Construction business performance measurement: the SPM alternative

Abstract

Construction business performance measurement (BPM) is myopic, most often being project-specific, profit-orientated, and neglecting broader “stakeholder” issues. If construction organizations are to remain competitive in the longer term, they need to develop and better understand their relations with their customers, suppliers, employees, lenders and the wider community. Hence, performance measurement must embrace these broader business characteristics. The need for a shift in “orthodox” (BPM) beliefs from “basic” performance measurement, to an alternative “stakeholder perspective measurement” (SPM), is underlined. SPM will adequately consider relations with customers, suppliers, employees, financiers, and the wider community; all being critical for a business’s long-term viability. The paper goes on to advocate that construction organizations should reject this myopic strategic thinking, and better consider the interests of their stakeholders, both economically and morally. The latter calls for development of a serious stakeholder perspective to business performance measurement, so that construction organizations can be monitored and judged in a socially acceptable manner.