Production Planning & Control

The Management of Operations

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Supply chain management in construction and

engineer-to-order industries

Roberto Cigolini, Jonathan Gosling, Ananth Iyer & Olga Senicheva

To cite this article: Roberto Cigolini, Jonathan Gosling, Ananth Iyer & Olga Senicheva (2020):
Supply chain management in construction and engineer-to-order industries, Production Planning &
Control, DOI: 10.1080/09537287.2020.1837981

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Published online: 29 Oct 2020.

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PRODUCTION PLANNING & CONTROL
https://doi.org/10.1080/09537287.2020.1837981

EDITORIAL

Supply chain management in construction and engineer-to-order industries

Roberto Cigolinia , Jonathan Goslingb , Ananth Iyerc and Olga Senichevac
a
School of Management, Politecnico di Milano, Milano, Italy; bCardiff Business School, Cardiff, UK; cKrannert School of Management, Purdue
University, West Lafayette, IN, USA

ABSTRACT ARTICLE HISTORY

The construction industry is a key sector of every country and the application of supply chain-related Received 1 October 2020
techniques holds much promise to improve performance of construction firms in many ways. Accepted 12 October 2020
According to an extended view, which encompasses the construction of industrial and residential
KEYWORDS
buildings, of civil engineering and infrastructure projects, there is a number of major actors that must
Supply chain management;
be coordinated in some way to reach ETO decisions, leading to performance outcomes and metrics. engineering-to-order; con-
The need to co-ordinate information across the supply chain is a persistent and pressing challenge for struction industry
ETO companies. Procurement helps to establish the conditions for the supply chain to function effect-
ively. New technologies such as product configurators or cloud manufacturing are being applied.
Planning and decision making is a critical driver. In the future, the challenges of applying supply chain
management techniques to a construction environment, will require more quantitative studies, to cast
light on some potential gains from better information management and use of digital technologies.
Then there is also an opportunity to integrate clear upfront planning and procurement with the pro-
ject delivery processes, and choose the right configurations, focus and relational types. Finally, there is
much potential to harness the innovation potential of SMEs.

Introduction suitable. This journal has been instrumental in developing

the discourse related to construction supply chains (e.g.
We conceived this special issue on Supply Chain
Behera, Mohanty, and Prakash 2015; Tezel, Koskela, and Aziz
Management (SCM) in Construction and Engineering-To-
2018), as well as the broader conceptualization of ETO sup-
Order (ETO) industries, published in Production Planning &
ply chains (Adrodegari et al. 2015; Birkie and Trucco 2016;
Control, for a number of reasons. Firstly, the current Gosling et al. 2015; Pero and Rossi 2014; Pero et al. 2015).
literature on SCM in Construction and ETO industries is scant Such work establishes a good platform for this special issue
and scattered over a wide range of publications. Second, the and make PPC an ideal outlet for building on these debates
construction industry and complex engineering work is a key and synthesizing a range of related papers.
sector of every country and the application of SCM techni- In this special issue, we demonstrate the breadth of chal-
ques holds much promise to improve performance of con- lenges for construction and ETO situations, spanning pro-
struction firms and their projects in many ways. curement, logistics, supplier and supply chain management,
The characteristics of many construction firms allow them innovation and complexity management, as well as adopting
to be placed in the domain of ‘engineer-to-order’ (ETO) situa- new technologies. Issues of lean and performance measure-
tions, where products are designed, engineered and finished ment and management are also prominent. The papers
after an order has been received (Gosling and Naim 2009, included focus on a range of industrial contexts, including
Gosling et al. 2016). The product design for each order is shipbuilding, construction, machinery, as well as
uniquely tailored to the customer’s specification, including ‘megaproject’ situations.
the development of order-specific product content, such as Papers in this volume focus on the links between supply
Bills of Material, drawings, and manufacturing work instruc- chain management (SCM) and construction projects. SCM
tions. The variety of work in ETO companies, the customized, challenges in construction projects are unique because they
complex products and the underlying uncertainties of mar- deal with deliveries for one goal – completion of the overall
kets, all indicate that SCM-related processes need to be inte- project. Suppliers play a large role, with engineered to order
grated with other core processes, including tendering components that face engineering change orders to balance
and design. the project’s evolving demands given long project comple-
These distinctive features of ETO industries influence the tion times. For megaprojects with significant project com-
potential application of established Operations Management plexity, management is often handled by a third-party
and SCM techniques, and it is still not clear which logistics provider. There are also many choices of decision
approaches can be adopted, need to be adapted, or are not systems to balance the interests of stakeholders. The papers

CONTACT Roberto Cigolini [email protected] School of Management, Politecnico di Milano, Piazza Leonardo da Vinci, 32, Milano, 20133, Italy
ß 2020 Informa UK Limited, trading as Taylor & Francis Group
2 R. CIGOLINI ET AL.

