SDanish Architecture Sales To Germany in The 1990skaates (2001) Phd-Thesis

1
Danish Architecture Sales to Germany in the 1990s:

A IMP/INPM Approach to Examining the Professional Service and Project-
Related Internationalization of Danish Architectural Service Firms

Maria Anne Skaates, PhD-thesis

Table of Contents:

0. Foreword 9

1. Introductory Presentation of Research Questions 11

2. Definition of Key Concepts 16
2.1. Architectural Services, Internationalization, and Market-
Seeking 16
2.2. Internationalization Theory 19
2.2.1. Introduction. 19
2.2.2. The Network View of Internationalization versus other Inter-
nationalization Theories 20
2.3.The Knowledge Aspect of Architectural Services 25
2.4. Architectural Services in Relation to General Characteristics of
the Professional Services 32
2.5.Architectural Services as Parts of Construction Projects 40
2.6.Architectural Services seen from an Architectural Project Perspective 50

3. A Review of Project Marketing Literature relevant to the Sale of
Project-Related Architectural Services 54
3.1. Methodology and Delimitation of the Literature Review 54
3.2. The Historical Development of Non-IMP and -INPM Related
Project Marketing Research relevant to the Sale of Pro-
ject Related Architectural Services 58
3.3. The Contribution of IMP and INPM Group Work on Project Market-
ing relevant to the Sale of Project Related Architectural Services 64
3.3.1. An Introduction to and Criticism of the IMP Group Work and IMP
Terminology 64
3.3.2. An Introduction to INPM Work concerning Project Marketing 75
3.3.3. Boundary Spanner and Relationship Promoter Actor Roles 90
2
4. Concerning My Ontological and Epistemological Viewpoints and
their Influence on My Chosen Methodology and the Operation-
alization of Bourdieus Cultural and Social Capital 97
4.1. Introduction 97
4.2. My Ontological and Epistemological Standpoints 97
4.3. Concerning the Methodology and Methods used in this Dissertation 105
4.3.1. Methodology and Case Study Design in Relation to the Objectives 105
of the Study
4.3.2. Sources of Data 107
4.3.3. Issues of the Validity of Interpretation 107
4.4. The Use of Bourdieus Cultural and Social Capital Concepts in
this Dissertation 113
4.4.1. The Role of Cultural and Social Capital in Establishing Credibility 113
4.4.2. The Commensurability of Bourdieus Field Concept and IMP
Network-Related Concepts 125

5. An Elaboration on the Scientific Relevance of the Dissertation Research
Questions in Relation to Previous Project Marketing Research
131
5.1. Introduction: General Remarks concerning the Entire Study 131
5.2. Remarks concerning Research Question 1 on the Size and Growth of
the German Market 134
5.3. Remarks concerning Research Question 2 on Danish-German
Architectural Export Actors 135
5.4. Remarks concerning Research Question 3 on German Project-Related
Knowledge 137
5.5. Remarks concerning Research Question 4 on the Process of Obtaining
Projects 141
5.6. Remarks concerning Research Question 5 on the Role of Previous
Project Work
142
5.7. The Scientific Relevance of this Dissertation Study 144

6. A Comparative Economic and Structural Description of the German
Market for Architectural Services During the Nineties 147
6.2. The Development of the German Markets for Architectural Services
and Construction 150
6.3. The Development of the Danish Markets for Architectural Services
and Construction 161
6.4. A Summary of the Development on the German and Danish Markets
During the Nineties 172
6.5. The Implementation of the EU Public Service Directive 172
6.5.1. Introduction to the EU Public Service Directive 172
3

6.5.2. The German Implementation and Interpretation of the EU Public
Service Directive with regard to Architectural Services 174
6.5.3. The Danish Implementation and Interpretation of the EU Public
Service Directive with regard to Architectural Services 177
6.5.3.1.Introduction 177
6.5.3.2. Consequences of the Implementation of the Public Services
Directive in Denmark and Danish Actors Reaction to the
Differences in Implementation in Denmark and Germany 180
6.5.3. Conclusions with Regard to the Implementation of the Public
Service Directive 189

7. A Description of Danish-German Architectural Internationalization Actors
in Germany in the 1990s 190
7.2. The Danish Ministry of Housing and other Danish Ministries 190
7.3. Danish Civil Engineering Consulting Firms and their Organizations 195
7.4. Danish Contractors 199
7.5. The Danish Real Estate Developing Firm Kuben 200
7.6. The Nature of the Internationalization of the Danish Architectural
Services Industry 203

8. The Knowledge used in Acquiring Architectural Projects in Germany 207
8.2. Knowledge of the Broader German Construction Industry Environment 209
8.2.1. Introduction 209
8.2.2. Firm 1s Knowledge of the Broader German Construction
Industry Environment 210
8.2.5. Conclusion concerning the Knowledge of the German Construction
Industry 213
8.3. Knowledge related to Specific Actors and Potential Projects 214
8.3.1. Introduction 214
8.3.2. Firm 1s Knowledge related to Specific Actors and Potential Projects 214
8.3.5. Conclusion concerning Actor and Project-Specific Knowledge 227
8.4. Degree of Knowledge Diffusion in the Case Study Firm and the
Acquisition of General versus Project-Specific Knowledge 229
8.5. Conclusions concerning the Knowledge Used in Obtaining Archi-
tectural Projects 237
4
9. The Acquisition of Architectural Projects by the Case Study Firms 240
9.2. The Process of Architectural Project Acquisition 240
9.3. The Role of Accumulated Social Capital in Relation to Project
Acquisition 247
9.4. The Role of Discontinuity in Project Acquisitions 250
9.5. Conclusions Concerning the Acquisition of Architectural Projects 256

10. The Role of Previous Project Work in Acquisitions on the German
Market 257
10.2. The Role of References in relation to Cultural and Social Capital 257
10.3. The Positioning of the Three Case Study Firms 265
10.4. Conclusion Concerning the Relation of Previous Project Work to
Obtaining Projects 272

11. Conclusion regarding the Scientific Contributions of this Dissertation
Study 274

12. Managerial Implications for Architectural Firms and other Construction
Industry Actors 284

13. Summary 292
13.1. Introduction to the Study and Its Research Questions 292
13.2. Introduction to the Theoretical Framework of the Study 294
13.3. Presentation of the Empirical Study 300
13.3.1. Analysis pertaining to Research Question 1 (Chapter 6) 300
13.4. Conclusions concerning the Contribution of this Study 317

14. Afhandlingsresum p dansk (Summary in Danish) 321
14.1. Introduktion til studiet og dets forskningssprgsml 321
14.2. Introduktion til studiets teoretiske ramme 323
14.3. Sammenfatning af det empiriske studium 328
14.3.1. Analysen af forskningssprgsml 1 (Afsnit 6) 328
14.4. Slutbemrkninger om studiets bidrag 346

5
15. Bibliography 350

Appendix A. Pilot Study Research on Danish Architectural Exports to
Germany 380
A.1. Chronological Description of the Pilot Study Research 380
A.2. Exclusion of Other Marketing/Economics Perspectives from the
Research Focus 384
A.3.The Danish Architectural Service and Construction Industry 391
A.3.1. Danish Architects and Their Organizations 391
A.3.2. Role of the Architect in the Danish Construction Process 393
A.3.3. Degree of Competition and Cooperation between Danish Architects 395
A.3.4. The International Competitiveness of the Danish Construction
Industry 395
A.4. Structure of the German Architectural Services Industry 396
A.4.1. Number of Architects and Architects Organizations in Germany 396
A.4.2. Role of the Architect in the German Construction Industry in
Comparison with the Danish Construction Industry 397
A.4.3. Degree of Competition and Cooperation between Architects
working on the German Market 400
A.5. Some Remarks on European-Wide Dynamics 403
A.6. The Qualitative Pilot Study Interviews 406
A.6.1. Selected Responses of Respondents 406
A.6.2. Criticism of Pilot Study Method and Results and Further Delimitation
of my Main Study on the Basis of my Pilot Study 408

Appendix B. Three Case Study Firms of Danish Architectural Firms 411
B.1. Introduction 411
B.2.Case Study Firm 1: DISSING+WEITLING arkitektfirma A/S 412
B.2.1.An Introduction to the Firm 412
B.2.2.DISSING+WEITLINGs Architectural Project Acquisition 413
B.2.3.DISSING+WEITLINGs Knowledge about the German Market 435
B.2.4.The Role of DISSING+WEITLINGs Previous Project Work in
Relation to Acquisitions. 439
B.3.Case Study Firm 2: Arkitektfirma C.F. Mllers Tegnestue 446
B.3.1. An Introduction to the Firm 446
B.3.2. C.F. Mllers Tegnestues Architectural Project Acquisition 447
B.3.3. C.F. Mllers Tegnestues Knowledge about the German Market 467
B.3.4. The Role of C.F. Mllers Tegnestues Previous Project Work
in Relation to Acquisitions 477
B.4. Case Study Firm 3: Almvig & Partnere A/S 479
B.4.1. An Introduction to the Firm 479
B.4.2. Almvig & Partneres Architectural Project Acquisition 480
B.4.3. Almvig & Partneres Knowledge about the German Market 506
B.4.4. The Role of Almvig & Partneres Previous Project Work in
6
Relation to Acquisitions 513

Appendix C. A List of Research Interviews 519

List of Figures and Tables:

Figures.

1. Cova, Mazet, and Salles General Marketing Configuration for
Project-to-Order Firms 13
2. Architectural Services which may be considered as Exports 18
3. Levels of Environmental and Structural Determinism in International- 24
ization Theories
4. The Knowledge Conversion and Sharing Processes of Nonaka and
Takeuchi 27
5. Boisots Social Learning Cycle 29
6. Alajoutsijrvi and Tikkanens Competencies in the Context of
Relationships 31
7. Architectural Services in relation to Construction Projects 41
8. The Division of Construction Projects into Design and Construction
Related Phases seen from the Viewpoint of the Architect 42
9. Key Characteristics of Construction Project Related Architectural
Services that are a Part of Architectural Project Offerings 53
10. The Actors-Resources-Activities (A-R-A) Model 71
11. Hkansson and Johansons Classification of Governance Structures 74
12. Karin Holstius Project Marketing Cycle 78
13. Cova et al.s Project Marketing Strategy Framework 81
14. Salminens Factors that Determine the Usability of a Specific
Reference 84
15. Potential Modes of Reference Use in Industry Project Marketing 85
16. Relationship of the Habitus to Structures and Practices 102
17. The Embeddedness and Social Construction of Networks in Relation
to Economic and Institutional Factors in this Dissertation 102
18. Classification of Governance Structures in the Professional Services 104
19. Bourdieus Field and Capital Concepts 117
20. The Relationship Between Activities and the Generation of Social and
Cultural Capital 120
21. The Positioning of Albertsens Three Architectural Sub-Fields with
Regard to Levels of Accumulated Cultural and Social Capital 123
22. The Hierarchy of Power of Architectural Firms on National Markets based
on Social, Cultural, and Economic Capital Accumulation 125
7
23. The Role of History in Relation to a Concrete Project Offering 126
24. The Case Study Firms German-Related Knowledge in the Context of
Relationships 230
25. The Case Study Firms Germany-Related Tacit Knowledge in the
Context of Relationships Revised Figure 231
26. The Structure of Project Acquisition Work by Case Study Firm Project
Acquirers 233
27. The Architectural Project Acquisition Process in the Private Sector 244
28. The Architectural Project Acquisition Process in the Public Sector 246
29. The Architectural Project Acquisition Process in a Client Relationship
Situation 252
30. The Initial Position of the Case Study Firms on the Danish Market 268
31. The Initial Position of the Case Study Firms on the German Market 269
32. The Accumulation of Social and Cultural Capital During the Nineties 270
33. The Position of the Three Case Study Firms on the German Market in
Relation to Albertsens Three Architectural Sub-Fields 271
A.1. Porters Five Forces Driving Industry Competition 385
A.2. Characteristics of Storper and Salais Worlds of Production 389
A.3. The Hierarchy of Architectural Firms on National Markets 402

Tables.

1. Nonaka and Takeuchis Two Types of Knowledge 26
2. Total Turnover in the German Construction Industry in Billions of DEM 152
3. Total Turnover in the Construction of Housing In Germany in Billions of
DEM 152
4. Total Turnover: Construction of Buildings for the Private Sector in
Germany (not including Housing) in Billions of DEM 153
5. Total Turnover: Construction of Buildings for the Public Sector in
Germany (not including Housing) in Billions of DEM 153
6. Total Number of Architects, Interior Decorators, Landscape Architects,
and Urban Planners registered by the German Architekten-
kammer 155
7. Number of Unemployed Architects, Urban and Regional Planners, and
Civil Engineers in Germany 156
8. Construction Industry Indices of Production 162
9. Indices of Construction Permits for Housing 162
10. Total Turnover: Construction Firms (e.g. Contracting, Bricklaying,
Carpentry, Plumbing, Electrical Installation Firms) situated in
Denmark in Millions of DKK 164
11. Number of Members of DAL/AA, 1989-1998 167
12. Number of PAR Member Firms and Firmed Headed by DAL Members 168
13. Number of VAT-Paying Architectural Firms 1989 1994 169
14. Expert Turnover of Danish Architectural Firms that are Members or
8
Associated Members of the Council of Practicing Architects
(PAR) in Millions of DKK 171
15. Percentage of Types of Calls for Tendering and Use of the Accelerated
Procedure in 1997 with regard to Architectural and Engineering
Consulting Services 187
A.1. Normal Allocation of Legal Responsibility in the Construction of
Buildings 398

9
0. Foreword.
At the beginning of the previous decade, in January 1990, the Danish construction
market, and therefore also the market for architectural services, were in the midst of a
severe slump (Eurostat, 1995). At the same time, the German market was beginning to
boom (European Construction Research, 1995:8,12). One of the reasons for this was
fall of the Berlin Wall and the subsequent process to unify the two German states - the
Federal Republic of Germany and the so-called German Democratic Republic - in
one, larger Federal Republic of Germany.

Due to the poor home market circumstances, many Danish construction industry
actors, including individual Danish architects (in most cases those who were unem-
ployed) as well as Danish architectural service firms, decided to attempt to find work
on the German market (Halskov, 1995). However, many of the aspirations of the
Danish firms who attempted to sell construction industry related goods and services in
Germany were dashed. By 1996, many of the largest Danish civil engineering and
contracting firms had lost billions of Danish kroner, and a great number of small firms,
typically architectural firms or subcontractors in the construction process, had
experienced severe losses, some of which had jeopardized the very existence of these
firms (ibid.). This turn of events surprised insiders in the Danish construction industry
and the general public in Denmark alike, as both groups believed that Denmark has
high construction standards and that the firms that had attempted operations in
Germany were generally technically competent and had sound domestic business
policies (ibid.).

This doctoral dissertation research will not attempt to explain the reasons for the
misfortunes of the Danish construction industry on the German market. Instead it will
focus on the internationalization activities of three Danish architectural firms that have
achieved a degree of success on the German market in the 1990s and are still present
on this market today in three case studies. It is, however, my hope, as well as the hope
of the partners and other employees of the three Danish firms that generously
contributed many hours of their scarce time to my research project, that other Danish
and Nordic construction industry actors, especially architects and architectural firms
as well as civil engineers and civil engineering firms, will benefit by reading and
reflecting upon the judgements and choices of the case study firms as they are
presented in this dissertation.

It should be noted that I bear sole responsibility for my case study research and the
content of this dissertation; thus the interpretations of the events and the connections
10
made between empirical observations and theories of economics and marketing in this
work are mine alone. Additionally I think it best to mention that I am a business
administration graduate and that the main academic aim of my research is to contribute
to progress in the discipline of marketing. Several initial chapters of this dissertation
may therefore seem mystifying or very demanding to read to persons who have other
educational backgrounds, such as architects, engineers, or skilled craftspeople. I
would like to suggest that these persons first read Chapters 6 10, 12-14, and Ap-
pendixes A and B.

Lastly I would like to mention I have chosen to focus a great deal more on ontology,
epistemology, and methodology than is common in English language (here, especially
American) business administration Ph.D. dissertations. There are two main reasons for
this:

1. I have been inspired by German and French academic literature in the fields of
Marketing, Business Administration, Sociology, and Political Science which I have
read in their original language. Many German and French works place a greater
emphasis upon these issues. Additionally I draw upon the works of the French
sociologist Pierre Bourdieu, whom I have read mainly in English, German, or
Danish translation due to my mediocre ability to read French. As steps in
conducting research, Bourdieu (1990) requires that the researcher (a) listen but then
distance herself from the informants own life world and (b) scrutinize her own
scientific stance.

2. I have chosen to combine and compare theories and models from several
disciplines in my work. This requires, in my opinion, explicitly stated ontologies
and epistemologies to insure commensurability (see e.g. Burrell and Morgan,
1979).

These points will be further elaborated upon in Chapters 1, 4, and 5 of this disser-
tation.

Maria Anne Skaates, Doctoral candidate at Copenhagen Business School,
M.A. in Business Administration and German (Odense University, Denmark, 1996).
Oulu, Finland, January 15, 2000.
Revised dissertation submitted January 15, 2001
11
1. Introductory Presentation of Research Questions.

The purpose of this research is to contribute to scientific progress in the area of
project marketing through a historical, descriptive, explorative-integrative (Maale,
1996) study of the international marketing of architectural services. This research
draws upon and enriches the present body of theories about project marketing. The
research questions for this Ph.D. dissertation were chosen on the basis of initial,
exploratory pilot study research about Danish sales of architectural projects on the
German market undertaken from November 1997 to August 1998. (See Appendix A
for a description of the pilot study.) These research questions and the structure of this
dissertation will be explained briefly in this chapter.

The first two research questions are of a general nature:

1. How did the German market for architectural services develop during the
nineties in terms of e.g. institutions, total market size, and growth rates at the
national and federal state (i.e. Lnder) levels?

2. Who were the major actors involved either directly or indirectly in the
Danish internationalization of architectural services to Germany in the 1990s
and to what extent and how did they cooperate with one another? The major
actors will be referred to collectively as the Danish-German Architectural Export
Actors; it is expected that the group will include not only architectural firms but also
civil engineering firms, contracting firms, financial institutions, governmental bodies as
well as professional and industrial organizations.

The purpose of these two questions is to provide a general overview of the situation
on the German market for architectural services in the nineties at the macro-economic,
macro-structural and key German-Danish actor levels as well as to lay a broad
contextual foundation upon which the specific experiences of the three case study
firms can be explained. Furthermore question two will also deal with whether the
cooperation occurred in a network, as the use of network theories of marketing and
internationalization will be assessed in this dissertation.

The remaining research questions concern the three case study firms. They are related
to a model developed by three French researchers, Cova, Mazet, and Salle, for firms
that sell projects. The model, which is a general marketing configuration for project-to-
order supplier firms, is depicted in Figure 1 on page 13 and will be explained in depth
12
in Subsection 3.3.2. The term project will be defined and related to architectural
firms offerings in Section 2.5.

3. What sort of specific knowledge about the German market and specific
projects on the German market did the case study firms use to receive
architectural projects on the German market? This research question relates
to steps 2 - 9 of Cova, Mazet, and Salles General Marketing Configuration as
shown in Figure 1 on the next page. At a general level, it concerns the knowledge
that the case study architectural service firms used to interact in specific situations
with important persons, officials, and firms (the network of step 2 in the model)
who might have potentially placed a project order or have possessed information
concerning potential orders (related to the dynamic project screening of the step
4) as well as the knowledge that enabled the architectural service firms to under-
stand information coming from the broader environment (see the models step 3)
of the German construction industry. It also includes the knowledge concerning
specific actors on the German market (in steps 5 9 of Cova et al.s model) once
a concrete project had been found upon which the firm had decided to bid.

4. How were concrete architectural projects obtained by the case study firms?
Here the focus of the empirical case research is the steps leading up to the
successful creative offering of the three case study firms (steps 2 - 9 of the
model of Figure 1). Key subquestions include: Did the steps undertaken by the
architectural service firms follow the chronological order listed in the General
Marketing Configuration? Does the model leave some important factors out and/or
include some irrelevant factors? In the case of architectural competitions in
Germany and orders from the public sector that have been procured in accordance
with the regulations of the EU Public Service Directive, did network investments
(step 2 in the model) and/or negotiations (step 9 in the model) play a role, and if
so, what was their role?

5. What role did previous project work play when case study firms obtained
specific projects on the German market? This question deals with the
relationship between the awarded projects-in-progress/already completed projects
and new project awards.

The issues of knowledge of Question 3 will be examined using the frameworks of
Alajoutsijrvi and Tikkanen (1999), Boisot et al. (1997), and Nonaka and Takeuchi
(1995) as explained in Section 2.4.

13
Figure 1. Cova, Mazet, and Salles General Marketing Configuration for
Project-to-Order Supplier Firms.

1. Analysis and Strategic Priorities

2. Network Investments

3. Environmental Scanning

4.1. Development of a Core Offer 4.2 Dynamic Project Screening

5. Creative Offering

6.1. Choice of Technical Adaptations 6.2. Choice of Socio-Economic
to the Project Adaptations to the Project

7. Resource Mobilization

8. Proposal

9. Negotiation

10. Completion

Steps 1 - 5 above and on the thick horizontal line concern marketing-related steps
taken independent of a given project (the phase of the anticipation of a project).

Steps 5 - 10 on and below the thick horizontal line concern marketing and
coordination efforts related to a specific project that has been awarded or is in the
processes of being awarded to the project-selling firm in question (the adaptive
phase).

14
Source: Cova et al., 1994, p. 40.
With regard to questions 4 and 5, the analytical framework will comprise of existing
project marketing theories, including network theories and concepts (see Chapter 3)
and an operationalization of Bourdieus conceptualizations of the accumulation of
social and cultural capital (explained in Section 4.4.). Additionally the suitability of
different network theories and concepts will be assessed on the basis of the inter-
pretation of the empirical data.

Concerning Figure 1 on page 13, Cova, Mazet, and Salles General Marketing Config-
uration for Project-to-Order Supplier Firms is a contribution to the sub-field of
marketing theory that deals with project marketing and systems selling. This sub-
field will be explained further in Sections 2.4 and 3.2-3.3. Within the project
marketing/systems selling sub-field, Cova, Mazet, Salle, and I, as the author of this
dissertation, consider ourselves to be associated with two closely related international
groups of researchers, the International Marketing and Purchasing Group
(subsequently referred to as the IMP Group) and the International Network for Project
Marketing and Systems Selling (in the following abbreviated as INPM).

The members of these groups emphasize that both the buying and the selling parties
play active and interactive (and thus NOT merely reactive) roles in the marketing/
purchasing of industrial and investment goods, such as buildings (Servais, 1994: 54-
62). In the opinion of the researchers associated with the IMP and INPM groups, it is
therefore very important to examine the relations between the buyer-seller dyad (a
key concept in IMP/INPM terminology, see e.g. Hkansson, 1992:14-18) as well as
more complex networks and positions of actors on a given market (see e.g.
Easton, 1992). This will also be explained in much greater depth in Section 3.3.

Having briefly introduced the research questions of this dissertation, the content of the
remaining chapters will now be summarized to help readers orient themselves in their
further reading:

Key concepts such as architectural services, internationalization, market seek-
ing, knowledge, professional services, projects, construction projects, and
architectural projects are defined and delimited in Chapter 2 on the basis of relevant
business administration literature.

Chapter 3 contains a review of project marketing literature relevant to the sale of
project-related architectural services. This review has been written with the aim of
15
fulfilling Bourdieus (1990) requirement that the researcher scrutinize her own scientific
stance (see the previous remarks on this issue in this dissertations foreword). It
contains an introductory section on literature review methodology as well as a section
concerning contributions from the IMP/INPM researchers and yet another section
dealing with selected research from other project marketing perspectives. Finally it
includes a review of IMP/INPM and non-IMP/INPM boundary spanner literature.

Chapter 4 commences with presentation of my epistemological and ontological view-
points. Thereafter, the methodology and methods used in this dissertations empirical
section are presented and justified. Finally, the use of Bourdieus social and cul-
tural capital terminology is justified and the issue of these terms commensurability
with key IMP/INPM contributions (e.g. Cova, Mazet, and Salles, 1996a, concept of
the milieu) is examined in keeping with e.g. Burrell and Morgans 1979 recom-
mendations (see the foreword to this dissertation).

In Chapter 5, the focus is once again upon the research questions of this study. They
are linked to the previously mentioned definitions, the literature from the literature re-
view, and the chosen methodology, i.e. the literature covered in Chapters 2-4.
Furthermore, the scientific relevance of these questions is discussed in some depth in
relation to (a) the current State of the Art of INPM and IMP scientific work,
including relevant on-going scholarly debates among INPM and IMP researchers, as
presented in Subsections 3.3.1. to 3.3.3. as well as (b) the cultural and social capi-
tal framework presented in Section 4.4.

Chapter 6 contains the description of the German market for architectural services in
the 1990s, i.e. the answer to research question 1. Chapter 7 deals with research ques-
tion 2. Chapters 8 10 deal with research questions 3 5 respectively. Chapter 11
discusses the scientific merit of this study. Chapter 12 contains practical and mana-
gerial suggestions for architectural and other project selling and/or professional service
firms. Chapter 13 is the summary of the dissertation in English, whereas Chapter 14
contains the same summary in Danish, and Chapter 15 the bibliography. Appendix A
describes my pilot study research, Appendix B contains a selection of the statements
of the respondents from my case study firms, and Appendix C lists all research
interviews undertaken in connection with this study.
16
2. Definition of Key Concepts.
2.1. Architectural Services, Internationalization, and Market-Seeking.

In daily conversation, when one speaks of architectural services, images of
architects drawing buildings are probably what most often come to the mind of the
layperson. In reality, however, architects around the world offer a wide range of in-
dividual services, including design, site and building inspection, renovation work, and
construction management services, which are combined in various ways depending on
agreements with the client in question. Additionally, many architects no longer
predominantly draw manually; instead they use computerized design software such as
CAD-programs. Over and beyond that, portfolios of services offered vary from one
architectural firm to another and from country to country due to e.g. differences in
legal regulations and the organization of the construction industry. According to
Stevens (1998:29):

In France, architects rarely prepare construction drawings, and may never
set foot on site. In Australia and other Commonwealth nations, the
measurement and costing of large buildings is conducted by quantity
surveyors, an occupation totally independent of architects. Norwegian
architects also invariably handle town planning. Not only does the division
of labor vary, but also the sort of client handled by the architect. In Italy,
almost all small-scale construction is handled by the geometria, who we
would consider surveyors, and the division of labor between architects and
civil engineers is very indistinct. Spanish architects deal with highly technical
buildings, such as industrial plants, that English-speaking architects tend to
leave to civil engineers. Similarly, architects in the Benelux countries
produce technical drawings that in the U.K. or U.S.A. would be handled by
engineers.

Thus it is necessary to specify the exact meaning of the terms architectural services
and internationalization in the German-Danish context of this Ph.D. dissertation.

Seen in very general terms, the individual services offered by architectural service
firms in Denmark as well as Germany are predominantly related to the following areas
1
:

1
Unfortunately I have not been able to find a good comprehensive definition of architectural services for
the Danish and German market, and thus have deemed it necessary to construct my own definition based
on my literature studies.
17
1. Designing new buildings
2. Conceptualizing additions or improvements to existing buildings, e.g. renovations
3. Managing or assisting in the construction of new buildings
4. Managing or assisting in the construction of additions or improvements to existing
buildings
5. Urban planning related services
6. Designing lawns, gardens, playgrounds or other outdoor areas (these areas belong
to the subfield of landscape architecture)
7. Building inspection-related services, e.g. in connection with e.g. property sales/
rentals or forces majeure damage
8. Management of facilities
9. Performing preliminary site studies for clients considering construction projects

With regard to the internationalization of architectural services, it is problematic to
speak of exports defined as e.g. the sale of goods and services in another country
than the country in which they were produced (Luostarinen and Welch, 1990:20;
other business administration scholars provide similar definitions) as the production of
architectural services as defined above may or may not take place in the same country
as the sale in question. On one hand, service types 7 - 9 must be performed on site
and thus cannot be regarded as exports. On the other hand, design and urban planning
related services (types 1, 2, 5, 6) may to some extent be performed at a distance from
the site, as long as the architect(s) performing the service has the necessary
information about the site from communication with the customer.

With regard to service types 3 and 4, the situation is unclear. The overall management
of a construction project usually requires the on-site presence of the architect on a
continual basis and therefore cannot be considered an export. Yet at the same time,
consultant type assistance in connection with specific problems related to a given
construction project may or may not require architect presence, depending on the
types of assistance provided. Thus service types 3 and 4 may or may not fall within
the above definition of exports, as shown in the depictions of architectural services
and architectural exports in Figure 2.

18
Figure 2. Architectural services which may be considered as exports.

Architectural Services

(3) Architect-
(4) ural Exports
7 1 2
8 (3) (4)
9 5 6

Source: Authors own conceptualization.

Figure 2 includes all of the nine previously mentioned types of architectural services.
Those which may also be regarded as architectural exports in the sense that
production may take place in one country and the sales and delivery in another
country are placed in the Architectural Exports ellipse which is encircled by the
larger Architectural Services ellipse.

The relation between exports and an architectural firms international offerings
becomes even more complex when one takes into account that offerings to individual
customers often are bundles of the individual services listed and depicted above,
which are specified in e.g. subcontracting contracts (see Luostarinen and Welch,
1990:112-116 for a definition of international subcontracting). In situations where ar-
chitectural service firms have achieved contracts which require the delivery of a com-
bination of design and construction management, only the design-related elements of
this bundle of services may be regarded as exports. On the other hand, if the contract
specifies a combination of design and construction assistance services, the design
element may be seen as an export, whereas the export status of construction
assistance services will depend upon their nature.

Due to the complexity related to the individualized bundles of services offered to
specific customers, I will subsequently speak of internationalization and not of ex-
ports in this dissertation. Majkgrd and Sharma (1998: 9-11) identify two distinct types
of service firm internationalization, client-following and market-seeking:
19

[C]lient-following [...] implies that a firm is part of an international network
of exchange. Client-following firms operate in a network in which their
exchange partners operate internationally. These partners both help and
pressure the other members in the network into going international. Client-
following firms have accumulated experiential knowledge of their
counterpart. (ibid.:9)

In the initial year the market-seeking firms operate in domestic exchange
networks that provide little assistance to go abroad. For a market-seeker,
success abroad is contingent upon the ability of the firm to find partners to
cooperate with, to detect needs, and to establish relations with firms abroad.
Market-seekers lack experiential knowledge of foreign markets and are
exposed to more potential problems than client followers. They must also
establish credibility with the buyers (ibid.:10-11).

In this research, the focus will be upon market-seeking internationalization because, as
indicated in the foreword to this dissertation and Appendix A, the activities of Danish
construction industry actors on the German market in the 1990s were mainly market-
seeking.

2.2. Internationalization Theory.
2.2.1. Introduction.

The title of this dissertation indicates that the focus of this study is internationalization.
The internationalization theoretic perspective must therefore be explained and justified.
This will be done by first describing and contrasting several major internationalization
theories and their ontologies and then discussing the strengths and weakness of the
network approach to studying internationalization in relation to the other theories. The
discussion of internationalization theories in this subsection will, however, be brief
and, in contrast to the literature review undertaken in Chapter 3, methodological
assessments of the individual contributions will not be undertaken because there exists
an excellent, thorough, and comprehensive metatheoretical work on these types of
theories (Strandskov, 1995) which could enlighten persons interested in
internationalization theories with regard to these aspects.

20
2.2.2. The Network View of Internationalization versus Other Inter-
nationalization Theories.

As previously mentioned in Chapter 1 (see also e.g. Hkansson, 1982), the research of
the IMP Group is based on the ontological assumption that interactions between
buying and selling firms on industrial markets as well as in their network influence their
purchasing decisions and marketing efforts. Correspondingly, the researchers of the
IMP Group who have worked with internationalization theory (e.g. Axelsson and
Johanson, 1992; Johanson and Mattsson, 1992a and 1988) emphasize that the inter-
actions and relationships between a firm and other actors in its national and inter-
national environment play a determining role in the internationalization process of the
individual firm in question.

However, the body of IMP literature on internationalization is small, the range of spe-
cific internationalization-related topics covered is wide, and the coverage itself is rather
spread and sporadic. Therefore only one IMP conceptualization that is relevant in
relation to describing the cooperation among network actors (see research question 2
as presented in Chapter 1) will be dealt with in this dissertation, namely Johanson and
Mattssons (1988:200) suggestion that there are three ways in which a firm can
establish and develop positions in relation to its counterparts in foreign networks:

1. through establishment of positions in relation to counterparts in national nets
that are new to the firm, i.e. international extension
2. by developing the positions and increasing resource commitments in those
nets abroad in which the firm already has positions, i.e. penetration
3. by increasing coordination between positions in different national nets, i.e.
international integration (The italics are Johanson and Mattssons.)

Several other well-known non-IMP internationalization frameworks will be presented
and discussed in the following paragraphs; they will thereafter be compared to the
IMP network internationalization ontology. These contributions are as follows:

1. The so-called Uppsala Internationalization Model
2. Institutional economic theories of internationalization based upon transaction
cost theory (e.g. Williamson, 1979) as presented in Strandskov (1995) and
Johanson and Mattsson (1988)
3. The so-called textbook view of foreign market entry as epitomized by Root
(1994); Axelsson and Johanson (1992) coined the term textbook view
The Uppsala Internationalization Model was the result of a number of studies (e.g.
Johanson and Vahlne, 1977) on the internationalization of Swedish manufacturing
21
firms undertaken at Uppsala University in the 1970s. Their collective outcome was a
description of the internationalization process as a gradual step-by-step commitment
to sell and to manufacture internationally as a part of a growth and experiential learning
process (Johanson and Mattsson, 1988: 209). There are two levels of description of
the final Uppsala model, a level that states that internationalization takes place as a
process and a level that suggests that the process is a series of incremental steps, as
opposed to e.g. continous leaps and bounds in many directions (Petersen and
Pedersen, 1996: 118).

One of the Uppsala models implicit assumptions is that the firm chooses to begin to
internationalize, e.g. because of an interest in achieving long-term growth. This and the
suggestion that internationalization processes per se are incremental have later been
called into question (see e.g. Strandskov, 1995:82-85; Petersen and Pedersen, 1996:
122-123) due to increasing pressure to internationalize in certain industries. For the
Danish architectural services industry in the 1990s, this criticism does not seem
especially relevant, due to the fact the European construction sector and the
architectural services industry are not especially international in comparison with other
sectors (see Appendix A). Instead, the lack of projects on the domestic market, as
described in the Foreword of this dissertation, is a much more plausible push mecha-
nism for the market-seeking internationalization that took place on the German market
in the 1990s. However, it is relevant to mention that the Uppsala model deals in its
initial phases with exporting, which, as previously explained in Subsection 2.1., is
somewhat problematic with regard to architectural and other professional services.

From an IMP perspective, it is interesting to examine the reason proposed by the
Uppsala Internationalization Model for incrementalism: the experimental learning pro-
cess. The Uppsala model suggests that (a) a process of experimentation and learning
determines the internationalization path of the firm and (b) this process takes place
through interactions with actors on the foreign market (ibid.). IMP theorists of
internationalization would be willing to subscribe to these propositions; however,
neither the Uppsala model nor the IMP internationalization theories say much about the
types of knowledge necessary for operations on foreign markets. This is thus a
justification of this dissertations research question three (see Chapter 1).

On the other hand, the difference between the Uppsala model as presented in
Johanson and Vahlne (1977) and the subsequent IMP work on internationalization is
that the Uppsala models framework for explanation concerning the extent to which
and the way in which the actions of the individual firm are shaped by its interactions
22
with other actors is much less sophisticated than the IMP framework of network and
dyadic interaction (see e.g. Johansson and Mattsson, 1988 and Subsection 3.3.1. for a
general description of the IMP framework).

The institutional economic theories of internationalization are based upon the
distinction found in Williamsons (1989:234) transaction cost theory between markets
and hierarchies as well as his ontological belief that firms internalize economic
transactions in hierarchies if they are not best governed by the market mechanism
(ibid.). On the basis of these foundations, institutional economic theories of inter-
nationalization seek mainly to explain to what extent and when firms that operate
internationally will internalize their international transactions in hierarchical forms of
governance (e.g. subsidiaries) and to what extent and when these same firms will
externalize them in market transactions (Strandskov, 1995:89-112), through e.g. sales
to distributors. Some institutional economic theories of internationalization also seek
to explain intermediate modes of organization such as joint ventures or virtual
corporations (ibid.).

From a network point of view, Johanson and Mattsson (1988:209) criticize the
transaction cost approach to studying internationalization for not considering the
cumulative nature of activities, the use of external assets, the development potential of
network relationships, or the interdependence between national markets. The
institutional economic perspective could also from the IMP perspective be criticized
for not taking the possible existence of sticky markets (Hedaa, 1996) into account.

The textbook view on internationalization, as epitomized by Root (1994), promotes
an ontology common to the strategic management literature of the 1980s (e.g. Porter,
1980 and 1985, as well as Boughton, 1987, whose work will be discussed in Section
3.2.): The firm can analyze relevant environmental factors and the interconnection of
these on foreign markets, and on the basis of this analysis subsequently develop and
implement a strategy for entry onto the various markets studied. Roots practically
oriented book (1994) explains in depth how this should be done. A further implicit
ontological assumption of Roots, which is shared by Porter (1980 and 1985), yet
questioned by Boughton, 1987, is the absence of Hedaas (1996) sticky business
markets; thus, Root (1994) assumes that potential buyers on the foreign market buy
products based mainly on discrete assessments of their given physical characteristics,
assessments which they repeat when purchasing repeatedly.

23
It is obvious that the textbook views exclusion of the role of specific interaction and
existing networks between parties on foreign and domestic markets would be criti-
cized by IMP researchers. The strategic planning-related ontological assumptions of
the textbook view, i.e. the feasibility of strategic planning, are critically scrutinized at a
meta-theoretical level in Hkansson and Snehota, 1989. At a lower level of abstraction,
Axelsson and Johansons (1992) case-based qualitative research provides examples
and categorizations of factors related to relationships that play a role in foreign market
entry, yet are omitted in the textbook view (ibid.: 221, 231-233):

Knowledge of specific actors in the network(s) of the foreign country in
question
Knowledge of the relative positions of the actors in the foreign countrys
network(s)
Knowledge of direct and indirect firm relationships to actors in the foreign
countrys network(s)
Knowledge of how the support of these actors could be mobilized in relation
to the planned export activities
The ability of the export firms actors to orient itself, i.e. obtain an
understanding of where different actors including the actor itself stand in
relation to each other (ibid.:231)
The ability of the export firms actors to position their firm in the network of
other firms
The ability of the firm to seize export market network opportunities that turn
up at irregular or totally unexpected intervals

These factors will be discussed in Chapter 8, in connection with my empirical
treatment of research question three.

Furthermore, it is worth noting that the above list of factors omitted in the strategic
management literature fits remarkably well with the picture painted by Cova, Mazet,
and Salle (1994:32) and presented in Subsection 3.3.2 of this dissertation with regard
to the neglect of network and relationship factors in textbook project marketing
contributions inspired by strategic management thinking.

Two continua are shown below in Figure 3. They depict the levels of environmental
and structural determinism in the four respective internationalization theories presented
in the previous paragraphs.
Figure 3. Levels of Environmental and Structural Determinism in Internation-
alization Theories.
Figure 3a. Environmental Determinism of Internationalization Path.
24
Low High

Uppsala Internationalization Model IMP Network Theories
Institutional Economic
Theories
Textbook View

Figure 3b. Degree of Structural Determinism in Internationalization Path.
Agents Discretion Pure Structural Determinism

Uppsala Internationalization Model Institutional Economic
IMP Network Theories Theories

Textbook View

As depicted in Figure 3a, the Uppsala models ontology puts the fewest environmental
constraints on firms internationalization paths. According to the Uppsala theory, the
only constraints the environment places on the internationalization path of firms relate
to knowledge. Firms must learn the rules of foreign market operations from and during
their internationalization efforts in order to further internationalize.

In the other three theoretical perspectives, factors in the environment play a compar-
atively larger role. In IMP internationalization theory, it is interactions within network(s)
that determine the path of internationalization; in the institutional economic theories it is
the relative efficiency of markets versus hierarchies, and in the textbook view it is a
number of parameters relating to areas such as target customers, product,
competition, and the macroenvironment (Axelsson and Johanson, 1992:220).

With regard to the degree of structural determinism in Figure 3b (see e.g. Bourdieu,
1990; Giddens, 1993), by including no structural factors, the Uppsala internation-
alization model as epitomized by Johanson and Vahlne (1977) is a pure process model
(see Majkgrd and Sharma, 1998:2-6).
2

In contrast, the IMP internationalization work lies approximately in the middle of the
discretion-determinism continuum; it focuses upon the structural characteristics of
networks which (a) limit the internationalization paths and choices of the firm to some
extent and (b) offer specific opportunities for cooperation. However the extent of the

2
One could also argue that knowledge is a structuring factor which creates structures (see Giddens, 1993).
This, however, goes beyond the argumentation of Johanson and Vahlne (1977).
25
limit and opportunities is not clearly defined in any IMP contribution and varies among
the various contributions. The range is depicted by the thick line in Figure 3b.

At the other extreme, the institutional economics approach and the textbook view con-
tain factors that are very structurally determining. In the institutional economics
approach, the question of markets or hierarchies determines the path of internation-
alization; little or nothing is attributed to the preferences of the agent. With regard to
the textbook view, there are a number of calculations for agents to make on the basis
of information about the existing structure of the foreign market; these calculations
objectively determine the firms optimal internationalization path.

On the basis of the above, I perceive that each of the four internationalization
perspectives has its strengths, weaknesses and degree of usefulness for certain
specific purposes. I will therefore not attempt to judge which theory is best from a
global perspective,
3
but merely justify my choice of theoretical framework: My pilot
study research (see Appendix A) indicated that knowledge of the German market had
been a barrier for Danish architectural firms that attempted operations on this market
during the nineties and that networks of social relationships had played a role with
regard to the path of internationalization chosen and the process of acquiring projects
on the German market. The findings justify my choice of the IMP framework
(including IMP internationalization theory).

