Firm performance and information technology utilization in the construction industry: An empirical study

This research makes two contributions to construction research and practice. First, the research proposes and deploys a benchmarking model that is robust enough to address the limitations of the existing construction benchmarking models. Second, the research provides empirical evidence that information technology (IT) has a positive impact on firm performance. This second contribution is significant to both construction and IT literature at large. The existing construction benchmarking models fall short in four respects. First, the existing benchmarking models are project-specific. They report project-level industry norms of some performance metrics (i.e. , cost, schedule, safety, etc. ). This limited view communicates a single metric performance on a single project. It by no means translates to the overall performance of the firm. Second, as a consequence of being project specific, the existing benchmarking models do not foster the measurement of the impact of certain technological and managerial attributes on overall firm performance. This makes it difficult to identify practices that lead to superior performance. Third, the current benchmarking models do not support an understanding of the trade-offs among the different metrics of performance. Fourth, the relationship between how much was expended on the metrics and the performance of those metrics is totally absent. This research proposes and deploys a benchmarking model that is robust enough to address the limitations of the current benchmarking models. The proposed benchmarking model is deployed using Data Envelopment Analysis (DEA) based on empirical data collected from 74 construction firms. The second research contribution is empirical evidence that IT has a positive impact on performance. This contribution is important to both construction and IT literature. The IT literature reports a productivity paradox when it comes to IT and performance. The construction literature reflects a hesitance on the part of the industry to adopt IT because of the low level of perceived benefits. Based on empirical data collected from construction firms, this research uses regression analysis to investigate the impact of IT on performance. The regression analysis provides evidence of the positive association between IT and performance.