Financiers

Suppliers and
Subcontractors Local
Authorities
ETO Decisions
Shishodia et al
Yildiz and Ahi
Third Party Planning Supply Chain Genovese et al. Performance
Logistics Shurrab et al Strandhagen et al Outcomes
Companies Technology & Bäckstrand and and Metrics
Information Fredriksson
Ekeskär and Rudberg Cannas et al Project Braglia et al
Tedaldi and Client Cantarelli
Miraglioa

Moreo et al
Customers Design and
Engineering
Organizations
Iakymenko et al
Figure 1. A common framework.

in this volume frame questions and provide insights for all of decisions, project management decisions, and the adoption
these contexts. of technologies to manage information flows.
The cases discussed range from construction manage- Each of the papers, in some way, explores the areas and
ment, to shipbuilding, to rail projects, to university hospitals interactions between the actors and drivers shown in the
to aerospace engines and provide a rich variety of problem Figure. Some key themes and clusters of papers are summar-
contexts. This diversity of construction projects highlights ised below:
the opportunities to use the tools discussed by the authors.
These cases characterize project complexity, socio-political  The need to co-ordinate information across the supply
issues and the need to understand local authorities’ perspec- chain is a persistent and pressing challenge for ETO compa-
tives. Emerging digital tools such as cloud manufacturing are nies. B€ackstrand and Fredriksson show the challenges of
also discussed. The methodologies used include ideas from managing information across the supply chain in the con-
the SCOR model in SCM, Analytic Network Process, multiple struction sector, while Strandhagen, Buer, Semini, Alfnes,
case studies, detailed interviews, and literature surveys. This and Strandhagen explore how Industry 4.0 technologies
showcases the diversity of research tools used to understand can help to co-ordinate information across the supply
the problem. chain for better outcomes in shipbuilding.
 Procurement helps to establish the conditions for the supply
chain to function effectively. Genovese, Morris, Acquaye
A framework to categorize special issue papers and
and Koh explore the interface between public procure-
discuss future research
ment organisations and contractors, and the impact of
For the reasons outlined above, in conceiving this special different configurations. Moretto, Patrucco, Walker, and
issue, we took an extended view of the Construction industry Ronchi highlight the need for a contingency based
and ETO supply chains, which encompasses the construction approach in the procurement strategy.
of industrial and residential buildings, of civil engineering  New technologies are being developed and applied. For
and infrastructure projects such as road, railways and instance, Cannas, Masi, Pero, and Brunø focus on the
bridges. We also included a wide range of ETO products potential of product configurators to customize products,
where the execution of engineering activities to complete while Tedaldi and Miragliotta demonstrates an application
each order is required. of cloud manufacturing paradigm.
An overview of the actors and drivers explored in this  There are possible new logistical patterns and arrangements
special issue is shown in the Figure 1. It shows the major to consider. Ekesk€ar and Rudberg show that it is possible
actors that must be coordinated in some way to reach ETO for third party logistics companies to play a role on con-
decisions, leading to performance outcomes and metrics. At struction supply chains (where they have not, typically,
the centre, we see crucial decision categories covered in this been widely used), and may help to establish an interface
special issue, including planning decisions, supply chain between the supply chain and the construction site.
 PRODUCTION PLANNING & CONTROL 3