2.3. The Context-Specific Knowledge Aspect of Architectural Services.

In this century, implicit, knowledge and its role in relation to economic phenomena
have been increasingly discussed since the groundbreaking work of Austrian
Economist and Nobel Prize Winner Friedrich Hayek (1937 and 1945; see also Nonaka
and Takeuchi, 1995:33-49 for a historical overview). In the treatment of this
dissertations research question three, the focus is on context-specific knowledge, i.e.
knowledge related to the German market as well as its relevant networks and actors. In
relation to this research question, it is necessary to discuss (a) types of knowledge and
(b) potential locations of knowledge. However, aside from the work of Sharma
(1992), until recently there has been a lack of IMP studies that incorporate insights
concerning the role of knowledge and organizational learning in relation to networks
and dyadic relations (Mller, 1993:361). This is especially true with regard to the
INPM-sub-field of project marketing; Havila, Hkansson and Pedersen (1998) was the

3
Also Strandskov (1995) avoids a global ranking of theories in his meta-theoretical work.
26
only IMP/INPM knowledge and project related study I could find. Therefore this
subsection will focus upon the work of researchers not affiliated with the IMP/ INPM
Group.

Knowledge has been defined by strategic knowledge management theorists Sanchez
and Heene (1997:4) as the set of beliefs [] about [] relationships among
phenomena. The element of belief is also present in Nonaka and Takeuchis
knowledge definition (1995: 58); however, these two Japanese scholars distinguish
between subjective tacit knowledge and objective explicit knowledge (ibid.: 59).
In this distinction they make use of Polyanis (1962) term tacit knowledge:

Polyani uses the example of the skater (who can skate beautifully but who
cannot explain how she manages to skate the way she does) to propose that
we know more than we can say (1962). This example has been invoked by
many writers to suggest that important knowledge within individuals and
within organizations can be tacit - i.e. incapable of articulation. (Sanchez
and Heene, 1997:8, authors italics)

Furthermore, Nonaka and Takeuchi contrast the two types of knowledge as depicted
in Table 1:

Table 1. Nonaka and Takeuchis Two Types of Knowledge.

Tacit Knowledge (Subjective) Explicit Knowledge (Objective)
Knowledge of experience (body) Knowledge of rationality (mind)
Simultaneous knowledge (here and now) Sequential knowledge (there and then)
Analog knowledge (practice) Digital knowledge (theory)

Source: Nonaka and Takeuchi, 1995:61.

According to Nonaka and Takeuchi, tacit knowledge has become embedded in an
actors bodily actions through the actors experience and practice. Although the actor
cannot explain how or why he or she acts the way he or she does at a given point of
time as he or she has not reflected upon this knowledge consciously, the actor knows
something about how and why to act in the given situation from tacit experience.
Explicit knowledge, on the other hand, is of a more theoretical or reflexive nature in
that it has been consciously generated in the aftermath of certain happenings through
the minds processes of rational thinking. Explicit knowledge may also be
transferred by direct, non-metaphorical statements that can be communicated verbally
from person to person (ibid.: 59-61).
27

However, over time, knowledge that at one time is completely tacit may, at least to
some extent, be described or absorbed by others who e.g. study the practice of indi-
viduals and groups and/or immerse themselves in a group (see e.g. Bourdieu, 1990).
This allows for the possibility of other persons accessing and using tacit knowledge
(Sanchez and Heene, 1997:9). Nonaka and Takeuchi (1995:62-70) depict some possi-
ble knowledge conversion and sharing processes in Figure 4:

Figure 4. The Knowledge Conversion and Sharing Processes of Nonaka and
Takeuchi.
Dialogue
Tacit knowledge to Explicit knowledge

Socialization Externalization
Tacit (creates Sympathized (creates Conceptual
knowledge Knowledge) Knowledge)

Field Linking
from Explicit
Building Internalization Combination Knowledge

Explicit (creates Operational (creates Systemic
knowledge Knowledge) Knowledge)

Learning-by-Doing

Source: Nonaka and Takeuchi, 1995: 64, 71, and 72.

According to Nonaka and Takeuchi (ibid.:64-5), socialization is process of sharing
experiences and thereby creating tacit knowledge such as shared mental models and
technical skills. An individual can acquire tacit knowledge directly from others without
using language. Apprentices work with their masters and learn craftsmanship not
through language but through observation, imitation, and practice. [] The key to
acquiring tacit knowledge is experience.

Externalization, on the other hand, is:

a process of articulating tacit knowledge into explicit concepts. It is a
quintessential knowledge-creation process in that tacit knowledge becomes
explicit, taking the shapes of metaphors, analogies, concepts, hypotheses,
28
or models. [] [E]xpressions are often inadaquate, inconsistent, and
insufficient. Such discrepancies and gaps between images and expression,
however, help promote reflection and interaction between individuals.

The externalization mode of knowledge conversion is typically seen in the
process of concept creation and is triggered by dialogue or collective
reflection. A frequently used method to create a concept is to combine
deduction and induction. (ibid.: 64)

Thirdly, internalization refers to a process of embodying explicit knowledge into tacit
knowledge. It is closely related to learning by doing (ibid.: 69). Lastly, in cases
where explicit knowledge is to be converted into further explicit knowledge, i.e. in the
combination quadrant, both socialization and externalization take place in the
process of scrutinizing and linking both the pieces of explicit knowledge an individual
or group possesses and the codified foundations upon which it rests.

Human beings can furthermore move from one mode of knowledge transfer to
another. This potentially partially individual and inherently partially social process is
illustrated by the knowledge transfer spiral depicted in Figure 4 (ibid.:71-72). Dialo-
gue about otherwise tacitly socialized experiences moves its participants from the
Socialization to the Externalization quadrant of Figure 4. Thereafter, the process
of linking pieces of explicit knowledge to one another moves an individual or a group
from the Externalization to the Combination quadrant. When a person or a group
seeks to transfer his, hers or its systemic theoretical knowledge into practice in his, her
or its daily actions by internalization, experimental processes of Learning by Doing
move the individual or group from the Combination quadrant to the Internalization
quadrant. Finally, when a person or group takes steps to transfer internalized
knowledge to others by way of example or though demonstrative action, this
individual or group is engaging in field building.

With regard to the location of knowledge, Sanchez and Heene (1997:4) state that while
knowledge originates and exists within individuals, it can also be situated at the level of
the organization. IMP scholar Sharma (1992) builds upon this suggestion by adding
yet other levels; he suggests that a key source of knowledge in a business service
firm may be its activities in networks. This network knowledge is, according to
Sharma, contextual, in the sense that it may be (1) industry specific, (2) technology
specific, (3) function specific or (4) client specific. (Sivula et al. 1997:124). Finally,
both Nonaka and Takeuchi (1995:57) and Finnish IMP researchers Alajoutsijrvi and
Tikkanen (1999) suggest four levels at which contextual knowledge may be found:
29

1. The level of the individual
2. The level of the group (Alajoutsijrvi and Tikkanen use the word team)
3. The organizational level (Alajoutsijrvi and Tikkanen use the term intra-
organizational level)
4. The inter-organizational level

The strategic knowledge management researcher Boisot has developed a social learn-
ing cycle for firms of all sizes. In contrast to the knowledge conversion and sharing
model of Nonaka and Takeuchi (1997), the model of Boisot (1997) focuses upon the
diffusion of knowledge from individuals to larger groups.

Figure 5. Boisots Social Learning Cycle.

Codified Proprietary 3. Diffusion Textbook
Knowledge Knowledge (Spreading the Knowledge
word)

DEGREE OF 2. Problem solving 4. Absorption
KNOWLEDGE (Creating taxonomies; (Making it
CODIFICATION establishing cause and effect) second nature)

Uncodified Personal 1. Scanning Common
Knowledge Knowledge (Acquiring new insights) Sense

Undiffused TARGET POPULATION Diffused
(i.e. situation in an indivi- (i.e. situated in a larger
dual or small group) population, e.g. a firm)

Source: Boisot et al., 1997:69; Hall, 1997:48.

In comparison with the model of Nonaka and Takeuchi (Figure 4), Polyanis tacit
knowledge is, in the terms of Boisot et al. uncoded and either personal knowledge
or a groups common sense. Absorption in Boisots social learning cycle (Figure
5) is approximately the same as learning-by-doing and internalization in Nonaka
and Takeuchis model. Boisot et al.s subconscious process of scanning to create
new personal knowledge at the level of the individual or very small groups is, how-
ever, not included in Nonaka and Takeuchis model. On the other hand, Nonaka and
Takeuchis process of socialization (spreading tacit knowledge) is not included in
30
Boisot et al.s model, due to Boisot et al.s assumption that tacit knowledge is
difficult to diffuse beyond very small groups (ibid.: 69).

Boisots problem solving and diffusion are encompassed by Nonaka and Take-
uchis dialog and linking explicit knowledge. However, diffusion may also take
place through one-way communication of codified or explicit knowledge. Thus
Boisots proprietary knowledge and textbook knowledge both contain elements of
conceptual and systemic explicit knowledge.

Boisot et al. (1997:69) describe the four steps of their learning cycle as follows:

1. Scanning
Identifying threats and opportunities in generally available but often fuzzy data - i.e.
weak signals. Scanning patterns such data into unique or idiosyncratic insights that
then become the possession of individuals or small groups. Scanning may be very
rapid when the data is well codified and abstract and very slow and random when the
data is uncodified and context specific.

2. Problem solving
The process of giving structure and coherence to such insights - i.e. codifying them.
In this phase they are given a definite shape and much of the uncertainty initially
associated with them is eliminated. Problem solving initiated in the uncodified region
of the I-Space [i.e. Information Space] is often both risky and conflict laden.

3. Diffusion
Sharing the newly created insights with a target population. The diffusion of well-
codified and abstract data to a large population will be technically less problematic
than that of data which is uncodified and context specific. Only a sharing of context
by sender and receiver can speed up the diffusion of uncodified data; the probability
of achieving a shared context is inversely proportional to population size.

31
4. Absorption
Applying the new codified insights to different situations in a learning-by-doing or a
learning-by-using fashion. Over time, such codified insights come to acquire a
penumbra of uncodified knowledge which helps to guide their application in particular
circumstances. Where newly acquired uncodified knowledge clashes with already
extant implicit models, a new round of scanning activity may be initiated in order to
eliminate the discrepancy.

Alajoutsijrvi and Tikkanen (1999) have built upon Boisot et al.s Social Learning
Model by e.g. explicitly incorporating interorganizational relationships in the model
and adding an intermediate level of knowledge as depicted in Figure 6.

Figure 6. Alajoutsijrvi and Tikkanens Competencies in the Context of Rela-
tionships.

Increasing codification/utility

Generic

Structuring
Portfolio-
of the specific/
Substantial
Information

Relationship-
specific

Individual Team-based Intra- Inter-
Increasing contextuality/ organizational organizational
tacitness
Increasing scarcity Information sharing Increasing sharing

Source: Alajoutsijrvi and Tikkanen (1999).

In Figure 6, the arrows refer to the four directions of knowledge transfer specified by
Boisot et al. in Figure 5. Additionally, Alajoutsijrvi and Tikkanen have incorporated
the four levels at which contextual knowledge can be found. Finally, they have added
an intermediate category of knowledge contextuality, portfolio specific or substantial
knowledge which they define as follows (ibid.):

32
Portfolio-specific or substantial competence refers to the knowledge and
skills that are transferable and applicable across individuals and individual
relationships of the organization. Adapting new technology, for example,
may represent a competence within several customer relationships.
Finnish post-doctoral researcher and CEO Marjatta Maula proposed several potential
locations for the knowledge of the architectural services (e-mail from Maula to me
dated 1998-10-26):

an individual architect is well-educated and knowledgeable (= the
knowledge is located in the head of a lonely rider); that the drawings of
the building etc. are complex (= the knowledge is located on a piece of
paper or as bits in the computer); that the project is complex (= the know-
ledge is located partially in the network of different actors and partially in the
architect/office)

In relation to research question three (see page 6), Section 5.4 and Chapter 8 will
elaborate further on the types of knowledge used in the Danish case study architectural
firms operations on the German market.

2.4. Architectural Services in Relation to the Characteristics of the Pro-
fessional Services.

As a concept, services have been defined in a wide variety of ways in business
administration literature. However, there are a number of characteristics which have
been included in many definitions, e.g. that services are intangibles as compared to
goods and that they must be consumed instantaneously because they are, by nature,
perishable (see e.g. Lwendahl, 1997:16 or Sharma, 1991:21). These general service
definitions and characteristics have, in turn, also been highly criticized, on account of
the fact that services are highly heterogeneous (ibid.), including offerings from
catering to engineering calculations, from family therapy to public transportation.

Due to this extremely wide range of offerings, I do not deem a discussion of
architectural services as services fruitful. Instead I will immediately go one step further
by discussing architectural services as professional services
4
. On the basis of
extensive readings, Lwendahl (1997:18), listed three common characteristics of

4
As I use a number of German works in this dissertation, it must be noted that there is no good direct
German translation of the term profession. In German the term freie Berufe refers to self employed
practitioners with specialist knowledge whereas the akademische Berufe are the old university
educated professions of the clergy, divinity, law, and high school teaching (Stevens, 1998:27).
33
professions that are found in a large number of scientific definitions of the term (e.g.
Schriesheim et al., 1977):

1) a vocation founded in a body of knowledge, typically a higher (academic)
education
2) a vocation concentrated on the application of this knowledge, combined
with experience, to problems of vital importance in society and in a way
which involves the altruistic service to clients, rather than self-seeking
motives such as profits or status
3) a vocational organization based on a common code of ethics, where self
control is supported by peer reviews, such that members who break the code
of ethics may be excluded

With regard to the above characteristics, I am skeptical towards characteristic two.
Problems of vital importance in society is an extremely vague phrase, and, over and
beyond that, I consider the notion that the professions are altruistic and non-self-
seeking pretentious
5
. Lwendahl attempts to justify this claim, but I am loath to ac-
cept her elaboration (ibid.:19):

A primary characteristic of a professional service is the altruistic service to
clients, meaning that in cases of conflict of interest between what is
profitable for the supplier and what will be the best solution for the client, the
latter alternative must be chosen. This is a difficult constraint to impose on a
firm, but it is critical to the long-term reputation of the company.

Although I agree that it is usually is in the long-term interest of the professional in
question to put his or her clients interests first, I find insufficient justification for either
an a posteriori or an a priori claim that this is what actually characterizes a profession.

With regard to characteristics 1 and 3, I have no similar objections in principle.
However it must be noted that while characteristic 1 can be said to be applicable to
architecture as it is practiced in both Germany and Denmark (see Appendix A for
details), characteristic 3 is more true of the architectural profession as it is practiced in
Germany. Architects responsible for building plans in Germany must be registered by
the Architektenkammer of the German federal state or Land in which they are working
(Arkitekt- og Byggebladet, March 1995:33), whereas there is no comparable

5
It is interesting to note that Freidson (1983) and Larson (1977) take almost the opposite view of
Lwendahl (1997): They view the professions as monopolies that have succeeded in convincing the
general public to give a monopoly on the right to perform certain tasks, justified or not.
34
organization with both a compulsory membership requirement and the power of peer
review in Denmark.

On the basis of these three characteristics of professions, Lwendahl goes on to de-
fine five common characteristics of the professional service (Lwendahl, 1997:20):

1. It is highly knowledge intensive, delivered by people with higher education,
and frequently closely linked to scientific knowledge development within the
relevant area of expertise.
2. It involves a high degree of customization.
3. It involves a high degree of discretionary effort and personal judgement by the
expert(s) delivering the service.
6

4. It typically requires substantial interaction with the client firm representatives
involved.
5. It is delivered within the constraints of professional norms of conduct,
including setting client needs higher than profits and respecting the limits of
professional expertise.

Characteristic 5 will be eliminated because of the previously voiced objections to the
argument upon which it rests. On the other hand, results from the pilot study (see
Appendix A) indicate that characteristics 1-4 do apply to architectural services. More
specifically, architects offerings of service types 1-6 and 9 from Subsection 2.1. are
customized (characteristic 2, above) and therefore require substantial discretionary
effort on the part of the architectural firm (characteristic 3) as well as substantial
architect interaction with clients (characteristic 4). Offerings of service types 7 and 8
are, in contrast, not necessarily always highly customized, but as the authors pilot
study results (ibid.) suggest that service types 7 and 8 are currently of relatively minor
importance in relation to the entire portfolio of architectural services, this idiosyncrasy
will be ignored in the subsequent discussions of the terms professional services and
architectural services.

It should be noted that Lwendahls characteristics 2 - 4 are defined in relative and
rather vague terms. Thus using her characteristics in defining architectural services

6
Starbuck (1992:149-151) and Alvesson (1995:8) note that not all professional services are based upon
judgement. In the case of e.g. doctors, dentists, and lawyers, there is a limit to the discretionary effort and
personal judgement these professionals may use in their assessments; instead they must use proven
scientific or scholarly methods. These two authors therefore make a distinction between professional
service firms and knowledge-intensive firms (KIFs). This distinction will be ignored in my work, as for the
case of architects, decision making does include the discretionary effort and personal judgement
characteristic of Starbucks (1992) and Alvessons KIFs.
35
serves not so much to give a clear picture of what architecture services are exactly,
but to differentiate the commonalties that architectural services share with other
professional services from the characteristics of other types of goods and services. It
is therefore fruitful to narrow the focus once more and look at architectural services in
relation to technical and engineering consulting services.

Sharmas 1991 work deals with the foreign operations of technical consulting firms
(TCFs). Technical consulting, as defined by Sharma (1991:20), refers to industrial
services sold to organizations, public or privately owned. These partly resemble
services, partly industrial markets and still possess their own particular
characteristics. Sharma then goes on to describe technical consulting services in
relation to characteristics commonly associated with services and professional
services. Many of Sharmas characteristics of technical consulting services are
relevant to some of the nine types of architectural services specified in Subsection 2.1.

With regard to intangibility, Sharma (ibid.:22) states:

The intangibility discussion is only partially relevant to TCFs. As TCFs
execute an assignment, a report containing text, figures and tables is
prepared. These are not absolutely intangible. The client can both see and
grasp the report. The skills consumed in producing the output is [sic!],
nevertheless, invisible and difficult to touch and grasp. Consequently, some
of the consequences attached to the intangibility dimension hold for TCFs as
well.

Concerning architectural services, these remarks are highly relevant with regard to the
design-related services (service types 1 and 2) as well as preliminary site studies
(service type 9).

Sharma goes on to deal with the issue of inseparability (ibid.:23):

The production of technical services cannot be separated from its producer.
As stated in the previous section, technical advice can, nevertheless, be
stored on a piece of paper in the shape of figures and text. These are
transportable. However, [...] a proper interpretation of the advice and
recommendations demands a close interaction and exchange between the
producer of the service and its user. [...] In this sense even in the field of
technical consultancy, a separation of service from its producer is difficult
and indeed undesirable.
36
These observations are worth considering with regard to the relations of the different
types of architectural services to each other, especially as applies to the relationship of
the architectural design work (service types 1 and 2) and the implementation of the
designs in the building work (service types 3 and 4). In Denmark, Germany, and the
other EU countries, a de facto separation between design and production is often
seen, as general contractors, construction management firms, or yet other actors often
organize the construction process without consulting the architect who designed the
building (see Section 6.2. and Appendix A). Danish and European architects bemoan
this situation (see e.g. Arkitekt- og byggebladet, November 1992:31 and Eurostat,
1995:24-39), whereas certain customers as well as other actors in the construction
industry apparently prefer it. Thus the general undesirability of inseparability cannot be
as categorically determined for the architectural services industry as Sharmas
statement suggests.

As for the standardization debate, Sharmas remarks are as follows (Sharma, 1991:
23):

For TCFs, the issue of standardization is made still more problematic as no
two assignments are absolutely identical, especially not in the international
market. In international markets due to differences in taste, climatic
conditions, cultural values, traditions, topology etc. the technical solutions
called for vary. As a consultant gains insight into a field and obtains feed-
back from others (in the network), his performance and the quality of the
services rendered may improve and vary. Thus brand name is difficult if not
impossible to establish. Among TCFs, use of brand name is non-existant
[sic!] and consumer loyalty must be ensured through alternative means. [...] it
is more important to build up good-will, establish reputation and nurture
relationships.

Articles from Danish architectural magazines (Arkitekt- og Byggebladet and
Arkitekten) as well as the pilot study interviews (see Appendix A) confirm these
observations with regard to standardization and the difficulty of the establishing of
ones name in the architectural services industry. These conceptual remarks will
therefore be included in the further delimitations of the term architectural services.
However, Sharmas statement about non-existent brand name use is probably too
extreme with regard to both technical consulting and architectural services. Some large
technical consulting firms such as the Swedish-Swiss multi-national company Asea
Brown Bovery (ABB) may in fact have established names for themselves that function
as de facto brands. Additionally one could argue that certain architects (e.g. British Sir
Norman Foster, the Dane Jrn Utzon, the Finn Alvar Aalto, the American Frank Lloyd
37
Wright, or the German Walter Gropius) or architectural firms throughout history have
established brand-like names for themselves on the basis of broad artistic recognition
and, in some circumstances, exceptional technical expertise in specific fields such as
airport or concert hall construction (see also Gerkan in Der Architekt, May 1990).

The last characteristic commonly associated with services and professional services
that will be covered in this dissertation on the basis of Sharmas work is perishability.
Sharma (1991:24-5) comments upon the specifics of the perishability issue with regard
to TCFs in the following way:

In the work on service industries, it is argued that services can not [sic!] be
stored [...] and thereby create problems of demand management. [...]
advance production is not feasible [...] The issue of perishability is,
consequently, different in service industries. The above argument holds for
TCFs as well. Managing demand fluctuation is difficult for TCFs at the same
time as capacity utilization must remain high (85-90%) to avoid losses. The
avoidance of excess capacity is important. [...]

TCFs borrow consultants from each other. [...] it is frequently difficult for a
TCF to maintain all its experts. Borrowing experts from outside is common
and the network is important. The network helps TCFs to balance their own
excess capacity through lending people to other parts of the network. TCFs
who have worked together borrow from each other to reduce time and
resource investment.

The authors pilot study (see Appendix A) confirmed that the perishability problems
of the architectural firms are large, due to the cyclical fluctuation of the construction
industry and the project nature of the business (see also Subsection 3.3.2); one of the
architects interviewed in the pilot study bases his one-man practice on providing ser-
vices to other, larger architectural service firms that regularly experience demand fluc-
tuations.

Furthermore, Alvesson (1995:6) lists three characteristics common to knowledge-
intensive services, which also apply to architectural services:

heavy reliance on individuals (and less dependence on capital) and a high degree
of independence on the part of practitioners
traditional concrete (material) assets are not a central factor. The critical elements
are in the minds of employees and in networks, customer relationships, manuals
and systems for supplying services
38
heavy dependence on the loyalty of key personnel and this is the other side of
the picture considerable vulnerability when personnel leave the company

Finally, it is relevant to mention one characteristic that distinguishes architectural
services from most other professional services as well as the services provided by
other actors on the construction market: Architectural projects are influenced both by
the governance structure of the construction market and by rules that are common to
artistic fields, as architects judge each others work on the basis of artistic qualities as
well as other criteria (Albertsen, 1996:3), such as user-friendliness, good use of
technological solutions, and energy efficiency. I will elaborate further upon the
theoretical implications of this point in relation to research questions 3 5 in Section
4.4.

Before going on to a discussion of construction projects in the next subsection, char-
acteristics inherent to architectural services as a sub-field of the professional services
are listed below to summarize the discussion of this subsection; they are thereafter re-
lated to case study research questions three and five, as presented in Chapter 1:

1. Architectural services are highly knowledge intensive.
2. Architectural services involve a high degree of customization and thus are non-
standardized.
3. Architectural services involve a high degree of personal judgement on the part of the
architect(s).
4. Architectural services involve substantial interaction with clients or their
representatives.
5. Architectural services involve both intangible and tangible elements; however, most
inputs in the production of the tangible elements are intangible.
6. Architects perceive a problem of inseparability in relation to architectural services,
whereas other actors do not necessarily perceive this problem.
7. Brand name is extremely difficult to establish in the field of architectural services.
8. Architectural services are perishable in the sense that advance production is not
possible.
9. Architectural services are highly dependent upon the efforts of individual architects.
10. Architectural services are less dependent on material assets than they are on
elements in the minds of the architect(s), their networks, and the routines related to
11. The production of architectural services requires loyalty from the architects
involved.
12. Architectural services are influenced by both the governance structure of the
construction market and by rules that are common to artistic fields.

39
Research question three, which deals with knowledge (see Chapter 1), behooves a
brief digression in which the insights of this and the previous section are combined.
This will be undertaken in the following paragraphs:

In relation to characteristic 2 (above), the high degree of customization and non-
standardization of architectural services (which, in turn, makes the establishment of
brand name difficult according to characteristic 7 and furthermore renders these ser-
vices imperishable in accordance with characteristic 8), the knowledge about how to
customize the architectural service in question lies at the level of the architectural firm
actors and/or teams and possibly also at the level of their interactions with their
external cooperation partners/customers, e.g. in the dyad or in an actor network (see
Subsection 3.3.1. for further elaboration about actor networks). In international
project work, this knowledge may concern e.g. differences in taste, climatic
conditions, cultural values, traditions, topology (Sharma, 1991:23; see Chapter 8 of
an empirical assessment of this point). Additionally, this knowledge is probably at
least partially tacit, although elements of it have been codified and communicated to
me in my research interviews.

Characteristic 3, the high degree of personal judgement on the part of the architect(s),
relates primarily to the uncodified, undiffused part of the knowledge, whereas
characteristic 4, the substantial interaction with clients or their representatives, is
related to both undiffused personal social knowledge (Svensson, 1990; stns and
Svensson, 1986) and the diffused knowledge that may be located in a network or
dyad, as Sharma (1992) suggests.

Characteristic 5 which states that architectural services involve both intangible and
tangible elements while most inputs in the production of the tangible elements are
intangible - can be related to the discussion of knowledge in the previous section in the
sense that the intangible elements are uncodified knowledge whereas the tangible
elements (e.g. drawing, models, contracts) contain specimens of diffused, explicit,
codified knowledge, in the terms of e.g. Boisot et al. (1997) and Nonaka and
Takeuchi (1995). However with regard to the perception of the knowledge content of
architectural services (characteristic 6), the situation that architects perceive their ser-
vices as being inseparable, whereas many other actors do not share this perception
seems to indicate that the other actors do not acknowledge (or wish to acknowledge)
the importance of knowledge that may include uncodified elements and that may be
located in the dyads between them and the architects. Instead they believe that the
knowledge necessary for the further steps of the construction project is adequately
40
presented in the codified, diffused physical documents (e.g. drawings and models)
produced by the architects.

Finally, with regard to characteristic 9, the knowledge that architects possess with
regard to achieving acclaim, tacit or codified, relates to conditions both in the
construction industry and within artistic fields. It is also a matter of personal judge-
ment (characteristic 3) how much attention the architect(s) should pay to these two
different arenas both with regard to a specific project and portfolios of projects. This
issue will be examined further in Subsection 4.4.1.

Concerning research question five, which deals with previous project work, it is
relevant to note that that characteristic 7, i.e. that brand name is difficult to establish.
This characteristic will be dealt with further in Chapter 10.

2.5. Architectural Services as Parts of Construction Projects.

In order to enable a discussion of architectural services in relation to construction
projects, it is necessary to define construction projects. Thereafter the role of archi-
tectural services within the typical construction project can be established. Due to the
large body of literature concerning the marketing of projects, it is then fruitful to go on
to find general characteristics of projects in the project literature and then critically
assess to what extent these characteristics apply to construction projects. These steps
will be taken in this section, thus laying the foundation for the discussion of
architectural services and construction projects in relation to the general project
marketing literature in the subsequent section.

Unfortunately, the step of defining construction projects is not undertaken in most of
the works on construction projects because these works are practically-oriented how
to manage handbooks (see e.g. Day, 1994 or Oxley and Poskitt, 1996). Most pro-
bably the authors of these works (very often rightfully) assume that their audience has
a good general idea of what is meant by construction projects and therefore go
immediately to the management issue at hand. In this more academic dissertation, the
definition of construction projects will be quite general; here a construction project
refers to a set of activities resulting in either the construction of a building/landscape
or improvements to existing buildings/pieces of property.

As depicted in Figure 7 (below), seven of the nine individual types of architectural ser-
vices identified in Section 2.1., namely types 1, 2, 3, 4, 5, 6, and 9, are exclusively
41
related to construction projects in that they are only undertaken in two situations, ei-
ther a) the situation in which a construction project in anticipated or b) the situation in
which the construction project process has been formally commenced. The remaining
two types of services, building inspection (type 7) and management of facilities (type
8) are not directly related to construction projects
7
.

Figure 7. Architectural Services in relation to Construction Projects.

Architectural Services

Construction Projects
7 (3) 1 2
8 (4) (3) (4)
9 5 6

Source: Authors own conception.

Most construction management handbooks (see e.g. Day, 1994 or Oxley and Poskitt,
1996) separate the construction project process into two major phases, (1) the design
phase and (2) the construction phase, based on the assumption that the client reviews
and approves the building and landscape designs before construction begins. A
Swedish empirical study of major construction projects (Hellgren and Stjernberg,
1995) provides support for this division, albeit its conclusions are not 100 %
unambiguous. Hellgren and Stjernbergs (1995:384) empirical results show that this
division exists in the sense that very different actors constellations are involved in each
of the two phases and that the actor coordination processes in the two phases also are
vastly different. However, while Hellgren and Stjernberg find support for this
distinction on the basis of actors and activities, they do not find unequivocal support
for the linear chronological division typical of normative, practice-oriented
construction management literature. On page 383, they state: Design activities [...]
may continue to the end of the process, although the more significant design
processes take place early.

7
Architects who manage construction projects often inspect the buildings in connection with the final
building acceptance upon the completion of construction in accordance with their construction management
contract. This type of building inspection is regarded as a part of construction management tasks (number 3
and 4) in my work.
42
Keeping in mind the above limitations and problems of the division of construction
projects into a design and construction phase, this two-phase conceptualization is
depicted in Figure 8 from the viewpoint of the architect. It will be referred to in this
sections discussion of construction projects as projects, the next sections
discussion of architectural services in relation to project marketing, and the description
of the case study firms architectural project acquisition process, i.e. the answer to
research question 4, in Chapter 9.

Figure 8. The Division of Construction Projects into Design and Construction
Related Phases seen from the Viewpoint of the Architect.

Design

9 1 2 5 6

in cooper. with e.g.
- Other consultants
-The Client
- Others

Construction
3 4
in cooper. with e.g.
- Materials suppliers
- Builders (bricklayers,
carpenters, plumbers etc)
- Poss. Cons. Manager
- Other Consult.
- The Client

Source: Authors own conception on the basis of literature studies.

With regard to viewing the preparation and delivery of a bundle of architectural
services as a project in itself within the larger construction project, project marketing
research pioneer Karin Holstius (1987:49, 56-58) states that this is possible:

The provision of consulting services differs from the delivery of
construction, machinery and turnkey projects in that consulting services can
be directed specifically towards one or more of the stages in the project
cycle. (ibid.:49) the services rendered by a consulting firm can range
from a more limited assignment at one of the project stages to a full turkey
contract. (ibid.:56)

43
On the basis of the above (see also Luostarinen and Welch, 1990, for a similar
assessment), in the cases studies of this dissertation, the individual contracts concern-
ing construction or renovation projects entered into by the Danish case study
architectural firms are regarded as architectural projects in their own right. These
individual architectural projects are, in turn, made up of variations in the bundles of
possible architectural services.

Turning now to the literature on the marketing of projects, project business is a term
that has been defined in a vast number of ways in business literature (Ahmed, 1993:27;
Cova, 1990a:9). As a consequence of this broad usage, the scientific limitation
problems associated with the project business and project marketing concepts are
similar to the definitional problems concerning the concept of services which were
discussed at the beginning of Section 2.4. A further problem is potential synonyms
and partial synonyms: Systems sales is a concept related to project marketing; the
two terms are regarded and used as a synonyms by some authors, while other authors
prefer to make various distinctions between the two words (Ahmed, 1993:30).

Based on this conceptual vagueness, this dissertation includes literature that uses both
terms as well as other, less frequently found partial synonyms such as contracting or
package deals, e.g. in the literature reviews of Chapter 3. I will, however, stick to the
term project business in my own conceptualizations because the phrase
construction projects is common in English language parlance concerning
construction and architectural services.

To enable a discussion of construction project offerings in relation to project offerings
in general, it is, as previously mentioned, necessary to examine elements of definitions
of projects. In this section, the definitions found in three of the most widely
recognized contributions to the project marketing and systems sales literature will be
scrutinized.

The Swedish academic Lars-Gunnar Mattsson is usually credited for having
popularized the term systems selling in 1973, in his seminal article on this project-
related subject
8
. According to Mattssons (1973:108-109) definition, systems selling
relates to the sale of:

8
However, the very first reference to the term systems selling is found in the following article: Murray,
Thomas J. (1964): Systems Selling: Industrial Marketings New Tool, in Duns Review, October 1964
(Mattsson, 1973:119).
44
a combination of hardware and software components that in principle could
also be marketed separately and which are, at least to some extent
standardized. The system sold in each case is therefore an adjustment to the
individual customers needs of some basic problem solution ideas. The
system that is offered consists of components between which the relations
are predetermined by the seller in two steps: (1): general system design, and
(2) system design adjusted to the individual customer. Systems selling is,
according to this definition, something more than selling a set of products
which can be used by the buyer to construct a system. The seller has to take
prime responsibility for the design of the system. Neither does the systems
selling concept include supply of unique, tailor-made systems to each
customer. [The italics in this quotation are also found in Mattssons
article.]

Mattssons definition of systems selling is different from most later definitions in that it
explicitly excludes offers that are tailored to the needs of individual customers. This
aspect of his definition will be disregarded in the following for two reasons: it
contrasts to later definitions, and it does not fit architectural service offerings well as
they, as discussed in previous sections, most often are designed to fit the specific
needs of each individual customer.

Other elements of Mattssons definition will, on the other hand, be included in the
subsequent discussion of construction projects as projects. These elements are
Mattssons specification that 1) systems are made up of hardware as well as software
components and that 2) these components to some extent are standardized. Last but
not least, Mattssons contrast between systems sales and product sales (i.e. that
system sales concerns the selling of comprehensive solutions created to solve broad
customer problems as opposed to merely selling products that fulfill specific
functions) will comprise point number 3 of the subsequent discussion of construction
projects in relation to general criteria of projects.

Based on a project cycle used by the World Bank, Finnish scientist Karin Holstius
conceptualized and empirically tested a project marketing cycle (see Holstius, 1987
and 1989) often cited by scholars working within the traditions of the interaction- and
network-oriented IMP group and its INPM sub-group. In connection with the
development and testing of her cycle, Holstius specified three characteristics common
to projects (Holstius, 1989: 8):

The sale concerns a discrete package of investments, services and other actions.
45
The objective of the sale is the creation of long-term capital assets.
9

The sales package is delivered within a designated period of time.

Holstius first characteristic is very similar to Mattssons first point; therefore it will
not be discussed as separate point from Mattssons point. In contrast, the objective of
project sales will be discussed in relation to construction projects as point number 4,
and time limits will be discussed as point 5.

The last conceptualization of project marketing to be used in this section is the work
of the German business administration academic Klaus Backhaus, who has researched
project marketing from a neo-institutional perspective (see Backhaus et al., 1995). In a
textbook concerning the marketing of investment goods, he lists a number specific
characteristics of project marketing not included in Mattssons (1973) and Holstius
(1989) work. These will also be discussed in relation to architectural services and have
therefore been assigned numbers in the list below. According to Backhaus (1995:
431-433), project marketing (i.e. industrielles Anlagengeschft in German
10
) is
distinguished by the following characteristics:

customized production (discussion point number 6)
long-term nature of the investment (point number 7)
high value of the single order (point number 8)
bidder/supplier coalitions (point number 9)
an ever-increasing share of service in the offering (point number 10)
differences between the customers and the suppliers levels of know-how (point
number 11)
possibility for variations in the scope of supply activities and other contractual
aspects (point number 12)
international offerings (point number 13)
discontinuity of incoming orders (point number 14)

9
Long-term capital assets is an accounting term. It refers to assets such as land, buildings, or production
equipment which are held by the owner for a long period of time and may be applied to cover liabilities
(see American Heritage Dictionary, 1982:134, 237; and Whe, 1996:1082-83)
10
Unfortunately industrielles Anlagengeschft is not a perfect translation of project marketing, as
industrielles Anlagengeschft does not include certain types of construction activities for the public or
private sector such as the building of museums or residential dwellings. However, on the basis of Gnter
and Bonaccorsi (1996:532), I will refer to the German language industrielles Anlagengeschft
literature as the literature most comparable to English-language project marketing and systems selling
literature.
A translation problem also exists in relation to French language literature. According to Cova (1990:9-10),
systemes refers to combinations of goods and services, travaux refers to the installation work in
connection with systems and project sales, and projets is the French word for systems and project sales
that involve a combination of installed goods and projects.
46
order financing offerings, i.e. financial engineering (point number 15)

Turning now to construction projects and discussion point 1, with relation to
Mattssons specification that systems (or projects) are made up of hardware as well as
software, this is true of the construction industry. Hardware elements in construction
projects are architectural drawings as well as walls, foundations, the electronic wiring
of the building, radiators, windows, etc., whereas software elements encompass the
human design and building related efforts (Mattsson, 1973:108).

With regard to discussion point 2, standardization, an increasing number of hardware
elements in the construction industries of todays Western countries are standardized
elements that are produced en masse. This is a relatively recent development; during
the past century the importance of standardized elements in the building process has
increased greatly to the detriment of non-standardized, on-site craftsmanship. (For a
discussion of this developments effects on Danish architectural practice, see Arkitekt-
og Byggebladet, 1992:30-34.)

On the other hand, in Western countries, buildings have for a long time been regarded
and sold as an entity, and, with the exception of craftspeople who have preferred to
construct their own homes, this has been the dominant type of final user sales. Thus
the third discussion point, i.e. the contrast between systems sales and product sales
on the basis of the generic level of fulfilled need, is of less relevance to the
construction industry than it is to producers of other types of industrial projects.

With relation to the types of gains or assets that are the objective of sales (discussion
point 4), Holstius specification that the objective of the sale is the creation of long-
term capital assets is too narrow for the construction industry. While some private
homes as well as most industrial and non-profit organizations buildings are indeed
regarded mainly as long-term capital assets by all shareholders in that they are valued
mainly in terms of monetary value (see e.g. Harrigan and Neel, 1996: 90-106, for a dis-
cussion of the influence of architectural design on the asset value of a medical care
facility), the primary objective of construction projects is sometimes other types of
value creation which cannot be expressed in economic terms. In the case of e.g. an art
museum, the main objective of the construction project in question may be to create a
building that is a example of a particular artistic style for future generations.
Additionally, in publicly supported construction projects of multi-purpose facilities
(see e.g. Hellgren and Stjernberg, 1995:385-7), the exact combination and prioritization
of the many economic and other objectives of the projects may be highly unclear even
47
to the parties making the decisions about the projects. This may for example have
been the case with regard to the construction of a building containing the main train
station, the municipal main public library, a county unemployment office, and a
shopping mall in Odense, Denmark in the early 1990s.

Discussion point 5, concerning time limits, on the other hand is applicable to con-
struction projects, as contracts concerning construction projects often specify spe-
cific dates upon which the project in question must be finished.

The remarks about discussion point 6 build upon the remarks about discussion point
2. Customization is a part of all construction projects due to the software element of
projects. However the degree of customization may vary widely from one construc-
tion project to another.

With regard to the long-term nature of the investment, discussion point 7, and the high
value of the single order, discussion point 8, both criteria are unproblematic with
regard to construction projects. Concerning discussion point 9 there are also no
problems; relevant literature (e.g. various articles in Arkitekt- og Byggebladet, Arki-
tekten ,and deutsche bauzeitung concerning Denmark and Germany; Dickson (1995)
on Denmark; Gerkan (1995) with regard to Germany; Kadefors (1995) with regard to
Sweden Madsens (1991) Danish study; Schultz and Wiberg (1981) on the con-
struction exports of the Nordic countries) proves the existence of bidder/supplier
coalitions in the construction industry. Furthermore, a survey undertaken by the Dan-
ish Council of Practicing Architects (PAR) in 1992 found that 79% of PAR member
and affiliated firms had worked with engineers and 88% had worked with Danish con-
tractors with regard to exports to Germany (Arkitekten 1993:3/120).

Discussion point 10, an ever-increasing share of service in the offering, is, on the other
hand, highly problematic with regard to construction projects. As previously
mentioned in the discussion of point 2, standardized elements play a greater role in
construction project offerings today than they did in the previous century.
Additionally, the trend seems to be going towards increased rationalization of service
elements in construction projects, both with regard to Germany, where architect
involvement in construction projects is required (Arkitekt- og byggebladet, February
1994:30) and the rest of the Western Europe:

Statistics suggest that the industrialization of the building sector in the US
and Japan is much more advanced than it is in Europe. This is attributed in
part to the highly sophisticated prefabrication of residential buildings which
48
exist there. It is still generally accepted that a real demand for products of
this type does not yet exist in Western Europe. However, if the economic
slump were to persist, offering a well-prepared supply of such products
could succeed in resolving the problem of dwindling resources and time
available and increasing needs to some extent.

EU architects are no more open than producers or consumers to taking such
a step, which would call into question the specific architectural features
which characterise most of the Member States. Nevertheless, even if the
single internal market were to remain insensitive to the search for effective
ways of responding quickly to a housing demand that requires a minimum
degree of comfort and also affordability (such needs are still immense: 1.5
million new dwellings in ten years are planned for Germany alone), designers
and building firms would still be able to offer their services and products to
many other regions of the world where housing needs are even more acute.
[...]

