From construction waste to business value: Defining new value propositions for construction contractors.

Paper in proceeding, 2017

The social and legislative focus on sustainability has pressed the construction sector to optimise and innovate in terms of both material and business processes. The activities of Construction and Demolition Waste (CDW) management have been under the same pressure. The collection and recycling of waste, in particular hazardous waste, has received a considerable amount of attention. The life cycle of various products and material is also well documented and many models are aiming at optimising the supply chain and logistic processes. Likewise, demolishing and recycling activities, usually considered as low value work, have received a renewed attention and large contractors are now developing units or subsidiaries to cover these activities, thereby taking over a part of the value chain in CDW. However, whereas the potential of these new business opportunities has been forecasted and measured by numerous academics, there is far less attention given to management practice in term of business development and the rationales to sustain it. Drawing on the discussion of business models carried by Baden Fuller and Mangematin (2015), we define a business model as a ‘model’ which can appear in many guises and serve many purposes, an artefact that can be used to convey knowledge about a business and its status to others. Instead of focusing on innovation as an internal matter, this conception allows us to understand this development as a dynamic process stretching outside company boundaries. Building on the case of a network of large contractor companies engaged in CDW that are developing new business proposition to do so, we propose to give an insight in how these propositions have emerged and are transformed in new businesses. The empirical material consists of two parts: Part one is based on the preliminary results of a three years’ multidisciplinary project taking place in the Gothenburg region and is a platform bringing together practitioners and academics in CDW. The project focuses on gaining an overall picture of the CDW industry, their practices as well as how they develop new innovations in both material and processes. We participate in and observe project meetings, workshops, and discussions. Next to the joint project platform, we more in-depth study a group of companies engaged in construction renovation through interviews and observations on the construction site, we follow their concrete considerations, choices and actions in developing the new solutions towards new business models. Accordingly, our contribution aims at informing how the dynamic processes of business models can support innovation in the construction industry.