 Planning and decision making is a critical driver, and it can that dominates others in the analyzed criteria for local
be supported by better co-ordination, tools and techniques. authorities, the authors highlight advantages and disadvan-
Shurrab, Jonsson, and Johansson highlight the need for tages of each of them and summarize their findings by link-
co-ordination across functions and organizations within ing each configuration to local government ideologies and
the tactical planning horizon. Yildiz and Ahi propose a public project deliveries. They emphasize that social and eco-
tool based on the Supply Chain Operations Reference nomic benefits arising from public project could be maxi-
(SCOR) model, and find that the tool has the potential to mized only when the local authorities promote their agenda
improve decision quality regarding cash cycle time, return at all levels of the supply chain.
on working capital and perfect order fulfilment. Braglia, When local authorities make decisions regarding public
Dallasega, and Marrazzini develop a framework to identify procurement, their relationship to stakeholders impacts per-
ETO construction losses and their causes, and propose a formance. Likewise, when third party logistics providers
metric named Overall Construction Productivity to meas- mediate suppliers to a construction project, their balancing
ure an overall impact of losses. Cantarelli show that com- role may be evaluated differentially across supply chain
plexity and innovation may create additional risk and participants.
uncertainty, impacting on project performance. Shishodia, The role of the third-party logistics providers is studied in
Verma, and Jain identify the factors that contribute to the the paper “Third-party logistics in construction: Perspectives
resilience of suppliers and propose a technique to meas- from suppliers and transport service providers” by Ekesk€ar
ure supplier resilience which should help companies to and Rudberg (Ekesk€ar and Rudberg 2020). Third party logis-
select, segment and develop their suppliers. tics providers impact the 60-80% of work done by suppliers
 Engineering and design changes are typical in ETO situa- and subcontractors. Recently, the use of third-party logistics
tions, but can be managed. Iakymenko, Brett, Alfnes, and providers in construction industry has increased due to the
Strandhagen show the scale of the problem of managing lack of SCM and logistics knowledge among clients and con-
engineering change, but provide a range of practices tractors. However, little is known about the role of third-
which have the potential to help management them. For party logistics (TPL) in construction supply chain. Since
instance, design freeze, standard operating procedures employing a TPL provider has a great impact on the struc-
and design for manufacture. ture of the traditional construction supply chain affecting all
parties involved, and there is a lack of research on the
upstream parties, there is a need for studying the perspec-
Summary of papers in this special issue
tives of upstream tiers on TPL solutions in construction. The
This section provides a review note of the papers included in authors investigate how suppliers and transport providers, as
this special issue. According to the presented framework, a a part of a TPL solution in construction, are affected by the
significant part of the issue is dedicated to the interaction of use of the TPL solution. They provide results from a 2.5 years
different actors of the construction industry and ETO supply longitudinal case study of a hospital construction project. For
chains, the coordination among them, and the configuration the project, all manufacturers and supplier deliveries were
and the integration of functions within them. The paper “An sent to a checkpoint managed by a TPL, with material
investigation into design and performance of supply chains for brought in by the TPL between 4 pm and midnight to reduce
public procurement projects” by Genovese, Morris, Acquaye, disturbance to hospital activities. Data consisted of surveys
and Koh (Genovese et al. 2020) analyzes the role of local of manufacturers, wholesalers, building merchants and trans-
authorities in ETO supply chains and their impact on the ETO port providers about the TPL’s role. They conclude that con-
decisions. The authors motivate their investigation based on sistent with findings from a literature review, suppliers and
public procurement accounting for 16% of total GDP of transport providers are positive towards TPL solutions since
member states. They investigate how public organizations it helps to establish an interface between the supply chain
coordinate and contract firms to deliver local economic ben- and the construction side, however the suppliers perceive
efits from large scale publicly funded projects while account- that the contractors benefit most from TPL solutions.
ing for power relations between public and private entities. Nonetheless, it is found that both the suppliers and transport
In particular, they examine how the procurement process providers have a willingness to address the necessary issues
can be used by local authorities as a leverage to manage needed to realize SCM. They emphasize that with the further
stakeholders and the activities of agents to best achieve a use of TPL in construction industry upstream tiers should be
range of economic and social objectives. They analyze 4 dif- included more in determining the delivery process, policies
ferent supply chain configurations obtained from an empir- and regulation to benefit fully from TPL solutions.
ical study of procurement practices used by the local Given that firms rely on suppliers to obtain 80% of their
authorities across the Yorkshire and Humber region of the materials and components in many contexts, the procure-
United Kingdom to deliver public projects, and study interac- ment configuration impacts the performance as well. The
tions of different stakeholders and the impact of these inter- paper “Procurement organization in project-based setting: a
actions on different procurement outcomes. The data multiple case study of engineering-to-order companies” by
consists of over 150 web-based questionnaires, 20 phone Moretto, Patrucco, Walker, and Ronchi (Moretto et al. 2020)
interviews with companies, interviews and focus groups with studies a procurement organization in project-based compa-
10 local authorities. Although there is no single configuration nies, in particular, focussing on large-scale construction and
4 R. CIGOLINI ET AL.