[o]ne of the most pronounced tendencies in the demand circuit for
construction is that the course of this demand is increasingly going directly
from the consumer to the producer, with designers being passed by.
(Eurostat: 1995:24-38, 24-39)

An assumption of differences between the customers and the suppliers level of
know-how (discussion point 11) is also problematic with regard to the construction
projects. Although many clients know less about the design- and construction-related
tasks than architectural firms, this is usually not the case if the client is a large
company or municipality with in-house construction procurement experts. Moreover,
it should be noted that degree of these differences may influence discussion point 6,
the scope of the customization of the production. It is, however, possible to vary the
scope of hardware and software provided by external sources in the construction
project if the client does possess hardware (e.g. components) or software (e.g. know-
ledge) relevant to the construction project in question. Thus discussion point 12 is
also fulfilled in relation to nature of construction projects and furthermore may be
related to point 6.

The thirteenth point, about international offerings, is fulfilled to some degree. The
authors pilot studies (see Appendix A) have shown that the construction industry is
not highly internationalized.
11
As mentioned in the foreward to this dissertation, Danish
actors in the construction industry have turned to exports mainly on account of home

11
This topic will also be elaborated upon in Chapters 6 and 7 which contain the answers to research
questions 1 and 2.
49
market stagnation (Arkitekt- og byggebladet, 1991:42). Additionally, their export
activities have to a large degree been nomadic; they have wandered from one export
market to another in correlation with the cyclic fluctuations of real estate markets (see
Section 6). These cyclic fluctuations, which to a large degree are due to variations in
the real interest rate, are one of the reasons why the flow of incoming construction
project orders is relatively discontinuous. (This last statement is a verification of
discussion point 14 with regard to construction projects.)

Finally, order financing offerings (characteristic 15) are sometimes used in the
construction industry in conjunction with construction project offerings.

To summarize the above discussion, relevant key characteristics of construction
projects found in common definitions of projects in the project marketing literature
include the following:

A. Project offerings include hardware and software components.
B. Some of the components are standardized. (2)
C. Customization is a part of project offerings, yet the extent of customization varies
from project to project. (6)
D. The scope of supply offerings may be varied between project offerings in
accordance with the capabilities and means of the buyer. (12)
E. Project offerings concern large orders in terms of monetary value. (8)
F. Project offerings concern long-term investments. (7)
G. Project offerings may include financial packages or other financial engineering
measures. (15)
H. Project offerings often involve bidder/supplier coalitions. (9)
I. Project offerings are international in the sense that offerers sometimes come from
foreign countries. (13)
J. Project offerings are subject to deadlines and time limits. (5)
K. Orders for projects are discontinuous. (14)

A characteristic from the project marketing literature which applies to construction
projects but is less relevant due to historical reasons is that project offerings fulfill
generic customer needs (3).

Characteristics from the project marketing literature which do not apply to all
construction projects include the following:

There are differences between customers and suppliers level of know-how with
respect to project offerings. (11)
50
The objective of the sale is the creation of long-term capital assets. (4) This
characteristic, however, probably applies to most construction projects.
Project offerings include an ever-increasing proportion of service elements. (10)

2.6. Architectural Services seen from an Architectural Project
Perspective.

On the basis of the discussions of the previous four sections, the aim of this section is
two-fold:

1. To define the architectural service elements of construction projects by
combining the main themes of the discussions of Sections 2.1., 2.4., and 2.5.
2. Based on the first point, to categorize specific characteristics of architectural
services relevant to architect projects according to the degree of architectural
project specificity and phase specificity in relation to Figure 8.

Section 2.4. ended with a brief summary of characteristics of construction projects
based on several renowned definitions from the project marketing literature. In the first
part of this section, these characteristics will be discussed in relation to the properties
of architectural services discussed in Sections 2.1. and 2.3.

Differences between customer and supplier levels of know-how, when present (see the
end of Section 2.5.), point to a dilemma in the marketing of architectural projects.
When knowledge differences exist, the architectural firm seeking projects must con-
vince a non-knowledgeable client that it is competent. The fact that the work of archi-
tects (as opposed to that of many other non-professional actors in the construction
project process) is characterized by a high level of software components (A) makes
this dilemma larger. These software components are highly knowledge intensive
(Mattsson, 1973:108; Lwendahl, 1997:20), and when the architectural firm is working
with the design-phase tasks related to the specific private sector
12
construction project
in question (i.e. tasks 1, 2, 5, 6, and 9 as defined in Subsection 2.1.), these
components entail substantial interaction with clients (Lwendahl, 1997:20, Hellgren
and Stjernberg, 1995), a high level of personal judgement (ibid.), and perishability
(Sharma, 1991:24-5). The interaction between client and architectural service firm in
the private sector is very important because the involved architectural firm must
convince the client that it understands his needs and project objectives and is able to

12
Public sector project acquisition usually involves public tendering (see Council of the European
Communities, October 13, 1997). This will be examined in Section 6.4. and Chapters 8 10.
51
incorporate them in a realizable design proposal during the interaction, as the achieve-
ment of client trust and consent does not normally occur through anonymous
measures such as branding (ibid.: 23).

If the client agrees to purchase a given architectural project, design-phase decisions
made in accordance with customer specifications also affect the proportion of stan-
dardized components in the project (B) and the extent of customization in the con-
struction project (C). However, choices concerning the use of supply offerings of the
buyer (D), if he has any, may be discussed as early as the design phase, if the buyer is
intent on ensuring that his means and capabilities are utilized to their full potential in the
construction project as a whole.

In the construction phase, the controversial inseparability issue (see Sharma, 1991: 21,
as well as Subsection 2.3.) plays a large role with respect to the scope of construction
management and consulting tasks (i.e. services 3 and 4 from Section 2.1.) that are
awarded to architectural service firms.

Provided that the architectural service firm plays a role in the construction phase, its
construction management and consulting efforts are once again software elements.
These elements are, figuratively speaking, the glue that holds the hardware elements of
the construction process together. Additionally, architectural firm involvement in the
construction phase is marked by some of the same characteristics as the architect-
specific tasks of the design phase: a high level of individual judgement, the com-
bination of tangible and intangible elements, perishability, and possibly a difference
between customers and suppliers levels of know-how. However, the level of
architect interaction with clients may or may not be substantial in the construction
phase depending on factors such as the level of incorporation of buyer capabilities
and means (D).

Characteristics E - K of construction projects most often have similar general
implications for all of the actors involved in the construction projects, including the
architectural service firms. Furthermore, these characteristics are independent of the
two phases of the construction project process and, with the exception of G, also of
the specific customers requirements. Thus, with regard to a given project, archi-
tectural service firms may choose to deal with these conditions either as individual
firms or in cooperation with other firms working on a given project. Additionally, con-
struction project firms can choose to primarily address these issues outside the
framework of specific construction projects. For example, the cooperation traditions
52
or agreements of a certain bidder/supplier coalition (H) may entail periodic or ad hoc
discussions among the coalition members concerning developments regarding project
specific issues such as deadlines (J), potential cooperation with international offerers
(I), and the creation of financial engineering measures (G), as well as issues related
to the general nature of project business (e.g. E, F, K) and the nature of the coalition
itself (H).

Based on the above remarks, Figure 9 on the final page of this chapter seeks to clarify
the connections between characteristics A to D listed in Subsection 2.5. and insights
from Sections 2.1. to 2.4. Characteristics E to K are merely repeated above the figure
because, as explained in the preceding paragraph, they concern general characteristics
of construction projects that cannot be related exclusively or specifically to either the
design or the construction phase of a specific architectural project. The characteristics
of Figure 9 will be referred to in the subsequent treatment of research questions 3 5
in Sections 5.4. 5.6. and Chapters 8 10.

53
Figure 9. Key Characteristics of Construction Project-Related Architectural
Services that are a Part of Architectural Project Offerings.

General Characteristics related to neither Specific Construction Projects nor
Specific Construction Project Processes and Phases:

Project offerings concern large orders in terms of monetary value.
Project offerings concern long-term investments.
Project offerings may include financial packages or other financial engineering
measures.
Project offerings often involve bidder/supplier coalitions.
Project offerings are international in the sense that offerers sometimes come from
foreign countries.
Project offerings are subject to deadlines and time limits.
Orders for projects are discontinuous.
General Characteristics related to Specific Construction Project Phases:
Project Process: Key Characteristics:

- Substantial client and architect interactions due to:
Design - Differences between customer and supplier know-how levels and
9 1 2 5 6 - The need of the architectural firm to familiarize itself with client
objectives.
in cooperation with e.g. - The services are Knowledge-intensive software contributions that are
- Other consultants - Perishable (i.e. they cannot be produced in advance) and include a
-The Client - High Level of discretionary effort/personal judgement and result in
- Other parties with pro- - Both intangible and tangible service elements.
ject -related interests - The tangible designs produced affect the standardization and customization
of construction phase and must take buyer contributions into consideration.
- Brand name recognition plays a highly negligible role in buyer decisions.

Construction - Extent of architect involvement related to the inseparability issue.
3 4 - Substantial or insubstantial client - architect interactions due to:
in cooperation with e.g. - e.g. potential buyer supply offerings and contributions .
- Materials suppliers - Differences between customer and supplier know-how levels
- Builders (bricklayers, - The services are knowledge-intensive software inputs in the fields of
carpenters, plumbers etc) - construction management or construction consulting that so to speak
- Poss. Cons. Manager - connect the tangibles and the intangibles of construction
activity. They are:
- Other Consult. - Perishable (i.e. they cannot be produced in advance) and include a
- The Client - High Level of discretionary effort/personal judgements.
- Revisions of decisions concerning design may be made during
construction.
- Further decisions concerning standardization and customization levels as
- well as the Scope of buyers contribution to the phase may be made.

54
Source: Authors own conception on the basis of the literature studies of Chapter 2.
55
3. A Review of Project Marketing Literature relevant to the Sale of
Project-Related Architectural Services.
3.1. Methodology and Delimitation of the Literature Review.

The purpose of the literature review of this chapter is to enable me to take advantage
of and build upon previous project marketing contributions in my subsequent
explorative-integrative (Maale, 1996) treatment of the research questions stated in
Chapter 1. Thus this review aims to be an integrative research review as opposed to
a purely theoretical review (see Cooper, 1989:13) and will focus on the insights and
results of previous research efforts.

Unfortunately in the social science community there appears to be a lack of rigorous,
well-accepted methodologies concerning literature reviews (Cooper, 1989:11). My
literature searches
13
on this topic resulted in only a handful of scholarly contributions
(e.g. Cooper, 1989; Easton, 1995a; Helmericks et al., 1991; Leibert, 1996; Meyer,
1988). This may be partially due to a lack of agreement about the nature of scientific
knowledge (see e.g. Chapter 4 of this dissertation), yet it is also the case that for each
specific paradigm there are many fewer works written about the methodology of
reviewing previous research than about the methodology of undertaking new studies.

With regard to the position of reviews in IMP and INPM literature, Easton (1995a:461-
2) has made the following remarks:

Reviews may not, at first blush, appear to be an example of a research
methodology. However, they can create new empirical knowledge, as well
as integrating, consolidating, and advancing theory. They may do so by
relating different findings and coming to new conclusions. In the industrial
networks field, reviews are not yet common []. However, partial reviews
and reinterpretations are often incorporated in papers reporting empirical or
theoretical work. The complexity of network studies means that such
reworking may be a necessary part of development, and it is clearly to be
both expected and encouraged. Meta-analysis is a more clear cut example
of the creation of knowledge:

Whereas a traditional qualitative literature review is not seen as empirical
research, meta-analyses apparently are. (Aldag and Stearns, 1988, p.
257).

13
I searched the databases of the Danish Royal Library and the Copenhagen Business School Library as
well as the article indices ABI Inform (1991-1998), Sociofile, and Helecon International.
56
It involves the analysis of the outcomes of a number of quantitative studies
concerned with examining a common issue (for example the relationship of
intention to action) that, fulfilling the requirements for statistical inference,
can be treated as a series of samples and meta-conclusions drawn. While
such studies are rare in industrial network research, there is no reason in
principle why meta-analyses should not be carried out.

Eastons meta-analysis (ibid.:461) corresponds to Coopers (1989:13) theoretical
review.

Concerning the state of the art of publications specifically dealing with the marketing
of projects, the current body of work encompasses the following types of
contributions (see e.g. Cova, Mazet and Salle; 1993:378):

1. Quantitative empirical studies (mainly concerning competitive bidding)
2. Case studies and other qualitative empirical studies
3. Conceptual studies
4. Practice-oriented contributions

It would be possible to assess and integrate results from studies of type 1 according
to the meta-analysis theoretical review comparison criteria developed by e.g. Cooper
(1989). Although the large number of quantitative project marketing studies have not
yet been assessed in this manner
14
, I judged that this task would not be a worthwhile
undertaking in connection with this research project because, as has been indicated in
Chapter 1, this research will mainly be based on insights from IMP and INPM Group
project marketing literature, which lie outside the sub-field of competitive bidding.
This review will therefore merely summarize key research questions, ontological
assumptions, and results of the body of quantitative competitive bidding studies.

Contributions of type 2 will be assessed on an individual basis according to scientific
criteria relevant to qualitative studies as described in Alasuutari (1995), Altheide and
Johnson (1994), Flick et al. (1995), Jorgensen (1989), Kvale (1996), Maale (1996)
and Yin (1994); studies that are deemed methodologically incorrect on the basis of
these works will be excluded. However it should be noted that sufficient data for
exclusion assessments is not always provided; judgment of e.g. studies presented in
articles or working papers is often difficult because the underlying research
methodology is merely briefly summarized in these contributions. In cases where the

14
For those who might consider such an endeavor, the comprehensive bibliography of the early
competitive bidding literature found in Starck and Rothkopf (1979) would be a good starting point.
57
methodology is not described thoroughly, the studies will be given the benefit of the
doubt and will be included. Similar to the analysis of the contributions of quantitative
research, I will focus on the research questions, ontological assumptions, and results
of the qualitative empirical studies.

Conceptual studies (type 3) are in this paper defined as studies which do not include
empirical observations, such as Hedaa (1998).
15
With regard to conceptual studies, the
focus will be on their research questions, the resulting conceptualizations, and the
underlying ontological assumptions. As for the practice-oriented contributions (type
4), these types of work are scientifically speaking less well-founded, irregardless of the
scientific paradigm that the authors subscribe to. Their prescriptive suggestions and
underlying assumptions will, however, be included in this more scientifically-oriented
review for three reasons:

Practice-oriented contributions influence the cognitive perceptions of
researchers and inspire qualitative, quantitative, and conceptual scientific
studies.
The scientific community does not agree about precise distinctions and
boundaries between practice-oriented contributions and scientific stu-
dies due to the more fundamental disagreement about the nature of science.
For better or worse, some authors of literature reviews include practice-
oriented work in their reviews as a matter of principle.

In my literature studies, I have aimed to read comprehensively and include the most
current project marketing contributions, in accordance with Meyers (1988) sugges-
tions. The purpose of this papers literature review is, as previously mentioned, to
enable the integration of previous research insights into the framework of the empirical
study. On the basis of this goal, both the general development of the field of project
marketing and especially interesting studies in relation to this studys research
questions will be treated in the literature review. The studies listed in the bibliography
have been selected according to an assessment of two factors:

The relevance of the study in question to the research project at hand
The standing of the study in question in the academic world (Studies
judged to be especially renowned and/or seminal will be included.)

15
It follows from this definition that studies based on grounded theory and other inductive methods are
classified as qualitative empirical studies.
58
Several articles and studies deserve specific mention in this section because they
contain project marketing literature reviews. These studies have been critically exam-
ined on two levels, the content level and the literature review methodology level, to
obtain inspiration and insights for this literature review
16
:

Tikkanen (1998)
Backhaus and Bschken (1997)
Owusu (1997)
Gnter and Bonaccorsi (1996)
Ahmed (1993) (The literature review is found in Chapter 2 of this
doctoral dissertation.)
Cova, Mazet, and Salle (1993)
Cova (1990b)

Furthermore, with regard to selection, many works concerning themes related to pro-
ject marketing were examined but quickly excluded because they deal with topics
irrelevant to the research questions of this study. These exclusions concern the fol-
lowing categories of contributions:

Studies dealing specifically with technology transfer projects (e.g.
Holstius, 1993, Tikkanen and Lindblom, 1998)
Studies dealing specifically with the marketing of projects from Western
countries to the developing countries, the Far East, or the former Eastern
block (e.g. Ahmed, 1993; Ghauri, 1998 and 1983; Jansson, 1989;
Ronkainen, 1984; Welch et al., 1996)
Studies focussed on situations in which offered sales can be either of a
generic-problem-solving project nature or of a technical problem-solving
product nature (e.g. Azimont et al., 1998; Backhaus and Weiber, 1987;
Kosonen, 1990; Mattsson, 1973)

The previous remarks in Section 2.5. (see p. 46) concerning the long-term traditions of
selling buildings as entities justify the exclusion of the last group of studies.

16
I have, however, refrained from using any one of these specific studies as a model for my literature
review, as I found that each of the examined literature reviews had its strengths and weaknesses and none
was optimal with regard to this studys focus.
59
3.2. The Historical Development of Non-IMP and NonINPM Related
Project Marketing Research relevant to the Sale of Project Related
Architectural Services.

As mentioned in Section 2.5, Lars-Gunnar Mattsson is credited for having popularized
one of the most important project marketing concepts, namely systems selling, in
1973. However, the earliest research contributions on the sale of projects are a couple
of decades older than Mattssons often-cited article. In the 1950s and 1960s, many
quantitative studies of project bidding strategies were undertaken (see Starck and
Rothkopf, 1979, for a comprehensive review of these studies). The ontological
assumptions of these studies were those of the neo-classical economic paradigm, and
the aim of the scientific research was to create models to solve practical bidder
problems such as when to bid and how much to bid (Boughton, 1987:88). Thus
many of these type 1 studies (i.e. quantitative empirical studies) also contained the
normative frameworks and practical prescriptions common to type 4 contributions.

Two very early contributions (Friedman, 1956; Vickrey, 1961) to the competitive
bidding literature literally inspired a host of similar subsequent studies. Friedmans
article presented an economic model to determine the optimum bid in a competitive
situation where each competitor submits one closed bid at a time (Friedman,
1956:104). However, he also discussed possible adaptations of his economic model
to the situation where a firm submits a number of bids simultaneously (ibid.: 110-112);
this theoretical problem in turn inspired a substantial number of the (predominantly
Anglo-American) studies listed in Starck and Rothkopf (1979).

Vickreys contribution modified the neo-classical assumptions of perfect markets, and
subsequently dealt with the problem of securing Pareto-optimal bidding results in
imperfect markets using a modified neo-classical economic framework (Vickrey,
1961:8). He proved that it is possible to achieve a Pareto-optimal bidding result in
imperfect markets by establishing in advance that the price is to be determined by the
first rejected bid (ibid.:28); this milestone in economic research prompted great
academic interest in creating neo-classical economic competitive bidding models that
encompass market imperfections, especially in the English speaking world.

Around the beginning of the 1970s, contributions that included basic marketing and
strategic concerns of project suppliers (e.g. Mattsson, 1973) began to challenge the
neo-classical economic bidding models which regarded suppliers as price-takers and,
so to speak, product-parameter-takers (Boughton, 1987:88). During the 1970s and
1980s, these voices from the disciplines of marketing and strategic management gained
60
strength and increasingly attacked the neo-classical competitive bidding literature for
leading to indiscriminately reactive (or pell-mell) bidding approaches (Bansard et al.,
1993; Cova et al., 1993:378). In e.g. Brooks (1978:35) article, it is stated that a
specific bidding process often not only concerns the opportunity to win a given
contract, but also opportunities for one or more follow-on contracts. Conesquently
the firm winning the concrete bid usually will have a substantial advantage in any
follow-on contract negotiations.

Key contributions from the 1970s and 1980s that sought to create and refine
frameworks for strategic supplier construction of project offers include Dunn and
Thomas (1986), Hannaford (1976), Mattsson (1973), and Page and Siemplenski
(1983). The ontologies that formed the basis for these articles cannot be fully dis-
cerned on the basis of the articles themselves. However, one ontological belief that
distinguishes them from the previous project bidding literature can be found in all four
of the above-mentioned articles: They all presuppose that it is possible for the project
supplier to create an offer that is differentiated in that it better fulfills broad, generic
needs of the customer. Additionally, in relation to the discussion in the next
subsections, it is worth noting that two of these contributions also include explicit
statements to the effect that interaction between sellers and buyers plays a role in
project marketing (Dunn and Thomas, 1986:2-3; Hannaford, 1976:144). However,
based on the assessment of Section 2.5. that the construction industry always has
been based on project sales and the limitations of the literature review listed in the
previous section, I judge the exact research questions of the above four articles to be
irrelevant to this research project and will therefore refrain from discussing them
further here.

In the 1980s, competitive bidding research (e.g. Boughton, 1987; Slatter, 1990) was
undertaken with the goal of creating bidding strategies that incorporate insights from
the emerging frameworks for strategic supplier construction (e.g. Mattsson 1973 and
the studies his article inspired). In a quantitative study, Boughton (1987) used a
standardized survey questionnaire to determine to what extent US construction firms
used the neo-classical competitive bidding models in comparison to other criteria,
such as company objectives or desirability of the job, in their competitive bidding
decisions. Boughtons (1987: 89-90) results indicated that only 9% of the construction
firms used mathematical competitive bidding models and that construction firms
instead ranked the factors clearness and detail of specifications, past experience
with similar work, confidence in subcontractor bids, location of project,
number of competitors, duration of project, workload, market condition (busy
61
or slow), size of bid, opportunity for follow-on work, and relationship with
architect/owner as being the most important elements of bidding strategies (in that
order). Additionally Boughton (1987:92) recognized the interactive nature of the
bidding process, which, in his words, meant the following:

the reputation of the supplier is a factor, as well as the suppliers knowledge
of how the buyer operates. It is not uncommon for a low bidder to increase
revenue through change orders as the project evolves. Thus, a supplier may
low ball the bid, with an expectation of improving the profit margin through
post bid contractual revisions. It is therefore important for any prospective
bidder to consider the role, if any, that client-supplier relationships will play,
not only in the selection process but throughout the life of the contract.

On the basis of these results, Boughton (1987:94) suggested the following managerial
implications:

1. The creation of a formalized Management Information System (MIS) to
monitor, gather, analyze, store, and evaluate a wide range of market
information [...] far beyond the collection of past competitive bid histories.
Information about the company, the customer, the competition, and the
environment must be obtained and processed to produce knowledge that can
be used directly in decision making.
2. Using a three step approach to move the strategy away from the traditional
cost plus markup approach to a demand/value orientation. The three steps
suggested were:
Setting performance standards for achieving defined company objectives.
Selecting target bid opportunities that best fit the above criteria.
Estimating how much the job is worth to the firm (value of the job).
3. Managerial policy-making based on the fact that buyers are not constrained to
accept the lowest bid, and in practice often incorporate nonprice features such
as value, as represented by delivery, reliability, technical ability, and
knowledge, and general reputation of the firm.

Ahmad (1990) also worked to refine the techniques used to bid on specific projects
seen in a larger perspective. In his work, he developed a model in which factors
influencing the to bid or not to bid decision are categorized in four different clusters:
project-specific factors, firm-specific factors, market-specific factors, and factors
pertaining to the available external resources.

Furthermore, for the specific case of architects involvement in international con-
struction projects, the American architect Messner (1994:2) suggested in his doctoral
62
dissertation that architectural firms should pursue projects only in situations where the
following criteria are fulfilled:

1. The firm in question is truly qualified to complete all aspects of the project.
2. The firm in question is competitive with regard to the project at hand.
3. The project at hand supports the general long-term goals of the firm.

Additionally, Messner (ibid.: 92) developed a five-fold project evaluation process for
scrutinizing and making decisions about bidding for international architectural projects:

1. The firm should assess the feasibility of the potential project(s).
2. The firm should determine its ability to perform with regard to the project(s) in
question.
3. The firm should assess its competitive advantages with regard to the project(s).
4. The firm should determine the risks associated with the project(s).
5. The firm should then on the basis of 1 4 select the projects it will bid upon.

In 1994, German project marketing scholars Backhaus, Aufderheide, and Spth (1994)
published a seminal German-language study on the marketing of projects containing
systems technologies. This work was innovative in that it incorporated insights from a
neo-institutional economic perspective (Gnter and Bonaccorsi, 1996:535). The
resulting framework from Backhaus et al.s (1994:V-VI) conceptual, quantitative, and
prescriptive study can be summarized as follows:

The purchasing of projects is characterized by the unique characteristic that the pur-
chaser must make a decision concerning technology which usually implies long-term
economic ties to the seller. The less the project allows for the subsequent
incorporation of components from alternative sellers, the greater the cost of replacing
the original seller. From the perspective of the project marketers selling efforts, this
implies that projects may be categorized by their degree of specificity in relation to the
incorporation of alternative components, and that there is no one way to maximize the
efficiency of marketing efforts for all types of projects. A theoretical algorithm based
on the insights of neo-institutional economics is used to test several categories of
project systems as well as hypotheses.

The quantitative empirical tests show that in cases where the buyer has incomplete
information, he usually does not commit himself to technology requiring long-term
ties. Therefore the information policy of the project marketing firm is of paramount
63
importance. Additionally, as risks increase with the degree of project and project
component specificity, the purchaser on one hand perceives potential productivity
gains due to the customization of the project to his unique needs, yet at the same time
also perceives risk due to his dependence on one seller. Part of this risk may,
however, be regulated through contracts and the legal system, thus the management of
legal contracts should be a key part of a project marketing strategy. If this alternative is
not possible, the seller should work to build the trust of the buyer. The trust-building
strategy is thus regarded as a different strategy than the legalistic strategy by Backhaus
et al. (1994).

In their 1996 article, Bonaccorsi, Pammolli and Tani present some groundbreaking
work to develop concepts and descriptions of the business world of system com-
panies, i.e. those large, multi-technology, multi-business firms that are typically active
in systemic industries in most industrialized countries (ibid.:539). Their conclusions
are that in the long run it is paramount for system companies to maintain the global
control of the technological dynamics of the system and that this implies that the very
boundaries of these companies will and should change in the pursuit of this goal. The
argumentation of Bonaccorsi et al.s (1996) article is mainly deductive based on
existing research contributions.

An issue of more specific relevance to the professional services is Bonaccorsi et al.s
(ibid.) statement that system companies aim to maintain the global control of the
technological dynamics of the system (ibid.:539) in situations where innovation is
likely to occur, as the complex relationship content between the project marketing firm
and other project actors cannot be given in advance (ibid.:546-547). For the world of
architects, similar thinking lead the Swedish architect Ahlqvist (1992: 85-86) to suggest
that architecture should be regarded as a field of knowledge instead of a field of
activity, thus enabling architects to redefine their role in construction, renovation, or
urban renewal projects on an ongoing basis and thus also influence future demand for
their knowledge:

If the architects fail to participate in the necessary modernisation of the
design and building process and continue to regard the design process more
as an end in itself, they are likely to loose [sic!] even more of the influence
they once had.

Architects, who during the end of the eighties were overloaded with design
work under conditions ideal at least for their self-indulgence are now under
employed or not employed at all. It is unlikely that they will ever experience
64
conditions of the kind typical for the past few years. This may, quite
naturally, cause a feeling of despair but could, on the other hand be
regarded as an opening to a revitalisation and a re-establishment of the
profession. []

Instead of being determined by its main fields of activities, primarily
planning and designing, the architects profession ought to be defined by its
sphere of knowledge. Technical, aesthetic and economic knowledge about
buildings, environments in the whole and parts combined with
understanding of the conditions required for their creation should form the
common base that defines the profession. The application of that
knowledge in design, management, public or private administration,
research, education, construction etc. should be the superstructure. The
creation, management and preservation of an architecture with a quality that
discriminates it from the mere construction or development requires
professionals whose activities are based on and supported by knowledge.

Gnter and Bonaccorsis (1996) literature review contains recent references to both
IMP/INPM and non-IMP/INPM project marketing literature. Additionally it
commences with a list of deficits of the more general, business-to-business marketing
literature (ibid.:531)

Commonalties and differences between consumer and business-to-business
marketing are not yet fully investigated. Additionally, the characteristics of service
marketing tends to blur the differences between the two sectors;
research in business-to-business marketing was originally inspired by behavioristic
approaches. With the upcoming of micro-economic orientated neo-institutional
approaches it becomes evident that there are substantial lacks and gaps in
theoretical penetration of business-to-business marketing;
focussing network theory, relationship marketing and similar cross-section
approaches it seems that commodity-specific characteristics of certain business-
to-business areas are widely neglected at least with respect to Anglo-american
publications and discussions.

Although Gnter and Bonaccorsi (ibid.: 532) mention the regular meetings of the
INPM group at e.g. IMP conferences, they state that the current situation is one in
which project marketing researchers scattered in different countries work with too little
knowledge of approaches and findings from other countries, due to e.g. language
problems as well as a separation of the different markets for research results and
publications (ibid.). In their opinion, major recent contributions have come from
Germany, the Scandinavian countries, and France (ibid.:535).
65

In the viewpoint of Gnter and Bonaccorsi (ibid.), most of the current body of
studies, with the exception of Backhaus et al., 1994, lack a theoretical basis. They are
instead preliminary, exploratory studies which suggest hypotheses for further research.
Gnter and Bonaccorsi do, however, list a few major trends that, in their opinion, will
change the general market for projects (ibid.: 533-4):

1. Economic Growth in East Asia
2. Liberalization, Privatization and Internationalization of Procurement in Public
Utilities
3. Centralization of Procurement in Multinational Corporations
4. Shortening of the Procurement Cycle, i.e. an increasingly rapid decision process
5. Financial Shortages seen from the side of the buyer. Whereas governments and
international financial institutions previously were involved in financing efforts, the
contractor is increasingly being asked to provide these services.

3.3. The Contribution of IMP and INPM Group Work on Project
Marketing relevant to the Sale of Project Related Architectural Services.
3.3.1. An Introduction to and Criticism of the IMP Group Work and IMP
Terminology.

Originating in Western Europe
17
, the international Industrial Marketing and Purchasing
Group (IMP Group) of researchers has since the beginning of the 1980s developed
dyadic interaction and network models that focus on relationship-related aspects of
business-to-business marketing and purchasing, the underlying assumption being that
both seller and buyer play active roles. The majority of IMP studies have focused on
the structural issues relation to interaction and networks (Mller and Wilson,
1995:606).

The first major IMP study (Hkansson, 1982) focused on international industrial pur-
chasing and marketing in six Western European countries. The research was explor-
ative, yet it had the goals of (a) developing concepts and models to aid in the under-
standing of close, long-term buyer-seller relationships in industrial markets and (b)
identifying factors that could influence the level of stability in these relationships
(ibid.:6).

17
Today, the body of researchers associated with the IMP Group is still mainly Western European.
However, the group includes scientists from the Eastern Europe, the Middle East, Africa, Australia, and
New Zealand, as well as a few North Americans. The presence of Latin Americans and Far Eastern
Asians is, however, negligible.
66

The second major IMP study (see e.g. Turnbull and Valla, 1986 and Hkansson,
1987) extended the framework to encompass other relationships beyond a given
buyer-seller dyad. According to Easton (1992:104):

It is concerned with individual relationships as in the first study but has
moved on to examine each relationship in the context of the other
relationships a particular firm may have. It therefore operates at a higher
level of aggregation than the first programme of work and might be said to
provide one form of link between studies of firms buying and selling and the
full blown network level of analysis.

Today IMP Group members continue to share common ontological beliefs that
relationships in dyads and networks play a decisive role with regard to the marketing
and purchasing actions of firms. However, the original theoretical framework of IMP
Group work, which comprised Inter-organizational Theory and Williamsons (1975)
New Institutional Economic Theory (Hkansson, 1982:10-14), has been modified, in
that both Williamsons (1975) markets and hierarchy dichotomy has been abandoned
and general agreement about the fundamental theoretical framework has lessened
(Mller, 1993). However interorganizational resource dependence theory, systems
theory, and theories of social structure and change continue to mark the IMP Group
(Mller and Wilson, 1995:605).

Current IMP researchers subscribe to a wide range of epistemologies. As two cases in
point, the Finnish Professor Henrikki Tikkanen (1997:77-89) advocates a scientific
approach common to the postmodernism, subjectivism, relativism, conven-
tionalism, constructivism, critical pluralism labels (ibid.: 83), whereas Professor
Geoff Easton (1995a and b) from the United Kingdom argues for a realist episte-
mology.
18

However, the IMP Group still operates to a large extent on the basis of a common
vocabulary. This enables definitions of key IMP terms to be given in the following
paragraphs. According to Easton (1992:106):

18
As will be explained in Section 4.2., my epistemology lies somewhere between moderate social
constructivism and critical realism, thus allowing for a critical pluralistic approach regarding methods and
methodology and an explorative-integrative (Maale, 1996) methodology based on abductive (Andersen,
1988; Dubois and Gadde, 1999) reasoning.
67
relationships (emphasis added) among firms are the sine qua non of an
industrial network approach. [] One analysis of interfirm behaviour
distinguishes between relationships and interactions (Johanson and
Mattsson, 1987). The relationship elements of the behavior are rather general
and long-term in nature. Interactions, by contrast, represent the here and
now of interfirm behaviour and constitute the dynamic aspects of
relationships (Johanson and Mattsson, 1987).

Relationships are seen by many IMP researchers as being comprised of four elements
(Easton, 1992: 106-110):

1. Mutual orientation, which implies that firms are prepared to interact with each
other and expect each other to do so (Mattsson, 1988).
2. Mutual dependence or perceived mutual dependence which in some sense may
be regarded as the price a firm may have to pay for the benefits that a relationship
bestows. Dependence is partly a matter of choice and partly a matter of
circumstances. (Easton, 1992:107)
3. Bonds, i.e. a measure of tying albeit unspecified, between partner firms (ibid.).
Bonds may include e.g. economic, social, technical, logistical, administrative,
informational, legal and time based dimensions (ibid.:108).
4. Relationship investments or processes in which resources are committed in order
to create, build or acquire assets which can be used in the future (Johanson and
Mattsson, 1986).

Furthermore, according to Easton (1992:111):

Relationships form the context in which transactions take place.
Transactions [] may be divided into exchanges and adaptation
procedures [emphasis added]. The latter are closely associated with the
investment element of relationships. Adaptation is a continuous process
which results in changes in products or services bought or sold, in
processes of manufacture or in routines and administrative procedures and
which implies resource commitment. The resulting adaptations are
investments in specific relationships. The returns to adaptation investment
are strengthening of bonds between firms, easier resolution of conflicts,
confirmation that continuing adaptation is possible and development of
mutual knowledge and orientation (Johanson and Mattsson, 1987).

Adaptation processes are, in turn, related to exchange processes. The
more intensive the exchange process among firms, the stronger will be the
reasons to make adaptations. The type of adaptations is also related to the
characteristics of the exchange, including frequency, complexity, and
regularity" (Johanson and Mattsson, 1987). Similarly exchange processes
68
are intimately connected to relationships. Relational elements strongly
influence the processes of exchange, for a firm will not order a product
from a partner firm that it knows the firm finds difficult to produce.
Conversely continuing exchanges provide the only medium firms have to
change the form of their relationship. For example social exchanges may be
strengthening social bonds at the same time as product exchanges are
weakening technical bonds.

The above statements that (a) the adaptation procedures are closely associated with
the investment element of relationships and (b) the more intensive exchange pro-
cesses among firms, the stronger will be the reasons to make adaptations are pro-
blematic for the specific case of project selling professional service firms such as
architectural firms, as the offerings of these firms always are customized, reflecting
the perceived needs of the customers, as previously explained in Section 2.4. Addi-
tionally long-term investments in relationships beyond the level of the individual archi-
tectural project may not take place, if e.g. the client only has a need for one specific
project. This point will elaborated upon in Subsection 3.3.2.

Ford (1980:43) states that a firm developing a relationship with another firm is influ-
enced by considerations concerning experience, uncertainty, and distance:

Experience in existing and previous relationships provides the criteria by
which the potential and performance of a new partner will be judged a
partner of which the company has no experience. The buyer will face
uncertainty about the potential costs and benefits which are likely to be
involved in dealing with a new supplier. The costs can be separated into
those involved in making a change to a particular partner, e.g. in a buyer
modifying its own product to suit that of a new seller. Additionally there are
opportunity costs involved in a continuing relationship, when compared
with alternative partners, e.g. in a buyer having to accept less frequent
deliveries.

The distance which is perceived to exist between buyer and seller has
several aspects:

Social distance [Fords italics]: the extent to which both the individuals and
organizations in a relationship are unfamiliar with each others ways of
working.
Cultural distance: the degree to which the norms, values or working methods
between two companies differ because of their separate national
characteristics.
69
Technological distance: the differences between the two companies product
and process technologies.
Time distance: the time which must elapse between establishing contact or
placing an order, and the actual transfer of the product or service involved.
Geographical distance: the physical distance between the two companies
locations.

In my opinion it is not fruitful to separate between uncertainty and distance, as Fords
five distances (above) also are potential factors of uncertainty. In Chapters 8 10, I
will thus draw upon Fords five distances in categorizing the knowledge acquired by
the Danish case study firms (research question 3, see Chapter 1), describing the
process of project acquisition, including the potential influence of relationships
(research question 4), and determining the role of previous project work in relation to
current project acquisition efforts (research question 5).

In the IMP approach, an industry is viewed as a network of interconnected exchange
relationships, which implies adopting a systemic focus and level of explanation
(Easton, 1992:104). However the relationship between the individual relationships and
the entire network is neither simple nor additive (ibid.:106). From the viewpoint of a
specific firm (ibid.:112):

it is clear that a firm will have, except in the sparsest of networks, more
indirect than direct relationships. [] However it is equally likely that some
law of distance will apply such that the more distant and indirect the
relationship the less impact it will have. One could, for example, imagine a
situation where an indirectly connected secondary ring of firms might be
capable of insulating the focal firm from the rest of the network. In a similar
way indirect relationships provide the context for direct relationships and
are capable of strongly influencing them (Mattsson, 1986). []

Mattsson (1986) identifies seven dimensions which can be used to
characterise indirect relationships. They include distance from a focal firm;
vertical or horizontal nature; complementary or competitive; narrow or wide
connection: the strength, kind and content of the direct bonds concerned;
the interdependency of the direct relations concerned and the value added
of a focal firms direct relationship. Such a characterisation provides a link
between descriptions of the operation of direct relationships and the
operation of networks. For example the predominance of widely or
narrowly connected indirect relationships will fundamentally affect the
microstructure and microprocesses of networks. It remains to be seen
70
whether this intermediate form of analysis provides a useful route to
descriptions of aggregate network phenomena.

In Subsections 3.3.2. and 4.4.1., two alternative concepts that establish the link
between relationships and broader networks will be presented: the project marketing
milieu (Cova, Mazet, and Salle, 1996a) and the field (Bourdieu, 1979 and 1986;
DiMaggio and Powell, 1983; Melin, 1989; Scott, 1994). These concepts will be
addressed in relation to research question 2, concerning the nature of actor coop-
eration on the German market.

In IMP Group work, networks are regarded as structures (Mattsson, 1986). Here,
however, the terminology of IMP Group members varies, due to the boundary issue.
Some IMP scholars use the term network to describe the global economic system
which encompasses all industries, the public sector, and private households, whereas
others speak of industry-specific networks (the usage in the above quotation) and
yet others of subdivisions of networks called nets (Easton, 1992); the nets are
delimited according to criteria such as interdependence between positions due to in-
dustrial activity chains, geographical proximities etc. (Mattsson, 1988).

Within the network(s) or nets, at any given point in time, its organizations of the
network have positions (Easton, 1992: 114-115). Mattsson (1984) has described four
characteristics of positions, which Easton (1992:115) summarizes as follows:

1. Function [emphasis added] describes the function firms are held to perform, the
activities they are expected to undertake, for example, a limited line wholesaler.
2. The identity [emphasis added] of the net of firms that the focal firm has
relationships with []. If the net changes the expectations change and so does the
position.
3. [T]he relative importance [emphasis added] of the firm in its net, measured by
size or other correlates of power.
4. The level of analysis [emphasis added] in relation to the position, e.g. the micro- or
the macroposition.

Johanson and Mattsson (1986) define the distinctions between micro- and macro-
positions:

The micropositions are characterized by: a) The role of the firm in relation
to the (other) firm(s), b) its importance to the other firm, and c) the strength
of the relationship with the other firm. The macropositions are characterised
by: a) the identity of the other firm with which the firm has direct
71
relationships and indirect relationships in the network, b) the role of the firm
in the network, and c) the strength of the relationships with other firms.

With regard to the above-mentioned characteristics of positions, characteristics 1 and
2, i.e. function and identity, may be difficult to identify objectively, especially for ar-
chitectural firms who derive their identity both from the world of applied art and the
construction industry (Albertsen, 1996; see Section 2.4.). Therefore three different
sub-fields of architectural firms with three different identities will be described in
Subsection 4.4.1.

With regard to dynamics, in IMP theory, network(s) or nets are usually regarded as
stable but not static; network change is a major topic of IMP research (Easton,
1992:116). However, there is strong disagreement about the forces that drive the pro-
cesses of network coordination and change (ibid.: 119), i.e. whether the processes of
change are caused by entropy, a lack of balance between resources that leads firms to
commence investment processes, or by yet other factors.

Hkansson and Johanson (1992) developed the so-called A-R-A model to make pos-
sible an integrated analysis of stability and development in industry. [] The models
basic classes of variables are actors, activities and resources (ibid.:129); it is
depicted in Figure 10 on the next page.

The actors of the A-R-A model are marked by five characteristics (ibid.: 130-1)
19
:
1. Actors perform and control activities.
2. Through exchange processes actors develop relationships with each other
(ibid.:130).
3. Actors base their activities on either direct control over resources, which is based
on ownership, or indirect control over resources, which is based on relationships

Figure 10. The Actor-Resources-Activities (A-R-A) Model.

Network of Actors

Actors

19
Four similar IMP models which also deal with the linkages between actors, activities, and resources in
networks are described and compared in Holmen, Pedersen, and Torvatn (1999).
72

Activities Resources

Network of Activities Network of
Resources

Source: Hkansson and Johanson, 1992: 130.

with other actors and the associated dependence relations with those actors (ibid.).
4. Actors are goal oriented and aim to increase control over the network through
control over resources or activities or both. This, in turn, enables them to achieve
other, more specific goals.
5. [A]ctors have differential knowledge about activities, resources and other actors
in the network. This knowledge is primarily developed through experience with
activities in the network. Consequently, the knowledge of nearer parts of the
network is greater than knowledge of more distant parts. The actors know different
parts of the network, and even if they have experience of the same parts such
experience may not be identical" (ibid.:131).

