Supply Chain Management: A Critique of Supply Chain Architecture

The purpose of this paper is to frame the contextual circumstances that craft the different interpretations of the buyer-supplier relationship in the UK construction industry. Advocates of supply chain management claim that business transactions, particularly those reliant on the outsourcing of services and products will benefit significantly in terms of industry competitiveness. In theory the UK construction industry represents a near perfect model for supply chain protocol, where the commercial exchange of goods and services represent a significant proportion of the overall project expenditure. In reality the uptake of supply chain management has been at best circumspect. Many reasons have been cited; the short-term nature of construction projects, adversarial contractual relationships, fragmentation of the construction industry and the opportunistic behaviour of contractors and suppliers. For an increasing number of construction commentators the error of construction supply chain management is founded on the acontextual nature in which supply chain management has been promoted within the construction community. Lack of success is not necessarily a failure of supply chain management but as a result of insufficient attention being paid to industry circumstances. Incorporation of supply chain management requires careful judgement in terms of definition and practice. This paper argues for a more pluralistic understanding of supply chain management within the confines of the UK construction industry. Building on the notion of a ‘horses for courses’ approach to the management of contractual relations a conceptual framework is developed to aid in the process of sense making. Research evidence suggests that construction market dynamics is a powerful determinant of supply chain architecture. As a consequence, it could be argued that the unprecedented downturn in construction activity will severely curtail business-related opportunities to foster learning alliances within the construction supply chain. This research paper provides a timely critique of the challenges facing supply chain management in an uncertain and turbulent post-recession construction environment.