ETO projects. The authors investigate how the procurement The temporary coordination among different organiza-
organization can be designed and how it can be made flex- tions in project-driven supply chains (PDSC), e.g. construction
ible and adaptable to changes in a project context. They supply chains, introduces new risks that might hurt project
study how project features, customer features and company performance, and cannot be efficiently handled by the trad-
features impact project performance. They apply contingency itional project risk management techniques. To analyze risks
theory which suggests that organizational design characteris- and increase the resilience of PDSC, new approaches that
tics should match external and internal factors affecting the would allow to handle uncertain and unpredictable scenarios
organization to achieve strong performance. A multiple case are required. The paper “Supplier Resilience Assessment in
study approach involving 11 companies is used to derive the Project-Driven Supply Chains” by Shishodia, Verma, and Jain
results. The analyzed case studies showed that there are two (Shishodia, Verma, and Jain 2020) analyzes the sources of
extreme typologies for procurement in project-based compa- risks on the supplier side of PDSC and studies the factors
nies: the “procurement-focused organization” and the that contribute to the resilience of suppliers in PDSC. The
“project-focused organization”, with a hybrid approach in- identified factors could be helpful in developing managerial
between, which implements some of the features of the two guidelines for assessing suppliers, decision-making and devis-
topologies. Project strength, time pressure and level of cus- ing strategies to control them effectively. The authors meas-
tomization are found to be critical factors for project-based ure supplier resilience using grey relational analysis, which
companies that would push towards the adoption of a pro- implies assessment of supplier ratings and assigning of
ject-focused configuration. The size of the company is weights to supplier attributes, and calculate a resilience score
important as well; it has been found that big companies for every supplier. Based on the resilience score, suppliers
would more likely adopt a procurement-focused are prioritized according to their level of resilience capabil-
organization. ities. The score could give early warning signals to a project
Multiple suppliers involved in the procurement process of
manager and have a more proactive supply relationship
ETO projects, e.g. construction project, often face a low infor-
management. The proposed technique has been tested for
mation availability among themselves, which leads to the
two case studies and managerial insights have been pro-
lack of coordination among actors in the supply chain and
vided into how to reduce the risks of the suppliers according
impacts the supply chain performance. Inability to coordinate
to their scores. Using the performance scorecards of the sup-
actions of supply chain partners results in less than 40% of
pliers should help organizations in choosing the right strat-
construction projects delivered successfully. The paper “The
egies for selecting, segmenting and developing
role of supplier information availability for construction sup-
their suppliers.
ply chain performance” by B€ackstrand and Fredriksson
Although gaining the right amount of information and
(B€ackstrand and Fredriksson 2020) focuses on the analysis of
evaluating the risks are essential for decision making, it
the construction supplier’s coordination needs and the
might not be enough to improve the performance. The
degree of their current information availability. It has been
paper “Innovative decision support model for construction
suggested that the problems with information availability dif-
supply chain performance management” by Yildiz and Ahi
fer between suppliers who continually supplied materials to
(Yildiz and Ahi 2020) emphasizes the need of a proper deci-
the site and suppliers who did so only intermittently. Thus, 4
suppliers, 2 with continuous supply and 2 with intermittent sions support tool to increase supply chain management per-
supply, that deliver materials and/or tools for production, formance. The authors propose a tool based on the Supply
have been selected and analyzed. The authors summarized Chain Operations Reference (SCOR) model. The model offers
information-sharing activities between the construction site a common set of supply chain performance metrics, which
and the suppliers in terms of the 6 factors affecting informa- are compared, weighted and prioritized using a combination
tion availability. The empirical study has shown that informa- of methods: Analytic Network Process (ANP), Technique for
tion availability is a real problem for construction supply Order Preference by Similarity to Ideal Solution (TOPSIS) and
chain suppliers. The main contractors, the ones responsible The Decision-Making Trial and Evaluation Laboratory
for the coordination of supply chain, do not see the effects (DEMATEL). Since a single method might lead to a wrong
of low information availability on the supply chain, although decision and inefficient allocation of the resources resulting
the supply chain performance effects have been found at in a higher cost, the authors suggest a combination of the
both ends of the supply chain. The delivery pattern has been above-mentioned techniques to overcome these disadvan-
shown to affect both the information available to and the tages and provide a better decision support system for the
information needed by the suppliers. Suppliers with intermit- managers. The implementation process has been demon-
tent supply have less access to the information on-site due strated using a case study of a construction company. The
to their lack of presence there, and therefore suffer more tool has helped to select the most effective supply chain per-
from the lack of information sharing. Suppliers with continu- formance metrics, rank them according to their score and
ous supply can use their presence on site to increase their use the ranking to help managers to take more precise deci-
service offerings to main contractors, which allows them to sions on improvements. Their results show that use of the
improve their information availability and eventually their tool has the potential to improve decision quality regarding
supply chain performance. Therefore, a supplier could be not cash cycle time, return on working capital and perfect order
just a receiver of the information, but also a gatherer. fulfillment.
 PRODUCTION PLANNING & CONTROL 5