As for activities, the A-R-A model distinguished between two types of activities,
based on previous work done by American marketing scholar Wroe Alderson (1957
and 1965):

1. Transformation activities, in which resources are changed in some way
(Hkansson and Johanson, 1992:131).
2. Transfer activities, in which direct control over a resource is transferred from one
actor to another (ibid.).

Resources, according to the A-R-A model (ibid.: 132) as well as Aldersons (1957
and 1965) theory, are fundamentally heterogeneous. This means that resources both
have attributes in an unlimited number of dimensions (Hkansson and Johanson,
1992: 132) and the use and value of a specific resource is dependent on how it is
combined with other resources (ibid.: 133). The relationship between knowledge and
resources is proposed to be the following (ibid.:133-134):

73
Knowledge and experience of resources are important. First, when
heterogeneous resources are combined their joint performance increases
through experiential learning and adaptation. This is valid in the small scale
when very specific resources are combined when performing specific
activities. It is also valid in the large scale when bundles of resources
controlled by one actor are combined with other bundles of resources.
Second, when heterogeneous resources are combined new knowledge
emerges which creates possibilities for new and improved combinations.
New insights into the handling of resources can break existing activity
cycles and transfer chains and contain the seeds for development and
change in industrial networks. Thus, when resources are heterogeneous,
change induces further change. This holds both for those resources which
are used in the activities and those which perform and influence activities. It
is also valid both for transformation resources and transfer resources.

Although the importance of context-specific knowledge is emphasized in the above,
Hkansson and Johanson are vague about the exact position of this knowledge (see
the previous discussion of this issue in Section 2.3.). Relevant questions related to
research question 3 of this dissertation are not answered unequivocally. For example,
can knowledge be regarded as a resource or does the model only deal with tangible
resources? Or where is the position of knowledge is it embedded in the individual
actors, the relationships between the individual actors, or the activities that form the
processes?

The A-R-A models inability to specify the exact position of knowledge is related to
two more general weakness of IMP theory: its inability to explain the emergence of
networks and its lack of accountability for the knowledge and interpretations of the
involved actors. According to Andersen (1995: 83-4):

any social order must be seen as organized by actors in ways that are
meaningful to them. The relationship content is therefore not given in
advance, but hinges on the actors interpretation. Knowledge is not merely
formed by structural contingencies of networks, but actively shapes them.
[] Although the organization of activities depends to a large degree on
structural contingencies, it is actors who interpret network possibilities,
form relations, and eventually transform network structures. The neglect of
the cognitive aspect of actors decision-making in the network perspective,
in spite of the focus on structural elements, leaves some unanswered
questions about the role of knowledge and action. Organizations consist of
actors, whose activities are coordinated. Organized activity, whether it takes
places under the auspices of the organization or between organizations, is an
act of applying meaning to reality []. Apart from pointing to historical
74
interaction as the basis for shaping shared experiences and learning among
interacting organizations, the network perspective has not offered any
convincing or integrated explanations for how specific meanings emerge and
become shared in a larger community of actors.

To make up for the deficit of interpretive factors, I will and justify present my personal
ontology regarding the place of interpretation within structures in Chapter 4, using
Bourdieus (1979 and 1986) theory of the field and social and cultural capital to
describe interpretative processes in relation to architectural project acquisitions.

With regard to the presence of networks, many IMP Group members admit that net-
works do not always play a major role in marketing and purchasing decisions in in-
dustrial markets. In order to depict when networks prevail, Hkansson and Johanson
(1993), have developed a model of four ideal type structures of industrial market
governance (ibid.: 44-45). These are determined by (a) two alternative types of actor-
internal forces (own interests versus general norms) and (b) two alternative types of
actor-external exchange relations (general relations, which are a consequence of the
dominance of general interplay between all industry actors, versus specific relations,
which imply the dominance of specific long-term relationship-related interactions
between individual actors), as depicted in Figure 11:

75
Figure 11. Hkansson and Johansons Classification of Governance Str uctures.
Internal Force is based on
Interests Norms
External Specific relations Network Hierarchy
Force is
Based on General relations Market Culture, profession

Source: Hkansson and Johanson, 1993: 45.

In the upper left-hand corner of Figure 1, in the Network cell, activities are governed
by actors different individual interests which are channeled to each other via relation-
ships between specific actors. In the upper right-hand corner we find the Hierarchy.
Here interests have been replaced by norms which individuals follow and which are
enforced through specific relations to other actors.

The Market is placed in the lower left-hand corner; here, actors also follow their own
individual interests, but, in contrast to the Network, do not predominantly interact with
specific other actors. This means that the actors are, on one hand, freer in relation to
one another, yet on the other hand, they cannot take advantage of specific productivity
gains which occur through specific joint activities with other actors in the relational
Network governance structure.

The last cell, in the lower right-hand corner, is termed Culture or Profession. Here ac-
tions are once again governed by norms yet the external forces that ensure that the
norms are followed are based on general relationships that involve all members of the
governance structure.

The issue of governance structures is extremely important for this research, as the
governance structure of markets for architectural services influences the applicability
of IMP network and dyadic theories of marketing and internationalization for the world
of architectural services. Therefore the governance structure issue will be examined
again in Section 4.2. and in Chapter 7, in connection with the empirical answer to
research question two.

76
3.3.2. An Introduction to INPM Work concerning Project Marketing.

The interpretivist criticism of the IMP approach as well as the possible governance
structures for which the network approach may be most suitable will now be dis-
regarded for the time being, to allow for the presentation of a number of key IMP-
related contributions that deal with project marketing. These contributions come from
members of the International Network for Project Marketing and Systems Selling (in
the following abbreviated as INPM), the IMP-related subgroup
20
previously
mentioned in Chapter 1. In comparison to the other IMP contributions, the literature of
this subgroup focuses on the unique features of project marketing business (in con-
trast to features specific to other types of industrial marketing). Specific project
marketing features that are dealt with by the INPM but not by other IMP researchers
include (Ahmed, 1993:55-56):

Projects contain software as well as hardware elements.
Projects concern large investments.
Each project is unique.
Technological and knowledge gaps between the seller and buyer are often
found.

As these features have already been discussed in Chapter 2, they will not be explained
further here. On the other hand, two assertions often associated with IMP research
which are problematic with regard to project marketing and therefore sometimes
(either explicitly or implicitly) excluded by INPM researchers (on the basis of Ahmed,
1993:44) will be dealt with below:

The categorical assertion of the long-term nature of relationships.
The categorical assertion of the repetitive nature of marketing activities.

In the years following Ahmeds (1993) dissertation, several groups of INPM resear-
chers have worked to refine the description of the most important and unique charac-
teristics of project marketing as opposed to general industrial marketing characteristics
that concern the rest of the IMP Group. One such effort resulted in the so-called D-U-
C framework; this term was first coined in the work of the research team of Cova and
Ghauri (1996) and is currently being refined and elaborated by Hungarian business
administration professors Mandjk and Veres (1998). On the basis of Cova and

20
As the INPM is a subgroup of the IMP Group, future references to the IMP Group also will include
members of the INPM unless otherwise stated.
77
Ghauri (1996), Tikkanen (1998:264) lists the three unique D-U-C features of project
marketing as follows (the italics are Tikkanens):

D. The discontinuity of demand for projects and the importance of the long-
term development of the supplier-buyer relationship;
U. The uniqueness of each project in technical, financial and socio-political
terms;
C. The complexity of each individual project in terms of the number of actors
involved throughout the supply process.

Characteristic D, discontinuity, as described by Tikkanen (ibid.) seems to be in oppo-
sition to Ahmeds (1993:44) previously mentioned statements that project marketing
seller-buyer relationships are not necessarily long term, as Tikkanen implicitly suggests
that developing long-term relationships is usually possible in project marketing when
he emphasizes its importance. Tikkanens implicit assumption is also in disaccord with
a statement found in Cova et al. (1996a: 650) to the effect that when the time span
between projects for a specific customer is more than five years, this must be
regarded as discontinuity. Also Salminen (1997: 110) believes that discontinuity that
prohibits the development and maintenance of long-term relationships is often found in
project marketing.

On the other hand, the second and third D-U-C characteristics, uniqueness and com-
plexity, as described by Tikkanen (ibid.) are not in contradiction to Ahmeds (1993)
work. However, it should be noted that, in connection with their model building,
Mandjk and Veres (1998:473) regard complexity more broadly than Cova and Ghauri
(1996) as summarized by Tikkanen (1998); in the definition of Mandjk and Veres, the
term also includes the complexity related to the fulfillment of multiple and/or
subsequent project orders.

The sum of the specific features of project business discussed above present the
following challenges to general IMP theory as described in the preceding subsection:

1. The long-term nature of relationships in project marketing is a subject of
controversy.
2. The discontinuity of demand may lead to a lack of bonding, long-term mutual
dependence, and mutual orientation beyond the single project.
3. The uniqueness and complexity of each project may lead to a lack of adaptation
procedures that go beyond the single project as well as a lack of network
coordination and change processes. Therefore Cova and Ghauri (1996) suggest
78
that project marketing lies somewhere between mass marketing and network-type
marketing.

The most far-reaching consequence of the above three points could be that the world
of project business is more aptly placed in the framework of the world of virtual cor-
porations, where general relations govern (see Hkansson and Johanson, 1993) than in
the framework of networks of specific relations (see ibid.). According to Andersen
(1995), Temporability in network interaction can be seen in project-like organizational
forms, such as construction consortia, as well as in SMEs attempting to preserve
flexibility. As pointed out by Kallinkos (1989), although cooperation in construction
consortia is organized around projects, where actors participate for a limited time and
where there is a substantial turnover of actors and constellations, they are still able to
capitalize on shared experiences, using these to rationalize coordination.

However, Atkins International (1993) reaches the opposite conclusion of Kallinkos; it
provides evidence of a lack of adaptation procedures and network coordination in the
European construction industry. It is therefore once more paramount to examine the
nature of the architectural service governance structure, as will be done in Chapter 7,
in the answer to research question two. More immediately, the following paragraphs of
this subsection will describe major contributions of INPM researchers and the way
these contributions deal with specific project marketing issues and problems.

Karin Holstius (1987) project marketing cycle was the first INPM project marketing
phase model. Holstius developed her cycle on the basis of a project cycle used by the
World Bank for development projects; she thereafter tested it using long interviews
with executives of Finnish project exporting firms and the corresponding qualitative
criteria for theory testing (ibid.). The six phases of Holstius project marketing cycle,
which describe the process of marketing and delivering a project seen from the sellers
point of view, are depicted in Figure 12:

79
Figure 12. Karin Holstius Project Marketing Cycle.

1. Search
2. Preparation
3. Bidding
4. Negotiation
5. Implementation
6. Transition
Source: Holstius, 1987:54.

Holstius conceptualization of project marketing is linear within the single project offer;
it also specifies that in the case of subsequent multiple projects, the sum of
experiences related to a particular project in question are, so to speak, fed back to
the persons undertaking the project search function in the project selling firm. These
persons, in turn, use this feedback to refine their project search methods. Last but not
least, Holstius, in keeping with Ahmeds (1993:44) remarks, neither assumes that a
given buyer-seller relationship will necessarily continue to exist after the completion of
the project nor that project activities are of purely repetitive nature (i.e. occur without
modifications).

The simplicity and elegance of Holstius model as explained above poses two
problems in relation to the research project at hand:

1. Holstius model must be modified to explain situations in which the project market-
ing firm works with multiple projects at the same time and/or commences new projects
without having completed the existing projects cycle.
2. It is not in keeping with Hellgren and Stjernbergs (1995:384, as previously men-
tioned in Section 2.5) work, which suggests that the negotiation of construction pro-
ject details (step 4 in Holstius model) sometimes continues into the implementation
phase (step 5).

To ensure Holstius fairness, it must be mentioned that she herself (1987 and 1989) and
the other scholars whose contributions include or build upon her model (e.g. Ahmed,
1993; Cova, 1998; Cova and Holstius, 1993; Holstius and Cova, 1998a and b;
80
Mandjk and Veres, 1998; and Tikkanen, 1998; see also Cova, Mazet and Salle,
1996b) demonstrate profound understanding of the general oversimplification
problems inherent to simple and elegant models.

Another characteristic of Holstius (1987) model is that each phase is undertaken by
the project selling firm in interaction with its environment, although the model solely
presents the perspective of the project marketer (Owusu, 1997:486). However,
Holstius ontological assumptions as to the nature of this interaction include the
possibility of anticipating and preparing for projects as well as the existence of
supplier-buyer relationships (Holstius, 1987:53). Moreover she indicates that com-
pleted projects may have a reference value, in that they can be instrumental in
bidding for new projects (ibid.:63).

Whereas Holstius project marketing model focuses upon one individual project at a
time, later, more sophisticated models take the possibility of several concurrent
projects into account. This is in keeping with one of the chronological developments
in the INPM project marketing literature: the initial studies (e.g. Holstius, 1987; Ahmed,
1993) mainly dealt with the individual project and the development of relationships
between the parties during the course of the project. Later contributions however deal
with the more general development and maintenance of relationships between projects
(Tikkanen, 1998: 268) or at the so-called level of multiple projects (see
Alajoutsijrvi, 1996).

Holstius model (1987) has been expanded into a more sophisticated phase model by
French INPM researchers Cova, Mazet, and Salle (1994) on the basis of an explor-
atory, qualitative case study using Decision System Analysis methodology (ibid.: 33-
36). The new model, which has already been depicted in Figure 1 on page 13 of this
dissertation, is less simple and elegant, yet it is a more powerful tool because it can be
used to conceptualize many more aspects of project marketing from the perspective
of the project marketer, including situations where there are no immediate projects at
hand. Additionally, the model can be easily modified to depict situations where
concurrent work on two or more projects is undertaken or situations concerning of
post-project supplementary delivery services (see Mandjk and Veres, 1998: 485 for
further information on supplementary delivery services).

An additional strength of the new model is its more detailed depiction of the pre-
project phases. Mandjk and Veres (1998: 484) have commented on the implications
of this development as follows:
81

The merit of the model is that it calls attention to the two fundamentally
separate phases of the preparatory stage of the project. There is no concrete
project in the anticipative stage, the company watches the market in order to
gain information necessary for anticipating future projects. This, however, is
not a passive process because the company wants to affect and initiate the
future projects through the network (Cova et al. 1996, Cova-Hoskins 1997).
Once the future project starts to take shape either in the form of a tender or
a contract, it is followed by the second stage of preparation, the adaptive
stage.

The concrete project does not yet exist but the contractor starts to prepare
and mobilises its network and if possible, tries to influence the buyer
concerning the development of specifications of the project to be purchased
(Cova et al. 1996, Cova-Hoskins 1997). This is followed by the offer stage
and the project negotiation stage. The last element of the model is realisation
(Coca et al. [sic!] 1995).

On the basis of the above merits, Cova, Mazet, and Salles General Marketing
Configuration has been chosen as the basis for research questions 3 5 of this study,
which have been initially described in Chapter 1.

With regard to the normative suggestions of non-IMP/INPM project marketing and
strategic management literature of the 1980s (e.g. Boughton, 1987, as described in
Subsection 3.2.), Cova et al. (1993 and 1994) furthermore examined (a) to what extent
project marketing firms have attempted to practice these normative suggestions and
(b) the results of these attempts. Their exploratory study dealt especially with
environmental management efforts of project marketing firms. The reason for this was
that much of the marketing and strategic management literature of the 1980s contains
the (sometimes implicit) ontological assumption that the selling firm can plan and
strategize in relation to its environment.

In-depth interviews with key informants from major European companies involved in
project business in several different industrial sectors comprised the method of the
study (Cova et al., 1993:395-6). Key results were as follows (Cova et al., 1994:32):

1. concerning the screening of projects, companies found difficulties defining
stable priorities for a given period of time due to the importance of human
factors (intuition, motivation, personal involvement) in the selection of projects
[...] In addition, most firms claim their screening strategy is of the go/no go
type, but flexible enough to vary and balance the different efforts put into each
82
project. More than sophisticated choices concerning markets and
technologies, it is often the financial constraints of the yearly budget allocated
to tender preparation that determine the final selection of projects.
2. Concerning the scanning of project opportunities, companies have
progressively acknowledged the importance of interpersonal relationships
between individuals [...]
3. Concerning the analysis and the definition of strategic priorities, difficulties are
raised due to the heterogeneity and the rapid evolution of the projects and of
their environment

Based on this response results, Cova et al. (ibid.) made the following statement
concerning the strategic marketing literature reviewed in their study:

it does not grasp the complexity of the situation faced by project- to-order
supplier firms and may lead to criticisms and contradictions when strictly
implemented

Building upon this statement, the said group of French researchers went on to create a
conceptual framework to illustrate some of tensions caused by the overly-simplified
models of the body of marketing literature they had examined. This framework is
illustrated in Figure 13 and will be used in subsequent treatment of research questions
3, 4 and 5 in Chapters 8, 9 and 10.

Figure 13. Cova et al.s Project Marketing Strategy Framework.

External Reserves

Anticipation Flexibility

Internal Reserves

Source: Cova et al., 1993:395, adapted from Bansard et al., 1993:130.

In Figure 13, anticipation refers to the project supplier firms strategic need to use
resources (a) to keep itself informed about very specific technological, political, or fi-
nancial developments in the environment that might only be relevant in a few type of
projects out of the total pool of projects that the firm could potentially acquire and (b)
83
to develop specific policies and programs in relation to these specific developments.
Flexibility, on the other hand, refers to the need to use resources to maintain broad
networks to ensure that that all of the firms project offerings that are considered to be
top quality by important parties in the broader network, and to ensure that all
individual project offerings can be adapted to e.g. specific cost and customization
demands (Bansard et al., 1993: 130-131). Due to resource limitations, there is an
inherent tension between anticipation and flexibility; therefore the project
marketing firm is constantly forced to prioritize between these two types of needs.
The tension between internal and external reserves refers to whether the resources are
to be used on in-house measures or on measures that involve outside parties in the
network (ibid.: 129-130).

With regard to the concept of the reference, previously mentioned in e.g. Holstius
(1987) work, Salminens (1997) doctoral dissertation is an in-depth conceptual and
empirical study of this concept. In it, he suggests that references may be used to
reestablish credibility in the eyes of former customers in discontinuous demand
situations. However, his research is not exclusively inspired by the IMP/INPM
traditions, but because he does make substantial use of their contributions, it has been
included in this subsection.

In this literature review, I will focus upon Salminens definition of the reference and
his description of the uses of references based on his extensive literature reviews. On
the other hand, I will neither use his qualitative data nor interpretations from his case
study of a Finnish company that exports and delivers turnkey contracts abroad, as
they may not be valid for architectural firms.

Building upon Ahmeds (1993:59) definition of a possible reference as projects
executed by the supplier and deemed to be of as much similar in nature as possible to
the project in question, Salminen (1997:50) defines a reference as follows:

[A] reference is a deal containing one or several deliveries of products/
services, or a part of that deal that either already has been, or will be
delivered to a subsequently recognized customer.

Furthermore, Salminen (1997:57+) lists a number of factors that influence the facility
and utility of the use of a specific reference, categorized by the degree of their
specificity in relation to the delivery at hand. Here the most general factors are pre-
sented first:

84
1. Environmental factors. These relate to e.g. the effect of the home country of the
reference customer firm or the degree of competition in the given industry.
2. Party-specific factors. These relate to e.g. salespersons of the potential selling
firm, representatives of the purchasing firm and the reference customer firm and
their ability to communicate with each other.
3. The equipment or buildings that the reference customer has purchased (i.e. both
the equipment and buildings supplied by the potential selling firm and the
equipment and buildings supplied by other firms).
4. The three usability factors of the specific reference in question: Openness,
experience, and satisfaction. These will be explained further in the following.

The first dimension (experience) means that the utilizability of a reference
depends on the age experience of the use of a reference. A deal (reference)
can be utilized in reference lists immediately after the deal with a customer
has been closed, although its reference value is not very high at that time
(it is not yet very convincing). After the installation of the equipment has
been completed, the value of the reference increases, and after the
equipment has been used for one year, the reference can really be utilized.
[]

The second dimension (openness) means that a reference may not be so
secret that the name of the customer cannot be mentioned. The
effectiveness of a reference decreases essentially if the name of the
customer is kept secret for some reason.

The third dimension (satisfaction) means that someone in the buying
company has to express the satisfaction of that buying company. This
means that a reference must be good enough (satisfied customer) and
someone has to express that satisfaction. The level and the type of
satisfaction might depend heavily on the referring person: if the referrer is
for example one of the users of the equipment, s/he probably wants to
emphasize the usability and maintenance aspect, whereas a manager of the
plant might want to emphasize the performance and economical aspects of
that equipment. (ibid.:50-1; Salminens underlining.)

These three reference usability factors are depicted in Figure 14:

85
Figure 14. Salminens Factors that Determine the Usability of a Specific
Reference.

O
p
e
n
n
e Satisfaction
s
s Experience

Source: Salminen, 1997:51.

Above, the three dimensions experience, satisfaction, and openness are depicted in a
three-dimensional cubic figure. The reference in question is most useful when the
values for all of the three dimensions are high. This is the case in the rear upper right
hand corner of the cube, which has been circled.

Furthermore, based on an extensive review of literature on relationship marketing, the
IMP Groups work, project marketing and systems selling, services marketing, high
tech marketing, marketing communication, sales management, key account manage-
ment, market entry, new product development, buyer searching behavior, the buyers
decision maketing unit, potential purchasing situations, supplier evaluation and
selection, and buyer risk reduction, Salminen (1997:166) conceptualized a model of
the possible modes of reference use in industrial marketing and purchasing which is
depicted in Figure 15 on the following page.

Salminens conceptualizations concerning references, including the potential modes of
reference use, will be treated in Chapter 10 in connection with research question 5,
which deals with the role of previous projects in new project acquisitions (see Chapter
1).

There are further INPM concepts currently under construction that may prove to be
highly relevant tools in describing the characteristics of project marketing relationships
outside the boundaries of the single project, as is necessary in the research project at
hand. These include the sleeping relationship (Hadjikani, 1996), the milieu (Cova,
Mazet, and Salle, 1996a), the project marketing horizon (Tikka-
86

Figure 15. Potential Modes of Reference Use in Industrial Marketing .

PURPOSE TASKS PRACTICES

UNIVERSAL TASKS:
Internal:
-serve as strategic criter-
ion in bidding decisions
-prove the functionability
of technology to supplier
-improve sales force per-
formance
External:
-break competing supplier
Keeping present relationships -articles
customers -reestablish credibility -press releases
among old customers -reference lists
-signal service quality -promotional material
-prove the functionability -seminars and conferences
of technology to supplier -requests to reference cust-
-develop suppliers image omers to promote
-aid in the access to new
market segments

SPECIFIC TASKS
-create opportunities for
further customer contact
abroad
-make launching customer
promote new product/
technology actively
-legitimate a new techno-
logy paradigm

Development of new Purchasing/tendering -visits to reference sites
exchange process: -detailed descriptions of
relationships (new -prequalification/short- similar contracts
customers or sources listing
of supply) -winning the final bid

Source: Salminen, 1997:166.
87
nen, 1998), and INPM treatment of the social construction of demand issue (see e.g.
Cova, 1998; Cova and Hoskins, 1997; Cova and Crespin-Mazet, 1997). The following
elaboration of these terms will, however, only include a discussion of the preliminary
definitions, due to their work-in-process nature.

Hadjikhanis (1996) concept of the sleeping relationship deals with the issues of dis-
continuity as well as potential long-term relationships at the level of multiple projects.
It comes from his recent contribution to the study of the marketing of successive
projects. In his 1996 article, Hadjikhani examines the nature of the buyer-seller
relationships in the period after project completion in which project buyer and seller
are not concerned with resource exchange or negotiation and the buyers mobility is
high. The aim of the article is the proposition of a conceptual framework for when
the project is completed (ibid.: 319,320). Hadjikhanis methodology is qualitative; he
used the case study method to examine project-related activities in the post-project
period as well as the role of dependence and trust in this period. However, the metho-
dological section of his article is weak; it does not sufficiently specify e.g. how many
case studies were undertaken, which types of projects had been undertaken in the
individual case studies, and which geographic areas were involved.

In the article, Hadjikhani challenges traditional negotiation models that presuppose that
project-specific negotiation tactics are the main determinant of the success or failure in
the marketing of a project, as he emphasizes that a project marketer should not just
think about the project at hand, but also about potential future projects (ibid.: 332).
Hadjikhanis (ibid.) sleeping relationship thus refers to cases of continued buyer-
seller dependence after completion of the project itself (due to i.e. the possible future
need for improvements or replacement parts with regard to the project). Hadjikhani
interpreted his case study results concerning sleeping relationships as follows
(ibid.:332-333):

During sleeping relationships, contacts based on e.g. technology-based,
financial, and social relationships were used on an off-and-on basis. These
contacts were based on trust, and trust was a significant factor in the sense
that it affect influenced buyer behavior with regard to ordering new projects.
In the sample of case study firms studies, in cases where the level of buyer
trust of the sleeping relationship was high, there were incidents where buyer
chose the seller to produce new projects. Thus in these cases, negotiation
tactics did not necessarily play a key role.

88
The concept of the sleeping relationships will be examined in relation to research
question 5 in Chapter 10 of this dissertation.

With regard to the macro-environment in which project marketing takes place, Cova,
Mazet, and Salle (1996a:654) have developed the concept of the milieu on the basis
of single case study of the French construction group BTPs activities in the Loiret
region of France as well as secondary literature about renowned industrial districts
such as Baden-Wrttemberg in Germany and Tuscany in Italy. In their project
marketing research, the milieu is a socio-spatial configuration that can be char-
acterized by four elements (ibid.):

a territory
a network of heterogeneous actors related to each other within this territory
a representation constructed and shared by these actors
a set of rules and norms (the law of the milieu) regulating the interactions
between these actors.

Furthermore, Cova et al. (ibid.) describe a milieu in the following way:

What distinguishes the milieu from a simple localized network of industrial
actors is its collective linkage to the territory developed by practices of all
types [...]. The actors share, both in their life and in their imagination, the
community of some elementary structures. In this approach, the territory is
no longer considered as a simple support of localisation factors but more
and more as a group of territorial agents and economic, socio-cultural,
political, and institutional elements having specific organisation and regulation
patterns [...], shared rules and norms. This territory is characterized as global
as it not only integrates companies, but also the population, the workers, the
various organizations as well as multiple social and cultural dimensions.

Thus the concept of the milieu attempts to also include some (static) elements of the
cognitive factors, i.e. rules and norms, that Andersen (1995) deemed lacking in IMP
network theory, as described at the end of the previous subsection. These elements
play a structuring role (see Giddens, 1993 or DiMaggio and Powell, 1983) within the
milieu. Moreover the milieu seems to be broad enough to be used both in situations
where general relations prevails and in situations where specific relations previal (cf.
Hkansson and Johanson, 1993 as described at the end of the preceeding subsection).
This aspect will be dealt with further in Section 4.2.

89
Finnish INPM scholar Tikkanen (1998:271) has, however, questioned whether the
milieu concepts strong emphasis on spatiality is pertinent (the italics in the following
citation are Tikkanens):

Despite the fact that the empirical evidence gathered by French project
marketing researchers strongly supports the claim for spatiality, i.e. the
socio-geographic vision (Cova et al. 1996, Cova et al. 1994), I would still
suggest that, on many occasions, the various actors belonging to a project
marketers horizon might not be so geographically concentrated (cf.
Tikkanen and Lindblom 1998). Thus, I see no reason to automatically include
the notion of spatiality as a pertinent feature of complex actor constellations
encountered in contemporary project business (cf. Cova et al. 1996, 661).

I consider Tikkanens spatiality challenge to be important and especially relevant in
relation to this dissertations theme, the internationalization of Danish architectural
firms project marketing activities. The issue of whether spatiality matters was touched
upon in the pilot study as indicated in Appendix A and will also be dealt with
empirically in Chapters 6 - 10. I, however, have made the initial assumption that
spatiality matters, in my use of the term the milieu (see Section 4.4.).

Tikkanens own concept-under-development for capturing relevant environmental
characteristics of the complex network of relationships both within the stages of a sin-
gle project and between the individual projects is the project marketing horizon (Tik-
kanen, 1998: 270). It refers to:

the relevant characteristics of a network involved in the project business of a
focal project supplier, seen from a focal firm viewpoint. These characteristics
can be investigated, for example, through the application of the basic A-R-A
(actors, resources, activities) model of industrial networks developed within
the IMP group [...]. It should be noted that a focal net, or a project
network related to the supply of a single project, is only a part of the project
marketing horizon, which also includes the long-term development of relevant
ties between several economic, social and political actors and between
individual project supplies or project marketing processes. This also
indicates that the supplier-buyer relationship can no longer be considered the
only focal point in relationship, e.g. during the discontinuity phase between
projects. Thus, the concept of the project marketing horizon can be
perceived as an elaboration of the network view of project supplies adopted
in some recent research (see e.g. Welch et al. 1996, Tikkanen and Lindblom
1998, also Tikkanen 1995). Furthermore, it also adds long-term orientation to
the basic concept of project marketing, which is no longer seen as the mere
90
management of individual project marketing processes, despite their explicit
interlinkedness through transition phases. In a sense, the project marketing
horizon might be considered a conceptualization of the relevant contextual
embeddedness of an organization engaged in project marketing containing
both short-term and long-term elements [...].

Tikkanens project marketing horizon can, however, be criticized for the same things
that the A-R-A model was criticized for in relation to this research project in Subsec-
tion 3.3.1.:

1. The categorical assumption of long-term relationships (despite discontinuity).
2. The lack of precision with regard to the position of knowledge.

I therefore use of Cova et al.s milieu instead of Tikkanens project marketing
horizon in this dissertation.

The last INPM conceptualization-under-development (see Cova, 1998; Cova and Hos-
kins, 1997; Cova and Crespin-Mazet, 1997) covered in this review deals with the so-
called social construction of demand issue. The ontological assumption of these
contributions is that it may in some circumstances be possible for project suppliers to
construct demand, e.g. with respect to a specific project offer. This leads the scholars
listed above to declare that there are two possible approaches to project marketing
which are encompassed by the so-called Twin Track Networking Approach to Pro-
ject Marketing (Cova and Hoskins, 1997:546-7):

1. The deterministic approach, i.e. anticipating the competitive arena and the
rules of the game
2. The constructivist approach, i.e. becoming actively involved in shaping the
competitive arena and the rules of the game

According to Cova and Hoskins (ibid.) as well as Cova (1998), the project selling firm
has the opportunity to choose either a mainly deterministic approach or a mainly
constructivistic approach to project marketing; additionally, the firm in question can
switch from deterministic to constructivistic strategies or vice versa at the different
stages of the project marketing cycle. In this dissertation, the initial assumption will be
that the case study firms follow a deterministic approach. However, Chapters 9 and 10
will contain some comments as to whether the case study architectural firms had the
possibility of following both types of approaches and used this possibility in their
project marketing efforts.

91
3.3.3. Boundary Spanner and Relationship Promoter Actor Roles.

Both non-IMP and IMP researchers have developed conceptualizations that describe
the roles of specific organizational actors who interact with actors from other organi-
zations. In the United States, non-IMP Group organizational theorists Adams (1976)
and Aldrich and Herker (1977) have elaborated upon the roles and functions fulfilled
by the so-called Boundary Spanner, whereas German IMP innovation management
scholar Gemnden (1986, 1990, Gemnden and Walter, 1994, 1995a and b) has
developed and refined the concept of the Relationship Promoter (in German:
Beziehungspromotor).

As interaction with members of other i.e. firms or public sector organizations is
important for project selling firms, insights and definitions from these respective
conceptualizations will be summarized in this subsection, to lay the foundations for the
further delimitation of research questions 3 and 4 (see page 5) in Chapter 5.

Adams (1976: 1176) lists three properties of organization actors who have interactions
with actors from other organizations:

1. the occupant of such a position named here the boundary role person or BRP
is more distant, psychologically, organizationally, and other physically, from other
members of his organization than they are from each other, and he is closer to the
external environment and to the agents of outside organizations
2. he represents his organization to the external environment
3. he is his organizations agent of influence over the external environment

According to Adams (ibid.: 1177), point number 2 implies two-way informational
activity: The BRP must, in effort, perform two representational tasks: He must reflect
his own system to the outside and he must reflect the outside inwardly.

In Aldrich and Herkers (1977) conceptualization of boundary spanning roles, Adams
point number 2 plays the central role, yet their conceptualization also encompasses
Adams point number 3. Aldrich and Herker focus namely on the two classes of
functions performed by boundary spanners (ibid.: 218-221):

1. The Information Processing Function.
2. The External Representation Function.

92
According to Aldrich and Herker, information processing encompasses the following
(ibid.: 218-219):

Boundary role incumbents, by virtue of their position, are exposed to large
amounts of potentially relevant information. The situation would be
overburdening if all information originating in the environment required
immediate attention. Boundary roles are a main line of organizational defense
against information overload. [] Expertise in selecting information is
consequential, since not all information from the environment is of equal
importance. []

The process by which information filters through boundary positions into
the organization must be examined. Boundary roles serve a dual function in
information transmittal, acting as both filters and facilitators. [] boundary
role personnel selectively act on relevant information, filtering information
prior to communicating it. []

The expertise of boundary role occupants in summarizing and interpreting
information may be as important to organizational success as expertise in
determining who gets what information, depending upon the uncertainty in
the information processed. Information to be communicated often does not
consist of simple verifiable facts. If the conditions beyond the boundary
are complexly interrelated and cannot be easily quantified, the boundary role
incumbents may engage in uncertainty absorption, - drawing inferences
from perceived facts and passing on only the inferences.

External representation, in the terms of Aldrich and Herker (ibid.: 219-220):

can be viewed in terms of an organizations response to environmental
influence. Environmental constraints and contingencies can be adapted to in
at least three ways: (a) by internal structural differentiation to match the
pattern of the relevant environment, which requires information about
environmental characteristics; (b) by gaining power over relevant elements
of the environments, manipulating it to conform to the organizations needs;
and (c) a compromise position, the modal pattern of use of boundary
personnel in normal boundary spanning roles. Included under the external
representation function are all boundary roles that involve resource
acquisition and disposal, political legitimacy and hegemony, and a residual
category of social legitimacy and organizational image.

Aldrich and Herker do not, on the other hand, deal with the dilemmas that could
potentially be caused by Adams (1976) first point as mentioned above, as they
93
assume that the normal flow of authoritative commands is from the core of the
organization to these boundary roles. The behavior of personnel in these roles is
supposed to reflect the policy decisions of decision makers in line roles. (Aldrich and
Herker, 1977:220).

However, for professional service such as architectural firms Aldrich and Herkers
assumption about the flow of authoritative command may be highly problematic, as
Lwendahl (1997:54) suggests:

When professionals who are employed by the firm also individually hold
the critical resource for value creation, the goals are typically developed
through an interaction between the senior professionals. These goals are not
set by outsiders, and operations are developed jointly by the professionals
over time, not designed in order to fulfil the needs of external stakeholders.
Goals of the organization are compatible with those of the individuals, and
as long as the firm is small, the professionals oversee each others work. In
the extreme case, all professionals are equal partners, and all decisions
concerning the firm and their joint efforts are made in partner meetings with
everyone present.

On the basis of the two conflicting commando scenarios of Aldrich and Herker and
Lwendahl (above), several of Adams remarks about internal conflicts regarding
boundary role persons will be cited, as they will be used in relation to the empirical
treatment of research questions 3 and 4 in Chapters 8 and 9:

The BRP who bargains with an external agency on behalf of his
organization must not only attempt to reach an agreement with outsiders, but
must also obtain agreement from his own group as to what constitutes an
acceptable agreement with the external organizations. The BRP is at the
crunode of a dynamic, dual conflict in which the outcomes of conflict
resolutions attempts (however tentative) in one conflict become inputs to the
second conflict, the outcomes of which then become new inputs to the first
conflict, and so on. (Adams, 1976:1178)

[O]verseas personnel frequently express concern about their distance from
their organization, even though they may be enjoying unusual perquisites.
The feelings are often reinforced by visits and audits that are clearly in the
nature of checks. (ibid.: 1176-1177)

Under some conditions, accurate representation of the external world is of
paramount importance, as when the function of the information is to permit
the organization to adapt to external events. Under other conditions, the
94
function of representation is secondary and designed to subserve another
function, such as influence of organization members. This, in effect,
constitutes impression management of the BRPs own constituents. (ibid.:
1177)

When representation by the BRP is manipulatively designed to influence
selectively either insiders or outsiders, it may be primarily coping or
defensive behavior on his part. It is coping behavior if it is functionally
related to the achievement of organization outcomes. [] Distorted
representation is defensive if the primary object of the behavior is to project
the BRP as a person and if such service potentially conflicts with the
achievement of organization outcomes. (ibid.: 1177-1178)

BRPs must display [Adams italics] their loyalty and norm-adherence to a
greater extent than do other organization members, although, in fact, their
loyalty and norm-adherence may under some conditions be greater and
more rigid than that of other members. To the degree organizational
membership is attractive to BRPs, their display of fealty may be correlated
with the extent to which they perceive their fidelity is suspected. The more
they feel their behavior and beliefs are suspect, the more they will display
their loyalty, the more they will be [Adams italics] loyal to the organization
and its norms, and the more narrowly, rigidly, and exclusively they will
interpret organizational norms and demands. Paradoxically, a corollary
consequence of being suspect and of rigid norm interpretation is to apply
[Adams italics] norms and demands inflexibly in bargaining transactions
and, therefore, possibly to reduce bargaining effectiveness, at least over the
long run. That is, there may result an intransigent demand for maximum
outcomes rather than a question for optimal outcomes. (ibid.:1179)

[Another] consequence deriving from the suspicion attached to boundary
role positions is conflict for the incumbent. The organizational need for
optimal outcomes, whether explicit or not, and the need for BRPs to display
their loyalty and norm-adherence are often incompatible. For example,
allowing a vendor a given margin of profit in order to achieve an optimal
outcome in obtaining organizational inputs may give the appearance that the
negotiator is disloyal (ibid.).

In Gemndens conceptualizations of the relationship promoter (see Gemnden,
1986, 1990, Gemnden and Walter, 1994, 1995a and b), Aldrich and Herkers
(1977:218-221) previously mentioned external representation function is focused
upon much more than their information processing function. Therefore, the
following description of selected aspects of Gemndens work will focus upon the
external representation function.
95

In Gemndens first contribution (1986), he focused upon the dyadic interaction
between a seller and buyer organization in a situation where innovation was important
(ibid.: 134). Additionally, he specified to types of promoter roles, the promotor [sic!]
by power and the promotor [sic!] by know-how (ibid.). In his 1990 contribution,
he expanded upon his previous promoter roles (thus also implicitly distancing himself
from his previous, more simplistic conceptualizations) by emphasizing, as Adams
(1976), that a promoter also needs to insure internal organization support for his
external activities (Gemnden, 1990: 4). Additionally the promoter must have the
communicative ability to explain his specific know-how both internally and externally
(ibid.: 5). Over and beyond that, Gemnden went further than dyadic interaction in his
1990 contribution, to list eight different types of external actors that the relationship
promoter might have interactions and/or relationships with (ibid.:18-22):

1. Customers
2. External consultants
3. Dealers or merchants of finished products
4. Producers of complementary technologies
5. Suppliers
6. Competitors
7. Public business assistance authorities, e.g. Chambers of Commerce or Trade
Representatives
8. Institutions specializing in R & D, such as universities and independent research
institutions

In their 1994 work, Gemnden and Walter (pp. 5-6) created an extensive list of
possible power sources of the relationship promoter. This list will be cited in below
in its entirety, as it contains a thorough discussion of the characteristics that may allow
actors to enter into relationships as well as maintain and use them for their own and/or
their firms purpose(s). The italics of the following citation are all Gemndens and
Walters:

(a) Persons are attractive partners in a social systems because of certain personal
characteristics.

Persons who dispose of a certain amount of expert knowledge are able to lead
professional conversations with potential problem solvers as well as assess their
need of problem solving within a sufficient reliability. Persons who are competent
in their fields are likelier to be asked for advise and to be accepted by experts as
96
undemanded counsellors as well as mediators. Expert knowledge is helpful in order
to influence external partners.
Relationship promoters acquire or dispose already of sufficient knowledge about
the (potential) co-operation partners. This relates among others to their willingness
and ability to co-operate with each other as well as to the risks that could endanger
the co-operation.
Persons between which an affinity exists, e.g. relating to the language, value
notions, and aims, are more expected to be able and/or willing to maintain
exchange relationships.
Relationship promoters posses the social competence to awaken and keep up the
willingness to interact of partners, once they are found.
Relationship promoters develop or dispose of an identification power (referent
power) with respect to their partners which is particularly useful when it comes to
exert [sic!] influence beyond organizational frontiers.
Relationship promoters dispose of the necessary experience of how to detect
appropriate partners and win them over for a co-operation. They are aware of the
typical relationship conflicts and pay attention to a foresighted conflict
management, where conflicts are spoken out openly in good time and binding
agreements are made.

(b) Persons are attractive partners because of a certain position in a social system.

Persons with high, hierarchically legitimated power are attractive partners because
of their decision competence and their pervasion potential as well as the resources
they dispose of, as e.g. promoters by authority on the side of the user organization
with respect to the innovation supplier.
Position bearers of lower ranking, like e.g. project managers, are favored in the
taking over of a relationship promoter role, since possibilities (e.g. a time budget)
are granted to them in order to enter into and maintain contacts and relationships to
external partners. Furthermore it can be expected that external partners hold project
managers for competent dialogue partners. There are a number of other proposals
coming from the business practice. To these belong the product manager and the
key account manager. The proposals are embedded in certain management
concepts.
Relationship promoters dispose of a strong network. They already know
appropriate internal and external co-operation partners or persons who could
provide contacts to potential partners. Connect to a high network centrality is the
access to information and the possibility to control it, which presents a power
source for relationship promoters.

Consequently, we understand the relationship promoter as a person who actively
and intensively advances inter-organizational exchange processes by good personal
relationships to key actors who dispose of critical resources.
97

A relationship promoter has the more power [sic!], the more important the resources
are that his dialogue partners bring in, the more efficiently he reaches these partners,
the more he can lead the dialogue with them or advance their exchange processes, and
the less third parties are able or authorized to fulfill this function.

