Description
Case Studies in Green Buildings and Organizational Changes: Italian:- Green building (also known as green construction or sustainable building) refers to a structure and using process that is environmentally responsible and resource-efficient throughout a building's life-cycle: from siting to design, construction, operation, maintenance, renovation, and demolition.
Case Studies in Green Buildings and Organizational Changes: Italian
ABSTRACT International policies indicate the building sector as one of the most promising for sustain- able development. According to the Intergovernmental Panel on Climate Change (IPCC), it has the greatest and cheapest potential for delivering significant greenhouse gas emission reduction. However, early experiences of sustainable construction have shown that both a social and a technical transition are required. Consequently, the changes in organizational aspects of firms involved in construction represent an urgent research theme. This paper investigates how inter-firm relationships are changing as the sector moves towards green building. The organizational model between firms is described at the integration level with suppliers, the integration level between the general contractor and the design team, the degree of specialization of involved firms and their sustainability certifications. These features have been analyzed in case studies collecting data through interviews. This paper compares organizational aspects in traditional and green buildings. Results suggest that green buildings are associated with inter-firm relationships of comakership with suppliers and with the design team, and with firms with a portfolio focused on sustainable projects. Finally, among the case studies, sustainability related certifications are scarcely related to the greenness level of the building. Copyright © 2012 John Wiley & Sons, Ltd and ERP Environment.
Keywords: construction sector; organizational changes; sustainable construction; green building; socio-technical transition; supplier network; comakership
Introduction
CLIMATE CHANGE HAS RAISED CONCERNS OVER THE RAPIDLY GROWING DEPLETION OF THE
ENVIRONMENT AND ITS resources. In this scenario, international programs and policies indicate the green
building sector as one of the most promising for sustainable development (IPCC, 2007). Laws and regulations around the world are encouraging the building sector to move to sustainability. The great attention on buildings arises from their energy consumption and greenhouse gas (GHG) emissions, which, in developed countries, represent 30 and 40% of the total quantities, respectively (IPCC, 2007; IEA, 2010). The building sector contributes 5% of US and 6% of China's gross domestic product, and it represents a large
and valuable sector in every country's economy, with a global average of 10% of country-level employment
(UNEP-SBCI, 2009). According to the Intergovernmental Panel on Climate Change (IPCC), the building sector has higher energy and pollution reduction potential than any other sector (IPCC, 2007). The IPCC states that in countries that are not members of the Organisation for Economic Cooperation and Development (non-OECD) and in economies in transition, the potential CO2 saving of building could be 3 and 1 Gt CO2-eq/y by 2030, respectively, with a total possible reduction of 6 Gt CO2-eq/y worldwide. This paper focuses on residential buildings, as these represent the large majority of buildings. In Europe, the residential building stock is 75% of the total building stock (ANCE, 2011). This percentage regards both existing buildings and new constructions. In particular, 55% of Italian annual investment in the construction sector is on residential buildings (ANCE, 2011). This helps to explain the importance of the residential sector. The European building sector is currently in ferment given the 2010/31/EU Directive (the recast of the Energy Performance of Buildings Directive), which aims to build only nearly zero energy buildings after 2020. This target represents a radical transformation of current practice. For example, in Italy, new residential buildings have average energy requirements of over 100 kW h/m2/y (ANCE, 2011). The gap between current practice and requirements in 8 years shows the urgency of a systemic transition of the sector towards green building. This paper focuses on medium-sized residential projects. The size of the projects was chosen because of the greater difficulties in introducing green and energy saving technologies in medium-sized projects (Williams and Dair, 2007; Winch, 2010). In particular, given the representativeness of the Italian construction sector for other European countries and the lack of studies of sustainable construction in Italy, construction processes for new residen- tial buildings in Italy are discussed. The efforts to increase the diffusion of green building are growing at international and national levels. R&D continually offers new products and processes facilitating the transition to sustainability (Rohracher, 2001), and many products for sustainable buildings already exist (Butera, 2010). Several studies have shown that both the tech- nical and economic potential for green buildings exists (Hoffman and Henn, 2008; Svenfelt et al., 2011). However, the construction sector is particularly slow in moving towards sustainability (Vermeulen and Hovens, 2006). Many researchers have investigated barriers to the diffusion of green building as recently reported by Häkkinen and Belloni (2011). Economic and knowledge factors are pointed out by Cooke et al. (2007) and Pinkse and Dommisse (2009). Howarth and Andersson (1993) discussed the persistence of building technologies as a barrier to innovation. Gluch (2005) indicated that the risks for the adoption of green innovation are generally avoided because buildings are unique, expensive and lasting. An important barrier to the adoption of green innovations is the structure of the construction process (Manseau and Shields, 2005; Williams and Dair, 2007). This is based on temporary relationships between many firms who collaborate side by side within a single project perspective (Anumba et al., 2005). In this context, the adoption of green technologies is contrasted by an agent versus agent problem: the general contractor and the suppliers, which should make the investment in new technologies, often have low interest in doing so because the main bene fit is for the end-user (Howarth and Andersson, 1993; Son et al., 2011). Several studies have investigated how construction firms are modifying their practice in order to adopt green innovations (Rohracher, 2001; Brown and Vergragt, 2008). The main result is that new organizations of construction processes are necessary; meanwhile, firms have to acquire the knowledge necessary for the sustainability transition of the sector. However, no clear idea exists about how the relationships between firms need to evolve. Existing studies have focused on commercial and office buildings and rarely looked at residential buildings. Moreover, the Italian construction sector has never been considered. Hopefully, this paper will contribute to filling in these gaps. In this paper, the organizational relationships between firms involved in construction processes are considered. The research aims to investigate how these relationships change as the sector moves towards sustainable practices for green buildings. This paper is interested in finding how these relationships evolve. In particular, given the key role played by the general contractor in the construction process (Winch, 2010), this paper aims to answer this question: which modifications in the relationships between the general contractor firm and the other firms are there in green buildings? Before continuing in the discussion about sustainable constructions, it is useful to clarify the concept of green building. In this paper, a green building is de fined as a building with high efficiency in the use of energy, water and materials and reduced impact on human health and the environment in its complete life cycle (Cassidy,
Green buildings and organizational changes
2003). Threshold limits for the concepts of high efficiency and reduced impacts go beyond the scope of the present research, although the differentiation between green buildings and non-green ones is performed using international sustainability assessment systems (Berardi, 2011). This paper is structured in the following manner: the following section describes inter-firm organization in construction processes. Based on literature results, the next section presents a research model for the analysis of organizational changes of construction processes; the fourth section reports the methodology of research and describes the investigation of organizational features in some case studies together with the results of data collection. The fifth section discusses the results and tries to respond to assumptions in the second section. To do this, the organizational features are analyzed stressing the differences between inter-firm organization in traditional and green buildings. The paper ends with some conclusions and suggestions for future work.
