicators of the effectiveness of the implementation of practices. Additionally, these aspects require compliance with all stages of project development and an assessment of how the result meets the customer’s requirements (Oyebisi and Ede, 2019). The importance of adhering fervently to project implementation stages, however, is debated by Patyal and Koilakuntla (2017). Indeed, due to the differences in the workplace environments, appropriate changes should be made to the framework to meet project goals. Thus, the researchers emphasize the essential role of planning in QM practices at the project level (Carstens, 2017).
QM practices through dynamic capabilities theory
Origins of dynamic capabilities theory (DCT) refers to change management, which focuses on transforming an organization to external change (Teece et al., 1997). Critics of the theory argue that this approach has a number of limitations, in particular, the theoretical basis rooted in a significant portion of individualistic perspectives and a lack of empirical data (Gölgeci and Larimo, 2017). Wright (2021) supports this point of view, arguing that the theory has little practical relevance and theoretical validity. Collins and Anand (2019, p. 19) state that the adoption of DCT requires a new set of capabilities that “undercut any advantage accruing to the pursuit of a new strategic positioning which cannot be effectively executed.” These capabilities include the use of sensory output as the means of navigating an unstable setting (Nielsen, 2006). Thus, the overwhelming opinion concerns the problem of combining functions of the capabilities in question to evaluate their effects.
However, these statements are based on the assumption that the theory does not have enough empirical data. Moreover, the researchers emphasize that the theory deals exclusively with external factors, overlooking the role of managers (Gölgeci and Larimo, 2017; Wright, 2021). Nevertheless, Fainshmidt and Wenger (2019) note that strategic fit plays a special role in achieving a competitive advantage, which is achieved by responding to internal and external factors. Thus, the researcher emphasizes that within an unstable environment, a manager can improve performance through efficient resource allocation without harming the firm. Moreover, the use of DCT in resource-limited settings can lead to continuous improvements in operational capabilities, making the company a “pioneer in inefficiency” (Fainshmidt and Wenger, 2019, p. 781). Kaur and Mehta (2017) support these claims by pointing out that DCT is effective in achieving a competitive advantage in environments of any complexity for its light focus on adaptability.
The literature also explores QM practices through DCT and identifies connections between the two concepts. Gutiérrez and Barrales-Molina (2018) argue that human resources-related QM has a positive effect on the dynamic capabilities of a company, increasing its adaptability through the expansion of the knowledge and decision-making ability of employees. Gutiérrez and Barrales-Molina (2020) support these findings, highlighting that team management and the use of statistical metrics are positively correlated with dynamic capabilities. The authors also argue that QM will help develop a sufficient level of learning capabilities and knowledge to increase adaptability (Gutiérrez and Barrales-Molina, 2020). However, some of the authors do not share the described stance, claiming that knowledge acquisition as an aspect of a competitive advantage requires additional changes to another department, namely, that one of the HRM (Porter and Kramer, 2002). Moreover, the study also emphasizes that there is no evidence of a long-term effect of this interaction. At the same time, Hong and Zhang (2017) emphasize that supply chain management is an integral part of the development of dynamic capabilities, which suggests that a compromise must be located between the specified approaches.
Despite the existence of other theories regarding QM practices, DCT offers the most comprehensive approach. Resource-based or market-based views offers focusing on one factor of adaptation as the main source of access to SCA (Assensoh-Kodua, 2019). DTC is better because it allows you to consider all areas of the company’s functioning to adapt to external changes, not being limited to one aspect. The specified stance is supported by Powell (1995), who emphasizes the necessity of promoting incremental changes in the context of quality management. In turn, Cyfert and Chwiłkowska-Kubala (2021) argue that dynamic capabilities change depending on a firm’s needs and the choice of appropriate practices for adaptation, which contradicts Assensoh-Kodua’s (2019) stance since it implies that incremental change as a notion requires further adaptation within the corporate context. The main stages in the development of the dynamic capabilities aspects are the accumulation of knowledge and resource management. At the project level, DCT can be used to generate and accumulate knowledge and transform it for the development of dynamic capabilities and applications for other company projects (Patrício and Lopes da Costa, 2021). In construction companies, the development of dynamic capabilities is achieved to implement projects through the use of digital technologies and information systems (Redwood and Thelning, 2017). Thus, the DCT for the construction industry emphasizes the importance of building knowledge and transforming it into innovation.
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