The formation and development of strategic business nets in the context of a megaproject

This research examines the formation and development of strategic networks in the context of a megaproject. It combines business network and megaproject related research, and does so by examining strategic networks forming and developing between local companies that are potentially utilized in a nuclear power plant construction project in Northern Ostrobothnia, Finland. In order to be able to compete for contract opportunities in the context of the plant project, local companies may seek to form strategic networks to enhance their competitiveness against larger national and international competitors, and to share project related risks. This research aims at providing insight into the formation and evolution of these networks by exploring the factors influencing strategic network formation in this specific context, by identifying the types of forming networks, and by examining the parts network management and network roles play in the studied phenomenon. The research is qualitative in nature. A single case study approach is chosen to provide real-life data of the studied phenomenon, where the megaproject serves as the case and the identified strategic networks function as embedded units of analysis. A critical realist perspective is assumed and an integration of context and explanation is sought through contextualized explanation. A set of focused interviews serve as the primary data collection method. Various factors affecting strategic network formation in this specific context were recognized. The factors arising from the megaproject, potential strategic network and from the potential network member itself can either facilitate or hinder the formation of a network in the context of the megaproject. Several forming or planned strategic networks were also identified, categorized and described, thus providing real-life data on the studied phenomenon. Network roles and management within these networks are also discussed, providing insight into the ways in which the network members and their actions influence the formation and development of the networks. Finally, a framework describing network formation and development in the context of the megaproject is presented. The formation of strategic networks is limited by the ambiguity concerning the project specifications prior to the selection of the final megaproject configuration. At this stage, the potential network members can take initial, however limited, steps towards forming strategic networks. Once the actors are fully informed, and if the formation factors favor the formation of a strategic network, the actual network can be formed. The network will continue to evolve, and it does so through changes in the network type and network roles, and through the exercised network management. This research gives insight into the prerequisites, conditions and other factors affecting the formation of strategic networks in the context of construction megaprojects, illustrates development of these networks, presents the benefits and limitations of the said networks, and discusses the management and actor roles within the networks. The contributions can be used to guide managerial attention towards relevant issues in strategic network formation and development. Though similar issues are bound to be relevant in other construction megaprojects, the overall generalizability of the findings still calls for further testing