The Organization of Construction Processes
The construction process is the series of activities of planning, realization and direction through which materials and equipment are assembled into a building (Walker, 2007). These activities are not limited to those realized on the jobsite. Consequently, firms working at the jobsite, first order suppliers and other actors of the process, such as the design team or real estate financier, have to be considered when investigating the construction process. In fact, the analysis of only jobsite actions gives a misleading view of the complexity of the construction process, which has been shown to be much more varied (Manseau and Shields, 2005). All the activities and relationships from the urban plan and negotiations for a building to completion of the building are considered in this paper. Given the large number of firms in construction processes and the non-integrated structure of the sector, the organization of the processes is fundamental. The uncertainty and fragmentary nature of construction processes have been suggested as reasons for the high transaction costs for innovations in the building sector (Williamson, 1991; Hobbs, 1996). Moreover, the instability of the production environment fragments the supply chains and determines low efficiency and high unpredictability (Black et al., 2000). A controversial aspect for the adoption of green innovations in buildings is the size of firms. Most firms operating in the sector are SMEs with a low degree of specialization (Manseau and Shields, 2005). These firms, instead of considering the adoption of green technologies, refuse them or prefer simple ones. In fact, nowadays construction firms often replace traditional components with green ones without a systemic approach to green building (Vermeulen and Hovens, 2006). Looking at the transition to green buildings and given the non-integrated structure of the construction sector, the organization of construction processes is studied by investigating inter-firm relationships and the characteristics of the firms involved. Inter-Firm Relationships in Construction Processes Approaches centered on inter-firm relationships, such as the OECD's Oslo model (2003), have been shown to be appropriate in analyzing the transition to sustainability of the sector (Pagell and Wu, 2009; Grin et al., 2010; Loorbach et al., 2010). Previous methodologies are appropriate to study the transition of the building sector too, as this requires a re-organization of the process (Walker, 2007). As sustainability issues are too complex and interconnected to be solved by individual firms (Loorbach et al., 2010), researchers have studied inter-firm approaches by analyzing primary firms together with sub-contracting, manufacturing and service companies (Bossink, 2007; Baas, 2008). Inter-firm relationships had received a lot of attention in construction management literature before the request for a transition to sustainability (Albino et al., 1998; Bossink, 2002). However, given the interest in green buildings, studies of changes in inter-firm relationships are particularly urgent (Bossink, 2007). In the construction sector, inter-firm relationships are fragmented but frequent. Having looked at homebuilders in the US, Eccles (1981) found a low number of subcontractors considered for performing each trade in the project, a long-term business relationship between each homebuilder and the subcontractors, and a low frequency of formal
competitive bidding procedures for the selection of subcontractors. Later, Dioguardi (1983) de fined the concept of 'macrofirm' to indicate the large stable network of contractors and subcontractors. Finally, Dahl and Dalum (2001) defined the 'construction cluster' to stress the frequent relationships between construction firms. The key firm when considering the relationships in construction is the general contractor, as it manages the subcontractors, material and service suppliers, design consultants and customers (Winch, 2010). Different relationships between a firm and its suppliers have been recognized in the literature, spanning from basic trading negotiation to partnering (Bresnen and Marshall, 2000) and comakership (Lamming, 1993). Cooper and Ellram (1993) stated the differences between traditional trading relationships and supply chain management in terms of information sharing, coordination, joint planning and amount of shared risk. In the construction sector, relationships between firms are often far from the criteria of supply chain management, given the low levels of integration with suppliers (Hobbs, 1996; Bresnen and Marshall, 2000; Bossink, 2002). Focusing on supplier sourcing, Vrijhoef (2007) identi fied four relationships with suppliers: price-focused incidental sourcing, quality-focused sourcing, collaborative integral sourcing and integrated chain sourcing focused on early supplier involvement and transfer of responsibilities. This last selection strategy has been shown to be propaedeutic to increasing the rate of innovation of a process and to building a comakership relationship with the supplier (Womack et al., 1990; Lamming, 1993; Pagell and Wu, 2009). Comakership has been largely investigated in the literature on organization. It is defined as a mutually intensive and integral relationship based on openness and trust (Compton and Jessop, 1995). Lamming (1993) indicated that, when considering levels of cooperation with suppliers, comakership is the most powerful strategy because it encourages a joint approach to problems. In fact, the active involvement of suppliers in a partnership relationship allows opportunities for innovation to be identi fied by exploiting suppliers' strength and expertise, which is particularly useful in innovative environments. Looking at the evolution of networks of firms involved in sustainable innovation adoption, Foster and Green (2000) described several successful relationships between partnering firms in the chemical, manufacturing, and energy sectors. They found that, to speed up the development of greener products and services, supply companies with the capacity and will to innovate need room to push their sustainability related abilities. The importance of supply chain management in the production of sustainable goods has received increasing attention (Seuring and Muller, 2008; Seuring, 2011). Referring to green building processes, partnership with suppliers has been described by Dahl and Dalum (2001) and Vermeulen and Hovens (2006). In both papers the integration of the general contractor with suppliers proved to be a key factor to the adoption of innovations. An important inter-firm relationship in construction processes is that between the general contractor and the design team. Although the latter often acts as a service supplier for the general contractor (Bossink, 2007), its power and in?uence over the final construction are much more important than those of any other supplier. In fact, material and design choices are mainly the responsibility of the design team, which is consequently a primary actor for changes in the organization of processes for green building (Maciel et al., 2007). Finally, the relationships between the general contractor and material and equipment suppliers, and between the general contractor and the design team, have to be considered in analyzing the characteristics of inter-firm organization.
Characteristics of Firms for Green Partnerships When analyzing changes in the organization of construction processes adopting green innovations, it is important to consider a few characteristics of the firms involved. In particular, their specialization is fundamental for partnership selection and for building innovative environments (Kemp et al., 1998; Grin et al., 2010). The characteristics of firms have been shown to be determinant for the successful integration of sustainable innovations in many sectors moving to sustainability (Runhaar et al., 2008; Nill and Kemp, 2009; Loorbach et al., 2010). Albino et al. (2009) showed the importance of the sustainability specialization of firms which are involved in the development of green products. In particular, looking at sustainability driven companies, they found a high correlation between the development of green products and the existence of environmental strategies. A similar finding has also recently been proven in the construction sector, where firm specialization and sustainability strategy have been discussed both for the general contractor (Son et al., 2011) and the suppliers (Brown and Vergragt, 2008).
Green buildings and organizational changes
Sustainability specialization can be related both to previous experience and to speci fic qualifications in sustainability. Unfortunately, the building sector is seldom able to recognize firm specializations. Gluch (2005) has shown the great importance that sustainability related experience can have for suppliers of green buildings. In fact, their knowhow about green issues has proved fundamental in solving the unexpected problems of green buildings. Considering the high power that the design team has in managing innovations in construction, some studies have focused on the sustainability specialization of the design teams involved in innovative construction projects (Maciel et al., 2007). This has shown that the sustainability related experience of the members of the design team is fundamental for the integration of sustainability principles into the building. Another way to allow the specialization of a firm to emerge is by looking at its sustainability certification. Poor knowledge of certification programs has been recorded for Italian firms (ANCE, 2011). In Italy, inter-firm relationships are often based on labour-only subcontracting and cheapest option. Both these approaches discourage the certi fication of firms. However, in the last 20 years, the spread of the sustainability paradigm worldwide has favored the diffusion of certification systems to assess the sustainability of buildings and the competences of the actors (Berardi, 2011). Consequently, in many countries, certifying associations have been created both to assess the buildings and to recognize expertise and leadership in sustainable construction. These elements represent a new factor for inter-firm relationships in the building sector, and are becoming a marketable skill for firms involved in sustainable projects. In this way, a clearer process of specialization in sustainability topics has been recorded worldwide. Previous sustainability certifications have been used as labels to show experience in sustainable projects (Maciel et al., 2007). Finally, to analyze the organizational changes related to the green transition of the construction sector, it is important to consider the level of specialization of the firms involved (general contractor, suppliers and design team), and their sustainability qualifications.
Research Model and Features of Analysis
The discussion of organizational characteristics in construction processes has shown the importance of considering both inter-firm relationships and the characteristics of the firms involved. Based on literature findings in the second section, four features have been selected for the analysis of construction processes. They are
• the • the • the • the
level of integration between the general contractor and its suppliers, level of integration between the general contractor and the design team, degree of specialization in sustainable buildings of the firms involved in the process and qualifications related to sustainable buildings of the firms in the process.
One or more proxy variables are chosen for the assessment of each of the above features. Before describing these, it is important to remember that the study consisted of qualitative research. Consequently, previous variables have been considered qualitatively, as themes of analysis more than quantitative variables. The variables that were selected to describe the level of integration between firms (relationships between general contractor and supplier, general contractor and design team) are the phase of the process in which the relationship started, the reasons for the selection and the frequency of transactions between the firms. The variables for the degree of specialization of the firms involved in the construction process (the general contractor, the design team and the suppliers) are the proportion of their portfolio that involves sustainable projects, and the presence o f environmentally related qualifications. The units of analysis for the four features are different, being the dyadic relationship between the construction firm and its suppliers when the integration relationships are assessed (units of analysis 1 and 2 in Figure 1), and the firms and their activities when portfolio and environmental certi fications are evaluated (units of analysis 3 and 4 in Figure 1). Figure 1 summarizes the framework used to analyze construction processes. Suppliers in the sector have been divided into three categories: subcontractors, materials, and equipment suppliers, in order to divide the suppliers of the general contractor according to the main subgroups (Manseau and Shields, 2005). The adoption of the
Figure 1. Organizational relationships of the construction processes and units of analysis of the research
units of analysis should not be interpreted analytically, because the research was qualitative and used a case study methodology (Myres, 2008). Consequently, the units of analysis have been considered as elements of observation. This research assumed that mutual relationships exist between the previous organizational features and the greenness level of the building. This does not mean that the proxy variables and sustainability level of the building act similarly to (in)dependent variables, but that they reciprocally in?uence each other. In fact, construction activities are often unplanned and many adjustments and choices are made during construction, depending on the possibilities created by the actors themselves. The hypothesis of this paper is that the variables described above show how buildings with different sustainability levels can be realized differently. This paper aims to compare the features of traditional and green building processes with the hope of identifying the organizational relationships which could be adopted in the construction of green buildings. With this aim in mind and considering the units of analysis, this research is designed to understand whether the construction of a green building requires
• a high level of integration between the general contractor and its suppliers, • a high level of integration between the general contractor and the design team, • involving firms with a specialization in sustainable building and • involving firms with certification in sustainable building.
As the recognition of a sustainable building is often a difficult task, the number of green innovations is considered as a qualitative proxy indicator. Moreover, in order to classify the innovativeness of the project and to evaluate the awareness of sustainability related topics, the integration level of each green innovation in the building is considered. Finally, among other variables that can in?uence the organization of a construction process (Bossink, 2007), the size and location of the building and the structure and size of the general contractor should be considered.
