Industrialised building system’s business model in improving the performance of SME contractors in Malaysia / Mohamed Rizal Mohamed

The Malaysian construction industry is dominated by SME contractors. Due to the high numbers, the competition to get projects is quite intense and some of the SME contractors face all sorts of problems affecting their performance. SME contractors need to move towards IBS if the target is to survive and sustain their construction business. Moving to IBS is not an easy task as there are many problems associated with it. The problems identified include the absence of an appropriate IBS business model for SME contractors, low performance of SME contractors in IBS business, limited study conducted to examine the moderating influence of government support on the relationship of IBS business and performance, and furthermore, most of the available IBS business models are not tailored to improve the performance of SME contractors. The study aims to develop an appropriate IBS business model in improving the performance of SME contractors in Malaysia with the establishment of four objectives which are (i) to investigate an appropriate IBS business model for SME contractors; (ii) to determine the relationship between IBS business models and the performance of SME contractors; (iii) to analyse the moderating influence of government support on the relationship of IBS business models and the performance of SME contractors, and (iv) to validate an IBS business model in improving the performance of SME contractors in Malaysia. A quantitative research approach was adopted for this study. The questionnaire surveys were randomly distributed to 358 G2 – G5 contractors who were involved in IBS, using a 34 item instrument. However, in the second phase of the data collection process, only 167 sets were completed. Data collected were analysed through three phases of statistical data analyses process. The phases were: data analysis preliminaries, descriptive statistical analyses and multivariate analyses. The data were analysed using the IBM SPSS version 23 and SmartPLS version 3.2.7 software. Based on the developed model, the study reveals that Operational Platform which consists of six elements: continuous improvement, partnering, sales management, supply chain management, core competencies, and key resources. Offering, on the other hand, consists of seven elements, i.e. manufacturing, installation, design, transportation, customisation, standardisation, and products. Meanwhile, Market Position which consists of the six elements of market segment, target customer, marketing strategy, supplier relationships, role in supply chain, and distribution channel, can improve the performance of SME contractors in terms of relationship, business, safety, profitability, quality, design, time, and cost. On the other hand, government support which consists of the promotion of IBS usage, training, financial assistance, tax incentives, and levy exemption was found to moderate the relationship between operational platform and the performance of SME contractors. Finally, it is expected that this research will be able to assist in escalating the participation of SME contractors in IBS in the construction industry. It can aid the owner or decision maker in the company in identifying areas that require development in order to improve the performance and it can be applied by other researchers in developing their research framework for future research. Future research should explore the IBS business model in terms of suitability to be used with other IBS systems, financial aspects, and collaborations with large contractors.