Since ETO projects often require some customization, they innovate and adapt to new unexpected circumstances. The
are characterized by a greater complexity, which has a nega- paper “Innovation in Megaprojects and the Role of Project
tive impact on the balance between supply and demand, Complexity” by Cantarelli (Cantarelli 2020) focuses on the
and, in turn, on performance. Due to the complexity, ETO interaction between project complexity, innovation and per-
companies could respond to the supply-demand imbalance formance in megaprojects using a multi-case study approach.
only within tactical planning horizon with the intensive com- Project complexity has been characterized based on struc-
munication between different demand- and supply-facing tural dimensions, uncertainty, dynamics, pace and socio-
departments, called cross-functional integration. The paper political issues. The paper studies the cases of TGV Med in
“Managing complexity through integrative tactical planning France and HSL South in the Netherlands. Data sources
in engineer-to-order environments: Insights from four case include papers as well as government reports. The authors
studies” by Shurrab, Jonsson, Johansson (Shurrab, Jonsson, identify for each case the aspects of innovation, the com-
and Johansson 2020) studies the customer order fulfillment plexity dimensions that were drivers of innovation, and the
process (COFP) as one of the tactical-level planning proc- impact of innovation on the project performance. They
esses that requires a high-level of cross-functional integra- develop a set of propositions on the relationships between
tion. In particular, the authors look at different mechanisms project complexity, innovation, and performance, and policy
used in ETO projects to realize cross-functional integration implications. For example, interactions between project com-
and how these mechanisms mitigate the negative impact of plexity and innovation may create additional risk and uncer-
complexity on the demand-supply balance. The authors con- tainty in delivery for megaprojects. The authors state that
ducted interviews with 19 managers across 4 companies innovations increase uncertainty which can impact project
over 27 occasions to study their COFP decisions. They pro- outcomes. They recommend an ex-ante evaluation adopting
vide a set of propositions on detail and uncertainty as com- both a tactical and strategic performance perspective, and
ponents of complexity in demand-supply relationships and considering alternatives to innovations to deal
how their can be reduced using different coordination mech- with complexity.
anisms. Based on the propositions, they presented a frame- Due to the length and complexity of Engineer to Order
work for managing complexity in ETO projects. (ETO) projects, engineering changes (EC) are often required.
Complexity of ETO construction projects and inability to If the changes are implemented successfully, it can bring
proper coordinate off-site fabrication and on-site installation additional profit to a company and provide a competitive
of the components by various suppliers results in a high advantage. Although a lot of practices and tools have been
amount of non-value adding activities on-site, which nega- developed to effectively and efficiency implement ECs in ETO
tively impact the performance. Therefore, construction proj- projects, companies still report cost and time overruns due
ects are often known for long lead times and to ECs. The paper “Analyzing the factors affecting engineer-
budget overruns. ing change implementation performance in the engineer-to-
The paper “Overall Construction Productivity: a new Lean order production environment: case studies from a
Metric to identify construction losses and analyze their Norwegian shipbuilding group” by Iakymenko, Brett, Alfnes,
causes in Engineer-to-Order Construction Supply Chains” by and Strandhagen (Iakymenko et al. 2020) identifies potential
Braglia, Dallasega, and Marrazzini (Braglia, Dallasega, and contingency factors that impact the implementation of
Marrazzini 2020) analyzes and classifies losses of Engineer- engineering changes in ETO projects and analyzes their
To-Order construction projects, and suggest a new metric, effect on the EC implementation performance: cost, time and
Overall Construction Productivity (OCP), to evaluate the profit margin. The authors study six ECs in a Norwegian ship-
impact of identified losses. OCP is a product of three compo- building company and investigate eleven contingency factors
nents: External Influence Mitigation, which covers losses due that play a role including EC type, time of EC occurrence,
to inefficiencies that are external to the first-tier supply maturity of the product design and technology, experience,
chain, Internal Supplier Effectiveness, which determines knowledge and skills of design and engineering staff. Based
losses due to inefficiencies that are internal to the first-tier on the analysis of the results, several propositions have been
construction supplier but external to the installation on-site, developed about how these factors impact the implementa-
and On-Site Effectiveness, which reveals the causes of losses tion performance. Recommendations on the tools and practi-
internal to the installation on-site. Since problems in a con- ces that can be used by ETO companies to eliminative
struction project are often interrelated, there is a chain effect negative impacts of ECs are provided. The study suggests
of losses. The proposed OCP metric helps to decouple differ- that allocating as many ECs as possible to the beginning of
ent types of losses to avoid a chain effect and define the the project allows high supply chain costs to be reduced.
appropriate improvement actions in time. The authors pre- Although the Engineer to Order (ETO) industry deals with
sent the results of successfully applying the proposed frame- complex, customized products, in the current competing
work for an ETO façade supplier company and a hospital environment it faces the same challenges as other industries,
construction project, and discuss the strength and limitations including pressure to reduce time-to-market, decrease costs,
of the approach. improve performance, and shorten a product life cycle. Mass
The complexity of megaprojects is even higher, which customization is one of the strategies that helps to address
often results in a failure to achieve planned cost, schedule these challenges. To succeed in mass customization, a com-
and revenue targets. One of the reasons is an inability to pany needs to have three capabilities: solution space
6 R. CIGOLINI ET AL.