Case Studies
The previous section presented the model of analysis to study which modifications are occurring in construction processes in the transition to sustainability. Using this framework, a case study methodology was selected. The adoption of a case study methodology was justified by the exploratory and interpretative characters of the study (Yin, 2009). Moreover, the examination of the interactions in complex and variable organizations such as
Green buildings and organizational changes
construction seemed particularly suited to analyze through case studies (Halinen and Tötrnroos, 2005). In fact, case studies allow better understanding of context speci ficities by collecting direct information about organizational relationships through interviews. The theories of interest for this analysis are network analysis (Kenis and Oerlemans, 2008) and decision analysis (Mintzberg, 1979). However, the above theories were not used as analytical tools. In fact, the research used qualitative methodology in order to better investigate organizational relationships for the adoption of green innovations.
Research Methodology Three construction projects were selected. The organizational features previously described were captured through semi-structured interviews with the most involved stakeholders. For each case study, the project manager of the general contractor, the head of the design team and the main suppliers of the general contractor were interviewed. After having interviewed the project manager of the general contractor, the design team and suppliers were then asked selected questions. In this way, multiple interviews allowed triangulation of the answers, especially those regarding the relationships between the firms. The interviews were conducted between February and May 2011. Each interview lasted 1.5 hours on average and it was recorded and transcribed. The aim of the interviews was to find out and assess the organizational practices of the construction firms. A semi-structured questionnaire was used to collect answers, but the interviews maintained an open character allowing new dimensions, not identified in the analytical framework, to emerge. In the case of discrepancies between responses, the interviewees were re-contacted to clarify and eliminate the discrepancy. Several situations required further dialogue with the general contractor and with the suppliers. Additional informa- tion was also collected through these informal and less structured interviews. The semi-structured interview has been shown to be particularly useful in collecting data about the organization and innovation of firms involved in construction projects (Slaughter, 1993; Bossink, 2007). The interviews consisted of both descriptive and numerical answers. The collection in a qualitative study of a few quantitative questions has been shown to be useful to assess the consistency of qualitative answers with corresponding quantitative values (Myres, 2008). A similar method was successfully applied in a recent study of stakeholders ' preferences for the adoption of green technologies (Parnphumeesup and Kerr, 2011). Triangulation of results was obtained by checking secondary information such as the findings of visits to the jobsite, direct observation of meetings and discussion between firms. Moreover, the authors were able to analyze the design documents and contracts for all three projects. This source was particularly useful to reveal the performance requests that the general contractor made to suppliers. At the end of the interviews, a report for each case study was created to present the evidence (Yin, 2009). This report was shown to the general contractor and discussed with him. The interviews, together with the documental materials, focused on the management of the construction activities, the organization of inter-firm relationships and the way in which the green issue affects them. The interview was structured in the following parts:
• general information about the project, and activities and involvement of the interviewee; • the sustainability related qualification of the interviewee and of the suppliers; • the level of integration of the general contractor with suppliers; • the green innovations which have been adopted in the building; • the drivers and barriers for the adoption of green innovations. After a descriptive response, the interviewee ranked
a list of drivers and barriers for the adoption of green technologies.
Selection of the Case Studies The main difficulties of studies of organizational aspects in the construction sector are site speci fic. In fact, any building is a single, unique and unrepeatable case. This makes the selection of cases dif ficult and complicates drawing general conclusions from single case observations (Bossink, 2007).
In order to limit the in?uence of regulations and context speci fics, three case studies were selected in a limited geographical area. This was a medium sized city in the Apulia region in Italy. The general contractors of the three projects were small firms with less than 20 employees and with two to four quali fied people in charge of technical duties. SMEs represent 96% of Italian construction firms (ANCE, 2011). This high percentage is a barrier to the introduction of sustainable innovations in this country (Son et al., 2011). In fact, in other countries, a number of very large firms dominate the residential market and their management structure has been shown to be better able to manage the sustainable transition of the construction sector. For reference, the results of Bossink (2007) show the case of the Netherlands. Looking for cases, the authors selected projects in which construction firms guaranteed unrestricted access to information. Although this selection criterion implied some biases, it was important to guarantee access to the work site and to all the contracts between firms. During case study selection, the evaluation of buildings of different typologies showed widely different organization, in agreement with the findings of de Blois et al. (2011). In fact, the organizational aspects between the firms involved in office, residential or other building typologies are very different. Consequently the selected case studies did not differ too much in architectural and typological design. Only residential buildings were selected. Many reasons justify this choice: the size and importance of the sector make its greening up unavoidable, whereas the complexity and the fragmentary nature of the residential sector make the adoption of green technologies more difficult. The choice of residential buildings was also justified by considering that, of the more than 135 000 million Euro invested in the construction sector in 2010 in Italy, approximately 74 000 million Euro was spent on residential buildings (ANCE, 2011). As the size of the project is an in?uencing factor over firms' organization, selected case studies were medium size projects with 50 apartments on average. This size was chosen as being representative of the building sector in the Apulia region. Description of the Case Studies All the case studies were private projects in which the general contractor owned the land and acted as real estate developer and general contractor. This overlap of roles often characterizes average-size residential projects in Italy, and in many other European countries (ANCE, 2011). As the study aimed to focus on organizational diversities related to the greenness of the building, in sampling the case studies the authors looked for contrasts in green characteristics. Project I was a social housing intervention. Construction was not originally allowed on the land where the buildings were to be sited. The general contractor applied for a program to provide 'social housing', and following a specific agreement with the regional and local government he received permission to build 32 detached houses. The construction was authorized thanks to this agreement, as without it no houses could be built. This situation gave a lot of power to the local government, which used this power to limit the sale price of the houses. In fact, the agreement expressly constrained the general contractor on the future price, but did not report any conditions on the characteristics of the houses, such as their sustainability level. Project II was urban regeneration, in which the general contractor built houses of different dimensions, quality and sale prices. In order to increase the number of houses which he could build, the general contractor signed an agreement with the municipal government. This agreement was voluntarily signed by both parties (the general contractor and the municipal government), and it focused on the possibility to increase the building surface after having built some public services for the community (a few public toilets and a garden). Project III was a private intervention in which the general contractor was free from constraints and could build and sell the houses deciding on all the features. He bought the land and submitted the building project to the local government for approval. In this case, the power of the municipal government was limited to the simple authoriza- tion for building according to the law. All three case studies were realized between 2008 and 2011, following the same regulations and within a distance of a few kilometers from each other. In the same way, they affected each other: general contractor III revealed that he had decided to adopt many green technologies to mark the difference between his houses and those in other projects such as the low-price houses in project I.
Green buildings and organizational changes
The three projects had different rates of innovation adoption. Table 1 reports some of their green technologies. Project I did not have any significant innovations. Project II adopted some innovations and, in particular, some green ones: for example, a rainwater harvesting system for irrigation purposes. Project III adopted, among other things, a rainwater filtration system, a highly efficient ventilated facade and active air conditioning radiant systems. Table 1 reports a classification of the case studies as traditional or brown building for project I, and innovative or green building for projects II and III. Moreover, according to the kinds of innovation adopted in the projects, the two green projects have been classified as modular and architecturally innovative projects, respectively. Modular implies an innovation within a system with no changes in other components, whereas architectural corresponds to an innovation that determines new ways of assembling and organizing practices (Henderson and Clark, 1990; Slaughter, 1993). The many green innovations in project III have been considered architectural innovations because they changed the traditional configuration of the building sub-components or the order of construction activities. The construction phases in project II were similar to those in project I. In fact, the innovations adopted mainly regarded modular changes. The interviews showed that most of these changes were not planned, and the decision for adoption was made during construction. For example, the general contractor of project II declared that he had always fitted traditional boilers, and during construction the design team proposed adopting condensation boilers. Later on, the general contractor evaluated the possibility with the equipment supplier and decided on the adoption of this system in all the houses. This green innovation changed the equipment of the air conditioning system, but it did not provoke any change in the series of construction phases. In contrast, some innovations adopted in project III required signi ficant changes in the order of construction activities. For example, the water filtration system was realized during the realization of the foundations of the building. This overlap of functions required the presence of plumbers and carpenters on the jobsite at the same time. Similarly, the highly efficient ventilated facade was produced and installed by a specialized firm. This required the other subcontractors to leave the jobsite while the specialized firm was working. Finally, the realization of active radiant systems required the air conditioning tubes to be embedded in the stru ctural?oor slab, and consequently anticipating the construction of the air conditioning system during that of the building structure. A similar change in construction phases was caused by the adoption of photovoltaic panels on the roof in project III. In fact, the adoption of photovoltaic panels was decided from the stage of building design, and the roof was designed with the best inclination for the photovoltaic panels. Interviewed about this, the design team of project III declared themselves to have been excited at the idea to adjust the inclination of the roof for such a reason.
