Value creation and capture in systemic innovation implementation: case of mechanical, electrical and plumbing prefabrication in the Finnish construction sector

Rita Lavikka*, Krishna Chauhan, Antti Peltokorpi, Olli Seppänen

*Corresponding author for this work

    Research output: Contribution to journalArticleScientificpeer-review

    16 Citations (Scopus)

    Abstract

    Purpose: Systemic innovations emerge and create value in an inter-organisational context. However, innovation studies rarely investigate the role of value creation and value capture among multiple organisations in successful innovation implementation. This paper aims to understand the role of value creation and value capture in the implementation of systemic innovations in construction which is by nature, an inter-organisational context.

    Design/methodology/approach: The empirical research focused on the barriers, enablers and opportunities for value creation and value capture of the Finnish construction project parties when trying to implement mechanical, electrical and plumbing (MEP) prefabrication, which is a systemic innovation. Data were collected through interviews, observations and action workshops.

    Findings:
    The empirical study identified interaction patterns on how social, political, technical and economic barriers lead to uneven value capturing, lack of value-based procurement and unclear value creation between MEP design and installation. They hinder the implementation of MEP prefabrication. The results point to enablers leading to fairly shared value to all parties, procurement of value and collaborative value creation, thus increasing the usage of MEP prefabrication, a systemic innovation.

    Originality/value:
    The study adds new knowledge by demonstrating that the identification of barriers and their interaction with enablers and opportunities for value creation and capture lay a baseline for suggestions on how to implement a systemic innovation. This study stresses the importance of enabling value creation and capture for all construction project parties when implementing a systemic innovation.
    Original languageEnglish
    Pages (from-to)837-856
    JournalConstruction Innovation
    Volume21
    Issue number4
    Early online date29 Mar 2021
    DOIs
    Publication statusPublished - 21 Oct 2021
    MoE publication typeA1 Journal article-refereed

    Funding

    The research was conducted as part of the Aalto University’s research project “Building 2030 - industrialized construction“ which is funded by 19 companies operating in the real estate and construction sector. The Finnish Science Foundation for Economics and Technology has also financed the research.

    Keywords

    • Construction
    • MEP
    • Prefabrication
    • Systemic innovation
    • Value capture
    • Value creation

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