Methodically it must be noted that Gemnden and Walter (1994, 1995a and b) make
rich use of secondary sources to justify this list of power sources. However, they do
not test the individual propositions listed above; instead they test related hypothesis
that seek to confirm the general importance of the role of the relationship promoter
with regard to e.g. technological and economical success as well as factors such as
trust and commitment (ibid.).

With regard to answering research question 3, I will make use of both the Aldrich and
Herkers (1977:218-221) information processing function of boundary spanners as
well as the external representation function common to both the boundary spanners
and the relationship promoters (see ibid., Gemnden and Walter, 1994, 1995a and b).
On the other hand, the emphasis in answering research questions 4 will be upon the
external representation function alone.
98
4. Concerning My Ontological and Epistemological Viewpoints and their
Influence on My Chosen Methodology and the Operationalization of
Bourdieus Cultural and Social Capital
4.1. Introduction.

This chapter deals in more detail with the explorative-integrative (Maale, 1996, see
also Chapter 1) nature of this dissertation. In Section 4.2., my ontological and episte-
mological standpoints will be presented to allow the reader to check the com-
mensurability between the theories and models that I borrow from several disciplines
(see e.g. Burrell and Morgan, 1979). Thereafter I will move down to the levels of
epistemology, methodology and methods
21
in Section 4.3. to explain my choices with
regard to these issues. Finally, in Section 4.4., on the basis of my ontological, episte-
mological, and methodological statements, I will introduce Bourdieu's capital
framework and my operationalization of his cultural and social capital terms in
relation to this dissertation. As Bourdieus work lies outside of the IMP/INPM
framework, I will also explicitly insure that there is commensurability between
Bourdieus concepts and selected IMP/INPM project marketing terms, e.g. Cova et
al.s (1996a) milieu, as described in Subsection 3.3.2.

4.2. My Ontological and Epistemological Standpoints.
Previously in this dissertation, in Subsection 3.3.1., reference has been made to the
diversity of epistemologies and ontologies that characterize IMP Group research. Ac-
cording to most social science paradigms, with the exception of radical, post-
modernism constructivism, in which the differences between levels of theory are de-
clared non-existent (see Guba, 1990: 25-6; Alversson and Deetz, 1996:192), the
methods and methodologies used as well as the epistemological and ontological meta-
theoretical levels must form a coherent whole. In footnote 18 of Subsection 3.3.1., I
have previously stated that my epistemology is a type of methodological pluralism
somewhere between critical realism and constructivism. This is possible because, as
Easton (1992:447) argues:

the social constructivists and critical realists are much closer than their
rhetoric would allow. The critical realist would argue that there is a reality
but that it may be ultimately impossible to know what it is. Thus
disagreements about its nature are not due to its nonexistence but to
problems of discovery. Alternatively, the social constructivist might say that

21
With regard to the terms methods and methodology, I will make use of the usage of Giddens (1993).
Methods, according to Giddens (ibid.), refer to techniques used to collect data, whereas methodology in
Giddens usage has to do with the techniques used to interpret the data.
99
such disagreements are inevitable, since there is no reality. However, since
the success of human activity depends upon the creation of an agreed-upon
reality, then it is only too plausible that something resembling reality would
be apparent in our social world."

All IMP researchers ontologies include the social construction of demand to some
extent, in that IMP Group members agree that on business-to-business markets,
buyer-seller agreement upon the good/service/project sold is constructed through
interactions between buyer and seller. In contrast, it is the limits of this social con-
struction on which they adamantly disagree. At one extreme, one finds works such as
Gemnden and Heydebreck (1994) and Schubert (1994) in which the social con-
struction is minimized to an extent that allows structurally determining macro-variables
to rule. The other extreme is to be found in Tikkanen (1997) who believes (a) in the
predominance of a postmodern business environment (ibid.:11, 87), i.e. the presence
of a interdependent, cooperative exchange and complex, fragmented and enacted
business environment (ibid.:81), and (b) that approaches where reality is regarded as
a world of symbolic discourse, a pure social construct, or a manifestation of human
intentionality (ibid.:84) should predominate. In Tikkanens world, demand is a pure
social construct, just like all other social phenomena.

My position on the social construction of demand is related to my ontological beliefs
on the social construction of reality. My ontology lies well between the extremes de-
scribed in the previous paragraph and is perhaps closest to the ontological/epistemo-
logical positions of the French sociologist Pierre Bourdieu, as will be explained in the
following
22
:

For Bourdieu, the goal of the discipline of sociology is to clarify the historical and
structural logic of social action by classifying and positioning agents according to their
individual, group, and class struggles to accumulate symbolic
23
and economic capital
(Stevens, 199:48). Thus, Bourdieu primarily focuses upon the economy of practices in
interactions between individuals, groups, and social classes.
24

As a part of his method and methodology, Bourdieu combines the objective focus
common to deterministic critical realist research with the presentation of the actors

22
Institutional theorists also have very similar ontological assumptions (see Scott, 1995).
23
The term symbolic capital will be explained in Section 4.4..
24
In my work, the primary unit of analysis is the firm. I examine how the boundary spanner/relationship
promoters in the firm interact with other firms who are a part of the field of architectural services in the
process of architectural project acquisitions. The term field is explained in Section 4.4.
100
own experiences (which is the focus of the social constructivists) as will be explained
in the following:

Bourdieu (1990) believes that there are certain universal conditions for human
existence which can be objectively described
25
. Hence his defense of the objective
side of his research. However, Bourdieu is at the same time very aware of the dangers
of pure objective research (e.g. that fact that results from this type of research de-
pend upon the researcher's selective powers of observation which also can contribute
to projections) and sees the need for listening to the viewpoints of the subjects
studied. However, what these persons tell is not the only - nor the final - side to the
story, for there are many things that they take for granted or perhaps have forgotten
as well:

The mode of knowledge that can be called phenomenological sets out
to reflect an experience which, by definition, does not reflect itself, the
primary relationship of familiarity with the familiar environment, and
thereby to bring to light the truth of that experience which, however
illusory it may appear from the objective viewpoint, remains perfectly
certain, qua experience. But it cannot go beyond a description of what
specifically characterized lived experience of the social world, that is,
apprehension of the world as self-evident, taken for granted. This is
because it excludes the question of the conditions of possibility of this
experience (Bourdieu, 1990: 25-6)

Bourdieu views the actions of human subjects as being improvisation based on after-
the-fact interpretations. When asked about their actions, subjects often refer to
objective truths. These objective truths are, however, according to Bourdieu, in
reality subjective constructions devised to solve a problem related to the objectively
describable universal conditions for human existence.

25
As it neither can be proven nor refuted that there are objectively describable universal conditions for
human existence, this statement belongs to the pure realm of ontological beliefs with the emphasis
strongly on beliefs. However, as the argumentation in the rest of this section and in this dissertation as a
whole, as well as most realist and naively positivist scholarship, rests on this belief, I will subdue my urge to
emphasize many times that this is merely a belief. In this dissertation, I will instead follow the convention of
writing as if this belief were sure knowledge. However, for the sake of honesty, I would like to mention that
I thoroughly dislike this convention. I regard it as dishonest and as a main source of impaired and
incomplete comprehension for those many students do not question ontological presumptions (perhaps
because they have not been taught to do so). On the other hand, in all fairness, I must also admit that this
convention does allows many researchers, including myself, to make our scholarly explanations more brief.
101
Because the logic of practice according to Bourdieu neither can be deducted from the
objectivist position of the deterministically-oriented researcher searching for rules or
from the statements of the participants themselves, which the interpretive researcher
would prefer to accept, the epistemology of Bourdieu's sociology requires a double
break from primary knowledge, i.e. that one takes two steps back in ones
scientific research:

This construction presupposes a break with primary knowledge, whose
tacitly assumed presuppositions give the social world its self-evident, natural
character. [...] Finally, it is only by means of a second break, which is
needed in order to grasp the limits of objectivist knowledge [...] that we can
integrate the gains from it into an adequate science of practices. (Bourdieu
in Lemert, 1981: 86-7)

social science must not only, as objectivism would have it, break with
native experience and the native representation of that experience, but also,
by a second break, call into question the presuppositions inherent in the
position of the objective observer. (Bourdieu, 1990: 27)

According to Bourdieu, the justification for the second type of break is the situation
that the researcher in scientific studies creates theory about practices that are in itself
non-theoretical in nature:

Because theory [...] only can be understood from a viewpoint away from
the stage on which the action is placed, the distance lies perhaps not so much
where it is usually looked for, in the gap between cultural traditions, as in the
gulf between two relations to the world, one theoretical, the other practical.
(Bourdieu, 1990: 14)

In my dissertation, I am not concerned with the logic of social action at large but with
the internationalization of Danish architectural firms. However, I have chosen to also
undertake the same two steps back: the first break, the break with native experience,
can be clearly seen when one compared the statements of my case study respondents
(see Appendix B) with my theory development in Sections 8 10. As for the second
break, the literature reviews of Sections 2 and 3 as well as the arguments in this section
should convince the reader that I have a critical, independent position with relation to
the body of existing theory in the fields of Internationalization and (international and
domestic) Project Marketing.

102

In order for the reader to understand my further research and theory building, I will
now divert a bit more on Bourdivin theory in relation to IMP/INPM literature. I will
then use my diversion to specify the types of explanations that my research aims to
generate in Subsection 4.3.3.

Through the use of the term habitus, Bourdieu explains how human subjects act.
The individual - or many individuals together, e.g. in a social group (in Bourdieus
own theory) or in a network (as defined in IMP theory) - develop a cognitive percep-
tion of the world and practical strategies for solving problems. The habitus is com-
prised of these perceptions, which in turn influence practice. Thus actors do not act
by consciously creating optimal solutions, but through a semi- or subconsciously ac-
quired ability to act in certain ways in certain situations, i.e. in a way comparable to a
jazz band's improvisation during a jam session (Callewaert in Andersen and Kasper-
sen, 1996: 347). Bourdieu states concerning practice:

Practice is the product of processes which are neither wholly conscious
nor wholly unconscious, rooted in an ongoing process of learning which
begins in childhood, and through which the actors know - without knowing
- the right thing to do. (Bourdieu, 1994: 62-63.)

The relationship of social structures, the habitus, and practice is depicted in Figure 16
on the next page. In this figure, social structures influence the habitus and, indirectly,
practices. Practices, in turn, reinforce the habitus and can furthermore create some
change in social structures, although social structures contain substantial inertia and
are also regulated by certain external universal economic conditions (Bourdieu,
1990).

Turning now to the key marketing issue of the social construction of demand,
parallel to Bourdivin theory, my ontology is that there are certain exogenously given
objective economic and institutional frameworks within which e.g. the networks of
the IMP approach as well as individual actors are embedded. These economic and in-
stitutional frameworks can be described intersubjectively. Within these frameworks,
however, actors and firms follow socialized and pragmatisized firm strategies
which are based upon their selective perceptions of the exogenously given economic
and structural frameworks (ibid.).
Figure 16. Relationship of the Habitus to Structures and Practices.

Social structures
103

are internalized through the

Habitus create

which regulates which reinforce

Practices

Source: Adaptation of Stevens, 1998:57 (after Bourdieu, 1990).

A consequence of this is that the boundary between (a) the given economic and
structural factors and (b) the activities/interpretations of individual actors e.g. in an
network, as defined by the IMP Group, is neither entirely permeable nor impermeable.
This is depicted by the broken boundary line between circle two and three in Figure
17a below.

Figure 17. The Embeddedness and Social Construction of Networks in
Relation to Economic and Institutional Factors in the Authors Work.
Figure 17a. Embeddedness. Figure 17b. Social Construction.
2. Actors
and Networks 3. Economic and Institutional Factors

1.
Traditional
Marketing 2. Actors and Networks
Variables

1. Traditional Marketing Variables
3.
Economic and Insti-
tutional Factors
The permeable boundary in Figure 17a between actor/network-related and economic
factors indicates some possibility for reciprocal determination. Thus actors and
networks of actors may sometimes be able to influence certain economic and institu-
tional factors, just as certain economic and institutional factors influence the rules of
104
the game that actors play and their interpretations thereof in their interactions with one
another. However, analogous to Bourdieus belief in certain universal conditions for
human existence, in my ontology, there are some economic factors that are immune to
network or actors attempts to change them. Thus in the depiction of the social
construction of the actor/network level (Figure 17b), there are two arrows depicting
the larger influence of economic factors on actors/networks and only one arrow going
the other way, showing the lesser opposite influence.

With regard to traditional marketing mix variables such as price and product qualities,
these are socially constructed at the level of the buyer-seller dyad or the network in my
ontology (cf. also Easton, 1992). This is depicted by the inner circle of Figure 17a and
its dotted line which indicates an even more permeable boundary. These constructions
of the traditional marketing mix variables are, however, also based upon the habituses
of the persons in the buyer-seller dyad or network and their interpretations of the
economic and institutional factors of circle 3. These remarks are the justification of the
single one-way arrow going from the networks to the traditional marketing variables in
Figure 17 b.

Concerning the nature of markets for architectural projects, I furthermore use Bour-
dieu to build on Hkansson and Johansons (1993:45) Classification of Market Go-
vernance Structure, as previously described at the end of Subsection 3.3.1. However,
in contrast to their 2 x 2 matrix of Figure 11, I view the distinction between interests
and norms as not being clear-cut in the world of project-related professional
services, including architectural services. This can be explained in the following
manner:

The potential difference in know-how (Backhaus, see Section 2.5.) between the buyer
and the seller with regard to professional services as well as the intangible service
inputs (Sharma, 1991:22) may lead to the buyer not knowing or being able to articulate
all of his or her interests. However, this does not imply that the relationship between
e.g. architects and their customers is purely dependent on existing norms, as achieving
architectural project sales depends on the selling of a credible promise, and, in the
longer term, being able to deliver the credible promise to the satisfaction of the buyer
(Lwendahl, 1998: 42-3), which also means taking the perceived interests of the buyer
into account. Furthermore, the services demanded entail judgemental assessments by
service providers (Lwendahl, 1997) and are marked by uniqueness/customerization
and complexity (Lwendahl, 1997:20, see also the discussion in Subsection 3.3.2.),
which would also suggest that a complex interplay between norms and interests
105
occurs. Here, once again, the perceptions of the perceived interests of the buyer and
the subsequent actions on the parts of both the buyer and the seller will be influenced
by the cognition of the parties habituses, in accordance with Bourdieus (1990) usage
of the term, and thus influenced by both norms and interests.

On the basis of the above, I have modified the possible markets governance structures
framework of Hkansson and Johanson (1993:45) for use in this dissertation to only
include the specific versus general relations dimension (Figure 18):

Figure 18. Classification of Governance Structures in Professional Services
Industries.

External Specific relations The Network (with or without hierarchical elements)
force is
based on General relations The Socially Constructed Market


The Network is the governance structure that one finds in project marketing situations
where specific relationships, based on e.g. trust or dependence (Hadjikhani, 1996),
exist across projects. On the other hand, the Socially Constructed Market functions in
situations when relationships between cooperation partners are mainly limited to the
concrete project in question due to e.g. the discontinuous nature of the projects and
the uniqueness and complexity of each individual project. In both cases, however, the
governance structures are socially constructed in the sense that they are regulated by
habituses (Bourdieu, 1990) of the participants as depicted in Figure 16.

My yet untested ontological belief is that both the network and the socially
constructed market governance structure exist in the world of project marketing of
architectural services (see Cova and Ghauri, 1996 for evidence). This is because the
discontinuity and complexity of project marketing as well as the uniqueness of each
project (see Subsection 3.3.2) make the maintenance of relationships across projects
difficult. This, in turn, implies that one cannot a priori say that specific, network-like
relationships predominate with regard to all projects. They may be present in some
circumstances, yet absent in others.

This, in turn, is the reason that the IMP framework must be modified to include
governance mechanisms that work both in the situations in relation to this research
projects. These mechanisms are provided by the milieu of Cova et al. (1996), as
106
presented in Subsection 3.3.2. and the social and cultural capital framework of
Bourdieu, to be presented in Section 4.4. Additionally caution must be taken when
applying other IMP concepts that have been constructed for use in a network
governance structure (see Hkansson and Johanson, 1993, as discussed in Subsection
3.3.1.). This last problem is the justification of my explorative-integrative (see Maale,
1996) study design, which will be elaborated upon in the next section.

4.3. Concerning the Methodology and Methods used in this Dissertation.
4.3.1. Methodology and Case Study Design in Relation to the Objectives of the
Study.

My methodological choices have been guided by my ontological and epistemological
beliefs, as explained in the previous subsection, as well as the research questions of
this study. The primary aim of this empirical study to describe and analyze the export
activities to Germany of three Danish architectural firms to achieve increased under-
standing as well as to propose theoretical explanations, in cases where the data gene-
rated allows for this. Thus conceptualizations including IMP/INPM researchers Cova,
Mazet, and Salles (1994) General Marketing Configuration for Project-to-Order Sup-
plier Firms, their (1996a:654) milieu concept, the frameworks for analyzing know-
ledge presented in Section 2.4., as well as Bourdieus (1983) social and cultural capi-
tal terminology as explained in Section 4.4. will be used to this end. The best found-
ation for these aims is the generation of mainly qualitative data through e.g. interviews
(see e.g. Coleman, 1990:305-6).

However, in spite to the conceptual framework elaborated upon in Chapters 2 and 3
and to be elaborated upon in Subsection 4.4., this dissertation study has been design-
ed as an exploratory-integrative study, i.e. a study in which both existing theory and
the research subjects own viewpoints and actions are examined, with the potential
long-term goal of creating robust new middle-range theory (see e.g. Alasuutari,
1995:133-141; Maale, 1996:90-7) which comes close to the ideals of the realist
perspective (see e.g. Bourdieu, 1990 or Easton, 1995b).

The first part of the study, the pilot study (see Appendix A), consisted of interviews
with key actors related to Danish architectural firms that have had experiences with
both success and failure on the German market from their respective positions. After
the pilot study, three of the most successful Danish architectural firms with regard to
internationalization on the German market were chosen for in-depth case studies. Each
firm came from a different group of the three groups of Danish architectural firms that
107
had been successful on the German market in the 1990s (see Appendix A, Subsection
A.6.2., as well as Skaates, Tikkanen, and Alajoutsijrvi, 1999):

1. I nternationally renowned and established architectural firms, whose names
are also familiar to architectural connoisseurs and experts abroad. There are only a
handful of these firms in Denmark. The firm from this group used in my case study
will subsequently be referred to as Firm 1; it has worked on German and other
foreign markets since the 1960s.

2. Nationally renowned and established architectural firms. These types of firms
are often responsible for the design of important national buildings and have strong
contacts to large firms and key persons in the Danish economy. My case studys
Firm 2 comes from this category; it started its market seeking strategy on the
German market at the beginning of the 1990s.

3. Successful and innovative younger firms. These firms do not have as strong a
position as the other two types of firms yet they have managed to establish
themselves as players on the Danish arena and have strong ambitions to increase
their importance in the future. Firm 3 denotes the firm from this group used in
my case study; it also started its activities in Germany at the beginning of the
1990s.

The case studies can be regarded as theoretically inspired historical reconstructions of
the activities undertaken by the three Danish architectural firms on the German market
in the 1990s. Using the terminology of Yin (1994:39), the case study methodology can
furthermore be categorized as being multiple-case. The study is multiple in the sense
that the export activities of not just one, but three Danish architectural service firms are
examined. Furthermore, the case studies were undertaken using a key informant (Heide
and John, 1995:539-541) and critical incident (Hedaa and Trnroos, 1997) design. The
key informants of the case studies include the studied firms boundary spanners and
relationship promoters (Adams, 1976; Aldrich and Herker, 1977; Gemnden, 1986;
see Subsection 3.3.3.) in the architectural firms who have been responsible or
contributed substantially to acquiring projects on the German market.

4.3.2. Sources of Data.
In case studies, researchers usually use data triangulation, i.e. collect data on a specific
subject from at least three different sources using specific techniques in relation to
each source (Silverman, 1993; Yin, 1994), as each source of data has its own
strengths and weaknesses (Alasuutari, 1995; Marshall and Rossmann, 1989: 101-109).

108
The primary method used to collect data in both the pilot study and the subsequent
case studies is the semistructured qualitative interview (see Kvale, 1996:124-143);
however analysis of documents is also used. These documents include:

Danish and German industrial statistics and studies of exports and international-
ization.
Articles in Danish, German, and Pan-European professional publications.
Firm- and organization-specific documentary data such as annual reports,
brochures, minutes of meetings, strategy plans, studies undertaken by Danish and
German architects organizations

Finally, during the completion of the three case studies, sixteen further supplementary
interviews with yet other key actors, e.g. German and Danish public officials, persons
from other German, Danish or Danish-German architectural services firms, and
representatives of Danish and German architects organizations, have been undertaken
to allow for further data triangulation (see Appendix C for a list of all interviews).

4.3.3. Issues of Validity of the Interpretation.
Assessing the validity of qualitative research methodologies such as case studies is
more controversial and problematic than assessing the validity of quantitative research
(see e.g. Alasuutari, 1995; Altheide and Johnson, 1994; Flick et al., 1995; Kvale,
1996). This explorative-integrative study is based upon the premises that I, the author,
recognize and state my theoretical preconceptions as well as other forms for know-
ledge/prejudices concerning the field to be studied (Maale, 1996: 96), so that I also
can distance myself from them if necessary on account of new and surprising
evidence (ibid.).

Concerning the dialectic process between theory and empirical data, Jansson, Saqib,
and Sharma (1990:5) state the following:

The empirical relevance of the theories thus has to be asserted, which does
not mean a statistical test of hypotheses derived from theory. Such a
classical deductive hypothesis testing method is based on the logical-
positivist presumption of an objective world consisting of universally valid
scientific laws. Organizational behaviour cannot be reduced to such simple
laws. The organizational world is much more complex. A social science
theory is broader and lacks the rigour of tightly constructed mathematical
models. It is construed for the special problems found by the studied TNCs
and government agencies and consists of several individual theories that are
adjusted to each other within the developed theory. These theories have in
109
their turn been selected from a greater number of theories. Some will be
found to fit the problem. Some will not. One main problem is to do this in a
consistent way, so that individual theories do not contradict each other.
Through this process theories are accepted or refuted in a new situation.
This framework can then be utilized as a vehicle for examining other cases,
i.e. be generalized to other situations. This adjustment process is mainly
controlled by empirical data, when the theoretical framework becomes
empirically motivated. The boundaries of the individual theories, the
premises of the theories, etc. are researched by comparing them with the
studied reality. As much research in social science, our method is a
combination of inductive and deductive methods, a constant interchange
between data and theory.

The approach to combined theory and data described above is the one also used in
this dissertation. It is commonly termed abduction, which refers to combining induc-
tive and deductive methodologies in the research process (Andersen, 1988:139-140;
Denzin, 1978:109; Dubois and Gadde, 1999). According to Denzin (ibid.), the
research process in an explorative-integrative case study is abductive:

That is, they do no use a full-fledged deductive-hypothetical scheme in
thinking and developing propositions. Nor are they fully inductive, letting the
so-called facts speak for themselves. Facts do not speak for themselves.
They must be interpreted. Previously developed deductive models seldom
conform with the empirical data that are gathered. The method of abduction
combines the deductive and inductive models of proposition development
and theory construction.

However, the step of new theoretical construction should, of course, only be
undertaken if the empirical data to be collected and analyzed support some clear
patterns. Thus theory development in this dissertation is forced, in accordance with
the spirit of Halinens and Trnroos (1998:188) and Ahmeds (1993:67) statements:

We feel, however, that the key to simple and powerful models lies in an
awareness of the broader and more complex reality from which the models are
drawn. (Halinen and Trnroos)

[I]f a social phenomenon lends itself to a clear-cut and consistent categorization,
then most likely something is wrong with the researcher [sic!] approach. An
exceedingly simplistic approach has been adopted and/or some blind spots
prevent the detection of the various aspects of the phenomenon. An impaired
comprehension results. (Ahmed)

110
With regard to the types of theoretical explanations constructed, Easton (1995b)
argues that case study research seen from a realist epistemology is very useful for
studying causality. This, however, will not be the only type of explanation attempted in
this dissertation; instead, furthering understanding by constructing teleological explan-
ations will also be used. According to Jansson, Saqib, and Sharma (1990:8):

The main difference between causal and teleological explanations concerns
time order, i.e. that the causing factor must occur before that it is supposed
to cause. Otherwise causes and consequences will be mixed up. With
teleological explanations time order does not matter, particularly not when
used to study interactive behavior in a network. What matters is the
interaction, not how it starts or ends. In this research we are thus not
concerned with making causal statements about consequential behaviour,
since we have not tried to determine whether an event x led to event y. One
sequel is that prediction is not important, since it will be difficult to find laws
to extrapolate into the future. Instead, the focus of the research is on
explanation. Covariance and the consideration of rival explanatory factors
are then still important.

The economic framework of the German market (research question 1) is taken as the
given contextual foundation; research questions 2 5, which deal with the actor
interactions (i.e. level 2 in Figure 17 of Section 4.2.), are embedded within this
foundation. Telelogical explanations are the correct type of explanation for questions
3-4, as they are the type of explanations that best describe the practices of the actors
from the case study firms who have worked with the German market. Although these
actors may perceive some cause and consequence relationships concerning e.g. the
specific knowledge of the German market (research question three) or obtaining
architectural projects (research question four), they have also used their perceptions in
their actions. Thus it is not possible to determine causality with regard to research
questions 3 - 4.

Research question 5, however, entails causality as it examines the role of previous
project work. Here the framework of social and cultural capital, as subsequently
explained in Subsection 4.4. will be used to make initial hypotheses concerning
causality on the basis of my case study data and secondary literature. These will be
presented in Section 9.3. and Chapter 10.

Concerning levels of analysis, there are several potential levels: the firm at large, the
persons of the firm involved in export activities, and the individual activities, i.e. the
projects themselves. The first relevant question with regard to these levels is: When
111
may one generalize at the firm level on the basis of the statements of individual actors?
Tikkanen (1998: 274) has several remarks relevant to this issue:

It should also be noted that the [...] higher levels of aggregation, ranging
from informal groups or firm departments to large multinational corporation
or informal alliances, pose a slight theoretical and methodological problem
for the identification of relevant actors in the horizon of an organization with
its strategic focus on project business. The fact that individuals are inevitably
the basic interactants in all collective actor configurations is thus somewhat
paradoxical. Regardless of whether a relevant actor is identified in an
informal group, a firm department or a whole organization, it is the individual
actor-interactants within them who, through every-day social interaction,
construct the reality or realities encountered in various project marketing
situations [...] Thus, the empirical identification of the relevant actor-
structures in the horizon of a project marketer might not be as easy as the
above typology would imply, at least at first sight.

Due to the fact that specific persons are responsible for specific projects on the
German market in the three case study firms, the problem raised by Tikkanen is less
prominent in this research project. Therefore the key informant method (see Heide and
John, 1995:539-541) is not a source of potential validity problems.

As case studies are historical, the critical incidents method (see e.g. Hedaa and
Trnroos, 1997: 4-5) has been used to prompt informants to elaborate on their activi-
ties on the German market. However, an inherent weakness of this method is its ten-
dency to represent the past as a series of discrete events, i.e. specific stimuli and re-
sponses, with intervening periods of no action. This is a simplification, reduction and
misrepresentation of the past, which increases potential problems of selective memory
bias, as it is often the case that there have been intermittent, less critical incidents
which have played a role, yet are not remembered by respondents.

The question of memory and selective memory biases is relevant with regard to a sec-
ond interpretive concern, namely the boundary problem inherent in all network and
interaction research: How does one assess the boundaries of an actors/a firms net-
work of relationships? In this research, boundaries will be set by the recollections of
the respondents and the prompting of the interviewer, based on available secondary
information. Thus the problem of selective memory bias may also affect the network
and interaction data generated. However, Yin (1994:13) states that an inherent
characteristic of the case study is the very fact that the boundaries between
phenomenon and context are not clearly evident.
112

A third type of potential bias has to do with the problem that respondents will be more
liable to report on unusual or surprising events, and less likely to tell about
everyday occurrences which they take for granted, unless asked. To overcome this
bias, the interviews have been structured in such a way that the questions have in-
cluded some of the key themes from the project marketing theories being examined,
which have been previously unknown to the respondents. The questions have at the
same time aimed to be open and not leading, to allow for the discovery of paradoxes,
surprises, and the contra-theoretical insights of respondents (see Maale, 1996:183-
187). Thus the chosen interview method is not purely phenomenological (as suggested
by McCracken, 1988) but is instead openly interpretive.

It should also be noted that the usual reason for choosing the multiple case-study
design is analytic generalization (Alasuutari, 1995:120-132; Flick et al., 1995: 446-
450; Maale, 1996:71-75; Yin, 1994:31), which in the words of Yin (ibid.) means the
following:

Multiple cases, in this sense, should be considered like multiple
experiments (or multiple surveys). Under these circumstances, the method
of generalization is analytic generalization, in which a previously
developed theory is used as a template with which to compare the empirical
results of the case study. If two or more cases are shown to support the
same theory, replication may be claimed. The empirical results may be
considered yet more potent if two or more cases support the same theory
but do not support an equally plausible, rival theory. (The italics are
Yins.)

Due to major firm-internal differences, the multiple cases in this study should not by
considered 100% analogous to multiple experiments as described above. This raises
some questions of external validity. However, my three case study firms are prime
case study firms in that the these three firms were chosen from a total population of
four Danish architectural firms who opened a subsidiary on the German market in the
1990s. Because the population of Danish architectural firms that have attempted
internationalization on the German market and obtained a reasonable degree of
success on the German market is quite small yet very diverse, I am convinced that
aiming for full analytical generalization would not have been feasible. Furthermore, I
will deal with the issue of external validity in more depth in the concluding chapter on
the studys scientific contribution in Chapter 11.

113
As a final point, it is important for the reader to remember that the IMP/INPM frame-
work for this study has been chosen on the basis of abduction during the process of
surveying the existing literature on international operations of Danish architectural firms
and interviewing persons from or in daily contact with Danish architectural service
firms during the pilot study, as described in Appendix A. Furthermore the data
generated in the main empirical study of this dissertation will be interpreted in Chapters
6 - 10 in relation to the IMP/INPM and Bourdivin frameworks of Chapters 2 - 4.

Due to the abductive nature of the methodology used in choosing the international-
ization theory frame, this study will not be able to confirm that the IMP and Bourdivan
framework that has been chosen for the study of the internationalization of the Danish
architectural services industry actually were or are the best framework for studying this
topic. If I attempted to confirm this assertion, my arguments would be circular and
thus could be reduced to mere tautologies. I perceive a need for making this point due
to the fact that these types of erroneous inferences are quite common in practice-
oriented business literature and, unfortunately, also can be found in some con-
tributions to scientific journals and anthologies. In contrast, the assessment of
competing concepts within these frameworks is possible; thus this assessment will be
found in Chapter 11, which contains the concluding remarks concerning the theoretical
contribution of the study.

114
4.4. The Use of Bourdieus Cultural and Social Capital Concepts in
this Dissertation.
4.4.1. The Role of Cultural and Social Capital in Establishing Credibility.

As previously described in Subsection 3.3.2., the governance structure of project mar-
kets (e.g. markets for architectural projects) is often something between a market and
a network (Cova and Ghauri, 1996). Furthermore, as described in Section 4.2., the
generation of credibility is especially important when marketing professional services
such as architectural services (see e.g. Lwendahl, 1998). Thus, to be able to describe
credibility generation in architectural services marketing, it is necessary to construct
concepts that work equally well in the network and the socially constructed market
governance structures (see Figure 18 in Section 4.2.). The concepts of cultural and
social capital are such concepts; they will be used to conceptualize the Danish archi-
tectural firms establishment of credibility in their market-seeking activities in the
German construction industry milieu.

Here, however, I must emphasize that I base my research definitions on Bourdieus
(1983) definitions due to the fact that there is little scholarly consensus concerning the
exact definitions and usage of social and cultural capital terminology (Araujo and
Easton, 1999). However, according to Araujo and Easton (ibid.), the general idea
behind the many existing conceptualizations of these terms relies on a metaphorical
mapping of features associated with economic notions of capital or assets into the
social domain. Furthermore, social and cultural capital are regarded as resources that
can, under certain circumstances, be converted into other types of capital (ibid.).

According to Bourdivin theory (see Bourdieu, 1979 or 1986), the struggle to accumu-
late capital takes place within the field. Halinen and Trnroos (1998:191) describe
the field as follows:

The concept of the field was introduced by the sociologist Bourdieu
(1979) in his famous work on the new middle classes in France. According
to Bourdieu, the field constitutes the playground or social setting for
interaction among the new middle-class actors. It also constitutes the social
base for creating distinction from other social groups, hence generating
value in the form of cultural capital. This idea can also be applied to
business networks.

Many institutionalist scholars have also used the term field (see Scott, 1995). In
their work, DiMaggio and Powell (1983:154) define an organizational field as:

115
those organizations that, in the aggregate, constitute a recognized area of
institutional life: key suppliers, resource and product consumers, regulatory
agencies, and other organizations that produce similar services or pro-
ducts.

Furthermore, Scott (1994:207-208) notes:

The notion of field connotes the existence of a community of organizations
that partakes of a common meaning system and whose participants interact
more frequently and fatefully with one another than with actors outside of
the field.

Bourdieu (1996:226-230) himself uses the term field to refer to a relatively autonomous
social area with a supporting set of social institutions, individuals, and discourses of
interpretation, such as the field of the production of literature. Thus field must thus at
the very least operate in a way that is irreducible to the market mechanisms by which
economic capital is traded, for if this were not the case, we would be in one of the
governance structures that is internally governed by interests only, e.g. the network of
Hkannson and Johanson (1993) or the market of their model (see Figure 11 in
Subsection 3.3.1.).

Furthermore, Bourdieu (1996) sees legitimizing the social order as one function of
fields related to culture, such as e.g. the field of architectural production. In the words
of Stevens (1998:70):

Groups that succeed in achieving their own symbolic system, their own
tastes, lifestyle, and culture, defined as socially worthy and as worth emu-
lating and acquiring, are those that dominate society. [] the very nature of
the battle is concealed from those fighting it in a way that would be
impossible were the conflict economic. If the wealthy lobby the state to
reduce taxes on the rich, it is seen as a naked act of class interest and could
be expected to meet some resistance. But if the wealthy subsidize opera or
dance companies, or build a new museum of art, then these things though
they are overwhelmingly the cultural province of the privileged, rarely visited
by the lower classes are seen as selfless acts, benefiting the whole of
society. So the culture of the dominant becomes that which all others
should support; the wealthy can promote the interests of their class under
the guise of promoting societys.
26

26
Stevens (1998:70-71, 232) mentions that Bourdieu has been criticized by Rigby (1991) and many other
Anglo-American academics for assuming that there exists a single dominant culture in most Western
countries. Rigby (ibid.) instead promotes the view of the Frankfurt School, i.e. the notion that culture is
116

Bourdieu (1983) has defined four types of capital: economic, symbolic, cultural, and
social capital. His economic capital corresponds to both the laypersons and most
economists understanding of the term, i.e. money owned, used, and accumulated by
a person or legal entity (ibid.), whereas symbolic capital refers to the power accumu-
lated and used in the dynamic struggle between and among groups and individuals to
define who and what is most legitimate in various societies and societal groups
(ibid., see also Albertsen, 1996:5).

Cultural capital, on the other hand, refers to value of the more static practices and
physical artifacts that are the result of individuals socialization within one of many
groups within society and this groups efforts to distinguish itself from other groups
(ibid.: 243-8). Cultural capital manifests itself in three forms (ibid.: 243):

in the embodied state, i.e., in the form of long-lasting dispositions of the
mind and body; in the objectified state, in the form of cultural goods
(pictures, books, dictionaries, instruments, machines, etc.), which are the
trace or realization of theories or critiques of these theories, problematics,
etc.; and in the institutionalized state, [ e.g. in the form of ] educational
qualifications.
27

It should be noted that Bourdieu does not use the term human capital (ibid.:244). In
his terminology, that which other sociologists term human capital (see e.g. Araujo
and Easton, 1999; Coleman, 1988) is a part of cultural and social capital.

As for social capital, Bourdieu states the following (1983:248-9):

an instrument of mass reification. At the other extreme, Blau (1998) and many conservative American
researchers promote the view of a mass culture which is shared by all. Stevens (ibid.:71) personally
believes that members of todays upper classes in the English-speaking nations differ from the lower strata
in both the quantity and range of cultural forms they consume. They are omnivores (elitist inclusivists, who
accept many practices) rather than snobs (elitists exclusivists, who reject certain practices). The privileged
show their class not by enjoying opera instead of rock, but by liking both: their cultural knowledge is
broader, deeper, and more encompassing than that of others. Although I have not been able to find similar
Danish and German criticism of Bourdieu, the tendency towards elitist omnivorousness can be found in
Denmark (see e.g. Blum, 1986) and Germany (see Schfers and Zapf, 1998: 167-177, 419-437; and
Glaser, 1991: 403-408, with specific regard to architecture in Germany.)
27
Stevens (1998:62-64) defines social capital as a subcategory of cultural capital. I, however, do not find
this 100 % in agreement with Bourdieus own writings. In my mind, the circles in which one accumulates
ones social capital and thus the value of ones social capital with regard to a specific part of a cultural field
are determined by ones cultural capital.
117
social capital is the aggregate of the actual or potential resources which are
linked to possession of a durable network of more or less institutionalized
relationships of mutual acquaintance and recognition or in other words, to
membership in a group which provides each of its members with the
backing of the collectively-owned capital, a credential which entitles them
to credit, in the various senses of the word. These relationships may exist
only in the practical state, in material and/or symbolic exchanges which help
to maintain them. They may also be socially instituted and guaranteed by the
application of a common name (the name of a family, a class, or a tribe or
of a school, a party, etc.) and by a whole set of instituting acts designed
simultaneously to form and inform those who undergo them; in this case,
they are more or less really enacted and so maintained and reinforced, in
exchanges. Being based on indissolubly material and symbolic exchanges,
the establishment and maintenance of which presuppose
reacknowledgement of proximity, they are also partially irreducible to
objective relations of proximity in physical (geographical) space or even in
economic and social space.

In relation to Tikkanens (1998:271) criticism of the spatiality limitation of the milieu
concept (see Subsection 3.3.2.), Bourdieu states that mechanisms of the generation of
social capital cannot be reduced to relations of proximity. His language may, however,
ring unclear to readers used to reading Anglo-American scientific works. In fact, many
Anglo-American academics and Nordic academics who use English as their academic
lingua franca criticize Bourdieu using broad and undifferentiated terms (see e.g.
Araujo and Easton, 1999). On the other hand, other scholars praise Bourdieu for his
ability to describe complex societal interdependencies and break with simplistic
common-sense understandings through his broad definitions and complex writing
style (see e.g. Callewaert, 1996: 338 or Fowler, 1997). I subscribe, albeit with some
reservations, to the latter viewpoint.

However, like Araujo and Easton (1999), I am not keen on using the fine distinctions
between social and symbolic or cultural and symbolic capital in my research, as they
are difficult to work with empirically. Thus I will eliminate potential symbolic capital
effects in this dissertation. The result of this omission is some loss of the ability to
explain changes in norms and actors perception of legitimate interests; thus the
empirical sections of this dissertation may be somewhat biased toward a state of
stasis. This can be seen in Figure 19, which depicts the relationships between the
different types of Bourdivan capital.

118
Figure 19. Bourdieus Field and Capital Concepts.

The field

A. A playgound or social setting B. Social base for creating distinction
Habituses which reflect norms and incor- 1. Playing by the rules of the game
porated social structures a. Accumulating Social Capital
b. Accumulating Cultural Capital
c. Accumulating Economic Capital

2. Changing the rules of the game
Accumulating Symbolic Capital

Source: Authors own conception, based on Bourdieu (1979, 1986) and Halinen and
Trnroos (1998).

In Figure 19, the twin, interlocked functions of the field as (a) a playground or social
setting and (b) a social base for creating distinction (Halinen and Trnroos,
1998:191) are separated. Symbolic, cultural, social, and economic capital are all used
with regard to function (b), creating distinction. When one makes use of ones
cultural, social, and economic capital, one is playing by the existing rules, whereas one
changes these rules with symbolic capital, thus affecting the contextual framework of
the field but not usually abolishing or endangering the field itself (see Bourdieu, 1986
and 1990). This possibility of changing the rules by using symbolic capital is omitted
in my dissertation.

The distinction between (a) and (b) are, however, artificial in the same way as the
distinction between explicit communication and metacommunication is (see Skaates,
1997:17-19). Analogous to the fact that we always are communicating about the way
we communicate when we communicate other messages, members of the field are
always in some way engaging in activities that affect their capitals, even when they
only may be aware that they are present and/or interacting in the given social setting.

Turning now to the issue of the operationalization of the term cultural capital, I exclude
its embodied state (e.g. norms and actors habituses) in my use of the term in this
dissertation, as I include norms and the habitus in my operationalization of social
capital. However I include the objectified and institutionalized states: The objectified
cultural goods that an architect produces are buildings, parks, etc. Furthermore as a
professional, the architect, similar to a doctor or an accountant, has most often
119
received (a) formal training and titles which provide him with the opportunity to claim
the right to practice his profession and thus provide cultural capital, i.e.
institutionalized legitimacy. Furthermore, (b) membership in architects organizations
as well as (c) reference lists which include (i) projects either in progress or completed
as well as (ii) prizes or honorable mentions awarded in architectural competitions or
public tendering procedures provide institutionalized cultural capital. Finally,
objectified as well as some forms of institutionalized cultural capital (e.g. reference
lists, prizes, and honorable mentions) can either be accumulated by (a) an individual
architect or (b) by the firm for which he works or (c) both.

With regard to social capital, Bourdieu (1983:248-9) states that a precondition for
accumulating it is affiliation to a group. However, with regard to highly differentiated
and fragmented modern societies, the term group can be defined in different ways
(see e.g. Hillmann, 1994:310-11), depending upon the specific context of the research
being undertaken. In this research, a group will defined as being comprised of actors
who have the similar viewpoints concerning architecture and the construction industry
which can be differentiated from the viewpoints of other groups. Groups are thus
socially constructed. Moreover, in this research the groups are small enough to allow
the members to have heard of or know each other and each others viewpoints on
architecture and the construction industry.

