A framework for determining critical success factors influencing construction business performance

Recent reports by Latham (1994) and Egan (1998) have emphasized the need for the construction industry to increase its competitiveness, and have suggested the use of performance measurement as a tool for continuous improvement. Comprehensive measurement of a company’s performance and subsequent feedback to its managers is vital for business transformation. Measurement also enables businesses to be compared with each other on the basis of standardized information, allowing best practices to be identified and applied more widely. Historically, business performance has been determined principally through the use of financial performance criteria, but recently, it has been established that performance measurement needs to go beyond this. This paper reviews the various financial and non-financial factors that influence construction business. A methodology for defining the critical success factors relevant to construction businesses is further outlined. The critical success factors associated with construction business are also reviewed. Finally, it is concluded that more important than presenting a list of critical success factors (which are bound to change) is the need to have a holistic framework for identifying and implementing the required success factors.