Results
Having described green innovations in each case study, it is possible to look at organizational relationships between the firms involved in the construction processes. Table 2 summarizes the findings of the interviews, grouping them according to the model described in the third section. The results of the study have been condensed following these
Project
Classification for adopted innovations Brown project Green project Traditional project Modular innovations Architectural innovations
Green innovations
Adopted green innovations
Project I Project II Project III
None Few Several
Water harvesting system, condensation boiler, highly insulated envelope Water filtration system, ecological plaster, thermal bridge correction, photovoltaic integrated panels, active radiant systems
Table 1. Case study classification for adopted green innovations in the three projects
Table 2. Case studies results according to the features of analysis (? , present in the project ~ X= lightly present in the project)
parameters: level of integration between the general contractor and suppliers, level of integration between the general contractor and the design team, sustainability specialization and sustainability quali fications of firms. Looking at the reasons for supplier selection, availability and economic convenience were the main reasons declared by the general contractors of projects I and II. In contrast, supplier selection in project III was based on experience, knowhow and specialization of the supplier and on transfer of responsibilities. In this case, the general contractor's necessity to limit the risks related to the adoption of innovations emerged. Moreover, early involvement in the project was recorded for several suppliers. Involvement was considered early when the supplier was contacted earlier than in traditional buildings, and possibly already at the design stage. For example, the supplier of the ventilated facade declared he had been contacted at the beginning of the design phase to judge the feasibility of the facade. From that time, he was always in contact with the general contractor, and he exchanged plans and documents almost every two weeks for the whole year from the first contact to the realization of the facade. As shown, the relationship between the general contractor and the design team is fundamental in construction processes. Previous collaborations with the design team proved the most important parameter for selection in projects I and II. In contrast, the general contractor of project III chose a famous architect with whom he had no experience, who was well known for sustainable projects. In contrast to other suppliers, during the selection of the design team, economic considerations had no importance in any of the three case studies. Moreover, the involvement time of the design team was also independent of the innovativeness of the project, as early involvement was recorded in every project. An interesting aspect of project III was the necessity to select, together with the design team, several specialized consultants too. A specialized consultant for the energy systems in the building and a sustainability assessor only took part in project III. In this way, more designers and consultants participated in the project. In every case study, no members of the design teams had a sustainability qualification, and the three general contractors also lacked sustainability qualifications. Moreover, the general contractor of project III had no experience in green buildings. Interviewed about the adoption of green technologies in the project, he declared that, since the beginning of the project, he had decided to realize an innovative building with sustainable features. He thought this was the only way to reduce the competition which other projects were exercising over his sales. For this reason, he contacted suppliers looking at their capacity to satisfy the necessity and he selected the architect for his visibility and experience in sustainable projects.
Green buildings and organizational changes
Finally, the general contractor of project III applied for and was awarded a sustainability certi fication label for the building. This label was used for signaling purposes in marketing material, and represented the distinctive element to differentiate his project from other buildings around.
Discussion of Results
Case study results showed several differences between the organization of the three construction processes. Some differences were specifically related to changes necessary to adopt green technologies in the building. In project III a high level of integration between the general contractor and several suppliers occurred. Many suppliers were involved in the building activities earlier than in traditional buildings. New sequences of activities were necessary, as shown by the presence of plumbers during the realization of the foundations. These changes in the relationships between the general contractor and suppliers were related to the architectural essence of the green innovations in project III. Among the reasons for the selection of suppliers in project III, there was the necessity for the general contractor to limit risks. For example, during the interview, the general contractor expressed fear in managing the problems of the highly innovative facade, so he transferred the responsibility for proper assembling and functionality of the fa- cade to the supplier. This also clearly emerged in the contract related to the facade, in which the supplier guaranteed the building component for 10 years. The supplier of the facade declared that they guarantee their products for a long time as they control all the phases of construction, and they are specialized in it. The risk of improper operation was also transferred by contract to the supplier for the water filtration system in project III. In project III, the prolonged and intensive relationships between the general contractor and suppliers often assumed the characteristics of comakerships. In fact, these suppliers realized the executive plan of the innovative technologies and discussed the design realization at length with both the general contractor and the design team. This management was necessary to overcome the dif ficulties raised by the adoption of the green innovations. Risk limitation is a typical feature in home construction (Slaughter, 1993). All three project managers ranked it as a significant barrier to the adoption of green innovations. Coherently, in project III, the general contractor selected suppliers of the green innovative technologies considering their ability to entirely manage and build the subcomponent. The choice to externalize risky activities resulted in changes of construction practice and also in the necessity of new relationships. The general contractor of project III revealed the lack of sustainability specialization among its traditional suppliers. He was obliged to select few new firms and to start different kinds of relationship with these specialized suppliers. These realized the design, supply and mounting of the subcomponent integrally. Consequently, their power was significantly greater in the green innovative project, where they were asked to integrate their knowledge both in products and in processes. The integration of suppliers ' knowledge led to mixed paths in knowledge sharing between firms (Nonaka, 1994). In particular, both the general contractor and the suppliers were obliged to externalize their knowhow and to communicate to each other the desires and problems related to the green innovative technology. The co-design between the design team and suppliers of building subcomponents revealed an externalization process of knowledge creation. This reinforces the idea that a comakership relationship emerged in the organizational process of a green building (in the units of analysis 1). Albino and Sivo (1992) stated that comakership is rare in residential building projects. The results of the present paper partially contradict this, because the comakership level was more related to the greenness of the project than to the building typology. Consequently, residential buildings can also show high comakership levels, as in the green innovative project. In all the case studies, supplier selection seemed little in?uenced by specialization of suppliers in sustainable pro jects. Table 2 shows that, also in the most innovative project, the ratio of sustainable over non-sustainable portfolio for several suppliers showed a low value. In fact, the general contractor of project III declared that, also for suppliers with high technical skills and high specialization, their previous experience in sustainable projects was reduced. This confirmed Eccles' findings (1981) about the lack of specialization in the construction sector. The reasons for the selection of the design team of project III represent an interesting outcome. Limited experience and risk adversity of the general contractor led him to prefer a design team with experience in green building
projects. Consequently, the degree of specialization and the experience of the design team played an important role in the selection of the design team for the green innovative project. The interviews revealed that difficulties had emerged with suppliers' competencies and specializations in all the case studies. The general contractor of project I declared that previous collaborations and affordability were by far the main parameters for the selection of suppliers. He said he personally knew all the people working on the jobsite and all the material and equipment suppliers, so he did not ask the suppliers for (sustainability) certi fications. Obviously, in traditional projects the lack of formal competitive bidding procedures limit the room for specialization. However, the selection of specialized firms for green innovative subcomponents, such as the water filtration system in project III, represented a new element in supplier selection in building processes. The sustainability qualification of firms had a limited in?uence over the greenness level of the project and their selection. In fact, no environmental qualification was recognized in the case studies despite their different green levels. This contrasts with results of other studies (Bossink, 2007). In fact, in the context of analysis, the sustainability qualification was not common, and suppliers were selected more for their capabilities than for their level of quali fications. This outcome means a low penetration of certification programs related to sustainability in the context of analysis. Finally, the achievement of a sustainability label for project III represented a signaling element for the general contractor. The label was considered a distinctive element for the project, and many suppliers during the interviews remarked on the presence of the green label in the project. This con firms that the promotion of green buildings can be supported by sustainability labels.
Conclusions
This paper has discussed the context of analysis and first results of a larger study. It has presented the research model and the features of analysis that were selected to study the organizational changes in green building processes. The general hypothesis of the research was that a transition to sustainability of the construction sector corresponds to new relationships between firms in the construction organization. Inter-firm relationships and the characteristics of the firms involved have been considered to understand pathways for a transition to sustainability. This paper has shown the importance of new organization of construction processes for green residential build- ings. The results of the analysis suggest that, to realize sustainable buildings, a higher level of integration between the general contractor and suppliers is required. A level of integration up to the level of comakership can be favorable to engage the ability of the suppliers for green innovative technologies. Comakership has also proved necessary to engage suppliers' responsibility for the sustainability of the final product. This paper has shown that the selection of a design team with experience in sustainable buildings is particularly important, especially when the general contractor wants to realize a sustainable building and has no specialization in it. The paper has shown how difficult is for suppliers' sustainability specializations to emerge. However, the case studies have demonstrated that a sustainable building requires specialized suppliers, especially when risks for the green innovation are transferred to them. Sustainability certification has proved uncommon among all the firms involved in the three case studies. In fact, suppliers were selected more for their cheapness, capability and experience than for their quali fications. The results of this study agree with many literature findings in other sectors. However, the adoption of a qualitative case study methodology prevents generalizations to be made about the results of the study outside of Italian medium-size projects. The paper contributes to studies of organizational relationships for sustainable constructions, and provides an initial insight into the Italian green building sector. However, in order to incentivize the transition to green buildings, a specific analysis of the effects of different sustainable technologies over the organization of construction processes is necessary. This paper has avoided discussing the in?uence of tools of interaction between firms. However, these are promising instruments to investigate the characteristics of inter-firm relationships between the general contractor and other firms. Attention should be paid to interaction aspects in further research. Moreover, the possibility to compare
Green buildings and organizational changes
findings of the present paper with organizational changes in other typologies of buildings, in other geographical areas, and in other sectors remains desirable. Finally, an aspect that has been neglected in this paper but that is important for policies for sustainable building is the role of local governments. In every case study, the local government had the opportunity to promote sustain- able construction, but its main attention was directed towards other aspects. This decoupling between international and national policies, and local government activities, needs much attention.
