Academic journal article Advances in Management

Supply Chain Management in Construction Industry

Academic journal article Advances in Management

Supply Chain Management in Construction Industry

Article excerpt

Abstract

The success of a civil project is evaluated through parameters of quality, cost and time. Construction companies use modern tools and technologies in order to improve the mentioned parameters in their supply chain. The paper aims at studying the role of supply chain management on construction industry. This is a descriptive analytic research and the data has been gathered using library methods. The obtained results revealed that supply chain management is crucial in different stages of construction industry including providing materials and tools as well as designing, supervising and execution stages. Supply chain and its applications can be remarkably effective in each quality stage in order to reduce the time and expenses.

Keywords: Civil projects, Supply chain, Cost, Time, Construction.

Introduction

Due to the increasing need for houses, our country requires a technologic and scientific change. It is impossible to fulfill construction aims without this change. Increase in costs of supplying materials, equipment and human resources, not having a proper efficiency, problems during executive actions by different work groups in civil projects lead to huge expenses and even failure in civil projects.

In general, it can be said that success in civil projects are evaluated using parameters or quality, price and time of completing a project. Performance and cooperation of marginal contractors and suppliers of huge construction companies are cmcial factors. Construction companies need new tools and technology in order to improve the mentioned parameters in their supply chain. So, one of the most important things is supply chain management.

In Iran, like other countries, huge construction companies spend extra time and money due to overlap of suppliers' activities and activities of inferior contractors. Considerable costs are imposed on the company due to lack of balance between the design and the execution as well as between suppliers, inferior contractors and public contractors. It is clear that we need to design and use an integrated system in order to synchronize these activities and constructing activities of the country. Supply chain management is a solution which had acceptable results in the construction and industrial companies in developed countries.

The concept of supply chain was developed between 1960s and 1970s when companies had to improve their strategies that were based on attraction and retention of customers. They also had to involve in the network management of all the previous companies (that provided inputs) and all the following companies (that delivered the goods and were responsible for after sale services). To this end, the present paper aims at studying the role of supply chain management in construction industry.

Significance of Research

Standardization and improvement of internal processes and improvement of quality of the products were popular in 60s and 70s in order to add to the competitive capability of the organizations. To this end, in recent years, organizations have increased flexibility in order to manufacture lines and develop products so that the customers' needs are fulfilled. As the time passes, organizations have figured out that flexibility is not enough and suppliers need to know market development policies. This fact leads to a process called supply chain management. One of the paradigms in 20th century production is supply chain that helps improvement of competitiveness. Since they encountered challenges like production cycles and lack of time, in 1990 they formed a management process called supply chain management. To this end, integration of suppliers and producers as well as stocks and markets clearly displayed the significance of using supply chain management so that specific amounts of needed products are produced at the right time and are offered to the customers so that the total expenses of the chain is minimized.

Supply chains have led to development of various competitive advantages for today's companies. …

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