Research On Coopetition Strategy For Chinese Contractors Implementing International Construction Projects

According to the report from Engineering News Record, in 2013, Chinese contractor enterprises’revenue in overseas markets accounted for 14.5% of the Top 250 contractor enterprises’ total revenue, which accounted for more than the contractors from United States, and the influence was just behind European contractor groups. The Chinese contractors’ overseas business is developing boomingly. At the same time, Chinese contractors in the international construction market are facing fierce competition; these competitions come from both the big foreign contractors and domestic Chinese contractors. In comparison, the latter is fiercer. Chinese contractors in the international construction market are in urgent need of a new way to reduce the pressure from the competition between Chinese contractors. Coopetition, which means cooperate with rivals, is a kind of new competition mode. This strategy can effectively reduce the competition between Chinese contractors, and strengthen the cooperation between each other. But coopetition strategy research has not been implemented in the construction industry; also the Chinese contractors and government agencies have not pay attention on this strategy. This paper will do the research on the Chinese contractors’ coopetittion strategy in international construction projects.The research content of this article is mainly to identify critical factors influencing Chinese contractors’ coopetition relationships, evaluate the Chinese contractors’ coopetition situation in the international construction market and different coopetition strategies matched to each coopetition status. Lastly, a case study was implemented to do the empirical analysis.First of all,53 factors influencing coopetition were identified through the literature review, and then a questionnaire for data collection was designed. Descriptive statistical analysis and exploratory factor analysis were conducted by SPSS 22.0 software, and AMOS software was used to do the confirmatory factor analysis. The results show that the support of senior management (A02), effective coordination (B12), fair profit assumption (B03), mutually beneficial policy and strategy (A03) and a commitment to a win-win attitude (B05) are the top five factors ranked by the mean value. Then the critical factors influencing the coopetition relationships are divided into nine categories from the internal and external environment factors:alliance stability capability (ASC), technological innovation capability (TIC), risk management capability (RMC), effective cooperation capability (ECC), operation & executive capability (OEC), alliance organization capability (AOC), political environment category (PE), industry specific category (ISC), and economic performance category (EPC).Secondly, in the state of coopetition evaluation model building, a questionnaire was designed to collect projects’ data according to the critical influencing factors. The state of coopetition can be divided into four categories, respectively is "adaptation situation", "partnering situation", "isolating situation" and "competition situation".Then, on the basis of key factors and coopetition situation research, literature review and cluster analysis were used to divide the Chinese contractors’ strategies in international construction market into four categories, respectively is entering strategy, cooperative strategy, innovative strategy and competitive strategy. Each strategy was corresponded to the four coopetition situations. After then high and low competitive strategies with high and cooperative strategies were combined to describe the four conditions of coopetition.Finally, during a case study, a questionnaire was designed to get different projects’ data in each region about Chinese contrators. The results can reflect each project’s coopetition situation, and propriate coopetiton strategies can be advised to Chinese contrators according to the analysis. Through the case study, the reliability, effectiveness and operability can be proved.The findings of this research make certain contributions to the improvement of research system of coopetition strategy, and provide some theoretical reference for the future studies in this area. Further more, by offering Chinese contractors reference and guidance about how to reap competitive advantages through coopetition, the results we get in this paper are beneficial for the spreading of coopetition strategy in business.