development, robust process design, and choice navigation. CM paradigm in ETO industry. The paper is based on inter-
The last one allows customers to choose or configure the views with the Chief Technical officer of an ETO machinery
product that matches their needs, and it is implemented manufacturer that provides on-demand manufacturing serv-
using product configurators, applications that translate cus- ices in the metal industry through a CM platform. The
tomers’ needs into product requirements. The most com- authors highlight the role of the manufacturer in the imple-
monly reported benefit of product configurators is a lead mentation and development of the CM paradigm as a rele-
time reduction. The paper “Implementing configurators to vant contributor, and emphasize that the use of the CM
enable mass customization in the Engineer-to-Order industry: platform could be a strategic benefit for the growth of the
a multiple case study research” by Cannas, Masi, Pero, and manufacturer.
Brunø (Cannas et al. 2020) studies the challenges that ETO We hope you enjoy this research journey through rich
companies face when implementing product configurators to contexts in construction management and supply chains, feel
enable mass customization and how companies manage challenged by the opportunities to improve performance of
these challenges. The authors perform study seven ETO com- projects and megaprojects, and learn about best practice
panies, using face to face interviews, document analysis and ideas. More importantly, we look forward to continued
company visits to gather data. All companies reported that research that can improve project outcomes and deliver out-
the implementation of the product configurator makes it size benefits to companies and society.
easier to manage mass customization in ETO companies,
however there are certain challenges to consider. It has been
Future research directions
observed that companies at different stages of the imple-
mentation phase face different challenges. The actions taken The papers in this volume showcase how supply chain man-
by companies are summarized. As a result, a practical tool agement is challenging in a construction environment, given
for the implementation of the project configurator long lead times, changing specifications and project com-
is presented. plexity. While the cases provide a rich base of domain know-
In addition to the “common” project challenges faced by ledge, there remains a range of opportunities to build more
ETO companies, there is an increasing pressure from the decision support solutions that can coordinate across stake-
manufacturing side of their supply chains to focus on the holder preferences, and enable optimization. More specific-
sustainability of their operations. Nowadays, various digital ally, we propose a number of areas for future research,
technologies are available that could help companies to which are summarized below.
attain more sustainable operations if applied correctly. The First, there is an opportunity to develop the body of
paper “Sustainability challenges and how Industry 4.0 tech- knowledge to include more quantitative studies. As is shown
nologies can address them: A case study of a shipbuilding from this special issue, there is great value in the context
supply chain” by Strandhagen, Buer, Semini, Alfnes, and offered by qualitative studies. However, as the ETO field
Strandhagen (Strandhagen et al. 2020) identifies sustainabil- moves forward to a position of maturity, there are many
ity challenges and explores how Industry 4.0 technologies opportunities to gather insights from larger quantitative
can enhance sustainability of ETO supply chains, in particular, datasets. In particular opportunities to apply tools from
addressing the issues of shipbuilding industry. Through an game theory, multi-objective optimization, statistical data
empirical investigation of the shipbuilding industry and exploration to shed even more insights. But that requires a
reviewing relevant literature, the authors derive a list of sus- comprehensive dataset that gathers projects across industries
tainability challenges that the shipbuilding industry faces at and characterizes their attributes.
different phases of a ship’s life cycle. They provide an over- Second, technological advances generate many opportu-
view of relevant digital technologies and address links nities but also challenges. Papers in this special issue have
between sustainability, digitalization and manufacturing for demonstrated some of the potential gains from better infor-
the life cycle of ships. The authors present 9 different scen- mation management, use of digital technologies, product
arios in which digitalization can improve sustainability in the configurators and cloud-based services. Technology can play
shipbuilding industry. The paper provides a guideline for an important role in the co-ordination of information require-
researchers on future research topics about sustainability and ments across the stakeholders and we will likely see this
digitalization in ETO companies, and for practitioners regard- trend continue and accelerate across ETO type industries.
ing the potential application areas for digital technologies. Research that supports the way in which these technologies
Another “modern” concept that has received a lot of can be adopted and exploited for improvement would be
interest among researchers and practitioners is cloud manu- very welcome.
facturing. Cloud Manufacturing (CM) or “Manufacturing ver- Third, there is also an opportunity to consider the appro-
sion of Cloud Computing” is a service-oriented model that priate management structure and governance to deliver
shares manufacturing capabilities and resources on a cloud desired outcomes. We see from papers “An investigation into
platform with multiple users. The paper “The role of design and performance of supply chains for public procure-
Engineering-to-Order machinery manufacturers in future ment projects” by Genovese, Morris, Acquaye, Koh, and
Cloud Manufacturing supply chains: a business case and a “Procurement organization in project-based setting: a mul-
strategic perspective” by Tedaldi and Miragliotta (Tedaldi and tiple case study of engineering-to-order companies” by
Miragliotta 2020) demonstrates a real-life application of the Moretto, Patrucco, Walker, Ronchi, in particular, the need to
 PRODUCTION PLANNING & CONTROL 7