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doc_996309390.docx
Case Studies in Green Buildings and Organizational Changes: Italian:- Green building (also known as green construction or sustainable building) refers to a structure and using process that is environmentally responsible and resource-efficient throughout a building's life-cycle: from siting to design, construction, operation, maintenance, renovation, and demolition.
Case Studies in Green Buildings and Organizational Changes: Italian
ABSTRACT International policies indicate the building sector as one of the most promising for sustain- able development. According to the Intergovernmental Panel on Climate Change (IPCC), it has the greatest and cheapest potential for delivering significant greenhouse gas emission reduction. However, early experiences of sustainable construction have shown that both a social and a technical transition are required. Consequently, the changes in organizational aspects of firms involved in construction represent an urgent research theme. This paper investigates how inter-firm relationships are changing as the sector moves towards green building. The organizational model between firms is described at the integration level with suppliers, the integration level between the general contractor and the design team, the degree of specialization of involved firms and their sustainability certifications. These features have been analyzed in case studies collecting data through interviews. This paper compares organizational aspects in traditional and green buildings. Results suggest that green buildings are associated with inter-firm relationships of comakership with suppliers and with the design team, and with firms with a portfolio focused on sustainable projects. Finally, among the case studies, sustainability related certifications are scarcely related to the greenness level of the building. Copyright © 2012 John Wiley & Sons, Ltd and ERP Environment.
Keywords: construction sector; organizational changes; sustainable construction; green building; socio-technical transition; supplier network; comakership
Introduction
CLIMATE CHANGE HAS RAISED CONCERNS OVER THE RAPIDLY GROWING DEPLETION OF THE
ENVIRONMENT AND ITS resources. In this scenario, international programs and policies indicate the green
building sector as one of the most promising for sustainable development (IPCC, 2007). Laws and regulations around the world are encouraging the building sector to move to sustainability. The great attention on buildings arises from their energy consumption and greenhouse gas (GHG) emissions, which, in developed countries, represent 30 and 40% of the total quantities, respectively (IPCC, 2007; IEA, 2010). The building sector contributes 5% of US and 6% of China's gross domestic product, and it represents a large
and valuable sector in every country's economy, with a global average of 10% of country-level employment
(UNEP-SBCI, 2009). According to the Intergovernmental Panel on Climate Change (IPCC), the building sector has higher energy and pollution reduction potential than any other sector (IPCC, 2007). The IPCC states that in countries that are not members of the Organisation for Economic Cooperation and Development (non-OECD) and in economies in transition, the potential CO2 saving of building could be 3 and 1 Gt CO2-eq/y by 2030, respectively, with a total possible reduction of 6 Gt CO2-eq/y worldwide. This paper focuses on residential buildings, as these represent the large majority of buildings. In Europe, the residential building stock is 75% of the total building stock (ANCE, 2011). This percentage regards both existing buildings and new constructions. In particular, 55% of Italian annual investment in the construction sector is on residential buildings (ANCE, 2011). This helps to explain the importance of the residential sector. The European building sector is currently in ferment given the 2010/31/EU Directive (the recast of the Energy Performance of Buildings Directive), which aims to build only nearly zero energy buildings after 2020. This target represents a radical transformation of current practice. For example, in Italy, new residential buildings have average energy requirements of over 100 kW h/m2/y (ANCE, 2011). The gap between current practice and requirements in 8 years shows the urgency of a systemic transition of the sector towards green building. This paper focuses on medium-sized residential projects. The size of the projects was chosen because of the greater difficulties in introducing green and energy saving technologies in medium-sized projects (Williams and Dair, 2007; Winch, 2010). In particular, given the representativeness of the Italian construction sector for other European countries and the lack of studies of sustainable construction in Italy, construction processes for new residen- tial buildings in Italy are discussed. The efforts to increase the diffusion of green building are growing at international and national levels. R&D continually offers new products and processes facilitating the transition to sustainability (Rohracher, 2001), and many products for sustainable buildings already exist (Butera, 2010). Several studies have shown that both the tech- nical and economic potential for green buildings exists (Hoffman and Henn, 2008; Svenfelt et al., 2011). However, the construction sector is particularly slow in moving towards sustainability (Vermeulen and Hovens, 2006). Many researchers have investigated barriers to the diffusion of green building as recently reported by Häkkinen and Belloni (2011). Economic and knowledge factors are pointed out by Cooke et al. (2007) and Pinkse and Dommisse (2009). Howarth and Andersson (1993) discussed the persistence of building technologies as a barrier to innovation. Gluch (2005) indicated that the risks for the adoption of green innovation are generally avoided because buildings are unique, expensive and lasting. An important barrier to the adoption of green innovations is the structure of the construction process (Manseau and Shields, 2005; Williams and Dair, 2007). This is based on temporary relationships between many firms who collaborate side by side within a single project perspective (Anumba et al., 2005). In this context, the adoption of green technologies is contrasted by an agent versus agent problem: the general contractor and the suppliers, which should make the investment in new technologies, often have low interest in doing so because the main bene fit is for the end-user (Howarth and Andersson, 1993; Son et al., 2011). Several studies have investigated how construction firms are modifying their practice in order to adopt green innovations (Rohracher, 2001; Brown and Vergragt, 2008). The main result is that new organizations of construction processes are necessary; meanwhile, firms have to acquire the knowledge necessary for the sustainability transition of the sector. However, no clear idea exists about how the relationships between firms need to evolve. Existing studies have focused on commercial and office buildings and rarely looked at residential buildings. Moreover, the Italian construction sector has never been considered. Hopefully, this paper will contribute to filling in these gaps. In this paper, the organizational relationships between firms involved in construction processes are considered. The research aims to investigate how these relationships change as the sector moves towards sustainable practices for green buildings. This paper is interested in finding how these relationships evolve. In particular, given the key role played by the general contractor in the construction process (Winch, 2010), this paper aims to answer this question: which modifications in the relationships between the general contractor firm and the other firms are there in green buildings? Before continuing in the discussion about sustainable constructions, it is useful to clarify the concept of green building. In this paper, a green building is de fined as a building with high efficiency in the use of energy, water and materials and reduced impact on human health and the environment in its complete life cycle (Cassidy,
Green buildings and organizational changes
2003). Threshold limits for the concepts of high efficiency and reduced impacts go beyond the scope of the present research, although the differentiation between green buildings and non-green ones is performed using international sustainability assessment systems (Berardi, 2011). This paper is structured in the following manner: the following section describes inter-firm organization in construction processes. Based on literature results, the next section presents a research model for the analysis of organizational changes of construction processes; the fourth section reports the methodology of research and describes the investigation of organizational features in some case studies together with the results of data collection. The fifth section discusses the results and tries to respond to assumptions in the second section. To do this, the organizational features are analyzed stressing the differences between inter-firm organization in traditional and green buildings. The paper ends with some conclusions and suggestions for future work.
