Critical factors affecting the performance of Korean construction firms

Abstract

Construction industry is the base of the nation’s welfare as well as the key industry for nation’s competitiveness. Currently, Korean construction companies are suffering from hardship due to financial environment change and fierce order competition caused by real estate market depression, etc. In order to set up a long-term strategy and objective to overcome the hardship, it is required to set up Key Performance Indicators which are suitable for the nature of the construction companies, by considering the feature of causal relation. Applying Kaplan & Norton's strategy map, this research studied how the human capital, information capital and organization capital influence the operation management process and customer management process of the construction companies. In order to find out how these processes ultimately influence the financial performance, this study surveyed the 1st group of Korean construction companies and their subcontractors and then this study analyzed the statistics resulted from the survey. Through this study, this study recognized the importance of customer management processes of construction companies, so-called order-made production industry. Information system of construction companies is estimated not to be sufficiently applied to customer management process and we will have to recognize again the importance of organization capital for more efficient customer management process. © Research India Publications.