integrate clear upfront planning and procurement with the evolves, an increase in quantitative studies may provide use-
project delivery processes, and choose the right configura- ful clarity. A final comment concerns contingency, which has
tions, focus and relational types. These contingency based formed the theoretical basis for a number of papers in this
prescriptions are valuable, and we would welcome more evi- special issue. There is a still a relevant challenge for research-
dence to show which configurations work, and which do ers to understand and explain which approaches work in dif-
not, according to different situations. In terms of the govern- ferent situations, and to show the relevant evidence and
ance of the project process, there is a danger that project prescriptions.
decision making is too centralized and thus vulnerable to
error, or it is too decentralized and lacks coordination.
Research into the right balance of centralized vs. decentral-
ized control may shed insights. Acknowledgements
Finally, there is much potential to harness the innovation The Authors (and co-Guest Editors of this Special Issue) wish to thank
potential of SMEs. The paper “Innovation in Megaprojects the Editor-in-Chief of Production Planning & Control journal and his
and the Role of Project Complexity” by Cantarelli notes the assistant for providing many helpful suggestions and guidance through-
intricate relationship between complexity and innovation in out the process that led to the publication of this Special Issue. We
would also like to thank all reviewers that contributed to the timely
megaprojects, and this observation can be extended to the
publication of this special issue.
area of SMEs. The latter play a vital role in niche industries,
specialist capability and local economies, and hence, it is
vital that public clients and large engineering organizations
find ways of engaging with SMEs. We would welcome further Disclosure statement
research that would support, or increase our understanding, No potential conflict of interest was reported by the author(s).
of these processes.

Notes on contributors
Concluding remarks
The construction industry and complex engineering work is a
Roberto Cigolini is a full professor of Supply Chain
key sector of every country and the application of Management and of Production Management with
Operations and SCM techniques holds much promise to the School of Management of Politecnico di Milano
improve performance of construction firms and their projects (Italy). His main research interests are primarily
in many ways. In this editorial, we have conceptualized con- related to business planning and control, supply
struction and complex engineering projects as ETO supply chain planning, collaborative forecasting, planning
for circular economy and supply chain finance. He is
chains, where products are designed, engineered and fin-
director of the Global Executive Master in Operations
ished after an order has been received. This facilitates discus- and Supply Chain Management (GEMOS) at MIP –
sion across sectors, as well as adaptations to mainstream Politecnico di Milano Graduate School of Business. He is visiting profes-
SCM theory and practice. We have also presented an outline sor at Eada Business School Barcelona (Spain) and at Krannert School of
framework to categorize the papers in this special issue. This, Management (Purdue University – USA). He is also member of the teach-
hopefully, serves as a helpful guide to the reader, but also ing body of the PhD program in Management Engineering at Politecnico
di Milano and founding member of the Technical Committee on
contextualizes the wider challenges of implementing opera-
Semiconductor Factory Automation (IEEE Robotics and Automation
tions and SCM concepts. We hope our readers help the field Society). He was also responsible for the exchange program between
by taking up the challenge of understanding these more Politecnico di Milano and Texas A&M University (USA).
complex interactions shown in the framework and their
impact on project success.
Common themes arise from the papers included in this Jonathan Gosling is a Professor of Supply Chain
special issue, including those related to procurement, logis- Management. He is also Deputy Director of the
tics, supplier and supply chain management, engineering Business and Management PhD Programme at
changes, innovation and complexity management, as well as Cardiff Business School. Prior to becoming an aca-
adopting new technologies and performance measures. We demic, he worked in the automotive industry as a
supply chain analyst. Jon’s research and teaching
see these issues explored in a range of industrial contexts,
revolve around the themes within operations and
including shipbuilding, construction, and machinery, as well supply chain management. In particular, he focuses
as ‘megaproject’ situations, primarily through case-based on ’engineer-to-order’ (ETO) supply chain environ-
approaches. Looking across these papers, our suggested ments, where bespoke innovative engineering work is undertaken for an
areas for future research are to give further insights and individual customer. This often leads him into the domain of large com-
guidance for technological advances in ETO supply chains, plex engineering projects, taking a systems approach to facilitate
improvements and challenge current practice. To undertake research in
further development of appropriate management and gov-
this area, Jon has been involved in a number of funded projects, for
ernance structures to deliver desired outcomes, and research example in the areas of procurement for major contracts, learning les-
investigating the innovation potential of SMEs. Overall, while sons across projects, and adopting new technologies across the supply
qualitative approaches have given much insight, as the field chain in ETO environments.
8 R. CIGOLINI ET AL.