The groups are furthermore a part of the field of architecture and can either encom-
pass entire networks or contain persons who are members of networks that include
other persons who are not members of the group. The field of architecture, in turn,
encompasses architects, persons working at schools of architecture or as critics of
architecture, persons active in the construction industry who work with architects, and
members of society at large who show interest for architecture and urban planning.
Thus the field of architecture is defined slightly differently for my research purposes
than was the case in previous contributions which apply Bourdivan theory to the field
of architecture, namely Albertsen (1996) and Stevens (1998). In my operationalization
of the field, the other construction actors are included due to the project marketing
focus (as opposed to e.g. the education purpose of Stevens (ibid.) research); this
requires the inclusion of e.g. customers and cooperation partners.

However, to move on to social capital, according to Bourdieu (ibid.), it is acquired
through actor relationships in a broad sense of the word, in that these relationships can
consist of (a) material and symbolic exchanges, (b) sharing common school-related,
120
party-related or family names or titles, and (c) reciprocal following and enforcement of
rules and norms.

My operationalization of social capital within the field of architecture focuses on the
social capital linked to (a) material and symbolic exchanges as well as (c) rules and
norms. I exclude the social capital related to (b) names and titles, as it is included in
the institutionalized cultural capital in my operationalization of these terms. Moreover,
in my operationalization, social capital is always linked directly to a specific actor, i.e.
the boundary spanner or relationship promoter of Subsection 3.3.3., not directly to his
or her firm. The actors social capital can, however, be used by the firm that the actor
in question works for; thus the amount of social capital accessible to the firm is equal
to the total amount of capital of the boundary spanners/relationship promoters who
work for the firm. However, in the subsequent empirically based chapters of this
dissertation, no attempt will be made to calculate exact levels of cultural or social
capital; I will only speak of accumulation, depreciation, and relative positions.

Concerning the uses of social capital, I regard it as a credential in my work, as
Bourdieu (ibid.:249), but do not go so far as to suggest that this credential entitles its
bearers to credit. Instead, in my operationalization, social capital entitles its bearers
to be regarded as credible to other members of the given group of the field of archi-
tecture, in accordance with Majkgrd and Sharmas (1998: 11) as well as Lwendahls
(1998:42-3) statements that credibility is extremely important in marketing professional
services-related projects both domestically and abroad. Credibility in my
operationalization is the actors perceived ability [i.e. perceived by the other members
of the group] to perform something he claims he can do on request (Blomqvist,
1997:279) and includes, for the specific case of architects, judgement of his
knowledge of and ability to judge complex technical and economical factors.

The relationship between architects business activities and their generation of social
and cultural capital are depicted in Figure 20 on the next page:

121
Figure 20. The Relationship between Activities and the Generation of Social
and Cultural Capital.
Figure 20a. The Relationship between Activities and Social
Capital/Knowledge.

Credibility

Social Capital/ Business-related
Knowledge Activities

Figure 20b. The Relationship Between Activities and Cultural Capital.

Architects presentation of Capital/
Other actors observation of Capital

Institutionalized (i.e. prizes, Business-related
diplomas, etc.) and objectified Activities
(i.e. buildings) cultural capital

Source: Authors own conceptualization on the basis of Bourdieu (1979, 1986).

Figure 20a depicts that successfully completed business-related activities (e.g.
negotiations, presentations, projects, client advisory services) in the field of the con-
struction industry lead to the generation of social capital as well as knowledge. The
social capital furthermore entitles its bearers to credibility which often leads to further
business-related activities and thus further generation of social capital and credibility in
a continuous cycle. However, negative capital may also be generated, if activities are
122
not completed to the expectations of the cooperation partners, thus also generating a
lack of credibility.

With regard to cultural capital, Figures 20b depicts that some types of business-
related activities such as participation in architectural competitions, public tendering
procedures, or continuing education programs result in prizes or diplomas, i.e.
institutionalized cultural capital, or physical artifacts such as buildings, i.e. objectified
cultural capital. The architect or architectural firm may either present its cultural capital
to interested potential clients or these potential clients may observe or seek
information about this cultural capital themselves. Potential clients conviction that the
architect or firm in question has a certain level of cultural capital may lead them to
engage in certain activities with this architect or firm, thus leading to the generation of
further institutionalized and/or objectified cultural capital.

On the Socially Constructed Market of Figure 17 of Section 4.2., where general rela-
tions are dominant, the level of social capital corresponds to the individual architects
general reputation within a specific group inside the field. In the Network of this figure,
on the other hand, where specific relations are dominant, the social capital cor-
responds to the credibility generated within specific relationships.

The generation of credibility and reputation in field of architecture is, however,
complex, as the architect is always oriented towards three groups within the
construction industry: (a) his fellow professionals, i.e. the other architects, and (b) po-
tential customers, and (c) other actors in the construction sector. His (and,
consequently, his firms) ability to acquire architectural projects depends upon (a) his
credibility in relation to other architects as well as architectural critics, (b) other
construction industry actors judgment of his credibility, and (c) complex interaction
effects that occur when these two groups voice their opinions about his credibility
(Albertsen, 1996:2).

Moreover, in the field of architecture, complex conversion effects between social,
economic, and cultural capital occur which are different in key respects from the
conversion effects of other professional services. This is due to the influence of
artistically-oriented architects and critics as well as an audience interested in aesthetics.
These unique effects will be described in the following.

In the pure fine arts, cultural capital is viewed by connoisseurs as more important than
economic capital in generating social capital, as the generation of social capital is
123
facilitated by the critical renown that results in cultural capital (ibid.:5-6). In the field of
architecture, an actors social capital is generated when other group members judge
him able to fulfill criteria such as user-friendliness, good use of technological solu-
tions, energy efficiency, and good aesthetic judgement in architectural projects
(ibid.:3, see also the end of Section 2.4.). Here the cultural capital reflects to a higher
degree the criterion of aesthetics than the other criteria, as the currucula of architec-
tural degree programs as well as architectural competitions focus especially upon the
artistic element of architecture (Stevens, 1998: 96-98, 170-174). Thus cultural capital
does not equally facilitate the generation of social capital with regard to all judgement
criteria of group members. It is therefore relevant to divide the field of architecture into
sub-fields which are distinguished by the way in which actors who are members of the
sub-field view the importance of artistic criteria versus other criteria. Albertsen
(ibid.:6-7) uses Bourdieus capital terminology in describing three sub-fields:

The artistic sub-field: The major concern of its members is protection of the
autonomy of architectural artworks against the influence of economic and political
power (ibid.: 6). Members of this sub-field orient themselves predominantly
towards architectural and art critics, showing little outward concern about market
mechanisms, marketing, or profit. Few, if any, businesspersons and managers of
firms other than architectural or other artistic firms are members of this field.

The professional sub-field: Here cultural capital [...] is transformed into economic
capital for employers and wages for employees. The possession of both economic
and cultural capital goes hand in hand with the possession of symbolic and social
capital. While selling [] cultural services to a clientele, the accumulation of
economic capital merges with the accumulation of symbolic capital, that is, with the
acquisition of a reputation for competence and an image of respectability and
honourability. [] At the same time this makes possible [] a consumption which
symbolizes possession of the material and cultural means of maintaining a
bourgeois lifestyle and in this way provides social capital, a capital of fashionable
relations which can, if needed, provide usable support, a capital of honourability
and respectability that is often essential in winning or keeping the confidence of
high society (ibid.:6-7). Members of this sub-field show an interest in selected
design-related ideas from the artistic sub-field, which are closely related to cultural
capital; this also provides social capital for them in their relations to other high
society actors of this sub-field who show an outward interest in art.

The technical-economic sub-field: In this sub-field efficiency and productivity are
valued most highly, and this is not hidden or euphemized in any way (ibid.:7).
Members of this sub-field openly prioritize logistic and cost concerns higher than
artistic concerns. The architectural firms of this sub-field attempt to obtain cust-
124
omers previously served by the professional sub-field; however, architects from
the other two sub-fields scorn the work done by the architects of this sub-field due
to their neglect of the artistic aspect of architecture (ibid.).

Albertsens three sub-fields are depicted in Figure 21 below. In this figure, the
architects of the artistic sub-field (and their firms) have a generally low levels of total
social and economic capital due to the fact that they exclusively orient themselves
toward other architects and art critics and not towards other construction industry
actors. Some member may, however, achieve critical acclaim and thus high levels of
cultural and economic capital.

Figure 21. The Positioning of Albertsens Three Architectural Sub-fields with
Regard to Levels of Accumulated Cultural and Social Capital.

High

Level of Accu- Artis- Professional
mulation of tic Sub-field
Cultural Capital Sub-
within a Field field

Technical-Economic Sub-field
Low
Low High
Level of Accumulation of Social Capital
within a Social Group

Source: Authors conception based on Bourdieu, 1979, 1983, 1986; Albertsen, 1996.

On the other hand, the architects (and firms) of the professional sub-field have high
levels of both social and cultural capitals due to their success in achieving critical
acclaim as well as their contacts to both other architects, art critics, and other parties
in their social circle(s) ofthe construction industry. The high levels of both types of
capitals generally also translate into a high level of economic capital (Albertsen,
1996:6-7).

125
Finally, the architects of the technical-economic sub-field have a relatively high-level
of social capital in their dealings with other actors in the social group(s) of this sub-
field, in comparison with their level of cultural capital. Due to their lack of lip-service
for the primacy of matters aesthetic, they are generally less successful at winning
architectural competitions and thus accumulating cultural capital. They are therefore
also scorned by the architects of the other two sub-fields. This makes their potential
total level of social capital lower that that of the most successful architects (and firms)
of the professional sub-field, although their social capital from relationships to actors
who prioritize criteria other than artistic criteria may result in many orders and thus a
relatively high level of economic capital.

In my delimitation, it is furthermore possible to be positioned between the sub-fields
depicted in Figure 21, e.g. between the professional sub-field and the technical-
econoimc sub-field or between the artistic and professional sub-fields, if one is
moving from one sub-field to another. A newly established firm whose partners have
accumulated little social and cultural capital will furthermore be place in the lower left-
hand quadrant of Figure 21. However, in the long term, if ones firm is successful in
surviving, i.e. accumulating the necessary economic, social, and cultural capital for
survival, the firm automatically moves to one of the three sub-fields specified by
Albertsen (1996), as these are the three dominating discourse structures of the field of

The relation between the level of the sub-field and the levels of the groups and net-
works is as follows: Groups are always a part of a specific sub-field. Networks are
also most often mainly part of one sub-field. Some network actors may, however, be
positioned within another sub-field or between the sub-fields.

I have not included firms from the artistic sub-field in my empirical pilot study and my
case studies, as I presume that they would show little interest in contributing to re-
search concerning project marketing. After this omission, I expanded the framework
of the hierarchy of power of architectural firms on national markets of the pilot study
(see Figure A.3. in Appendix A) on the basis of Albertsens (1996) delimitation of the
three architectural sub-fields, as depicted in Figure 21; the result is depicted in Figure
22:

126
Figure 22. The Hierarchy of Power of Architectural Firms on National
Markets based on Social, Cultural, and Economic Capital Accumulation.

1. Very Few Firms of national and international renown
High social, cultural, and economic capital (Professional Sub-field).
2. A Few Firms of some national renown
Either relatively high social, cultural and economic capital (Professional Sub-field)
or relatively high social and economic capital (Techno-Economic Sub-field)

3. Many Firms of lesser renown
Those who understand how to create social, economic, and possibly
cultural capital and are able to do so in practice (Successful innovators)
or
Floundering firms that are not able to use these mechanisms

Source: Own conception, based on Bourdieu, 1983; Albertsen, 1996; and Ger-
kan, 1990.

4.4.2. The Commensurability of Bourdieus Field Concept and IMP/INPM
Project Marketing Concepts.

As architectural project acquisition is influenced by (a) the governance structures of
project marketing professional service markets, as depicted in Figure 17 of Section
4.2., which can be captured by Cova et al.s (1996) concept of the milieu (see Sub-
section 3.3.2.) as well as (b) the rules of capital accumulation of the field of archi-
tectural services, as described in Subsection 4.4.1., it is necessary to establish that the
combined framework consisting of IMP/INPM project marketing concepts and Bour-
divan concepts is commensurable.

Both Cova et al. (1996:654) and Bourdieu (1983:248) state that current norms, rules,
and practices of a certain milieu or field are structuralized by actors interpretations of
past actions:

What distinguishes the milieu from a simple localized network of industrial
actors is its collective linkage [...] developed by practices of all types [...].
The actors share, both in their life and in their imagination, the community of
some elementary structures. (Cova et al., 1996:654)

[These relationships] may be socially instituted and guaranteed by the
127
application of a common name (the name of a family, a class, or a tribe or
of a school, a party, etc.) and by a whole set of instituting acts designed
simultaneously to form and inform those who undergo them (Bourdieu,
1983:248).

Thus the viewpoints on the nature of human actions of Cova et al. (1996) are not in
discordance with Bourdieu (1983, 1990, 1996).
28
Furthermore, in both theoretical
frameworks, the role of historically determined societal and industry, i.e. institutional,
structures can be regarded as determining (a) the current set(s) of representations con-
structed and shared by actors within a given milieu or field as well as (b) the
corresponding sets of rules and norms that to some extent regulate the interactions
between these actors in the given milieu/field. With specific regard to this study, the
influence that these historical features have upon an individual con-
struction/architectural project are depicted in Figure 23:

Figure 23. The Role of History in Relation to a Concrete Project Offering.

History

Actors Actions and Perceptions within the Milieu in Relation to the Project

Project Content Project Process


At the individual project level, history influences the project actors of the given milieu
in two ways:

1. Their habituses and their understanding and interpretation of project-relevant issues
depend upon the historical perception of similar projects common to their milieu
or field.

2. Milieu- or field-specific norms and rules that govern their actions have arisen due to
factors related to historical path dependency, i.e. the division of power among
actors.

The actors perceptions (way 1, immediately above) influence their perceived interests
in relation to project content and process. However the specifics of the content and

28
They are also not in discordance with most institutional theory (see Scott, 1995).
128
the process of the project in question also influence the actors perceptions, and
different views about the suitable project content and process may be deliberated
among the actors of the milieu/field in efforts to promote their own interests. This,
however, takes places within the cognitive and normative framework (points 1 and 2)
of the habitus provided by the historical path dependency as do the actions actually
undertaken by the actors.

During completion, an individual project completed enters into the minds of the
individuals working on the project and thus becomes a (small) part of the history per-
ceived by the actors that have participated in the individual project. This is indicated
by the arrow from the Project box to History in Figure 23. However, at the level
of multiple projects, whether the project is perceived as being new or different by
its participants to an extent that will cause them to revise some of their general
cognitive frameworks about the nature of the industry will depend upon both their
current general cognitive framework, which is also based on observations outside the
specific project in question, the actors individual psychological characteristics, and
the degree of differentiating project uniqueness in comparison with other projects.

The main difference between the milieu (Cova et al., 1996) and the field (Bour-
dieu, 1996) is that Cova et al. (1996) unequivocally state that the actors in a milieu
are linked by territoriality. As previously mentioned in Subsection 3.3.2., this is an
issue that I will examine further in relation to my empirical data on the basis of the
assumptions in the following paragraph. Furthermore, in subsequent sections of this
dissertation, I will use the term milieu instead of field, to describe the area in which the
actors from the case study firms use capital accumulation strategies to acquire archi-
tectural projects, due to the fact that Cova et al. (1996) developed the concept of the
milieu especially for the marketing subdiscipline of Project Marketing. This choice is
furthermore justified by my inclusion of other construction industry actorsin the
architectural project milieu, which makes my operationalization different than those of
Albertsen (1996) and Stevens (1998), as indicated in Subsection 4.4.1.

Initially, I will work from the assumption that territoriality does matter, due to the re-
sults of my pilot study (see Appendix A), which indicated that territoriality has
mattered for many Danish construction industry firms internationalizing onto the
German market during the nineties. Thus I will initially regard the German and Danish
fields of architecture as two separate milieus. My argumentation for why this could be
the case is as follows:

129
When an individual firm and its actors enter a new milieu abroad, e.g. by Johanson
and Mattssons (1988:200) international extension, as explained in Subsection 2.2.2.,
they may have different ways of interpreting the industry in question due to their
habituses. This implies that they probably will view the process and project content
differently as well as act differently. When it is important to establish credibility, as is
the case in the marketing of professional services (Lwendahl, 1998:42-3; Majkgrd
and Sharma, 1998:8-9), it is necessary for the market-seekers to insure some compa-
tibility of their cognitive frameworks and actions to that of the other actors with whom
they interact or will potentially interact. This compatibility will exist in situations where
firms have accumulated cultural and social capital that are recognized by the actors in
the foreign milieu in question. Therefore it is relevant to examine the extent of recog-
nition of cultural capital (e.g. education qualifications, references, and prizes) of
foreign origin, the extent to which existing social capital can be used in the foreign
market due to social connections and common norms, and the extent to which these
things must be accumulated anew upon the new market and the ways of doing so in
relation to research questions 3 and 5 as stated in Chapter 1. These issues will be exa-
mined empirically in Chapters 8 and 10.

However, a final concept will now also be introduced into the commensurability
discussion. IMP scholars Halinen and Trnroos (1998:191) have also explored the
Swedish researcher Melins (1989) conceptualization of the industrial field-of-force
as a potentially relevant concept for described the environment in which firms operate.
According to Halinen and Trnroos (ibid.), Melins usage of the word field is
directly related to Bourdieus usage of the term (see the quotation from their 1998
article at the beginning of Subsection 4.4.1.).

Melin (1989: 164, 166, 177) explains key features of his field-of-force metaphor as
follows:

The environment represents two different things for the industrial firm: on
the one hand, the objective resources (physical and monetary) necessary for
survival, and on the other hand, the decision makers subjective images of
the external whole of which the organization is a part. [...] I believe that the
enacted environmental model (Weick, 1979) is [...] realistic. However, I am
convinced that [...] we also must incorporate the objective environment view
[...] within the principal environment model based on enactment process.

The concept forces refers to many different basic reasons behind change
in industrial fields, from physical conditions (like a shortage of raw
materials) to mental constructions of reality.
130

The industrial field-of-force represents the context in which an individual
industrial firm operates and of which it is an integral part. The relevant arena
for each industrial firm is its industrial and societal context [...]. The
commercial core of the field is the interorganizational set of industrial firms
(the company net discussed by Hgg and Johanson, 1982), held together
by cooperation through social interaction and mutual exchange of resources
between different parties as well as by hostility between different parties
concerning the capacity to establish exchange relations. [...] The industrial
field also comprises different forces outside the proper company network,
affecting the structure of the field as a whole through influence on the
relative freedom of action of the individual firms within the field. The
structure of the field can be described by the existing pattern of relations
between all the different actors in a specific industrial field.

The field-of-force concept, taken in the sense that different forces are in
action, highlights the fact that changes, both in the whole structure of the
field and in the strategy and internal structure of the individual company, are
results of ongoing political processes, controlled by different power
groups. The effects on an individual company are governed by both
external and internal organized interests [...]. The field-of-force
perspective promotes the view of external and internal power relations as
part of an integrated power structure [...]. One of the fundamental
characteristics of the industrial field is the relative position of the
organizations making up the field. The relative position expresses the basic
possibilities of locomotion within the field [...]. What happens within an
industrial field depends on the distribution and strength of the different
forces throughout the field.

Within each social cluster (or network) one important characteristic is
personal trust; each actor is accountable. The actors in one cluster are
trustworthy players in the game being played; they accept the same moral
and transactional rules. When an actor enters a new social cluster/network,
he makes moral and instrumental investments. [...] The moral dimension
expresses shared values and norms. The transaction dimension expresses
interest for desired resources in the cluster/network.

On the basis of the above descriptive quotation, I judge Melins concept of the field-
of-force to be commensurable with Bourdieus and my own ontology as described in
Subsection 4.2. as well as Bourdieus field and Cova et al.s (1996) milieu. Further-
more, Melins power group (ibid.) corresponds relatively precisely to Bourdieus
(1979 or 1986) group, and it is interesting to note that Melin also emphasizes personal
trust in each social cluster. Trust is a concept related to the credibility needed to
131
establish social capital (see Blomqvist, 1997 for a thorough genealogy and delimitation
of these two concepts). On the basis of the above similarities I would like to suggest
that IMP/INPM scholars working with Cova et al.s milieu concept also read
IMP/INPM literature on the field-of-force and vice versa, with the aim of combining
insights to create one refine and more parsimonious concept for future use in
marketing research. I will return to this point in Chapter 11.

Finally, in relation to concept commensuability, the boundary issue must be examined
once again. In a subsequent article based on Melin (1989), Hellgren, Melin, and Pet-
tersson (1993) examine the industrial field of newsprint paper producers, working
from the assumption that the field of the newspaper print industry is world-wide, i.e.
not subdivided by national categories. As this assumption is the opposite of mine it
could be relevant to compare the two studies and other IMP/INPM studies that use
similar concepts (if they exist!) for under- or overrepresentation of territorial features
in a future research project. Such comparison would further knowledge as to whether
the milieu is best regarded as a socio-geographic unit (see Tikkanens (1998: 264)
remarks on this topic in Subsection 3.3.2.). This issue will therefore be addressed
indirectly in answering research questions 2 5 in Chapters 7 10 and returned to in
the concluding assessment of this studys theoretical contribution in Chapter 11.

132
5. An Elaboration of the Scientific Relevance of the Dissertation Research
Questions in Relation to Previous Project Marketing Research Contri-
butions.
5.1. Introduction: General Remarks concerning the Entire Study.

In Section 4.2., I clarified the ontological foundations of this project with regard to
several key issues of disagreement among IMP/INPM researchers: the nature of em-
beddedness, i.e. the role of the interpretations of actors and networks in relation to
given economic and institutional variables. Having done so, the scope of this entire re-
search dissertation will now be explicitly limited to (a) interpretations of interactions at
the level of the actors and networks within the milieu, i.e. level 2 in Figures 17a and b
from Section 4.2. and (b) factors at the level of the traditional marketing variables
(level 1 in the same figures). As the case studies are historical reconstructions of past
activities undertaken by the three Danish case study architectural firms on the German
market, the issue of how actors, networks, or a milieu may have influenced the
broader macro-economic and institutional reality (i.e. the potential influence of level 2
on level 3 of Figure 17) is not directly relevant to this dissertation research project.
Instead, research question 1 will merely present some macro-economic and
institutional data about the size and growth of the German market for each year of the
1990s as well as the roles of the different types of actors. This data will be taken as
the given level 3 economic and institutional framework within which the three case
study architectural service firms and their contacts, i.e. clients and cooperation
partners, have worked in the 1990s.

Mller (1991:210) classifies marketing/strategic management theories and studies as
belonging to four possible domains; here, the broadest domain is mentioned first:

1. Environment/industry/market domain
2. Environmentmarketing relationship
3. Marketing in a firm-strategy context
4. Marketing function/marketing management perspective

Additionally, he classifies these types of studies by determining whether they have a
structure/content or a process view as well as whether they focus upon economic or
behavioral aspects (ibid.).

On the basis of the conceptual definitions, literature review, and methodological elabo-
ration of Chapters 2 4, it should be obvious that this study focuses on the beha-
vioral aspects of the three Danish firms internationalization efforts on the German
133
market of the 1990s. Additionally, research question 1 (see Chapter 1) deals mainly
with level 1, the environment/industry/market domain, whereas research questions 2
5 are placed at the next broadest level, i.e. the level of the environmentmarketing
relationship. Finally, research questions 1 and 2 deal with structure, research question
3 with content, research question 4 with the process aspect, and research question 5
with both content and process issues; its focus, however, is on the content of
previous project work and the resulting references.

With regard to processes, Van de Ven (1992:169) suggests that there are three pos-
sible ways in which processes may be used in empirical business administration
studies:

1. To explain causality in situations where there is variation
2. To categorize the chains of actions of individuals or organizations
3. To describe sequences of events and how things change over time

Research question 4 is based upon Cova, Mazet, and Salles (1994:40) General Mar-
keting Configuration for Project-to-Order Supplier Firms (Figure 1 in Chapter 1)
which, like Holstius (1987: 54) Project Marketing Cycle (Figure 12 in Subsection
3.3.2.), is an attempt at categorize project marketing processes, i.e. the second of Van
de Vens (1992:169) three possible ways to use processes in research. However, this
studys research question 4 will first focus upon description of the actual sequences
of events (the third of Van de Vens three possible ways) using Cova, Mazet, and
Salles (1994) work as its foundation; only if clearly different patterns are found, will
categorization be attempted in this dissertation.

Research question 5, on the other hand, goes in the direction of causality (the first of
Van de Vens three possible ways), in that description will first be attempted, and
thereafter, the construction of causal explanations will be attempted, as indicated in
Subsection 4.3.3.

With regard to geographical limitation of this research, regarding Germany as one
architectural service market has been chosen after critical consideration. Due to the
facts that Germany is a federal country with sixteen federal states (the Lnder), the
country was unified about a decade ago, and most German architectural firms operate
only locally or regionally (Gerkan in Der Architekt, 5/1990:247), the question should
be raised as to whether the German market should be considered as one market in this
study.

134
Several alternative ways of partitioning Germany have been pondered, including distin-
guishing between the territory belonging to the former so-called German Democratic
Republic and the territory of the Federal Republic of Germany before 1990. The main
arguments for this division would be the fact that the former GDR region has received
and still receives some special subsidies (Hndvrksrdet, 1992) and that it to some
extent still is undergoing the transition to a market economy. Another possibility would
be to look at individual Lnder. Credible reasons for this choice include the facts that
the Lnder are primarily responsible for the regulation of the architect profession
(Button and Fleming, 1992:411, Oliver-Taylor, 1993:33-5) as well as a large part of
German construction legislation (Galkowski et al., 1997: 16, Arkitekten, 1993/5:182),
and that most German architects and contractors only work locally due to e.g. the
federally organized German political system (Oliver-Taylor, 1993:50). Yet another
possible categorization would be to concentrate on specific urban German regions
with particularly high rates of growth as was done in the European Construction
Research report (1995).

The previous paragraph suggests that there is no one right answer to the question of
whether it is best to work with data from the whole of Germany or from some specific
region. Moreover, as one study indicates the jobs that Danish architects have done are
spread quite evenly across the entire country (Arkitekt- og byggebladet, February
1993:32)
29
, and as the unification process has progressed in the territory of the former
GDR, with the abolition of some transitory subsidies and temporary rules (see e.g.
Hndsvrksrdet, 1994), I see no pressing reason for creating requirements that the
German projects must be located in certain areas of Germany. The argument for
accepting projects from the whole of Germany is further strengthened by (a) the large
probability that working on the level of the Lnder would not be feasible, as many of
the Lnder are quite small and the case study firms have actually worked in more than
one Land during the 1990s and (b) the delimitation of the term milieu to be based on
national boundaries in Subsection 4.4.2. These facts and arguments also speak against
limiting the study to the "Regions of Growth" in the European Construction Research
(1995) report. On the basis of these considerations, this dissertation regards the entire
German state as the unit of analysis and includes the case study firms architectural
projects undertaken in all regions of Germany.

29
Results from a later study commissioned by the Danish Federation of Small and Medium-Sized
Enterprises (Hndvrksrdet, 1994: 64) indicated that the bulk of activities for the entire Danish
construction industry was concentrated in Northern Germany. However, only approx. 4 % of the
respondents of this study were architects (ibid.: 60). I therefore prefer to use the source mentioned above.
135
Finally, with regard to the time element of this study, the last interviews with respond-
ents from the three case study firms (see Appendix C) were conducted in April 1999.
Therefore the term the nineties should be interpreted as encompassing 1990 to the
first part of 1999. The latter part of 1999 has not been investigated, as I as the author
of this dissertation have been more involved in analyzing and interpreting data as well
as writing this dissertation after April 1999. Furthermore I in most cases have only
been able to obtain statistics for the years 1990 1998, as the statistics for 1999 were
not yet complete.

5.2. Remarks concerning Research Question 1 on the Size and Growth of
the German Market.

To refresh the readers memory, research question one is, as originally stated in Chap-
ter 1, formulated as follows:

How did the German market for architectural services develop during the
nineties in terms of e.g. institutions, total market size, and growth rates at the

As mentioned in the previous subsection, this question, which concerns the macro-
economic and institutional development of the German market for architectural ser-
vices during the nineties, will serve as the given macro-economic and institutional
framework within which the three case study firms have worked. It will be dealt with in
Chapter 6.

The description of the German market will be comparative in that it will also include
data and descriptions of the situation in Denmark and Europe. One weakness of the
data is, however, a lack of official statistics specifically concerning the architects and
architectural service in Germany, the individual German federal states (Lnder), Den-
mark, and Europe. With the exception of Bundesarchitektenkammer, 1990-1998 and
the statistics that the Danish architectural organizations DAL and PAR have compiled
(see Appendix A, Subsection A.3.1. for a description of these organizations), most
official statistics (e.g. Eurostat, 1996; Statistisches Bundesamt, 1992-1999, Danmarks
Statistik, 1992-1999) either group architectural and engineering consulting services to-
gether in one category or concern themselves with e.g. the construction industry as a
whole. I will therefore make use of the most suited statistical material available.

136
Additionally my description of institutional factors, such as the division of labor
between architects, engineers, and other construction industry actors, is supplemented
by the information in Appendix A, Sections A.3. A.6.

The implementation of the EU Public Services Directive (see Council of the European
Communities, October 13, 1997) in Germany and Denmark and its influence on
market conditions and the competitive environment will also be described in general
terms in Chapter 6, as it is a general institutional factor. Due to the vast differences in
the way Germany and Denmark have implemented the directive as well as the diver-
gence of opinions about the directive itself, its implementation, and the public author-
ities way of administrating the directive, the description will also incorporate some
anonymized statements from the case study firms, the persons interviewed in the pilot
study, and persons interviewed in the supplementary interviews of the main study.

5.3. Remarks concerning Research Question 2 on Danish-German
Architectural Export Actors.

Research question two, which will be the topic of Chapter 7, was stated in Section 1
as follows:

Who were the major actors involved either directly or indirectly in Danish
internationalization of architectural services to Germany in the 1990s and to
what extent and how did they cooperate with one another?

As described in Appendix A as well as in Arkitekten, 1993/5:166-183, the path leading
to export-related activity on the German market has varied greatly from one Danish
architectural service firm to another. Additionally, a number of articles (from e.g.
Arkitekten and Arkitekt- og Byggebladet) document that a vast number of public and
private actors as well as actor constellations have been involved in Danish architectural
internationalization to Germany in the 1990s. Thus it is relevant to examine the type of
internationalization in relation to e.g. IMP internationalization theory (i.e. Johanson and
Mattsson, 1988) through the process of abductive scrutiny.

It is, however, at the same time obvious that the scope of this study does not allow for
a comprehensive description of all of Danish actors involved in this internationalization
in some way. Therefore focus will be placed upon the larger private sector firms as
well as key public sector offices and interest organizations. Relevant private sector
Danish architectural export actors include major Danish contracting firms, engineering
consulting companies, and real estate development firms. Additionally, major Danish
137
interest organizations to be included are e.g. the Council of Practicing Architects
(Praktiserende Arkitekters Rd, PAR), the Danish Association of Engineering
Consultants (Forening af Rdgivende Ingenirer, FRI), and the Danish Council of
Consulting Architects and Engineers (AI-Rdet). Finally, the public sector institutions
which will be treated are the Danish Ministry of Housings International Department
and Construction Industry Attachs, the Trade Commissioners (eksportstipendiater)
Program of the Danish Ministry of Commerce and Industrys (Erhvervsministeriet)
Agency for Trade and Industry (Erhvervsfremmestyrelsen), and the Royal Danish
Ministry of Foreign Affairs Commercial Attachs.

Knowledgeable persons from these firms/organizations (i.e. key informants, as elabor-
ated upon in Subsection 4.3.3.) have been used to identify the major actors involved in
Danish architectural service exports to Germany in the 1990s. Additionally these
respondents have been asked to name and/or describe other actors with which they
have had frequent contacts and/or cooperation with and the extent of these contacts
or cooperation agreements. This has been undertaken in an attempt to discover the
existence of possible relationships and networks between or encompassing the
individual firms/organizations
30
as defined in Subsections 3.3.1 and 3.3.2. and the
nature of these relationships and networks. Additionally the issue of the possible
governance structures (see Figures 11 and 19 in Subsection 3.3.1. and Sections 4.2.)
within which these actors have cooperated is also taken into account. Finally, the
extent of contact to Danish actors versus German actors has also been examined to
allow for a classification of the actors activities in accordance with Johanson and
Mattssons (1988:200) three modes of establishing positions in relation to counterparts
in foreign networks, as described in Subsection 2.2.2. Thus the theoretical
contribution of this research question will relate to the refinement of the
conceptualization of relationships, networks, governance structures, and modes of
internationalization.

5.4. Remarks concerning Research Question 3 on German Project-
Related Knowledge.

Research question 3 is the first of the three case study research questions. It is exam-
ined in Chapter 8. Abridged descriptions of the responses of the respondents from the

30
With regard to the Construction Industry Attachs and the Trade Commissioners, these persons will
only be asked to name public sector cooperation as confidentiality rules prohibit them from speaking of
their work for specific private sector clients.
138
three case study firms are presented in Appendix B. The unabridged responses were
the starting point for my answers to research questions 3 5.

In Chapter 1, research question 3 was formulated as follows:

What sort of specific knowledge about the German market and specific
projects on the German market did the case study firms use in obtaining
architectural projects on the German market?

Research question 3 has been formulated such that it (implicitly) encompasses the
theoretical assumption that the accumulation of knowledge about the German market
and its potential architectural projects is a necessary (but not necessarily a sufficient)
precondition for the case study firms ability to function on the German market due to
the presence of different rules and norms on the German construction industry milieu
(see Subsection 4.4.2.). This assumption was supported by the results of my pilot
study, as explained in Appendix A, Section A.6., as well as Drbyes (1999) and
Entreprenrforeningens (1996) reports. The answer of Chapter 8 will provide further
support for this assumption, which is slightly different than that of the Uppsala
Internationalization Model (see Subsection 2.2.2. or Johanson and Vahlne, 1977).
Whereas the Uppsala model suggests that internationalization is incremental due to a
necessarily experiential learning process, I presume that a certain amount of
knowledge is necessary for the internationalization process to even begin.

Moreover, as previously indicated in Section 2.3., research question 3 is the most
exploratory of the three case study questions, as the state of the art of the literature
on knowledge as a resource or a precondition for marketing is very preliminary. Thus
(1) no one definition of knowledge has been used in my questioning and (2) the
respondents understanding of knowledge as well as the prompts that I have chosen
to use in my interviews have (2a) affected the answers given by the respondents as
well as (2b) possibly prompted processes of further reflection and learning both for
my respondents and for myself (see e.g. Figures 4 and 5 in Section 2.3.). However, at
the same time, the case study method (interviews and document analysis, as described
in Section 4.3.) limits the scope of data to the types of knowledge that lie at a level of
consciousness and can be codified as well as articulated (see Section 2.3.). This
means that my case study research has not been able to capture the knowledge that
has remained tacit throughout the study. However, originally tacit knowledge which
has be subsequently codified during the study may have been made accessible
through this process of change.

139
In the terminology of Lwendahl (1997:42, 43; see Subsection 4.4.1.), the knowledge
which is a prerequisite for obtaining architectural projects in Germany is related to the
ability of the selling firms boundary spanners or relationship promoters (see
Subsection 3.3.3.) to make/sell a credible promise to customers or other cooper-
ation partners on the German construction industry milieu. Similarly to social capital
(see Figure 20a of Subsection 4.4.1.), their knowledge is partially acquired through
activities on the German construction industry milieu, yet is also a prerequisite for
these activities, as the credible promise cannot be created without knowledge of how
to create it. Thus the situation of initial presence on foreign markets is a potential
Catch-22 situation, as the knowledge necessary to receive projects is mainly
available only through project experience (see Figure 20). Thus the Catch-22 aspect
will also be dealt with theoretically and empirically.

Furthermore, the acquired knowledge can, in accordance with Cova et al.s (1994)
Model in Figure 1 of Chapter 1, be divided into two categories:

1. Knowledge related to the broader German environment (relating to Cova et al.s
Steps 2 4).
2. Knowledge related to the specific project and the specific potential customer/
potential cooperation partner (Steps 5 9 in Cova et al.s 1994 model).

The knowledge related to the broader German environment (category one, above) is
more closely related to economic and institutional factors as well as the factors en-
compassed by the literature about industry recipes and managerial cognition (see
e.g. Eden and Spender, 1998). It is also related to the general information processing
role of boundary spanners (see Aldrich and Herker, 1977:218-221, as described in
Subsection 3.3.3.). However, as it is difficult to encompass the entire scope of
managerial cognition in a geographical area such as Germany, potential knowledge-
related problem areas such as the legal framework governing the German construction
industry, the German DIN norm system, the German language itself, German
negotiation practice, German public tendering procedures, German design traditions
have been discussed in depth with respondents on the basic of the pilot study, as
described in Appendix A. Additionally, the respondents have been asked to elaborate
on their knowledge of these factors at different points of time in relation to specific
project offers. Finally this knowledge may correspond to Alajoutsijrvi and Tikkanens
(1999) generic competence (see Figure 6 of Section 2.3.). This issue will be
examined empirically.

140
On the other hand, project- and customer-specific knowledge is much closer to Chet-
ty and Erikssons (1999:1) definition of foreign market knowledge as the knowledge
of business relationships in the local network. With regard to this type of knowledge,
interviewees have been requested to tell about their ability to (a) make social contacts
in Germany to potential clients and cooperation partners, (b) act in concrete situations
on the basis of their understanding of the German construction industry, and (c)
undertake the process of looking for projects and may also be more closely related to
Alajoutsijrvi and Tikkanens (1999) portfolio- and relationship-specific
competence (see Figure 6 in Section 2.3.). The knowledge examined here is relevant
to both the external representation function and the specific information processing
function of boundary spanners (see Aldrich and Herker, 1977:218-221 as described in
Subsection 3.3.3.).

Concerning point (a), the personal characteristics listed by Gemnden and Walter
(1994:5-6) were scrutinized. With regard to point (b), data concerning the following
points has also been gathered in the case studies:

Knowledge of the relative positions of the actors in the foreign countrys (i.e.
Germanys) milieu
countrys milieu
to the planned activities on the German market
Knowledge of where different actors including the actor itself stand in relation
to each other (Axelsson and Johanson, 1992:231)

These points are based on Axelsson and Johanson, 1992:231-3, as previously pre-
sented in Section 2.2. Respondents have also been queried about their knowledge and
perception of the identity of the constellation of firms that they have sought to work
with and their knowledge of the potential function they would have in the constellation
in question, in accordance with Mattssons (1984) definition of position as sum-
marized in Section 3.3.1 and the discussion and delimitation of social and cultural
capital and Albertsens (1996) three sub-fields in Section 4.4. This part of my
knowledge-related research is also related to my treatment of research question 5 in
Chapter 10.

Moreover, in Section 2.5., possible differences in the level of customers and sup-
pliers know-how were listed as a characteristic of projects. However, in Section 3.2.,
it was also mentioned that Gnter and Bonaccorsi (1996) have suggested that the
141
procurement function is increasingly being professionalized, especially in multinational
corporations, which could imply smaller differences in levels of know-how. On the
basis of this conflicting information, respondents from the Danish architectural firms
have been asked in connection with point (b) to describe the knowledge that they have
used to asses the level of know-how of their prospective German clients and to what
extent they have perceived differences in know-how. The opinion of a renowned
German architect operating in Germany and abroad has also been obtained on this
issue; his answer is found in Section 6.2. This issue will also be compared with data
concerning how the support of actors could be mobilized in relation to planned
activities on the German market, which is also related to research question 2.

Furthermore, in relation to points (a), (b), and (c), inquiries into the respondents
knowledge of the role of differences in taste, climatic conditions, cultural values,
traditions, and topology and their influences on the concrete architectural project(s)
have also been made on the basis of Sharmas (1991:23) remarks on international
consulting work in Section 2.3.

Finally, with regard to points (a) and (c), questions were asked concerning which
respondents from case study firms contacted other persons in project acquisition
activities and when, where, and in what way these persons were contacted.

Questions concerning the national division of labor (e.g. which employees in the case
study firms are Danish and which are Germans, how much do the Danish employees
know about the German architectural services and construction industries) at specific
points in time in the 1990s have also been asked. These are used in Chapter 8 to
obtain a picture of the diffusion of Germany-specific knowledge in the case study
firms in relation to Alajoutsijrvi and Tikkanens (1999) work on the spreading of
competencies in the context of relationships (see Figure 6 of Section 2.4.).

In connection with the issue of the spreading or diffusion of knowledge within the
case study firms, respondents have also been presented with the characteristics and
dilemmas of the boundary spanner and relationship promoter roles (see Subsection
3.3.3.) and asked to comment upon their general relevance for obtaining projects and
their personal experience in relation to these (potential) roles.

Over and beyond that, the dilemma of using resources to acquire level two knowledge
necessary to invest in specific relationships versus using resources to invest in level
one learning more about trends in the broader milieu has been discussed with
142
respondents. In connection with this, the Anticipation versus Flexibility issue
(Bansard et al., 1993, see Subsection 3.3.2 and Figure 13) was covered.

To summarize the above points, the theoretical contribution of research question 3 is a
description of knowledge types acquired and the location of this knowledge, a
discussion of means to overcome the Catch-22 knowledge dilemma, as well as a
discussion of knowledge in relation to the adaptation/flexibility dichotomy and the
boundary spanner literature.

In my answer to research question 3 in Chapter 8 as well as research questions 4 and
5 in Chapters 9 and 10, I cite specific responses from my respondents found in
Appendix B. Appendix B has been read and corrected by my main study respondents
to insure that it is in accordance with their own views and life world. Chapters 8 10
are, however, in contrast, the results of my Bourdivin distancing or breaking away
from their views (see Section 4.2.). To emphasize this fundamental difference, I have
chosen to call all firms and respondents by name in Appendix B, but to refer to them
as firms and respondents (or, synonymously, interviewees, partners, employees, etc.)
in Chapters 8 - 10, as well as the final three Chapters 11 14, which contain my
theoretical and managerial conclusions as well as the English and Danish language
summaries of this dissertation.