The Organization of Construction Processes
The construction process is the series of activities of planning, realization and direction through which materials and equipment are assembled into a building (Walker, 2007). These activities are not limited to those realized on the jobsite. Consequently, firms working at the jobsite, first order suppliers and other actors of the process, such as the design team or real estate financier, have to be considered when investigating the construction process. In fact, the analysis of only jobsite actions gives a misleading view of the complexity of the construction process, which has been shown to be much more varied (Manseau and Shields, 2005). All the activities and relationships from the urban plan and negotiations for a building to completion of the building are considered in this paper. Given the large number of firms in construction processes and the non-integrated structure of the sector, the organization of the processes is fundamental. The uncertainty and fragmentary nature of construction processes have been suggested as reasons for the high transaction costs for innovations in the building sector (Williamson, 1991; Hobbs, 1996). Moreover, the instability of the production environment fragments the supply chains and determines low efficiency and high unpredictability (Black et al., 2000). A controversial aspect for the adoption of green innovations in buildings is the size of firms. Most firms operating in the sector are SMEs with a low degree of specialization (Manseau and Shields, 2005). These firms, instead of considering the adoption of green technologies, refuse them or prefer simple ones. In fact, nowadays construction firms often replace traditional components with green ones without a systemic approach to green building (Vermeulen and Hovens, 2006). Looking at the transition to green buildings and given the non-integrated structure of the construction sector, the organization of construction processes is studied by investigating inter-firm relationships and the characteristics of the firms involved. Inter-Firm Relationships in Construction Processes Approaches centered on inter-firm relationships, such as the OECD's Oslo model (2003), have been shown to be appropriate in analyzing the transition to sustainability of the sector (Pagell and Wu, 2009; Grin et al., 2010; Loorbach et al., 2010). Previous methodologies are appropriate to study the transition of the building sector too, as this requires a re-organization of the process (Walker, 2007). As sustainability issues are too complex and interconnected to be solved by individual firms (Loorbach et al., 2010), researchers have studied inter-firm approaches by analyzing primary firms together with sub-contracting, manufacturing and service companies (Bossink, 2007; Baas, 2008). Inter-firm relationships had received a lot of attention in construction management literature before the request for a transition to sustainability (Albino et al., 1998; Bossink, 2002). However, given the interest in green buildings, studies of changes in inter-firm relationships are particularly urgent (Bossink, 2007). In the construction sector, inter-firm relationships are fragmented but frequent. Having looked at homebuilders in the US, Eccles (1981) found a low number of subcontractors considered for performing each trade in the project, a long-term business relationship between each homebuilder and the subcontractors, and a low frequency of formal
competitive bidding procedures for the selection of subcontractors. Later, Dioguardi (1983) de fined the concept of 'macrofirm' to indicate the large stable network of contractors and subcontractors. Finally, Dahl and Dalum (2001) defined the 'construction cluster' to stress the frequent relationships between construction firms. The key firm when considering the relationships in construction is the general contractor, as it manages the subcontractors, material and service suppliers, design consultants and customers (Winch, 2010). Different relationships between a firm and its suppliers have been recognized in the literature, spanning from basic trading negotiation to partnering (Bresnen and Marshall, 2000) and comakership (Lamming, 1993). Cooper and Ellram (1993) stated the differences between traditional trading relationships and supply chain management in terms of information sharing, coordination, joint planning and amount of shared risk. In the construction sector, relationships between firms are often far from the criteria of supply chain management, given the low levels of integration with suppliers (Hobbs, 1996; Bresnen and Marshall, 2000; Bossink, 2002). Focusing on supplier sourcing, Vrijhoef (2007) identi fied four relationships with suppliers: price-focused incidental sourcing, quality-focused sourcing, collaborative integral sourcing and integrated chain sourcing focused on early supplier involvement and transfer of responsibilities. This last selection strategy has been shown to be propaedeutic to increasing the rate of innovation of a process and to building a comakership relationship with the supplier (Womack et al., 1990; Lamming, 1993; Pagell and Wu, 2009). Comakership has been largely investigated in the literature on organization. It is defined as a mutually intensive and integral relationship based on openness and trust (Compton and Jessop, 1995). Lamming (1993) indicated that, when considering levels of cooperation with suppliers, comakership is the most powerful strategy because it encourages a joint approach to problems. In fact, the active involvement of suppliers in a partnership relationship allows opportunities for innovation to be identi fied by exploiting suppliers' strength and expertise, which is particularly useful in innovative environments. Looking at the evolution of networks of firms involved in sustainable innovation adoption, Foster and Green (2000) described several successful relationships between partnering firms in the chemical, manufacturing, and energy sectors. They found that, to speed up the development of greener products and services, supply companies with the capacity and will to innovate need room to push their sustainability related abilities. The importance of supply chain management in the production of sustainable goods has received increasing attention (Seuring and Muller, 2008; Seuring, 2011). Referring to green building processes, partnership with suppliers has been described by Dahl and Dalum (2001) and Vermeulen and Hovens (2006). In both papers the integration of the general contractor with suppliers proved to be a key factor to the adoption of innovations. An important inter-firm relationship in construction processes is that between the general contractor and the design team. Although the latter often acts as a service supplier for the general contractor (Bossink, 2007), its power and in?uence over the final construction are much more important than those of any other supplier. In fact, material and design choices are mainly the responsibility of the design team, which is consequently a primary actor for changes in the organization of processes for green building (Maciel et al., 2007). Finally, the relationships between the general contractor and material and equipment suppliers, and between the general contractor and the design team, have to be considered in analyzing the characteristics of inter-firm organization.
Characteristics of Firms for Green Partnerships When analyzing changes in the organization of construction processes adopting green innovations, it is important to consider a few characteristics of the firms involved. In particular, their specialization is fundamental for partnership selection and for building innovative environments (Kemp et al., 1998; Grin et al., 2010). The characteristics of firms have been shown to be determinant for the successful integration of sustainable innovations in many sectors moving to sustainability (Runhaar et al., 2008; Nill and Kemp, 2009; Loorbach et al., 2010). Albino et al. (2009) showed the importance of the sustainability specialization of firms which are involved in the development of green products. In particular, looking at sustainability driven companies, they found a high correlation between the development of green products and the existence of environmental strategies. A similar finding has also recently been proven in the construction sector, where firm specialization and sustainability strategy have been discussed both for the general contractor (Son et al., 2011) and the suppliers (Brown and Vergragt, 2008).
Green buildings and organizational changes
Sustainability specialization can be related both to previous experience and to speci fic qualifications in sustainability. Unfortunately, the building sector is seldom able to recognize firm specializations. Gluch (2005) has shown the great importance that sustainability related experience can have for suppliers of green buildings. In fact, their knowhow about green issues has proved fundamental in solving the unexpected problems of green buildings. Considering the high power that the design team has in managing innovations in construction, some studies have focused on the sustainability specialization of the design teams involved in innovative construction projects (Maciel et al., 2007). This has shown that the sustainability related experience of the members of the design team is fundamental for the integration of sustainability principles into the building. Another way to allow the specialization of a firm to emerge is by looking at its sustainability certification. Poor knowledge of certification programs has been recorded for Italian firms (ANCE, 2011). In Italy, inter-firm relationships are often based on labour-only subcontracting and cheapest option. Both these approaches discourage the certi fication of firms. However, in the last 20 years, the spread of the sustainability paradigm worldwide has favored the diffusion of certification systems to assess the sustainability of buildings and the competences of the actors (Berardi, 2011). Consequently, in many countries, certifying associations have been created both to assess the buildings and to recognize expertise and leadership in sustainable construction. These elements represent a new factor for inter-firm relationships in the building sector, and are becoming a marketable skill for firms involved in sustainable projects. In this way, a clearer process of specialization in sustainability topics has been recorded worldwide. Previous sustainability certifications have been used as labels to show experience in sustainable projects (Maciel et al., 2007). Finally, to analyze the organizational changes related to the green transition of the construction sector, it is important to consider the level of specialization of the firms involved (general contractor, suppliers and design team), and their sustainability qualifications.
Research Model and Features of Analysis
The discussion of organizational characteristics in construction processes has shown the importance of considering both inter-firm relationships and the characteristics of the firms involved. Based on literature findings in the second section, four features have been selected for the analysis of construction processes. They are
• the • the • the • the
level of integration between the general contractor and its suppliers, level of integration between the general contractor and the design team, degree of specialization in sustainable buildings of the firms involved in the process and qualifications related to sustainable buildings of the firms in the process.
One or more proxy variables are chosen for the assessment of each of the above features. Before describing these, it is important to remember that the study consisted of qualitative research. Consequently, previous variables have been considered qualitatively, as themes of analysis more than quantitative variables. The variables that were selected to describe the level of integration between firms (relationships between general contractor and supplier, general contractor and design team) are the phase of the process in which the relationship started, the reasons for the selection and the frequency of transactions between the firms. The variables for the degree of specialization of the firms involved in the construction process (the general contractor, the design team and the suppliers) are the proportion of their portfolio that involves sustainable projects, and the presence o f environmentally related qualifications. The units of analysis for the four features are different, being the dyadic relationship between the construction firm and its suppliers when the integration relationships are assessed (units of analysis 1 and 2 in Figure 1), and the firms and their activities when portfolio and environmental certi fications are evaluated (units of analysis 3 and 4 in Figure 1). Figure 1 summarizes the framework used to analyze construction processes. Suppliers in the sector have been divided into three categories: subcontractors, materials, and equipment suppliers, in order to divide the suppliers of the general contractor according to the main subgroups (Manseau and Shields, 2005). The adoption of the
Figure 1. Organizational relationships of the construction processes and units of analysis of the research
units of analysis should not be interpreted analytically, because the research was qualitative and used a case study methodology (Myres, 2008). Consequently, the units of analysis have been considered as elements of observation. This research assumed that mutual relationships exist between the previous organizational features and the greenness level of the building. This does not mean that the proxy variables and sustainability level of the building act similarly to (in)dependent variables, but that they reciprocally in?uence each other. In fact, construction activities are often unplanned and many adjustments and choices are made during construction, depending on the possibilities created by the actors themselves. The hypothesis of this paper is that the variables described above show how buildings with different sustainability levels can be realized differently. This paper aims to compare the features of traditional and green building processes with the hope of identifying the organizational relationships which could be adopted in the construction of green buildings. With this aim in mind and considering the units of analysis, this research is designed to understand whether the construction of a green building requires
• a high level of integration between the general contractor and its suppliers, • a high level of integration between the general contractor and the design team, • involving firms with a specialization in sustainable building and • involving firms with certification in sustainable building.
As the recognition of a sustainable building is often a difficult task, the number of green innovations is considered as a qualitative proxy indicator. Moreover, in order to classify the innovativeness of the project and to evaluate the awareness of sustainability related topics, the integration level of each green innovation in the building is considered. Finally, among other variables that can in?uence the organization of a construction process (Bossink, 2007), the size and location of the building and the structure and size of the general contractor should be considered.