Ananth Iyer is the Susan Bulkeley Butler Chair in Analyze Their Causes in Engineer-to-Order Construction Supply
Operations Management at the Krannert School of Chains.” Production Planning and Control (forthcoming).
Management. He is the Department head of Cannas, V., A. Masi, M. Pero, and T. Brunø. 2020. “Implementing
Management and Senior Associate Dean at the Configurators to Enable Mass Customization in the Engineer-to-Order
Krannert School of Management at Purdue Industry: A Multiple Case Study Research.” Production Planning and
University. He is he Director of DCMME (Dauch Control (forthcoming).
Centre for the Management of Manufacturing Cantarelli, C. 2020. “Innovation in Megaprojects and the Role of Project
Enterprises) and the GSCMI (Global Supply Chain Complexity.” Production Planning and Control (forthcoming).
Management Initiative). He was the Director of Ekesk€ar, A., and M. Rudberg. 2020. “Third-Party Logistics in Construction:
Purdue NExT - a University wide modular online interactive courses for Perspectives from Suppliers and Transport Service Providers.”
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Prior to joining the Krannert faculty taught at the University of Chicago. Genovese, A., J. Morris, A. Acquaye, and L. Koh. 2020. “An Investigation
His teaching and research interests are operations and supply chain into Design and Performance of Supply Chains for Public
management. His research currently focuses on analysis of supply chains Procurement Projects.” Production Planning and Control (forthcoming).
including the impact of promotions on logistics systems in the grocery Gosling, J., and M. M. Naim. 2009. “Engineer-to-Order Supply Chain
industry, and analysis of the impact of competitors on operational man- Management: A Literature Review and Research Agenda.”
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supplier contracts, study of spare parts and reverse supply chains, “Defining and Categorizing Modules in Building Projects: An
impact of information visibility and use of empirical data sets in opera- International Perspective.” Journal of Construction Engineering and
tions management model building Management 142 (11): 04016062.
Gosling, J., D. R. Towill, M. M. Naim, and A. R. Dainty. 2015. “Principles
for the Design and Operation of Engineer-to-Order Supply Chains in
Olga Senicheva is a professor at the Krannert School the Construction Sector.” Production Planning and Control 26 (3):
of Management, Purdue Univeristy. She joined 203–218.
Purdue in 2016 after she obtained her Ph.D. in in Iakymenko, N., P. Brett, E. Alfnes, and J. Strandhagen. 2020. “Analysing
Business Administration with concentration on the Factors Affecting Engineering Change Implementation
Supply Chain Management and Logistics from Performance in the Engineer-to-Order Production Environment: case
Kuehne Logistics University (KLU), Hamburg, Studies from a Norwegian Shipbuilding Group.” Production Planning
Germany. Her research and teaching interests focus and Control (forthcoming).
on service operations, inventory management and Moretto, A., A. S. Patrucco, H. Walker, and S. Ronchi. 2020. “Procurement
project management. Olga has a solid quantitative Organisation in Project-Based Setting: A Multiple Case Study of
background in supply chain modelling and analysis. In her work, she Engineering-to-Order Companies.” Production Planning and Control
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Pero, M., M. Sto €ßlein, and R. Cigolini. 2015. “Linking Product Modularity
ORCID to Supply Chain Integration in the Construction and Shipbuilding
Industries.” International Journal of Production Economics170: 602–615.
Roberto Cigolini http://orcid.org/0000-0002-0752-3416 Shishodia, A., P. Verma, and K. Jain. 2020. “Supplier Resilience
Jonathan Gosling http://orcid.org/0000-0002-9027-9011 Assessment in Project-Driven Supply Chains.” Production Planning and
Ananth Iyer http://orcid.org/0000-0001-7700-0728 Control (forthcoming).
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