5.5. Remarks concerning Research Question Four on the Process of
Obtaining Projects.

In Chapter 1, research question 4 was formulated as follows:

How were concrete architectural projects obtained by the case study firms?

This research question comes close to a qualitative test of the model of Cova, Mazet,
and Salle (1994) depicted in Figure 1. However, as indicated in Section 5.1., the
purpose of the question is not to validate or refute their model; instead it is to use the
model as the departure for a richer description of the process of obtaining project or-
ders on the German market seen from the viewpoint of the case study architectural
firms. This rich description is obtained through a dialectic process of abduction, i.e.
by comparing theory and empirical data as previously described in Subsection 4.3.3.

The statements of key informants from the Danish case study firms concerning how
they perceive the process of obtaining projects form the basis of my answer to re-
143
search question four. Initially the respondents described their project acquisition in
their own words on the basis of specific projects. Thereafter, the step of showing the
interviewees Cova et al.s (1994) model, explaining it to them, and asking for com-
mentary was undertaken.

In Chapter 9, respondents own replies are reinterpreted in the light of my critical
scrutiny and adaptation of Cova et al.s (1994) model as well as the models of the
phases of construction projects (see Figures 8 and 9 in Chapter 2). Furthermore, (a)
the role of the accumulation of social capital, as operationalized in Section 4.4. and (b)
the question of whether long-term relationships and networks exist on construction
project markets seen in the light of the discontinuity issue and the possibility of the
existence of sleeping relationships (see Ahmed, 1993; Andersen, 1995; Cova et al.,
1996a; Hadjikhani, 1996; and Kallinkos,1989 in Subsection 3.3.2 and the discussion of
Figure 18 in Subsection 4.2.) are treated in Chapter 9. Here some causal explanations
are also presented, which are elaborated upon further in Chapter 10. They concern the
accumulation of social capital on the German market. Finally, the position of
negotiations with regard to the public sector and orders financed by the public sector
is discussed in relation to the EU Public Services Directive (Council of the European
Communities, October 13, 1997) and its implementation and administration; here a link
is made to the description of the directive in Section 6.4.

5.6. Remarks concerning Research Question 5 on the Role of Previous
Project Work.

As previously mentioned in Chapter 1, this research question deals with the relation-
ship between (a) already awarded projects that are/were either still in progress or com-
pleted and (b) subsequent project awards that the individual case study firms have/had
obtained. The precise formulation of research question 5 is as follows:

What role did previous project work play when case study firms obtained
specific projects on the German market?

Research question 5 is the focus of Chapter 10. Similarly to research questions 3 and
4, statements from the respondents in which they explain in their own words the
relationship between already awarded projects and subsequent acquisition of project
work are presented in Appendix B. These form part of the basis for my subsequent
distancing from the respondents inside view in Chapter 10. The insights from Chap-
ters 8 and 9 concerning the knowledge and social capital acquired in previous project
activities are also brought into the discussion. Moreover, several IMP/INPM concepts
144
and the cultural capital framework of Bourdieu (1983) are also used as tools in the
step of building causal explanations. These IMP/INPM concepts include the following
(see Subsection 3.3.2.):

Holstius (1987:63) reference value
Salminens (1997) conceptualization of references, their value, and their possible
uses
The position (Mattsson, 1984, see pp. 44-5) possibly created by the firms
portfolio of projects
Cova et al.s (1996a) socio-graphic concept of the milieu

With regard to Holstius (1987:63) reference value and Salminens (1997) concep-
tualization of references, it should be noted that one theoretical issue will be focused
upon in Chapter 10 which lies outside of the original frameworks of these concepts:
Concerning projects-in-process or e.g. runner-up prizes/honorable mentions in
architectural competitions or public tendering procedures, contrary to the suggestion
of Salminen (ibid., see also Subsection 3.3.2.), a reference value may be present
even though the project in question has not yet been completed or, in the case of
runner-up prizes/honorable mentions, may not ever be realized. In this case, the
reference value may be based on the potential customers trust in the judgement of
the selection committee that awarded the project or the runner-up prize/honorable
mention in question. The extent to which this is the case will be examined.

Multiple references might furthermore lead to the establishment of position (see
Mattsson (1984) or the brief description of his contribution in Subsection 3.3.2). This
issue will, however, mainly be examined from the framework of Bourdieu as presented
in Section 4.4 on account of my methodological reservation concerning Mattssons
conceptualization of position (see Subsection 3.3.2.) and the description of the case
study firms lack of knowledge of any exact, objective position in Chapter 8.

5.7. The Scientific Relevance of this Dissertation Study.

From the literature review of Chapter 3, it should be obvious to the reader that the
existing project marketing framework, including the work of the IMP/INPM groups,
within which this study is placed, is very fragmented and to a large extent based on
qualitative research. Therefore my choice of the previous research to draw upon in my
interpretation of my empirical data is rather eclectic. However, the aim of my work is
both to address and, subsequently, if possible, to reduce this eclecticism by providing
further empirical evidence concerning previous qualitative contributions as well as
145
building bridges between the contributions of different IMP/INPM scholars within the
boundaries of a coherent and consistent ontological and epistemological framework. I
thus draw upon a relatively large number of previous IMP/ INPM contributions, yet at
the same time take measures to insure that I use them in a commensurable way.

My work also deals with the boundaries of the IMP perspective in that I work in an
area of project marketing where relationships, as defined in the classical IMP works
(see e.g. Subsection 3.3.1.), may or may not be present, due to the possibility of the
architectural firms being on socially constructed markets as specified in Figure 18 of
Section 4.2. With regard to both these socially constructed markets and networks, I
use the milieu concept of Cova et al. (1996a), a concept which seems to be especially
suited to dealing with this type of environment. I have furthermore compared it to
Bourdieus (1979 or 1986) field and Melins (1989) Field of Force, which have been
mentioned in Halinen and Trnroos (1998) more mainstream IMP contribution on
embeddedness in particular environments in Section 4.4. By doing so, I contribute to
the potential future building of a IMP framework which is suited to deal with this
borderline type of environment.

The empirical focus of my research is upon operations on a foreign market where
norms and rules may differ from the domestic market. By focusing upon the mental
representations and rules and norms which actors share, i.e. as both Cova et al.
(1996a) and Bourdieu (1979, 1983, 1986) do, I move away from the more functional
focus of classic IMP works such as the A-R-A model (Hkansson and Johanson,
1992, as explained in Section 3.3.1.). Instead I focus upon the structuring role of
knowledge and the understanding of the mental representations, rules, and norms of a
given market as a precondition for generating social capital and the resulting credit-
ability with enables project acquisition on that market. I thus also must deal with the
role of knowledge in relation to internationalization. Although mentioned in the
Uppsala internationalization model (see Johanson and Vahlne, 1977), these factors
have also been relatively neglected in IMP internationalization research (see e.g. Johan-
son and Mattson, 1988).

My more interpretive perspective is, however, also deemed important by certain other
members of the IMP Group, such as Tikkanen (1998:271,275) who emphasizes the
increasing importance of the social and the acquisition of knowledge:

However, as project marketers broaden and widen their horizon, i.e. span
more projects or project opportunities and include more actors in its
between individual project supplies, it is certainly apparent that the
146
relational logic is paramount, exchanges are more of a social nature than
of a technico-economic nature and are concerned with other actors than
just business actors i.e. socalled institutional actors (Cova et al. 1996a,
650) [...]

[A] project also occurs when the actors involved perform activities and
mobilize resources in order to create and appropriate value for the
customer. Furthermore, an understanding of how a project occurred within
a net of involved intra- and interorganizational actors is an important vehicle
for organizational learning and a basis for further, potentially similar projects
realized in terms of the same competence area in the future.

Moreover, in incorporating social and cultural capital into my framework (Bourdieu,
1983, as also treated in Albertsen, 1996 and explained in Section 4.4.), I deal speci-
fically with the complexity of the generation of credibility among other actors in the
milieu of the construction industry. Description of the generation of credibility on
foreign markets is highly relevant in relation to efforts towards the more interpretively
oriented theory building on the basis of e.g. Mattssons (1984) and Johanson and
Mattssons (1986) work on positions within a network. Furthermore my model allows
the viewpoints of construction industry actors to differ with regard to e.g. the
importance of aesthetics and the relation of matters artistic to technological, economic
and logistic issues; it actually incorporates these differences in perspective.

Finally, with regard to the more specific field of project marketing, my contribution to
further scientific development is my critical, empirically-based dialectical and abduc-
tive scrutiny of many of the key INPM models and concepts under construction in
different countries (see Subsection 3.3.2.) on the basis of my empirical data from
architectural firms. Architectural projects, especially those concerning e.g. housing or
the renovation of buildings, often are smaller than the types of projects described in
much of the IMP/INPM project marketing literature (see e.g. Ahmed, 1993; Ghauri,
1998 and 1983; Holstius, 1993; Jansson, 1989; Ronkainen, 1984; Tikkanen and Lind-
blom, 1998, Welch et al., 1996). Thus my research may reveal issues of specific rele-
vance with regard to smaller projects that have not been sufficiently covered by the
existing project marketing literature (see e.g. Gnter and Bonoccorsi, 1996:531 as
described in Section 3.2.).

In the chapters to come, I will at some points write very simple and concise sentences
and sections, yet at other times I will purposefully use more complicated sentence and
paragraph structures. I am aware that such stylistic changes are very unusual in
English-language academic writing. I have however chosen them in an attempt to be
147
very honest towards the reader with regard the degree of precision and non-ambiguity
of my conclusions. I will thus not write simple, concise arguments and conclusions
with an overly reader-friendly structure if I judge that my data does not provide a basis
for this simplistic prose style. As a case in point, in Chapter 6, I will be looking at the
economic and institutional characteristics of the German construction market which,
as previously mentioned in Chapter 1, are to be considered the given framework of
the case study. If these factors cannot be interpreted unambiguously, I will not attempt
to follow the English-language stylistic conventions that could give the reader this
impression; I will instead write in a way that is more similar to much German- and
French-language academic writing.
148
6. A Comparative Economic and Institutional Description of the German Mar-
ket for Architectural Services During the Nineties.
6.1. Introduction.
As already described in Chapter 1 and Section 5.2, the purpose of this chapter is to
present key economic and institutional characteristics of the German market of the
1990s for architects in particular as well as for the construction industry in general.
This data will serve as background information about the market upon which the three
case study firms have operated.

The data in this chapter are supplemented by the information in Appendix A, Sections
A.3. A.5. which was accumulated during my pilot study. The outline of the chapter is
as follows: General data about German architects and other construction industry
actors in the 1990s are presented in Section 6.2. In order to enable comparison, the
development of Danish market in the nineties is presented in Section 6.3. A summary
of the development on the German and Danish markets is provided in Section 6.4.
Finally, the subject of Section 6.5. is the implementation and administration of the EU
Public Service Directive (see Council of the European Communities, October 13,
1997) in Germany and Denmark with regard to architectural services.

However, a general description of the construction and architectural services indust-
ries is also relevant to give the reader an overall picture of the importance of the con-
struction sector in Europe. Therefore a short description will be provided in the fol-
lowing paragraphs, using citations from a recent doctoral dissertation about the
internationalization of the construction sector workforce in Germany, Denmark, and
Sweden. In his dissertation, Lubanski (1999: 303) states:

[T]he construction industry constitutes an important sector in the EU as
is clearly shown by the key figures for the sectors turnover and size.
Annual turnover amounts to some ECU 510 bn, while the sector has roughly
8.5 m employees, mainly in small and medium-sized enterprises. This
corresponds to some 7% of all workers in the EU. If we include
dependants, then the living conditions of roughly 40 m people - i.e. 1 out of
every 8 EU citizens are linked to the construction sector [] [I]ts
activities are traditionally conducted on and for a domestic market, with the
focus on single projects (a bridge, a building, etc.). And most of the
production involved takes place, as it were, on-site.

And when a product has been completed and delivered, the workers and
the relevant employees of the employer enterprise must move to a new
construction site.
149

As previously discussed in Section 2.1., the construction project planners (e.g. the
architects and civil engineers) do not necessarily have to be as mobile as the con-
struction workers, unless they are e.g. responsible for the management of the con-
struction project. However, concerning the internationalization of other construction
industry actors, Lubanski (1999:307-8) provides us with the following summary of the
developments of past decade, focuses especially upon the increasing role of the large,
multinational contracting firm:

During the past 10-15 years the construction industry has undergone a
process of Europeanisation, both politically and economically []. For the
purposes of this paper, the term Europeanisation is taken to mean a number
of processes whereby the single country orients itself towards a larger,
European market rather than towards the traditional domestic market.

In economic terms, investments and firms can move freely across
national boundaries, while at political level the national rules and regulations
are being drafted and adopted within the framework of the EUs institutions,
which promote open markets []. The single enterprise now has an
opportunity to gain a market share in other European countries; it is no
longer restricted to the domestic market. Transnational groups of
companies, joint-venture enterprises and large-scale take-overs are among
the visible results of Europeanisation.

The building and construction industry has traditionally restricted its
activities to the domestic market, on which most projects have been carried
out by local contractors, using local labour. As mentioned earlier, the
products are one-off items, and no two projects are alike. Besides, the
single project can be extremely complex. The workplace is a temporary one,
and part of the work is carried out by specialist sub-contractors and co-
operation partners from various inter-related branches. []

At the European level there are some 1.8 m enterprises in the industry, of
which some 97% are small, with fewer than 20 employees (Atkin, 1993).
This means that half of the workforce is employed in these small firms,
which handle relatively small contracts, but are engaged in projects with
larger firms and can offer a wide range of technical services.

The following is a list of some of the EU initiatives takes to promote a Euro-
peanisation of the construction industry: The introduction of rules for
public-sector tendering []. The so-called building materials directive,
intended to remove technical trade barriers impeding the export/import of
150
building materials. Direct EU support for the construction industry is
available, partly via the EUs structural funds (for less developed regions),
and party via the EUs infrastructure programme, if the aim is to provide
support for construction projects carried out to develop the European
infrastructure and thus promote the realisation of the Single Market.

Although these initiatives affect the entire industry, the infrastructure
programme covers only projects of such a size that even the largest
contracting groups have to form consortia to handle them. This is a
question of large-scale projects that demand high levels of organisation and
require rationalisation of resources, planning and implementation, also
across national boundaries, which are actually being eroded in the case of
such giant projects. Processes are being set in motion that affect the entire
construction industry. []

The creation of the European Single Market implies competition across
national boundaries, and European enterprises are urged to rationalise and
form groups of companies with the aim of achieving economies of scale.
Many firms have entered mergers, alliances and joint ventures across
national boundaries. The 300 largest contracting firms in Europe now
account for roughly half of the new building- and construction projects
(Lehrskov, 1995). The situation is now very different from the situation
about 15 years ago, when very few firms conducted extensive activities in
another European country.

The origins of this development can be traced to the building boom in the
UK in the 1980s [] when foreign firms mainly French acquired British
firms. And since then there has been rapid development in the construction
industry, with acquisitions and mergers, so that this industry now accounts
for one third of all mergers in the EU. In 1995, 796 acquisitions were
registered in the industry, as compared with 683 a year earlier []. Large
groups are acquiring enterprises in other countries, while many medium-
sized contracting firms are disappearing from the market as a consequence
of a take-over or bankruptcy.

The Single Market, the liberal economy and free competition have had a
major impact on the construction industry. Formerly, size alone did not
confer any marked competitive advantage, as the small and medium-sized
firms were capable in many situations of competing with larger entities.
But the Europeanisation of the industry offers some opportunities to the
large firms where the smaller firms can reap no benefit, primarily in the case
of the large-scale, open tenders, situations in which a single enterprise
undertakes the total project, hiring (or buying) sub-contractors and projects
requiring high levels of technological expertise.
151

In the single member state there is a tendency towards concentration,
although there are differences in the extent of this development. In the case
of the Swedish, French and UK markets, a few very large enterprises
dominate the building and construction industry. The five largest firms thus
account for between half and one fifth of the national turnover. In Denmark
and in Germany the degree of concentration is less, as the five largest firms
account for a mere 10-15% of turnover.

The degree of concentration is often related to the public sectors ordering
strategy and the dynamics of the private sector []. In Germany, for
example, public sector purchasing is conducted by many regional and local
entities a system that confers an advantage on small and medium-sized
firms when competing with the larger forms for market share.

The trend towards greater concentration of contracting firms will be dealt with in
relation to architectural firms in the next two sections. On the other hand, this
dissertation will not examine any of the major EU infrastructure projects, as the case
study firms were not involved in huge infrastructure projects on the German market of
the nineties. However, the German and Danish public sectors order giving patterns
will be examined in Sections 6.2. and 6.4., in connection with treatment of the EU
Public Service directive in the area of architectural services.

6.2. The Development of the German Markets for Architectural Services and
Construction.

Lubanski (1999: 310-311) describes the general developments in the German
construction sector in the 1990s in the following way:

Up to the late 1980s, very few construction projects in Germany were
carried out by foreign enterprises, but the picture changed dramatically
following the fall of the Berlin wall and the subsequent reunification of the
country. The new lnder (regions of the former GDR) and the city of
Berlin, with their shoddy housing and neglected infrastructure, offered the
building and construction industry a great opportunity for growth and
expansion. The subsequent boom in activities in the sector involved labour
and enterprises from the rest of Germany (the former Federal Republic)
and from all parts of Europe.

The scale of this building boom can be attributed to several factors: The
availability of large numbers of worker in the neighbouring countries and
regions in Eastern and Central Europe; the collapse of COMECON, the
152
East European trade organisation, with the closure of entire industries and
mass unemployment; the willingness of workers from Eastern Europe to
support the emerging democracies, in this case by taking jobs in the building
and construction sector; tendencies towards a slump in other European
markets, and the simultaneous added impetus in the efforts to promote the
European Single Market, with liberalisation and a determination to achieve
the free movement of capital, goods and labour and the abolition of
technical trade barriers.

The inevitable result was the presence in great numbers of foreign firms
and workers on the German market. For the first few years the market
proved capable of accommodating both German and foreign firms, but
gradually the competition became sharper, and prices fell, seriously
affecting the German firms. The foreign firms were often in a position to
submit more competitive bids, on account of the lower costs of hiring for-
eign workers. Large German groups of companies tried to cope with the
new situation by assuming control of the entire building and construction
process, while delegating the actual work to foreign sub-contractors.

In 1995 the boom began to subside, leading to even keener competition.
The major investments in the eastern part of Germany could not stave off
the stagnation in the country as a whole, and in 1996 there was a decline in
construction activity in Germany for the first time since reunification. In
1995 there were 30,000 fewer jobs, and 3,700 firms were declared bankrupt.
The average number of unemployed in 1995 was 108,000.

The building and construction industry is now experiencing an economic
downturn, a reversal of the halcyon days following reunification, but with an
important new factor in the equation: the large number of actors from other
European countries. The current situation is now one in which there is
widespread unemployment among German building and construction
workers, in a sector that has up to 400,000 foreign workers. The number of
bankruptcies is growing [].

The size of the boom in the German construction industry at the beginning of the
1990s and the subsequent stagnation after 1995 can be assessed by examining Tables
2 5, which provide figures corrected for inflation for the total construction industry
turnover and turnover in the areas of housing, the private sector (excluding housing),
and public sector (excluding publicly financed housing). Furthermore, Tables 2 5
provide figures for the entire territory of the Federal Republic of Germany after 1990
as well as separate figures from the states of the original F.R.G. region and the new
153
German states that previously belonged to the territory of the former so-called German
Democratic Republic.

Table 2. Total Turnover in the German Construction Industry in Billions of
DEM (1995 prices)
Year Federal Republic of Original FRG New German
Germany Region States States (ex-GDR)
1991 471 402 69
1992 520 (+10%) 422 (+ 5%) 98 (+ 30%)
1993 541 (+ 4%) 422 (+ 0%) 119 (+ 18%)
1994 585 (+ 8%) 441 (+ 4%) 144 (+ 17%)
1995 590 (+ 1%) 437 (- 1%) 153 (+ 6%)
1996 575 (- 3%) 422 (- 4%) 153 (+ 0%)
1997 566 (- 1%) 417 (- 1%) 149 (- 3%)
1998
1
528 (- 1%) 398 (- 5%) 130 (- 15%)
1999
1,2
526 (- 0%) 400 (+ 1%) 126 (- 3%)
2000
1,2
531 (+ 0%) 405 (+ 1%) 126 (- 0%)

Table 3. Total Turnover in the Construction of Housing in Germany in Billions
of DEM (1995 prices)
1992 244 213 31
1993 264 (+12%) 223 (+ 5%) 41 (+ 32%)
1994 305 (+15%) 248 (+11%) 57 (+ 39%)
1995 315 (+ 3%) 249 (+ 0%) 66 (+ 16%)
1996 315 (+ 0%) 244 (- 2%) 71 (+ 8%)
1997 316 (+ 0%) 245 (+ 0%) 71 (- 0%)
1998
1
291 (- 8%) 231 (- 6%) 60 (- 15%)
1999
1, 2
289 (- 1%) 232 (+ 0%) 57 (- 5%)
2000
1, 2
292 (+ 1%) 235 (+ 1%) 58 (+ 2%)

1
DIW changed its methodology for registering turnover during 1998-99. Therefore the figures for 1998
2000 are somewhat lower than they otherwise would have been.
2
Prognosis from March 1999.

Source for both tables above: Deutsches Institut fr Wirtschaftsforschung (DIW), Danish Construction
Industry Attach Jrgen Skovgaard Vind, Berlin.
154
Table 4. Total Turnover: Construction of Buildings for the Private Sector in
Germany (not including Housing) in Billions of DEM (1995 prices)

1992 160 122 38
1993 162 (+ 1%) 116 (- 5%) 46 (+ 21%)
1994 180 (+11%) 124 (+ 7%) 56 (+ 22%)
1995 179 (- 0%) 122 (- 2%) 57 (+ 2%)
1996 169 (- 5%) 116 (- 5%) 53 (+ 7%)
1997 162 (- 4%) 112 (- 3%) 50 (- 6%)
1998
1
152 (- 6%) 109 (- 3%) 43 (- 14%)
1999
1, 2
153 (+ 1%) 111 (+ 2%) 42 (- 2%)
2000
1,2
155 (+ 1%) 113 (+ 2%) 42 (- 0%)

1
DIW changed its methodology for registering turnover during 1998-99. Therefore the figures for 1998

2

Source: Deutsches Institut fr Wirtschaftsforschung (DIW), Danish Construction Industry Attach
Jrgen Skovgaard Vind, Berlin.

Table 5. Total Turnover: Construction of Buildings for the Public Sector in
Germany (not including Housing) in Billions of DEM (1995 prices)

1992 116 87 29
1993 115 (- 1%) 83 (- 5%) 32 (+ 10%)
1994 100 (- 13%) 69 (- 17%) 31 (- 3%)
1995 97 (- 3% 67 (- 3%) 30 (- 3%)
1996 92 (- 5%) 63 (- 6%) 29 (- 3%)
1997 89 (- 3%) 61 (- 3%) 28 (- 3%)
1998
1
85 (- 4%) 58 (- 5%) 27 (- 4%)
1999
1, 2
84 (- 1%) 57 (- 2%) 27 (- 0%)
2000
1, 2
84 (- 0%) 57 (- 0%) 27 (- 0%)

1
DIW changed its methodology for registering turnover in 1998-99. Therefore the figures for 1998

2

Source: Deutsches Institut fr Wirtschaftsforschung (DIW), Danish Construction Industry Attach
Jrgen Skovgaard Vind, Berlin.

155
As can be seen in Tables 2-5, the German construction boomed especially in the years
1991-1994. In this period total turnover increased markedly in each subsequent year. By
1995, the total market growth reached its peak, with the market of the former West
German region declining already from 1994 to 1995 and the former East German region
declining after 1996. However, despite the decline in the entire German region taken
together from 1995, the total volume of construction in the latter half of the 1990s was
considerably higher than it had been at the beginning of the 1990s.

Furthermore, the German market for housing boomed much longer than the German
market for other private and public sector construction. There was a nominal growth in
housing construction volume until 1997 in both in the former West German and the for-
mer East German regions. On the other hand, other public sector construction invest-
ments declined in the former West German region already from 1992 and in the former
East German region already from 1993. The development of non-housing private sector
construction volume resembled the development in the total German construction
industry most: In the private sector, excluding housing, the volume in former West Ger-
man region increased until 1994 and decreased thereafter, whereas in the former East
German region the turnaround took place in 1995.

It is plausible to assume that the turnaround in all of the above-mentioned sectors took
place a bit earlier for the architectural firms, as these firms are most often involved in the
pre-construction phases of the building process. However, as Table 6 on the next page
indicates, although total construction volume declined in Germany after 1995, the number
of architects registered at the German Architektenkammern continued to increase after
1995 (see Section 2.4. for further information about the Architektenkammern).

With regard to Table 6, unfortunately none of German Architektenkammern collect sta-
tistics about the number of architects from foreign firms or architects educated abroad in
their registers. This makes it practically impossible to assess the number of foreign archi-
tects in Germany in the years of the nineties. However, representatives of two German
architectural organizations, BDA and BDB (interviews on April 12, 1999, July 19, 1999,
and October 14, 1999) indicated to me that they believed that the greatest number of
foreign architects came to Germany during the boom at the beginning of the 1990s, i.e.
the time when other foreign construction industry actors also entered the German market
(see Lubanski, 1999:310-311).
156
Table 6. Total Number of Architects, Interior Decorators, Landscape Architects,
and Urban Planners registered by the German Architektenkammer.

German Federal State (Land) 1990 1991 1993 1995 1998

Original FRG Region Lnder:
Baden-Wrttemberg 14,305 14,621 15,182 16,319 17,331
Bavaria 12,830 13,290 13,705 14,750
1
15,326

Bremen 836 865 875 941 1,005
Hamburg 2,510 2,579 2,658 2,894 2,707
Hesse 7,886 8,154 8,360 7,482
1
7,812
Lower Saxony
2
8,868 9,074 9,393 5,878 9,430
North Rhine-Westphalia 18,616 19,467 20,472 21,197 22,830
The Rhineland-Palatinate 3,038 3,115 3,296 3,726 4,309
Saarland 704 708 819 782 776
Schleswig-Holstein 2.944 3,039 3,119 3,491 1,891

Berlin 4,000
3
5,000
3
5,202 5,809 6,305

New German Lnder:
Brandenburg N.A. 812 830 1,071 1,152
Mecklenburg-Pomerania N.A. 583 850 1,127 1,209
Saxony N.A. 1,811 2,010 2,938 2,843
Saxony-Anhalt N.A. 478 621 939 1,073
Thuringia N.A. 1,002 1,265 1,627 1,739

Total for Germany: 76,537 84,598 88,657 90,971 98,240

Notes:
1
The figures for Bavaria and Hesse for 1995 were not available at the time of the publication of the
statistics. Therefore these figures are from 1994.
2
Lower Saxony discovered in 1992 that some of its Architektenkammer members were registered twice.
An attempt to solve this problem was the reason for the small number of 1995; however, the means of
counting was changed again for the figures of 1998, after the Bundesarchitektenkammer had moved from
Bonn to Berlin and other persons had taken over the statistical work. The statistics for Schleswig-Holstein
were also adjusted in 1998.
3
Due to administrative problems connected with the reunification of the city of Berlin, the statistics for the
years 1990 and 1991 are estimates based on national averages.

Source: Bundesarchitektenkammer: Kammerstatistik, 1990-1998, Bonn and Berlin, Germany.

Statistics about unemployment among German architects and civil engineers are
compiled in Table 7 on the next page.
157
Table 7. Number of Unemployed Architects, Urban and Regional Planners, and Civil Engineers in Germany.

Architects Urban and Regional Planners Civil Engineers, Unspecified
Former BRD Former DDR Total Former BRD Former DDR Total Former BRD Former DDR Total
9/1990 1668 N.A. N.A. 222 N.A. N.A. 2237 N.A. N.A.
9/1991 1385 N.A. N.A. 184 N.A. N.A. 1887 N.A. N.A.
9/1992 1318 N.A. N.A. 180 N.A. N.A. 1740 N.A. N.A.
9/1993 1489 92 1581 180 51 231 2238 832 3070
9/1994 1640 109 1749 223 30 253 2230 963 3193
9/1995 2490 193 2683 286 51 337 2769 1358 4127
9/1996 3951 408 4359 309 66 375 3920 2078 5998
9/1997 5011 605 5616 372 70 442 4938 3155 8093
9/1998 5030 636 5666 365 76 441 4931 3194 8124
9/1999 5099 755 5854 391 83 474 4950 3716 8666

Civil Engineers specialized in Civil Engineers specialized in Civil Engineers specialized in Buildings
Structural Construction Design Construction Statics
Former BRD Former DDR Total Former BRD Former DDR Total Former BRD Former DDR Total
9/1990 331 N.A. N.A. 256 N.A. N.A. 60 N.A. N.A.
9/1991 257 N.A. N.A. 231 N.A. N.A. 50 N.A. N.A.
9/1992 205 N.A. N.A. 196 N.A. N.A. 49 N.A. N.A.
9/1993 243 300 543 225 131 356 52 14 66
9/1994 224 286 510 224 112 336 63 15 78
9/1995 263 491 754 251 129 380 88 22 110
9/1996 357 768 1125 314 194 508 131 35 166
9/1997 435 1162 1597 389 290 679 154 70 224
9/1998 484 1058 1542 405 248 653 136 72 208
9/1999 492 1220 1723 430 296 726 154 88 242

Source: Bundesanstalt fr Arbeit (German Federal Institute of Labor), Nuremberg, Germany, Frau Vietheer. Fax to author, October 14, 1999.
158
Table 7 indicates that the number of unemployed architects and civil engineers of all
types increased after the peak construction sector year 1995. However, for architects
the increase started already in 1993. This may be partially attributed to the fact that
both the total number of architects and the number of students of architecture has
increased during the 1990s (see e.g. pp. 3-4 of BdB Info, a supplement to deutsche
bauzeitung 1/98).

An additional explanation is that German architects have slowly lost some of the areas
in which they traditionally have worked, as will be explained in the following para-
graphs (see Subsections A.3.2. and A.4.2. of Appendix A for background infor-
mation). Consequently, the erosion of traditional German role of the architect is an im-
partial and independent advisor to the customer in matters concerning the relationship
between customer and contractor has also begun (see e.g. Subsection A.4.2. in
Appendix A for background information). According to Huovinen and Kiiras (1998:
568), in 1993, 88 % of German construction industry turnover volume involved pro-
jects in which the architect both was the designer and the advisor to the client with
regard to subcontracting to contractors and suppliers. 10 % of total turnover volume
involved cooperation constellations in which the architectural firm was responsible for
the design and the client subsequently subcontracted to one main contractor who was
responsible for the construction work without the advice of the architect. 2 %
involved Design-and-Build agreements, in which the architectural firm was a
subcontractor to the D&B contractor.

In the middle of the nineties, however, several of the German Lnder began to syste-
matically limit the scope of public sector architectural projects to the introductory and
projecting phases of the construction project; these Lnder made it their policy to hire
construction management firms to take over the project management functions that
previously often had been the work of architects or civil engineers (Rudolph-Cleff and
Uhlig, 1997:2). A similar trend has also been seen on the private market in the urban
areas of Germany, whereas the architect usually still is responsible for the entire
project, including the construction management, in more rural German regions (ibid.).

Additionally, due to their poor financial situation as well as the incitement that the wave
of mergers-and-acquisitions among the largest European contracting firms may have
provided (see the citations of Lubansky (1999) earlier in this and the previous section),
the German Lnder and municipal governments have in recent years increasingly made
use of the EU Public Works directive to request design-and-build solutions from
contracting firms to the detriment of using the Public Services Directive (Council of
159
the European Communities, October 13, 1997) to first obtain building designs from
architects (Rudolph-Cleff and Uhlig, 1997:5). This development corresponds to a new
tendency within the ranks of German contracting firms to increasingly incorporate
tasks in-house previously undertaken by independent architectural firms. Today these
contractors offer potential customers integrated design-and-build packages and call
themselves Generalunternehmer or GU (i.e. general contractor) in German (ibid.:2-
3). In relation to the public sector, in the 1990s, some larger contractors have also
begun to offer to take over the financing of formerly purely public sector projects in
so-called public-private partnerships, which usually also involved design-and-build
solutions (ibid., compare also with Gnther and Bonaccorsis, 1996, remarks about
this trend in Section 3.2.). These same large contractors are also experimenting with
facility management contracts and life-cycle costing models (ibid.).

At the same time project management firms have increasingly begun to build upon on
their core competency of management of the overall construction project. They
either assume responsibility for the project as a whole, delegating either (a) all
construction related tasks or (b) all specific design and construction related tasks to a
large number of subcontractors (ibid.: 3-4). This construction is typically referred to
in German as the Generalbernahme (G) Model (in English, figuratively: general
coordinator). The final factor that has probably contributed to the diminishing role of
the architect in Germany is the increase in the percentage of standardized housing
solutions sold to the detriment of the unique houses designed by architects (ibid.).

Concerning the above developments, a renowned German professor of architecture
and partner in a major German architectural firm described the situation in the segment
of nationally and internationally renowned German firms as follows (interview,
October 14, 1999):

Today both public and private clients in Germany increasingly demand to
receive all consulting services from one firm, i.e. one complete building plan
that includes architectural planning as well as all types of engineering
planning services. [] Architectural firms still receive a great number of
these types of orders but of course only a few architectural firms are able to
fulfill the necessary requirements. This means that it is not possible for the
smaller and less strong architectural firms to operate in this area of the
business. This way of doing business is, of course, also connected with
substantial increases in risk, as the architectural firm also bears legal
responsibility for the engineering services.

160
Concerning more ordinary and simple projects, it is increasingly becoming
the case that architects are not involved in planning at all. The only way that
architects can fulfill a concrete demand, so to speak, or, to take another per-
spective, the interests of society is by positioning himself positively in the
relation to the usual conflict between the governments ideas and rules and
the [interests of] the investors. The investors always want to build a bit
more than the rules permit, and then the officials often say You may do so
but the building had better be good. Therefore you have to find a reputable
architect or arrange an architectural competition to insure quality construc-
tion.

In this situation many architects have the chance to create a role for
themselves, so to speak, in relation to this conflict of interest. [] In
Germany, this possibility exists with regard to all large projects. []

Our customers or customer firms are usually very professional themselves.
This means that they have their own construction department that employs
architects. These departments are also procurement departments, and
because they often are involved in construction projects, they often state
that they know at least as much as the external architectural firm they have
hired. They therefore often say, We really could have done this ourselves.
We have only hired you because we had to arrange an architectural
competition and you won. This means that you have to design the building
very well but we can take care of the rest ourselves. We already know how
to purchase building materials, how to construct buildings, which materials
are easiest to maintain, and we know what the users needs will be. We also
know exactly how the roof and the floor should be designed

It is difficult to deal with such people. [] The role of the external architect
seen from their perspective is to deliver a label that enables them to say We
have built this with a renowned architect. Then one is promoted, one is
mentioned in the press, and a public relations brochure concerning the
building is produced which includes a picture of the architect

This is actually a type of role-playing game. Now I must mention that it is
very dangerous for the involved architect if he loses his ambition and gets
too laid back. He cannot simply say, Oh well, I will again design something
beautiful and if the customer does not like it, this is just his bad luck. The
architect can lose his good reputation very quickly by acting in this manner.
When he no longer fights for the highest level of quality, but just says, Why
bother, after all they do not like to ask me about this manner? [] and then
allows the customer firm to use his name, he runs the risk of losing his
credibility. Then all is lost. This happens to many, many leading employees
in large firms they are used because they want to please everyone, and
161
then suddenly they are no longer a good label or name [] and have lost
their market value.

In the citation above, the German professor of architecture mentioned the trend
towards clients wanting a comprehensive package of consulting services from one
cooperation partner. To meet this demand, smaller independent architectural bureaus
and civil engineering firms have, in turn, experimented in recent years with developing
building teams (i.e. coalitions among suppliers, see Characteristic I in Section 2.5).
The building team is also an instrument used by these actors in an attempt to
strengthen their position vis vis e.g. the large contractors and the project
management firms. By forming building teams, these groups of firms aim to offer
clients complete architectural design and construction management services (Rudolph-
Cleff and Uhlig, 1997:6); BDA and BDB recommend that an architectural firm should
head the team (interviews with Mahmood Sairally, Chairman of BDBs Hamburg
Chapter and BDBs Representative to ACE, October 14, 1999; Herbert Michaelis,
Vice Chairman of BDBs Hamburg Chapter, July 19, 1999; and Sven Silcher, BDAs
Representative in ACE, July 19, 1999).

Additionally, architects as well as other actors in the German construction industry are
counting on a substantial increase in activity in the market for building improvements
and renovation in the coming years, also in the former West German region, which will
give them new projects (Baus, 1997:83, Lehrskov, 1996; Sddeutsche Zeitung, May
14, 1999). They are therefore working to position themselves in relation to this
development (ibid.).

One final factor that has changed substantially in the nineties is the fee scale for
German architects and engineers, the Honorarordnung fr Architekten und Inge-
nieure (HOAI). Although the EU Courts have ruled that this fee scale is legal (inter-
view with Dr. Tillman Prinz, the Legal Advisor of BDA on April 12, 1999), it has
increasingly come under pressure (see Subsection A.4.3. of Appendix A). Some re-
spondents have anonymously indicated that not all architectural and engineering firms
demand the fees stipulated by the HOAI when dealing with private sector customers in
Germany. This, in turn, leads some private sector customers to shop around until
they find the (illegally) most inexpensive offer, according to these same anonymous
respondents. (Other respondents indicate that such rumors may be exaggerated and
may also be spread by actors who would prefer the abolishment of the HOAI.)

In relation to the loss of position on the German markets, German Professor of
Architecture Frank Werner believes that common architectural methods and ways of
162
working have not kept up with technological developments, i.e. in the area of
computer-aided design and new building materials and type of cooperation (Baus,
1997:13). German architect Reinhard Wustlich states that German architects generally
have not sufficiently adjusted to the fundamental challenges that the above mentioned
trends as well as the recent abolition of the rules that forbade the advertisement of
architectural services (see also Appendix A, Section A.4.3.) present (Baus, 1997: 43-
9); this is also a hypothesis that Sommer (1996) presents.

6.3. The Development of the Danish Markets for Architectural Services and
Construction.

Lubanski (1999: 311-312) describes the situation on the Danish construction market in
recent years as follows:

The Danish construction sector is currently experiencing an upturn, unlike
its German counterpart. Since 1993 there has been a general increase in
turnover on the domestic market. The sector appears to have good
prospects of maintaining the high level of turnover in the forthcoming
period, on account of the favourable economic cycle.

In the Danish construction sector, however, there are some factors that are
reminiscent of the economic recession in the early 1990s, when price
competition caused earnings problems for some enterprises, resulting in the
disappearance of a number of medium-sized firms often as the result of a
take-over by a larger firm. Thus, as in Germany, market concentration is
taking place, although at a slower pace. []

Whereas turnover on the Danish domestic market has been increasing for
the past five years, the contracting firms share of the export market has
been declining, although this cannot be taken as an expression of any halt in
the move towards Europeanisation in the Danish sector. What has happened
is that the Danish building and construction market has become more
interesting for foreign enterprises, resulting in the acquisition of some
Danish firms by foreign contractors.

The main reason for the foreign interest in the Danish market can be traced
to two major projects: the bridge/tunnel over/under the Great Belt (linking
Zealand and Funen) and the fixed link over the Sound (linking Zealand to
South Sweden). One of the outcomes is that the two largest Swedish
groups, via their Danish subsidiaries, are taking vigorous steps to become
leaders on the Danish market.
163

With regard to the comparison between German and Denmark, Eurostat has produced
two relevant construction industry indices that illustrate the differences in the deve-
lopment of the Danish and German construction markets in first half of the 1990s:

Table 8. Construction Industry Indices of Production.
EUR15 DK D
1989 97.1 105.8 94.4
1990 100.0 100.0 100.0
1991 99.0 90.1 104.1
1992 98.6 86.7 115.4
1993 94.5 78.0 119.0
1994 96.0 81.8 131.2
1995 96.0 87.2 129.6

Source: Eurostat: Industrial Trends. Monthly Statistics, 12/96, p. 95.

Table 9. Indices of Construction Permits for Housing.
EUR15 DK D
1989 96.3 138.1 70.5
1990 100.0 100.0 100.0
1991 95.9 78.5 102.4
1992 96.8 79.9 122.4
1993 99.4 68.1 152.9
1994 110.1 68.5 179.7
1995 103.4 60.4 161.1

Source: Eurostat: Industrial Trends. Monthly Statistics, 12/96, p. 96.

Eurostats statistics show that the Danish market picked up to some extent after 1993,
following the severe decline at the end of the 1980s and the beginning of the 1990s.
31

The housing sector was, however, apparently slower to pick up than the rest of the
construction industry. In the first half of the nineties only approximately 10,000
dwellings were built annually; the annual average for the eighties had been roughly
20,000 dwellings per year (Hansen et al., 1994: 28-9). Furthermore, the upturn did not
manage to offset the severe decline in previous years. Finally, in comparison with
Germany, the picture painted in the introduction of this paper of the German market

31
Eurostat reorganized their monthly industrial statistical bulletins in 1997, thus abolishing the periodical
Industrial Trends and creating new indices. I have therefore unfortunately not been able to find
comparable figures for the years 1996 1998.
164
booming at the beginning of the 1990s while the Danish market was in a slump
becomes very clear when one examines the Eurostat indices in Tables 8 and 9.

With regard to Lubanskis remarks about the share of constructing firms export
activities declining (Lubanski, 1999:312), it must be mentioned that one key Danish
contractor (Rasmussen & Schitz) was purchased by the Swedish NCC Concern in
the autumn of 1996 and that another large Swedish contracting concern, Skanska, has
bought a number of smaller Danish contractors during the 1990s (see e.g. Lubanski,
1999:177, 185). The domestic and foreign developments in Danish construction firms
activities can been seen from the figures in Table 10 below:

165
Table 10. Total Turnover: Construction Firms (e.g. Contracting, Bricklaying,
Carpentry, Plumbing, Electrical Installation Firms) situated in Denmark in
Millions of DKK. (Figures not corrected for inflation.)

