Supply Chain Capital in Construction Industry: A Conceptual Model

Supply chain management is one of the concepts adopted from other industries and being translated to suit the construction industry in order to bring improvements within the industry. The recent emphasis is on the integration of the whole supply chain because of the fragmented nature of the industry, and the large number of participants involved in a project development process. One of the aspects to achieve integration is by managing both tacit and explicit knowledge existed within a project supply chain through IT systems and social interaction. The main purpose of this paper is to develop a conceptual model, that provides a link between construction organisations and their learning activities as part of a supply chain of a project, resulting in creation of a learning organisation and a learning supply chain. The model shows that the learning supply chains, consist of learning organisations which would create supply chain capital in order to promote innovation and creativity by managing knowledge in supply chains on long term basis. In addition, the learning organisations would also establish a virtual knowledge transfer among themselves and the supply chains they are involved. The paper also suggests that, as unit of competition changes from organisation verses organisation to chain verses chain under supply chain management, supply chain capital will become increasingly important for sustaining competition within construction industry. Therefore, supply chain capitals are to be created through managing knowledge in supply chains on long term basis using the proposed conceptual model. The model also facilitates innovation and creativity essentially required to thrive in the downturn business environment of today in many countries in different parts of the world.