Evolution of the business models of Russian construction companies digitalization of the industry

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Abstract

Development of the first business models of companies and the sectoral business system of the construction sector in Russia began 10 years after the country’s transition to market economy and was of evolutionary nature. The purpose of the study is to identify the relations between business models of large construction companies and their ability to adopt and apply digital technologies and non-technological innovations. Today, only the largest construction and development companies are capable of purposefully shaping and developing their business models. The share of such companies in Russia is less than 1 %, but their role in the development of the industry is large. Most companies are listed in national and regional ratings, which opens access to the information about their history and development, geography of presence, strategies, experience in overcoming crises, etc. The head offices of these companies are mainly located in Moscow and St. Petersburg, and sometimes in million-plus cities. Research methodology included compilation of a non-representative sample of 50 construction and development companies, identification of four types of business models and analysis of the models on the basis of the collected information. In the construction industry of Russia, business models of large companies evolve from incomplete to complete construction cycle, then to complete development cycle with and without the building contractor function. A significant share of development companies retains the building contractor functions, and it is a distinctive feature of their activity in Russia associated with the high uncertainty of economy. Complete cycle developers show great interest in digital technologies and organizational innovations, but their inclination to digital technologies reduces interest in non-technological innovations and vice versa. The business model of the complete construction cycle gives the companies a weaker impetus for innovation.

Original languageEnglish
Pages (from-to)565-582
Number of pages18
JournalJournal of Siberian Federal University - Humanities and Social Sciences
Volume12
Issue number4
DOIs
Publication statusPublished - 1 Jan 2019

Keywords

  • Business model
  • Company strategy in the industry
  • Complete and incomplete construction cycle
  • Complete development cycle and development cycle with the building contractor function
  • Industry business system
  • Innovations and digital technologies in construction

OECD FOS+WOS

  • 5.04 SOCIOLOGY

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