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Civil-Comp Proceedings
ISSN 1759-3433
CCP: 73
Edited by: B.H.V. Topping
Paper 2

E-Commerce in Construction: Barriers and Enablers

K. Ruikar+, C.J. Anumba+, P.M. Carrillo+ and G. Stevenson*

+Centre for Innovative Construction Engineering (CICE), Department of Civil and Building Engineering, Loughborough University, United Kingdom
*The Building Information Warehouse, Nottingham Science and Technology Park, Nottingham, United Kingdom

Full Bibliographic Reference for this paper
K. Ruikar, C.J. Anumba, P.M. Carrillo, G. Stevenson, "E-Commerce in Construction: Barriers and Enablers", in B.H.V. Topping, (Editor), "Proceedings of the Eighth International Conference on Civil and Structural Engineering Computing", Civil-Comp Press, Stirlingshire, UK, Paper 2, 2001. doi:10.4203/ccp.73.2
Keywords: E-commerce, E-commerce barriers, E-commerce enablers, construction innovation, internet.

The Internet has revolutionised the way in which information is stored, exchanged and viewed. It has opened new avenues for businesses, which were only a decade before almost inconceivable. With the help of the Internet traditional technologies like Electronic Data Interchange (EDI) and new, emerging technologies like eXtensible Markup Language (XML), it is now possible to reach a much wider, if not a global, audience within a very short span of time at a fraction of the amount it would have cost previously.

Thus, the Internet has made the world a much smaller place. Businesses have recognized the possibilities such a revolution has opened up and have plunged into the global race to take advantage of the opportunities offered by the new ICT (Information and Communication Technology). This sudden recognition of the need to adopt new measures has some immediate consequences. There arises a need for businesses to shift from their traditional, tried and tested methods and in some cases, to radically alter these methods to embrace new technology. Such changes can prompt businesses to improve the traditional business processes, innovate their products and services, and develop strategies that are flexible to incorporate new technologies as and when they emerge. The boom in electronic ways of conducting business, or e-commerce, as is commonly referred to, has had knock-on effects on virtually every business sector. The construction industry is no exception.

It has been well documented that there is a growing need for the construction industry to adopt innovative ideas and methodologies in its operation; this has been expressed in the Egan report[1], which is one of the major drivers for innovation in the construction industry. The Egan report states that the construction industry is an important pillar of domestic economy in UK, contributing to about 10% of the total revenue. This report further states that the construction sector is simply too important to be allowed to stagnate. Stagnation of any industry can be prevented by researching into the amalgamation of new and revolutionary technologies such as e- commerce into the industry's day-to-day working methods. The use of e-commerce has become quite common in the industrial world; however, the construction industry has been very slow at embracing this technological development. The use of e-commerce as a tool in construction has been relatively limited and ineffective as compared to other engineering industries such as the automotive or the aerospace industry. One of the reasons for this could be the fragmented nature of the construction industry and the one-off nature of the product. In order to take on board these new technologies it is vital that the barriers and enablers of using technologies such as e-commerce are examined and analysed to make recommendations for an effective uptake of these technologies within the construction industry. A construction project is a complex activity involving several participants namely the client, architect, structural designer, fabricator and the contractor. It is a team effort, which involves several, inter-organisational activities and dialogue. Currently, the information flow in the construction industry is based on traditional methods and is hence slow. These involve producing numerous paper copies of documents and drawings. Management of these loose documents is often a very time-consuming and tedious process. Libraries of documents need to be maintained to effectively access data as and when required by the user. Thus the conventional methods of communicating information are proving to be outdated. The reliance on third parties such as courier services, sometimes leads to delays. There are also additional expenses incurred in the delivery of project documents to project members who are geographically distributed. Many e-commerce companies are trying to cash-in on these current inefficient methods of communication within the construction industry. This is made possible through the use of web-based solutions for communication and project management. The use of Internet services may lead to considerable savings in terms of time and money for construction projects. This increased efficiency in terms of project communication will lead to lower building costs. This paper presents background information on e-commerce, its uptake in the construction sector and its potential impact. Initially the paper briefly reviews the technologies and business drivers, which have contributed to the evolution of e-commerce, namely EDI and Value Added Networks (VAN). It further outlines, with the help of examples, the categories into which e-commerce is divided and briefly discusses e-commerce applications outside construction. It then discusses the current trends of e-commerce in the construction industry along with examining the barriers and enablers that influence e-commerce adoption. The potential benefits of e-commerce to the construction sector are also discussed.