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Abstract
This research aimed at evaluating the application of Business Performance Measurement (BPM) by UK construction companies and developed a methodology for evaluating business performance. This methodology is a comprehensive approach to the measurement of corporate performance, which comprises of a blend of quantitative and qualitative, financial and non-financial measures, to reflect the various aspects of construction business. The methodology drew upon the concepts of modern business performance measurement, including such self-assessment frameworks as the Business Excellence Model, Baldridge Award, Inclusive Approach and the Balanced Scorecard. It also took into consideration the Key Performance Indicators (KPIs) recently introduced in the UK construction industry. The model developed is more prescriptive and specifically tuned to the needs of UK construction business.
The research methodology comprised the analysis of both qualitative and quantitative data. A preliminary pilot study was conducted to clarify the needs of construction managers in relation to performance measurement. This was followed by a survey of current BPM practice by UK construction companies and identification of indicators used to evaluate business performance. The data collected was analysed by means of relative importance ranking, correlation analysis and factor analysis. These analyses underpinned the development of the BPM model, which consists of five broad perspectives of measuring business performance in construction companies; viz. i) Financial Results, ii) Stakeholder Satisfaction, iii) Resource Capability, iv) Project Performance and v) Leadership and Innovation perspective. These board perspectives were then subdivided into relevant Critical Success Factors (CSFs), each of which is measured against a set of Key Performance Indicators (KPIs). A specification guide accompanying each perspective has been included to enable users to apply the model. The guide elaborates the details of each of the five perspectives and their relevant CSFs and KPIs. This builds in flexibility in the model enabling the tailoring the KPIs to individual companies and allowing for changes to be made in the future.