Case Studies
The previous section presented the model of analysis to study which modifications are occurring in construction processes in the transition to sustainability. Using this framework, a case study methodology was selected. The adoption of a case study methodology was justified by the exploratory and interpretative characters of the study (Yin, 2009). Moreover, the examination of the interactions in complex and variable organizations such as
Green buildings and organizational changes
construction seemed particularly suited to analyze through case studies (Halinen and Tötrnroos, 2005). In fact, case studies allow better understanding of context speci ficities by collecting direct information about organizational relationships through interviews. The theories of interest for this analysis are network analysis (Kenis and Oerlemans, 2008) and decision analysis (Mintzberg, 1979). However, the above theories were not used as analytical tools. In fact, the research used qualitative methodology in order to better investigate organizational relationships for the adoption of green innovations.
Research Methodology Three construction projects were selected. The organizational features previously described were captured through semi-structured interviews with the most involved stakeholders. For each case study, the project manager of the general contractor, the head of the design team and the main suppliers of the general contractor were interviewed. After having interviewed the project manager of the general contractor, the design team and suppliers were then asked selected questions. In this way, multiple interviews allowed triangulation of the answers, especially those regarding the relationships between the firms. The interviews were conducted between February and May 2011. Each interview lasted 1.5 hours on average and it was recorded and transcribed. The aim of the interviews was to find out and assess the organizational practices of the construction firms. A semi-structured questionnaire was used to collect answers, but the interviews maintained an open character allowing new dimensions, not identified in the analytical framework, to emerge. In the case of discrepancies between responses, the interviewees were re-contacted to clarify and eliminate the discrepancy. Several situations required further dialogue with the general contractor and with the suppliers. Additional informa- tion was also collected through these informal and less structured interviews. The semi-structured interview has been shown to be particularly useful in collecting data about the organization and innovation of firms involved in construction projects (Slaughter, 1993; Bossink, 2007). The interviews consisted of both descriptive and numerical answers. The collection in a qualitative study of a few quantitative questions has been shown to be useful to assess the consistency of qualitative answers with corresponding quantitative values (Myres, 2008). A similar method was successfully applied in a recent study of stakeholders ' preferences for the adoption of green technologies (Parnphumeesup and Kerr, 2011). Triangulation of results was obtained by checking secondary information such as the findings of visits to the jobsite, direct observation of meetings and discussion between firms. Moreover, the authors were able to analyze the design documents and contracts for all three projects. This source was particularly useful to reveal the performance requests that the general contractor made to suppliers. At the end of the interviews, a report for each case study was created to present the evidence (Yin, 2009). This report was shown to the general contractor and discussed with him. The interviews, together with the documental materials, focused on the management of the construction activities, the organization of inter-firm relationships and the way in which the green issue affects them. The interview was structured in the following parts:
• general information about the project, and activities and involvement of the interviewee; • the sustainability related qualification of the interviewee and of the suppliers; • the level of integration of the general contractor with suppliers; • the green innovations which have been adopted in the building; • the drivers and barriers for the adoption of green innovations. After a descriptive response, the interviewee ranked
a list of drivers and barriers for the adoption of green technologies.
Selection of the Case Studies The main difficulties of studies of organizational aspects in the construction sector are site speci fic. In fact, any building is a single, unique and unrepeatable case. This makes the selection of cases dif ficult and complicates drawing general conclusions from single case observations (Bossink, 2007).
In order to limit the in?uence of regulations and context speci fics, three case studies were selected in a limited geographical area. This was a medium sized city in the Apulia region in Italy. The general contractors of the three projects were small firms with less than 20 employees and with two to four quali fied people in charge of technical duties. SMEs represent 96% of Italian construction firms (ANCE, 2011). This high percentage is a barrier to the introduction of sustainable innovations in this country (Son et al., 2011). In fact, in other countries, a number of very large firms dominate the residential market and their management structure has been shown to be better able to manage the sustainable transition of the construction sector. For reference, the results of Bossink (2007) show the case of the Netherlands. Looking for cases, the authors selected projects in which construction firms guaranteed unrestricted access to information. Although this selection criterion implied some biases, it was important to guarantee access to the work site and to all the contracts between firms. During case study selection, the evaluation of buildings of different typologies showed widely different organization, in agreement with the findings of de Blois et al. (2011). In fact, the organizational aspects between the firms involved in office, residential or other building typologies are very different. Consequently the selected case studies did not differ too much in architectural and typological design. Only residential buildings were selected. Many reasons justify this choice: the size and importance of the sector make its greening up unavoidable, whereas the complexity and the fragmentary nature of the residential sector make the adoption of green technologies more difficult. The choice of residential buildings was also justified by considering that, of the more than 135 000 million Euro invested in the construction sector in 2010 in Italy, approximately 74 000 million Euro was spent on residential buildings (ANCE, 2011). As the size of the project is an in?uencing factor over firms' organization, selected case studies were medium size projects with 50 apartments on average. This size was chosen as being representative of the building sector in the Apulia region. Description of the Case Studies All the case studies were private projects in which the general contractor owned the land and acted as real estate developer and general contractor. This overlap of roles often characterizes average-size residential projects in Italy, and in many other European countries (ANCE, 2011). As the study aimed to focus on organizational diversities related to the greenness of the building, in sampling the case studies the authors looked for contrasts in green characteristics. Project I was a social housing intervention. Construction was not originally allowed on the land where the buildings were to be sited. The general contractor applied for a program to provide 'social housing', and following a specific agreement with the regional and local government he received permission to build 32 detached houses. The construction was authorized thanks to this agreement, as without it no houses could be built. This situation gave a lot of power to the local government, which used this power to limit the sale price of the houses. In fact, the agreement expressly constrained the general contractor on the future price, but did not report any conditions on the characteristics of the houses, such as their sustainability level. Project II was urban regeneration, in which the general contractor built houses of different dimensions, quality and sale prices. In order to increase the number of houses which he could build, the general contractor signed an agreement with the municipal government. This agreement was voluntarily signed by both parties (the general contractor and the municipal government), and it focused on the possibility to increase the building surface after having built some public services for the community (a few public toilets and a garden). Project III was a private intervention in which the general contractor was free from constraints and could build and sell the houses deciding on all the features. He bought the land and submitted the building project to the local government for approval. In this case, the power of the municipal government was limited to the simple authoriza- tion for building according to the law. All three case studies were realized between 2008 and 2011, following the same regulations and within a distance of a few kilometers from each other. In the same way, they affected each other: general contractor III revealed that he had decided to adopt many green technologies to mark the difference between his houses and those in other projects such as the low-price houses in project I.
Green buildings and organizational changes
The three projects had different rates of innovation adoption. Table 1 reports some of their green technologies. Project I did not have any significant innovations. Project II adopted some innovations and, in particular, some green ones: for example, a rainwater harvesting system for irrigation purposes. Project III adopted, among other things, a rainwater filtration system, a highly efficient ventilated facade and active air conditioning radiant systems. Table 1 reports a classification of the case studies as traditional or brown building for project I, and innovative or green building for projects II and III. Moreover, according to the kinds of innovation adopted in the projects, the two green projects have been classified as modular and architecturally innovative projects, respectively. Modular implies an innovation within a system with no changes in other components, whereas architectural corresponds to an innovation that determines new ways of assembling and organizing practices (Henderson and Clark, 1990; Slaughter, 1993). The many green innovations in project III have been considered architectural innovations because they changed the traditional configuration of the building sub-components or the order of construction activities. The construction phases in project II were similar to those in project I. In fact, the innovations adopted mainly regarded modular changes. The interviews showed that most of these changes were not planned, and the decision for adoption was made during construction. For example, the general contractor of project II declared that he had always fitted traditional boilers, and during construction the design team proposed adopting condensation boilers. Later on, the general contractor evaluated the possibility with the equipment supplier and decided on the adoption of this system in all the houses. This green innovation changed the equipment of the air conditioning system, but it did not provoke any change in the series of construction phases. In contrast, some innovations adopted in project III required signi ficant changes in the order of construction activities. For example, the water filtration system was realized during the realization of the foundations of the building. This overlap of functions required the presence of plumbers and carpenters on the jobsite at the same time. Similarly, the highly efficient ventilated facade was produced and installed by a specialized firm. This required the other subcontractors to leave the jobsite while the specialized firm was working. Finally, the realization of active radiant systems required the air conditioning tubes to be embedded in the stru ctural?oor slab, and consequently anticipating the construction of the air conditioning system during that of the building structure. A similar change in construction phases was caused by the adoption of photovoltaic panels on the roof in project III. In fact, the adoption of photovoltaic panels was decided from the stage of building design, and the roof was designed with the best inclination for the photovoltaic panels. Interviewed about this, the design team of project III declared themselves to have been excited at the idea to adjust the inclination of the roof for such a reason.
Results
Having described green innovations in each case study, it is possible to look at organizational relationships between the firms involved in the construction processes. Table 2 summarizes the findings of the interviews, grouping them according to the model described in the third section. The results of the study have been condensed following these
Project
Classification for adopted innovations Brown project Green project Traditional project Modular innovations Architectural innovations
Green innovations
Adopted green innovations
Project I Project II Project III
None Few Several
Water harvesting system, condensation boiler, highly insulated envelope Water filtration system, ecological plaster, thermal bridge correction, photovoltaic integrated panels, active radiant systems
Table 1. Case study classification for adopted green innovations in the three projects
Table 2. Case studies results according to the features of analysis (? , present in the project ~ X= lightly present in the project)
parameters: level of integration between the general contractor and suppliers, level of integration between the general contractor and the design team, sustainability specialization and sustainability quali fications of firms. Looking at the reasons for supplier selection, availability and economic convenience were the main reasons declared by the general contractors of projects I and II. In contrast, supplier selection in project III was based on experience, knowhow and specialization of the supplier and on transfer of responsibilities. In this case, the general contractor's necessity to limit the risks related to the adoption of innovations emerged. Moreover, early involvement in the project was recorded for several suppliers. Involvement was considered early when the supplier was contacted earlier than in traditional buildings, and possibly already at the design stage. For example, the supplier of the ventilated facade declared he had been contacted at the beginning of the design phase to judge the feasibility of the facade. From that time, he was always in contact with the general contractor, and he exchanged plans and documents almost every two weeks for the whole year from the first contact to the realization of the facade. As shown, the relationship between the general contractor and the design team is fundamental in construction processes. Previous collaborations with the design team proved the most important parameter for selection in projects I and II. In contrast, the general contractor of project III chose a famous architect with whom he had no experience, who was well known for sustainable projects. In contrast to other suppliers, during the selection of the design team, economic considerations had no importance in any of the three case studies. Moreover, the involvement time of the design team was also independent of the innovativeness of the project, as early involvement was recorded in every project. An interesting aspect of project III was the necessity to select, together with the design team, several specialized consultants too. A specialized consultant for the energy systems in the building and a sustainability assessor only took part in project III. In this way, more designers and consultants participated in the project. In every case study, no members of the design teams had a sustainability qualification, and the three general contractors also lacked sustainability qualifications. Moreover, the general contractor of project III had no experience in green buildings. Interviewed about the adoption of green technologies in the project, he declared that, since the beginning of the project, he had decided to realize an innovative building with sustainable features. He thought this was the only way to reduce the competition which other projects were exercising over his sales. For this reason, he contacted suppliers looking at their capacity to satisfy the necessity and he selected the architect for his visibility and experience in sustainable projects.
Green buildings and organizational changes
Finally, the general contractor of project III applied for and was awarded a sustainability certi fication label for the building. This label was used for signaling purposes in marketing material, and represented the distinctive element to differentiate his project from other buildings around.
Discussion of Results
Case study results showed several differences between the organization of the three construction processes. Some differences were specifically related to changes necessary to adopt green technologies in the building. In project III a high level of integration between the general contractor and several suppliers occurred. Many suppliers were involved in the building activities earlier than in traditional buildings. New sequences of activities were necessary, as shown by the presence of plumbers during the realization of the foundations. These changes in the relationships between the general contractor and suppliers were related to the architectural essence of the green innovations in project III. Among the reasons for the selection of suppliers in project III, there was the necessity for the general contractor to limit risks. For example, during the interview, the general contractor expressed fear in managing the problems of the highly innovative facade, so he transferred the responsibility for proper assembling and functionality of the fa- cade to the supplier. This also clearly emerged in the contract related to the facade, in which the supplier guaranteed the building component for 10 years. The supplier of the facade declared that they guarantee their products for a long time as they control all the phases of construction, and they are specialized in it. The risk of improper operation was also transferred by contract to the supplier for the water filtration system in project III. In project III, the prolonged and intensive relationships between the general contractor and suppliers often assumed the characteristics of comakerships. In fact, these suppliers realized the executive plan of the innovative technologies and discussed the design realization at length with both the general contractor and the design team. This management was necessary to overcome the dif ficulties raised by the adoption of the green innovations. Risk limitation is a typical feature in home construction (Slaughter, 1993). All three project managers ranked it as a significant barrier to the adoption of green innovations. Coherently, in project III, the general contractor selected suppliers of the green innovative technologies considering their ability to entirely manage and build the subcomponent. The choice to externalize risky activities resulted in changes of construction practice and also in the necessity of new relationships. The general contractor of project III revealed the lack of sustainability specialization among its traditional suppliers. He was obliged to select few new firms and to start different kinds of relationship with these specialized suppliers. These realized the design, supply and mounting of the subcomponent integrally. Consequently, their power was significantly greater in the green innovative project, where they were asked to integrate their knowledge both in products and in processes. The integration of suppliers ' knowledge led to mixed paths in knowledge sharing between firms (Nonaka, 1994). In particular, both the general contractor and the suppliers were obliged to externalize their knowhow and to communicate to each other the desires and problems related to the green innovative technology. The co-design between the design team and suppliers of building subcomponents revealed an externalization process of knowledge creation. This reinforces the idea that a comakership relationship emerged in the organizational process of a green building (in the units of analysis 1). Albino and Sivo (1992) stated that comakership is rare in residential building projects. The results of the present paper partially contradict this, because the comakership level was more related to the greenness of the project than to the building typology. Consequently, residential buildings can also show high comakership levels, as in the green innovative project. In all the case studies, supplier selection seemed little in?uenced by specialization of suppliers in sustainable pro jects. Table 2 shows that, also in the most innovative project, the ratio of sustainable over non-sustainable portfolio for several suppliers showed a low value. In fact, the general contractor of project III declared that, also for suppliers with high technical skills and high specialization, their previous experience in sustainable projects was reduced. This confirmed Eccles' findings (1981) about the lack of specialization in the construction sector. The reasons for the selection of the design team of project III represent an interesting outcome. Limited experience and risk adversity of the general contractor led him to prefer a design team with experience in green building
projects. Consequently, the degree of specialization and the experience of the design team played an important role in the selection of the design team for the green innovative project. The interviews revealed that difficulties had emerged with suppliers' competencies and specializations in all the case studies. The general contractor of project I declared that previous collaborations and affordability were by far the main parameters for the selection of suppliers. He said he personally knew all the people working on the jobsite and all the material and equipment suppliers, so he did not ask the suppliers for (sustainability) certi fications. Obviously, in traditional projects the lack of formal competitive bidding procedures limit the room for specialization. However, the selection of specialized firms for green innovative subcomponents, such as the water filtration system in project III, represented a new element in supplier selection in building processes. The sustainability qualification of firms had a limited in?uence over the greenness level of the project and their selection. In fact, no environmental qualification was recognized in the case studies despite their different green levels. This contrasts with results of other studies (Bossink, 2007). In fact, in the context of analysis, the sustainability qualification was not common, and suppliers were selected more for their capabilities than for their level of quali fications. This outcome means a low penetration of certification programs related to sustainability in the context of analysis. Finally, the achievement of a sustainability label for project III represented a signaling element for the general contractor. The label was considered a distinctive element for the project, and many suppliers during the interviews remarked on the presence of the green label in the project. This con firms that the promotion of green buildings can be supported by sustainability labels.
Conclusions
This paper has discussed the context of analysis and first results of a larger study. It has presented the research model and the features of analysis that were selected to study the organizational changes in green building processes. The general hypothesis of the research was that a transition to sustainability of the construction sector corresponds to new relationships between firms in the construction organization. Inter-firm relationships and the characteristics of the firms involved have been considered to understand pathways for a transition to sustainability. This paper has shown the importance of new organization of construction processes for green residential build- ings. The results of the analysis suggest that, to realize sustainable buildings, a higher level of integration between the general contractor and suppliers is required. A level of integration up to the level of comakership can be favorable to engage the ability of the suppliers for green innovative technologies. Comakership has also proved necessary to engage suppliers' responsibility for the sustainability of the final product. This paper has shown that the selection of a design team with experience in sustainable buildings is particularly important, especially when the general contractor wants to realize a sustainable building and has no specialization in it. The paper has shown how difficult is for suppliers' sustainability specializations to emerge. However, the case studies have demonstrated that a sustainable building requires specialized suppliers, especially when risks for the green innovation are transferred to them. Sustainability certification has proved uncommon among all the firms involved in the three case studies. In fact, suppliers were selected more for their cheapness, capability and experience than for their quali fications. The results of this study agree with many literature findings in other sectors. However, the adoption of a qualitative case study methodology prevents generalizations to be made about the results of the study outside of Italian medium-size projects. The paper contributes to studies of organizational relationships for sustainable constructions, and provides an initial insight into the Italian green building sector. However, in order to incentivize the transition to green buildings, a specific analysis of the effects of different sustainable technologies over the organization of construction processes is necessary. This paper has avoided discussing the in?uence of tools of interaction between firms. However, these are promising instruments to investigate the characteristics of inter-firm relationships between the general contractor and other firms. Attention should be paid to interaction aspects in further research. Moreover, the possibility to compare
Green buildings and organizational changes
findings of the present paper with organizational changes in other typologies of buildings, in other geographical areas, and in other sectors remains desirable. Finally, an aspect that has been neglected in this paper but that is important for policies for sustainable building is the role of local governments. In every case study, the local government had the opportunity to promote sustain- able construction, but its main attention was directed towards other aspects. This decoupling between international and national policies, and local government activities, needs much attention.
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