Domestic Foreign Total

1990 86,237 4,716 90,953
1991
1
84,610 5,128 89,739
1992 82,196 5,452 87,648
1993 79,906 5,517 85,423
1994 88,928 5,557 94,485
1995 97,327 5,186 102,513
1996 104,655 4,832 109,487
1997 112,682 3,721 116,403
1998
2
120,588 3,982 124,570

1
In 1991, Danmarks Statistik changed its methodology for distinguishing between
domestic sales and exports. From the beginning of 1991, certain types of sales
previously categorized as domestic turnover are categorized as foreign turnover.

2
Preliminary figures published after the first statistical count in Danmarks Statistik:
Generel erhvervsstatistik og handel. Statistiske efterretninger 1999:7, pp. 5, 7.

Source: Danmarks Statistik: Generel erhvervsstatistik og handel. Statistiske
efterretninger 1992-1999. Danmarks Statistik: Bygge- og anlgsvirksomhed.
Statistiske efterretninger.

With regard to Danish contractors dealings with the other Danish firms active in the
domestic construction industry, architect Hans Haagensen, M.A.A., former president
of the Architects Council of Europe (ACE) and Partner in the Danish architectural
firm Skaarup & Jespersen A/S has furthermore observed that the business climate of
the Danish market of the nineties is different from the German and many other
European markets. In his words, he has had a:

clear impression that internal co-operation in the construction sector,
between engineers, architects, and contractors, is much better in Denmark
than in other countries. There is a larger amount of trust among the various
actors in Denmark. [] It is much more common here in Denmark to
realisethat we are doing something together [ and] are interdependent
on each other. In many other countries you have immense fights and you
spend immense amounts of money on employing claims managersThere
are these tendencies here also, obviously, but I think that there generally is a
166
better understanding in the various projects. (Source: Albertsen, 1997b:19)

Possible reasons for this cooperative spirit may be a small country effect (i.e. that
people in the Danish construction industry more often either know each other per-
sonally or know of each other because Denmark is a small country) as well as the
effect that institutions created to promote cooperation among construction industry
actors have had. Two such institutions are the former Danish Council of Building
Export (see e.g. Schultz and Wiberg, 1981; Albertsen, 1997b:19) and the Danish
Council of Consulting Architects and Engineers which is treated in Section 7.3.

However, as also mentioned in Appendix A, Subsection A.3.3., competition on the
Danish market increased substantially in the early 1990s when total turnover declined
in current value terms (Albertsen, 1996:14). From this time on, Danish architectural
firms began to rationalize their time for specific parts of projects and to itemize their
bills to clients to a much greater extent than previously; additionally, on the market for
architectural and civil engineering services, there has been a growing tendency away
from relationships based on trust towards relationships based on liability, contract,
and the placement of responsibility if e.g. something goes wrong, is delayed, or more
expensive than predicted (Albertsen, 1997b:2).

This development has, in turn, resulted in some consultants and contractors
discussing potential ways of sharing risks and responsibilities as well as earnings by
establishing models for common project economy that would require that the indivi-
dual actors give up some of their independence (ibid.). However, these are still two
main ways for architects and engineers to organize their work, (a) to work directly for
the client or (b) to work for a design-and-build contractors (see Appendix A, Sub-
section A.3.2. for information concerning the history of the division of work among
Danish construction industry actors). These two alternative choices are also the
source of some political struggle between the consultants and the contractors over the
leadership of building processes in general (ibid.). Design-and-build is mainly used for
non-complicated construction projects concerning e.g. publically financed housing,
offices, and smaller industrial buildings and by some municipalities and social housing
associations; with the exception of a handful of large contractors, most contractors do
not have in-house architectural and engineering design departments and therefore
subcontract if necessary (ibid.). As in Germany and the rest of the EU (see the pre-
vious section), when public sector design-and-build projects exceed the EU threshold
value of approximately ECU 5 million, potential contractors must bid for tender in
accordance with the Public Works Directive.
167

Danish architectural firms of all sizes are to a much larger extent generalists than is the
case in Germany (interview with Niels Albertsen, March 6, 1998). This is partially due
to the perception of a need to be flexible on such a small domestic market, i.e. the
need to be able to shift from private housing to public sector projects to private sector
investments and infrastructural projects according to the fluctuations of the Danish
market (interviews with various Danish respondents, including Niels Albertsen).
However, there is some segmentation in the Danish market for architects; the 5 10
largest firms do most of the biggest jobs in Denmark and relatively few housing jobs,
whereas the other firms mostly do the rest of the work (Albertsen, 1997b:12).

This has led the larger architectural firms to pursue flexible specialization policies in
which certain architects are assigned special knowledge functions, yet still move from
team to team, in order to satisfy rising demands concerning quality control knowledge,
knowledge of environmentally friendly solutions, knowledge of specific types of
components and other more specialized requests (ibid. as well as interviews with other
respondents). With regard to the size of the large Danish architectural firms, in 1996
there were two very large firms with more than 100 employees and four large firms
with more than 50 employees among PAR member firms (Albertsen, 1997a:15).

Statistics concerning DAL members in Table 11 seem to indicate that the number of
Danish architects has fluctuated from year to year the 1990s with no clear trend.
168
Table 11. Number of Members of DAL/AA, 1989 - 1998.

Date Non-Student Members Students Total

July 1, 1989 5,198 362 5,760
August 1, 1992 5,310 620 5,930
1994 5,106 890 5,896
1996 5,237 754 5,991
August 5, 1998 5,673 492 6,165
May 6, 1999 5,714 513 5,714

Sources: For the years 1989 - 1996, the calculations of Associate Professor Niels
Albertsen (1997a:9) of the Aarhus School of Architecture. For 1998 and 1999,
respectively, Hanne Hansen and Birgit Findstrm of the National Organization of
Danish Architects (DAL) Secretariat.

The probable reason for this development is that in Denmark, a number of persons
educated as architects, especially those who have been unemployed for a longer
period of time, find work in other fields and thus at some point move from DAL to
another professional organization (interview with Niels Albertsen, March 6, 1998).
These same persons may, however, at a later point in time, reenter the profession of
architecture and then once again become members of DAL. Additionally there has
been a trend has been towards more employed architects among DAL members which
is not captured in Table 11 (above); the number of wage-earners among the DAL
members has increased significantly from 1987 to 1996 (Albertsen, 1997a:9).

As for the development in the number of architectural firms in Denmark, the number
of PAR member firms has increased since 1993, as can been seen in Table 12 below.

169
Table 12. Number of PAR Member Firms and Firms Headed by DAL
Members.

PAR member firms Firms headed by DAL members
December 31, 1990 411
December 31, 1991 411
December 31, 1992 389
December 31, 1993 376
December 31, 1994 387 915 (January 1994)
December 31, 1995 400
December 31, 1996 432 844 (January 1996)
December 31, 1997 470
December 31, 1998 486

Source: Concerning the number of PAR member firms, Paul Jeppesen, the
International Secretary of PAR. Concerning the number of firms headed by DAL
members, Associate Professor Niels Albertsen (1997a:12) of the Aarhus School of
Architecture.

It must be noted that the number of PAR firms is not necessarily a good indicator for
the total development of architectural firms in Denmark, as the increase in PAR
members may be partially attributed to an exceptionally good member firm insurance
policy which PAR was able to offer its member firms from January 1, 1994 (e-mail
from Paul Jeppesen, September 10, 1999). In many cases, the money saved annually
by using this insurance policy is greater than the yearly cost of PAR membership
(ibid.) Furthermore, it must be noted that PAR also has a number of associated
members, i.e. firms that do not yet fulfill the requirements for full membership because
the managing director(s)/owner(s) do not fulfill the membership criteria of 5 years of
experience as practicing architects and two years of experience as managing
director(s)/owner(s) (See Appendix A, Subsection A.3.1. for further information
about Danish architectural organizations and their membership requirements). These
associated firms usually become regular PAR members as soon as these criteria are
fulfilled. The number of associated member firms was approximately 10 20 at the
beginning of the nineties and exactly 58 on December 31, 1998 (ibid.).

However, it is still the case that not all firms that fulfill the requirements for PAR mem-
bership choose to become members or affiliated members of PAR. This can be seen
from the statistics compiled by Albertsen (1997a:12) in Table 12 concerning the total
number of firms headed by DAL members for the years 1994 to 1996. One example
of an internationally renowned architectural firm that is not a member of PAR is
170
Henning Larsens Tegnestue A/S. Additionally, architectural firms headed by persons
without an academic degree in architecture are not included in PARs statistics. These
firms are also not necessarily included in ADAs statistics either, as membership in
ADA is also voluntary (see Subsection A.3.1. for further information about ADA).

Niels Albertsen has compiled data about the total number of architectural firms in
Denmark on the basis of statistics from the Danish National Bureau of Statistics
(Danmarks Statistik) as well as Preuss (1995). These are to be presented in Table 13
below.

Table 13. Number of VAT-Paying Architectural Firms 1989 1994.

No. of Firms Turnover Of which export Average
in DKK mill. in DKK mill turnover
1989 3,403 2,739 102 917,000
1990 3,391 2,629 126 816,000
1991 3,441 2,478 115 780,000
1992 3,389 2,259 112 752,000
1993 3,350 2,450 215
1994 2,700 176

Source: Data compiled by Albertsen (1997a:13) from Danmarks Statistik (1991-1996):
Statistisk rbog for the years 1989-1992 and from Preuss (1995) for the years 1993
and 1994.

According to Albertsen (ibid.), the total number of VAT registered firms is about four
times the total number of firms headed by DAL members (including PAR firms). This
large difference can be explained by the following factors:

1. Due to the fact that the title of Architect is not restricted in Denmark, persons
without an architectural degree may VAT register firms as architectural firms.
2. Many of these VAT registered firms are probably one-person establishments which
function as a subsidiary to the owners salaried employment.
3. Some of the one-person firms may be subcontractors to other architectural firms
which in some cases may even mean that the work done by the subcontracting firm
for the other firm may be registered twice.

At a research seminar at the Aarhus School of Architecture on February 17, 1999, at
which I presented my research in progress, the current DAL chairperson, former head
of the Aarhus School of Architecture, and current head of the Danish Design School
171
in Copenhagen, Associate Professor Gsta Knudsen, stated that he believed that the
average size of full-time fully-equipped architectural firms is rising due to the increased
necessity for investments in e.g. computer technology and specialist knowledge
concerning e.g. environmental issues and certain types of buildings. Additionally, Niels
Albertsen (interview on March 6, 1998) indicated that these factors also make it more
difficult for young architects to establish new architectural firms; these factors taken
together may explain at least some of the increase in the number of employed
architects. Finally, PARs Paul Jeppesen has stated that he believes that the number of
architectural firms doing independent consulting to clients has been reduced during the
years of the Danish domestic market crisis in the early 1990s, yet during the same
period the number of VAT-registered architects without own firm facilities who offer
their services to established and fully-equipped architectural firms has increased
substantially (Albertsen, 1997a: 14 and 1997b:7).

With regard to exports, PAR is the only Danish architectural organization that
compiles statistics about Danish architectural exports. Its statistics, however, only
include its own member and associated firms (correspondence from Paul Jeppesen
August 1999). Occasionally, however, PAR attempts to estimate the total export
turnover of Danish architectural firms; the 1995 PAR estimate was DKK 100 125
million (Albertsen, 1997a:14)
32
.

32
John Cederberg, the Managing Director of the Danish Association of Consulting Engineers (F.R.I.) has
estimated that engineer export turnover is about DKK 1 billion, and architectural exports are approx.
DKK 100 million. This figure accounts for only 6 7 % of the activities of Danish architectural firms.
(Albertsen, 1997b:26)
172
Table 14. Export Turnover of Danish Architectural Firms that are Members or
Associated Members of the Council of Practicing Architects (PAR) in Millions
of DKK.
Total Export Germany, Nordic Rest of Europe Rest of
the
Council Region World
1990
1
72.0 23.9 14.7 6.8
1991 74.4 N.A. N.A. N.A.
1992
2
54.2 45.5 6.9 1.8
1993 78.0 60.1 12.1 5.8

1994 87.3 66.0 11.9 9.5
1995 97.0 76.1 12.7 8.1
1996 103.1 71.4 13.4 18.2
1997 69.1 53.4 8.6 7.1
1998 73.4 51.7 14.6 7.1

1
For the year 1990, only DKK 45.5 mill. of the total export turnover of DKK 74.4
mill. has been attributed to one the three different regions. The destination of the final
DKK 28.9 mill. of export turnover is not known.

2
The geographic distribution of the figures for 1992 is based upon a survey
questionnaire which was answered by PAR member firms who stood for 73 % of the
total export turnover of that year. From 1993, the figures are based on the export
turnover figures used to calculate insurance premiums.

Source: Data provided by Paul Jeppesen, PARs Secretary for International Affairs in
August 1999.

With regard to Table 14, it is my judgment that the downturn in exports after the year
1996 reflects the entire sector relatively accurately, due to the fact that the number of
total PAR member firms, as previously indicated in Table 11, increased in the years
1993 1998. Additionally, the decline in PAR member and associated firms exports
after 1996 seen in Table 14 cannot be partially attributed to foreign acquisitions, as is
the case with regard to contractor firms (see Lubanski, 1999: 177, 185, 312), because
Danish architectural firms have not been acquired by foreign firms. A more likely
explanation is the result from my pilot study (see Subsection A.6.2. in Appendix A)
that most Danish architectural firms are home market oriented and only embark upon
export when they are forced to do so due to a depressed home market.

173
6.4. A Summary of the Development on the German and Danish Markets
during the Nineties.

On the basis of the previous three sections it can be said that the German construction
market boomed at the beginning of the nineties. The boom stopped in 1995, yet the total
level of German construction industry volume was still much higher at the end of the
nineties than it had been in the previous decade. Additionally, the number of architects
present on the German market continued to increase throughout the decade. The Danish
market was severely depressed from 1990 - 1992; it started to pick up after 1993, yet by
no means reached a level of record highs in subsequent years.

The largest European construction industry firms experienced a wave of mergers and ac-
quisitions as well as strategic alliances during the nineties; however, few architectural
firms were directly involved in this wave. Instead, architectural firms and smaller engi-
neering firms on the German market experienced increasing competitive pressure from
the General Contractor and Generalbernahme ways of coordinating construction pro-
cesses and, consequently, increasingly cooperated in supplier teams. Although German
architects at the end of the nineties still more often manage construction work than their
Danish colleagues, private and public German clients have been increasingly assigning
this responsibility to other construction industry actors. Thus the German architect has
lost some of his traditional domain of work during the nineties.

With regard to pressure on fees, the German Honorarordnung fr Architekten und
Ingenieure has provided German architects with some protection against falling levels of
income; in Denmark, this protection has not been present.

Due to the smaller Danish market, Danish architectural firms are to a larger extent gener-
alists than German architectural firms. Danish architectural exports peaked in 1996;
throughout the nineties, Germany was one of the main receivers of Danish architectural
exports.

6.5. The Implementation of the EU Public Service Directive.
6.5.1. Introduction to the EU Public Service Directive.

The EU Public Service Directive (92/50/EEC, see Council of the European
Communities, October 13, 1997) is one of a number of directives proposed by the
European Commission and adapted by the Council of Ministers with the goal of
liberalizing the European Market for goods and services and insuring that private
sector firms from all over the EU have the opportunity to compete for work in the
174
public sector. The directive establishes procedural rules for the publication of calls for
tender and the awarding of public procurement contracts. The scope of services
covered by the directive is very broad, including e.g. facility management, cleaning,
data processing, sanitation services, garbage collection, catering, and even certain
financial services. In the world of construction, the directive mainly applies to the
architectural and civil engineering services that are used in the planning and
conceptualization of buildings and infrastructure projects. The deadline set by the
Council of Ministers for the implementation of the Directive in EU Member States was
July 1, 1993 (ibid.).

Until the end of 1995 the threshold for the application of the Public Services Directive
was ECU 200,000. As of January 1, 1996, new thresholds were established on the
basis of a World Trade Organization (WTO) Agreement, the lowest being 130,000
Special Drawing Rights (SDR) or approx. EURO 134,000 (Danish Association of
Consulting Engineers, March 1996:1 and March 1999:1).

For the case of architectural and civil engineering services, the directive mentions four
modes of tendering: design contests (Article 13), open or restricted tendering
procedures (Article 36) and, in certain cases (Article 11), tendering procedures
involving negotiations with selected prequalified bidders (ibid.). According to the
Danish Association of Consulting Engineers (March 1996:3):

Open procedure means that all interested firms can submit a tender. [...] In
accordance with the restricted procedure the contracting authority, by
means of a contract notice, invites interested service providers to apply for
an invitation to submit tenders (prequalification). [...] The design contest is a
procedure which can be chosen if the objective is to receive ideas and
proposals. Design contests must follow clear and non-discriminatory
selection criteria. [...] The negotiated procedure can be applied in special
cases, where contract specification cannot be established with sufficient
precision to permit the award of the contract by selecting one of the other
procedures.

Additionally, in Title V, the directive mentions two time schedules, the normal and the
accelerated procedure schedules, and states the minimum amount of time that must be
allotted for bidding firms for each of these schedules. According to Article 20, the
accelerated procedure may be used in cases where urgency renders impracticable the
time limits laid down in Article 19. It shortens the time limits that the potential service
provider receives to work out his bid and can be applied in relation to the restricted
175
procedure and the negotiated procedure (Danish Association of Consulting Engineers,
March 1996:2).

Finally, the directive specifies that the selection of the winner of a public procurement
procedure (i.e. the open, restricted, and negotiated procedures) may be made on the
basis of two criteria (see Article 36 of Council of the European Communities, October
13, 1997), the economically most advantageous tender or the lowest price only. With
regard to the economically most advantageous tender, the directives Article 36
contains a non-exhaustive list of possible criteria: quality, technical merit, aesthetic
and functional characteristics, technical assistance and after-sales service, delivery
date, delivery period or period of completion, price and furthermore specifies the
following:

Where the contract is to be awarded to the economically most advan-
tageous tender, the contracting authority shall state in the contract docu-
ments or in the tender notice the award criteria which it intends to apply,
where possible in descending order of importance.

With regard to the aim of promoting the cross-border services trade among the EU
countries, the initial effect of the EU Public Service has been limited, indicating that the
process of liberalization and mobilization of services markets may be quite slow.
Between April 1 and December 31, 1995, 875 public service contracts related to
architectural and engineering consulting services were awarded in the EU countries,
Norway, and Iceland. Of these, only twenty were awarded to a service supplier from a
foreign country; five were awarded by Danish officials to foreign companies, whereas
two were awarded by German officials to foreign firms (Danish Association of Con-
sulting Engineers, March 1996:1). Furthermore, annual statistics for the total
percentage of public service tendering contracts related to these service areas awarded
to foreign firms in the EU plus Norway and Iceland are as follows: 1995: 1.2 %, 1996:
1.3 %, 1997: 2.0 %, and 1998: 0.05 % (ibid., March 1999:1). This indicates that the
sector for architectural and engineering consulting services is not nearly as
international as the large construction industry contracting firms project business,
which was discussed in the previous three sections on the basis of Lubanski (1999).

6.5.2. The German Implementation and Interpretation of the EU Public Service
Directive with regard to Architectural Services.

Germany, as well as several other EU member states, did not manage to implement the
services directive in its entirety by the deadline set in mid-1993 by the Council of
176
Ministers (Forchhammer, July 26, 1995; Mller, January 26 and February 21, 1995).
However, many German public authorities began to use the procedures mentioned in
the directive before the time of the official implementation. Germany did eventually
implement the directive through two ministerial orders, the Verordnung ber die
Vergabebestimmungen fr ffentliche Auftrge (VgV), which has most recently
been amended by the German Bundesrat on April 25, 1997 (Danish Association of
Consulting Engineers, February 3, 1998) and the Verdingungsordnung fr frei-
berufliche Leistungen (VOF), which is the main ministerial order for the area of
architectural and engineering consulting services and was put into effect on November
1, 1997 (Jochem, 1998:49).

One of the reasons for the two German ministerial orders to implement the public
service directive is the traditional German legal division of services into gewerbliche
Leistungen, i.e. non-professional and thus more standarizeable services, and
freiberufliche Leistungen or professional services (interview with Dr. Tillman Prinz,
the Legal Advisor of BDA on April 12, 1999). The VgV deals only with the area of
gewerbliche Leistungen, whereas the VOF deals only with the freiberufliche Leist-
ungen. Whereas the VgV recommends the use of the opened and restricted
procedures in most cases, the main procedure specified by the VOF is the negotiated
procedure because it is assumed that the public authority in question needs to discuss
the concrete project with the professional service firms that could potentially do the
work in order to insure the best match between the public authority and the firm and
thus the best project (Jochem, 1998:52; Prinz, 1999:602). Furthermore, due to the
existence of the HOAI (see Subsections A.4.3. and 6.2.), the lowest price only
criterium (see Article 36 of Council of the European Communities, October 13, 1997)
is not used with regard to the services covered by the VOF in Germany; only criteria
related to the economically most advantageous offer are accepted (Jochem,
1998:51-2).

As previously mentioned by Lubanski (1999:308) in Subsection 6.1., the degree of
concentration of German public procurement procedures is relatively low due to the
federal, decentralized German political system; thus public procurement is initiated by
a large number of independent regional and local German authorities. Originally,
special committees (Vergabeberwachungsausschsse) had been created in each
German Land to bear the responsibility for insuring that public procurement proce-
dures were handled correctly by all public authorities. These committees were also
responsible for the correct interpretation of the Public Services Directive. However,
the EU Commission was of the opinion that these committees were not sufficiently
177
independent because they were part of the executive branch and thus did not have the
status of an independent court (interview with Dr. Tillman Prinz, April 12, 1999).
Therefore, on January 1, 1999, special courts were created (in German: Vergabe-
kammern) at each of the administrative courts of the Lnder for the purpose of hand-
ling complaints concerning the EU Public Procurement Directives (ibid.).

Additionally, in a German case which went before the EU Court in 1995, the Court
decided that in the case of a firm who complains about a German authoritys
administration of the public service directive, the construction project must if possible
be suspended while the case is in court. If this is not possible, the firm has the right to
receive full remuneration for the losses incurred by not having been judged fairly
(ibid.). This resulted in a revision of the German law on fair competition, the Gesetz
gegen Wettbewerbsbeschrnkungen or GWB (Prinz, 1998:601).

With regard to design contests and other types of architectural competitions, German
has a long tradition of arranging architectural competitions (interview with BDA ACE
Representative, Architect Sven Silcher, July 19, 1999; Neusss, 1996). Therefore a
preexisting legal text, the Grundstze und Richtlinien fr Wettbewerbe auf den
Gebieten der Raumplanung, des Stdtebaus und des Bauwesens (GRW), was
changed in 1995 to accommodate the requirements of the EU Public Service Directive
(Neusss, 1996:174). The major change in the GRW was the abolition of regional cri-
teria for the participation in architectural competitions for competitions exceeding the
EU Public Service Directives threshold value (ibid.:178). Previously, German public
authorities had been able to specify that only architects situated in a certain German or
European region had the right to participate in a given architectural competition. This,
however, had to be changed due to the following sentence in Article 13, Section 4 of
the Public Services Directive (Council of the European Communities, October 13,
1997):

The admission of participants to design contests shall not be limited [...]
by reference to the territory or part of the territory of a Member State.

The immediate consequence of this change, combined with the downturn on the German
market after 1995, was a huge increase in the number of participants in German
architectural competitions; some competitions for relatively small project types such as
schools resulted in many hundreds of participants (interviews with 8 Danish and German
respondents). The consequence of this development was that many German public
authorities subsequently reduced the number of architectural competitions (ibid.), due to
178
the cost of processing so many proposals from participants. This situation has been
criticized by architects as being disadvantageous to young and innovative architects
(ibid.) and has furthermore resulted in a BDA press release promoting architectural
competitions. Its German language title translates to Five Good Reasons for
Architectural Competitions (BDA, 1999).

6.5.3. The Danish Implementation and Interpretation of the EU Public Service
Directive with regard to Architectural Services.
6.5.3.1. Introduction.

The EU Public Service Directive (93/37/EEC) was implemented into Danish law by the
Danish Ministry of Commerce and Industry (1993) on the July 1, 1993, the deadline
set by the Council of Ministers. In Denmark, architectural firms bid not only for archi-
tectural projects but occasionally also for administrative and building inspection tasks
for e.g. larger public housing companies which also fall under the jurisdiction of the
directive (see e.g. Brsen, October 30, 1995 and Bygge- og Boligstyrelsen, May
1996). I will, however, concentrate on the project-related architectural aspects of the
directive here, as this subject is most relevant for the comparison to Germany in
relation to the focus of my dissertation.

In contrast to Germany, it is import to note that the single ministerial decree issued by
the Danish Ministry of Commerce and Industry (1993) applies for all sorts of services,
professional or non-professional. Furthermore Section 3 of the Ministerial Decree
states that the open or restricted procedures of tendering are to be used by Danish
public authorities, and Section 3, Subsection 3 specifies that the negotiated procedure
may not to be used, except in cases where the preconditions stated in the Directives
(see Council of the European Communities, 1997) article 11, sections 2 and 3 are
fulfilled. Furthermore, the restricted tendering procedure is recommended by the
Ministry of Housing with regard to architecture (interview with Bjarne Strand,
Spokesperson, Danish Ministry of Housing, November 1998). Finally, with regard to
time schedules, the Danish interpretation of the directive is that the accelerated proce-
dure is only to be used in exceptional circumstances (Danish Ministry of Commerce
and Industry, 1993).

For most tendering procedures specified in the EU Public Service Directive,
anonymity is not legally required. In the relevant Danish ministerial order (Danish
Ministry of Commerce and Industry, 1993), anonymity is neither guaranteed in the
selection of the candidates in the restricted tendering procedure nor in the negotiated
procedure. However the Danish architectural organizations as well as the Danish
179
Ministry of Housing recommend anonymity and it is common Danish practice that
offers are submitted and judged anonymously with regard to the restricted tendering
procedure, as this insures equal treatment of all participants. This is, however, the
choice of the public authority in charge of the tendering procedure in question. With
regard to design contests, Article 13 insures participant anonymity and that the jury
includes members who have knowledge of the field that they are judging. Furthermore,
although it is not legally required, it is most often the case in Denmark that persons
with a significant knowledge of architecture are included in assessment of restricted
and open tendering procedures. However, it cannot be said that certain members of
the jury are exclusively responsible for judgment of certain aspects of the proposals
submitted. The jury as a whole attempts to reach agreement in relation to the stated
selection criteria. The juries may furthermore include user groups; e.g. if a nursing
home or neighborhood/town meeting hall is to be built, representatives of the nurses
or the residents of the neighborhood/town in question may be included in the
respective juries. (Interviews with Keld Mller, Managing Director of PAR; Jesper
Kock, DALs Competition Secretary; Bjarne Strand; and Jakob Scharff, representative
of the Danish Organization of Municipalities. All interviews took place in November
1998).

However, seen from the public sectors viewpoint, one disadvantage of anonymity is
that it cannot guarantee that the firms that are bidding for a project do not make secret
internal agreements about the level of prices. This is a general concern of the Danish
municipalities. (Interview with Jakob Scharff, November 1998).

PAR requires that its member firms tell the organization when they participate in de-
sign contests and tendering. Often a meeting for clarification of questions is held on
the initiative of PAR or the public organization responsible for the tendering. In the
case of restricted tendering procedure, if one of the competing firms submits a written
question, all of the competing firms are informed of the answer to the question
(interview with Keld Mller, November 1998). According to Jakob Scharff (interview,
November 1998), this sometimes had led to misunderstandings on the part of firms
less experienced in using the Public Service directive rules in practice. These firms
have not always anticipated that the answers to their questions would be given to all
participants. With regard to design contests, on the other hand, if necessary, DALs
Competition Secretariat arranges an orientation meeting for potential participants at the
very beginning of the competition proceedings (Jesper Kock, interview November
1998).

180
In Denmark, it is almost impossible for the jury to request supplementary information
or explanations with regard to the submitted proposals because of the danger of
violating the restriction of discrimination in Article 3, subsection 2 of the Public
Service directive. Wengler-Jrgensen and Hegh (1994) discuss the Danish
interpretation of the legal limits of pre- and post-competition negotiations in relation to
the Public Services directive in their often-cited article. According to them, the public
authority in question may not commence negotiations with a bidder on the basis of the
offers presented; however, they may accept offers with certain minor reservations. A
change in price cannot however be considered a minor reservation (ibid.). According
to Bjarne Strand (interview, November 1999), in relation to tendering, it is only
possible for the public authority to seek technical clarifications of a non-discriminatory
nature with regard to the submitted proposals. In relation to design contests, Article
11, subsection 3, point c may be used for negotiations only among all of the otherwise
successful candidates. It reads as follows (Council of the European Communities,
1997):

where the contract concerned follows a design contest and must, under the
rules applying, be awarded to the successful candidate or to one of the
successful candidates. In the latter case, all successful candidates shall be
invited to participate in the negotiations.

However, normally there has been only one successful candidate (i.e. winner) in
design contests in Denmark in the 1990s (interviews with Bjarne Strand and Jesper
Kock, November 1998).

Finally, as in Germany, Denmark has a long tradition of arranging architectural compe-
titions; Jesper Kock indicated that this tradition is over 100 years old (interview,
November 1998). With regard to competitions in the public sector, Bjarne Strand, the
spokesman of the Danish Ministry of Housing stated the following (interview in
November 1998):

Architectural design contests are held in Denmark often for large or
complex buildings or buildings that have significant historical or artistic
value, e.g. the Royal Library, the National Museum of Art. However one can
also find design contests for smaller buildings, e.g. a school. The decision
to arrange a contest and the reasons for this decision are the responsibility
of the authority in charge of the particular contest.

According to Jesper Kock (e-mail of November 23, 1999), the number of architectural
181
competitions in Denmark has increased during the 1990s; in 1992 there were 14
competitions, whereas there were 35 in 1998. Thus the situation is markedly different
from the German situation.

Jesper Kock describes Danish architectural competitions as follows (interview
November 1998):

Most Danish competitions are restricted to invited participants. Some are
however open to all interested participants, and a very small number are
two-stage. In a Danish two-stage competition, the 1
s t
stage usually is open
to all and the requirements are most broadly formulated in the first stage. In
this case, the opinions of the jury are made public between each of the two
stages.

Furthermore, in architectural competitions, 1/3 of the members of the jury
have special competency (i.e. architectural or engineering competency) in
the area of the project in question. The majority of the jury represents the
public client in question. The jury is not permitted to ask for information or
explanations concerning the proposals in order to designate the winner of
the competition; the proposals are to be complete and self-explanatory in
themselves. The jury usually contains specially trained jurors who know
how to judge architectural competitions; therefore this is not necessary.

The jury can, however, consult technical or economic advisors concerning
technical or economic matters, whereas the jury itself has the competency to
judge the architectural quality. However it is the entire jury that makes the
final decisions through a process of dialogue and synthesis. Thus all the
jurors are responsible for the decision as a whole.

6.5.3.2. Consequences of the Implementation of the Public Services Directive
in Denmark and Danish Actors Reactions to the Differences in
Implementation in Denmark and Germany.

At the beginning of 1994, one half year after the implementation of the Public Service
Directive, prices for architectural services had fallen drastically in Denmark, perhaps
by as much as 50 % (Arkitekt- og Byggebladet, January 1994; see also Subsection
A.3.3.). Additionally, at this time, Danish architects were learning to adapt to tighter
schedules than they had previously been used to, due to the time framework implicitly
suggested by the directive (ibid.).

With regard to connections between private actors and public authorities, local
182
networks in which architects and engineers received projects through traditional
person to person relationships to public servants were suddenly broken up (Albertsen,
1997b:3 as well as various interviews with Danish architects). Last but not least,
Danish architects were working to change their previous modes of cooperation with
engineers; engineers had to be consulted earlier by architects than was previously
common in Denmark, due to the fact that the names of the engineering firms usually
have been requested in connection with project proposals submitted by architects
(Arkitekt- og Byggebladet, January 1994). However, this has strengthened the relative
position of architects vis vis the engineers (Albertsen, 1997b:6).

Niels Albertsen (ibid.) has metaphorically depicted the Danish prequalification process
in relation to the closed tendering procedure as the urgent search for a partner for the
last dance of the season: As soon as a prequalification notice has been made public
or even earlier, if word-of-mouth has it that one is on the way - architectural and
engineering consulting firms scramble to find a suitable partner for the competition.
Although some firms may have preferred partners due to previous experience, they
can never be sure that their preferred partner has not found another firm to cooperate
with in connection with the tendering in question. Therefore they must be quick to ask
their desired firm and, if they receive a negative answer, they must hurry on to their
second choice. For the large engineering firms this is more problematic, as it must first
be decided which division or team will submit the proposal, as the parallel submission
of more than one proposal from different divisions of firms is not permitted. Usually,
the engineering firms look for an architectural firm partner who has won a substantial
number of competitions, yet has not won a project for the public authority in question
recently because it is believed that the public authority would be reluctant to prequalify
the same successful firm too many times within a relatively short time period (ibid.).

Danish architects were initially quite skeptical about the consequences of the directive,
especially due to the fall in the prices of services offered; many pointed out that
pressing prices on architectural services could lead to project proposals of a less high
standard which probably would not save the public authorities any money in the long
term (see e.g. Arkitekten 1/1994). PAR prepared an official press release on May 16,
1994 stating that one long term consequence of the problem might the demise of the
Danish architectural services industry in the long term (Arkitekten 9/1994). However,
one year later the situation had improved substantially, according to PARs managing
director Keld Mller (Arkitekten 9/1995). From July 1, 1993 to April 1, 1995, PARs
Secretariat in Copenhagen had been involved in 53 public service
competitions/invitations to tender. In almost all cases, juries included persons with a
183
knowledge of architecture, and competition was not based on price alone but rather
on the assessment of the economically most advantageous offer (ibid.).

The most likely reasons for these fluctuations of opinion are the adaptation and
learning processes that both architectural services firms and public sector institutions
experienced. In the public sector, working groups were created to assist in the
implementation of the directive (see Arkitekten, 8/1994). In an official statement of an
interministerial working group composed of members of the Danish Ministries of
Culture, Housing, and the Environment in 1994, it was suggested that the criteria for
selection of architectural projects to be submitted to public invitations to tender
should be broader than the price alone and that the quality of the architecture of the
proposals submitted should play a role in judging which offer is economically most
advantageous (ibid.).

However, the turn-around in opinion was not so radical as the above statements might
suggest. Subsequent statements by DALs competition committee (see e.g. Arkitekten
14/1995) included remarks to the effect that many public sector institutions still did not
know how to administer the requirements of the directive, although DAL agreed with
PAR that competition based on exclusively on price was disappearing. Certain
individuals, exemplified here by Jens Clemmensen and Hans Henrik Ortving, remained
skeptical. Clemmensen wrote a feature article in the Danish daily newspaper Politiken
on November 28, 1995 in which he accused the EU public services directive of not
being the proper framework for the fulfillment of its liberal intentions; according to
him, its use resulted in nepotism, lower income levels for architects, and high
administration costs for the public sector. Ortving had similar reservations concerning
the income levels and administration costs; additionally he worried that the quality level
of projects was declining due to the very rapid decision process (Ortving, March 23,
1996).

With regard to the Directives specifications on the separation of the roles of
architectural firms in, on the one hand, helping public sector institutions prepare for
public tendering, and, on the other hand, submitting tenders themselves, DALs
competition committee is of the opinion that this is somewhat problematic in certain
specialized areas of construction, e.g. hospital or theater projects. DAL has suggested
that architectural and engineering organizations should meet with representatives of the
Danish government to discuss this problem (Arkitekten 14/1995). The argument for
this is as follows: In a small country such as Denmark, only the few larger architectural
firms are specialized in such fields. They may therefore feel obliged to help Danish
184
authorities with tendering preparations when asked to do so, e.g. to maintain good
relations to the authorities in question, yet their assistance may mean that mainly
foreign firms will be eligible to compete for the project in question. Public
organizations for their part may be reluctant to ask foreign companies to help them
prepare tendering announcements and procedures because few if any foreign
architectural firms have profound knowledge of e.g. Danish occupational safety rules
and the traditional Danish ways of fulfilling these rules. Thus the larger Danish
architectural firms sometimes face the difficult choice of whether to assume the posi-
tion of advisor to e.g. maintain good relations to the authorities or whether to decline
this offer in hope of getting the project to be tendered (ibid., Albertsen, 1997a: 17).

Concerning the use of the directive in buildings owned by the national government, a
response from the Ministry of Housing to the Danish Governmental Auditing and
Controlling Board (Statsrevisoratet) dated October 13, 1998 (DocumentD-0275-20
SMJ) stated that the Ministry would use public tendering procedures to a greater
extent than previously and that future building projects will be selected using the
general criteria of the economically most advantageous offer. The background for this
statement was as follows: Certain independent national government institutions had
previously borrowed each others architectural and construction expects to solve
problems instead of allowing private firms to bid for this tasks. This procedure has
been criticized and has subsequently been changed (interview with Keld Mller,
November 1998).

In Denmark, the public institution responsible for hearing complaints concerning
public tendering is the Public Tendering Complaints Council (Klagenvnet for
Udbud). A list of cases judged by the Public Tendering Complaints Council for the
years 1992 to today is found on the Internet at http://www.ks.dk/udbud/kendelser.
html. Furthermore, the Danish Competition Authority (Konkurrencestyrelsen) is re-
sponsible for the administration of all EUs public tendering directives. This authority
investigates cases citizens and firms bring before them both anonymously and non-
anonymously. However, the Competition Authority has suffered from a lack of
resources and has therefore been unable to sufficiently investigate all cases (Politiken,
April 24, 1996).

One case of violation of the EU Public Service directive has been especially relevant
for Danish architectural firms working in Germany. It concerned the public tendering
rounds related to the design of the embassies of the Nordic countries in Berlin (see
e.g. Arkitekten 8/1997; Panduro, March 7, 1997; Mose, May 5 and 6, 1997). Two
185
complaints against the Danish Ministry of Foreign Affairs were filed in this case, one
by the Council of Practicing Architects (PAR) and the other by the Danish Associ-
ation of Consulting Engineers (F.R.I.). The Public Tendering Complaints Council
found both the Danish Ministry of Foreign Affairs and the Foreign Ministries of the
other Nordic countries guilty of breaking the public service directive in hiring a
German firm to manage the construction work after cancelling a planned public
tendering.
33
The Danish Ministry of Foreign Affairs was thereafter severely criticized
by the Danish Ministry of Commerce and Industry. However, the Ministry of Foreign
Affairs was neither penalized nor punished and construction has been continued as
planned. PAR and FRI have therefore subsequently complained to the European
Union about the case (ibid.). As a consequence, some politicians and interest groups
are looking into ways to give the Public Tendering Complaints Council more authority
to punish law-breakers (Brsen, August 25, 1997).

Several respondents from my interests have, however, indicated that they in many
circumstances are not willing to bring such cases before the Public Tendering
Complaints Council because they fear that such action might bring them in bad
repute. In the words of one respondent:

Denmark is a small country. Word that you are a inflexible actor may be
spread very quickly.

Additionally, one architect from my many interviews who had some activities in
Germany felt that he had been personally hit by the irregularities of the tendering with
regard to the Nordic embassies. He explained that he had been prequalified for an
earlier tendering with regard to the embassies. This had resulted in substantial German
interest for his firm, also from certain actors in the German public sector. However,
when the Nordic Ministries of Foreign Affairs ran into trouble concerning the rules of
the directive, this initial German interest quietly but rapidly disappeared again.

Moreover, the position of negotiations is also controversial in Denmark. Some of my
respondents (mainly those from established architectural firms) agree with engineer
Lars Holten Petersens statement in an article in Ingeniren on February 21, 1997 that
negotiations are both necessary and beneficial with relation to professional services
offered to public sector institutions. On the other hand, many other respondents (more
often from less well-established firms) support the narrow Danish interpretation of the
scope of permitted negotiations in the interest of fairness, transparency and

33
The court verdicts can be found on the web pages of the Danish Public Tendering Complaints Council.
186
equality of opportunity.

According to Flemming Hallen, vice-president of ADA, newly-established and smaller
architectural firms had positive expectations in relation to the directive in 1992 and
1993. These firms had hoped that they, on the basis of prequalification, would de
facto have the possibility of participating in all the types of competitions permitted by
the Public Service directive. These aspirations, however, have not been fulfilled in
practice; instead, public sector actors tend to choose the same small group of well-
established, larger architectural service firms again and again (interview with Flemming
Hallen, November 1998).

However, there is controversy concerning this issue. In a summary of PARs annual
report for 1994/1995, PAR denied that this was the case (Arkitekten 9/1995) because
25 % of PARs member firms had been involved in architectural tendering and
competitions related to the Public Services Directive. The author of the report was,
however, convinced that larger, most well-established firms are much more easily
prequalified to take part in invitations to tender from the municipal, regional, and
national authorities.

It is the opinion of DALs competition committee as stated in August 1995 (see Arki-
tekten, 14/1995) that the Danish administration of the public services directive does
not give young, promising architects optimal conditions for developing their skills.
DALs competition committee was especially critical of the fact that an official guide
concerning the use of the directive in the public sector (Bygge- og Boligstyrelsen,
KonkurrenceSekretariatet, July 1993) strongly suggested that the restricted tendering
procedure should be used by public sector institutions; the DAL competition
committee believes this policy serves the interested of the most well-established firms
to the detriment of the others. In a later white paper (Arkitekturpolitik, 1996), DAL
suggested that one outsider firm with relatively few references should be invited to
participate in each closed public tendering.

Furthermore, according to Architect Jesper Kock, DALs Competition Secretary: It is
the opinion of DAL that 13 of the Public Services Directive is the most appropriate
paragraph with regards to architectural competitions. The possibilities of open and
closed tendering of the Public Services Directive are, in the opinion of DAL, not
appropriate for architectural competitions but should be used for other types of
services. (Interview with Jesper Kock, November 1998.)

187
However, despite some bias towards well-established firms in prequalification rounds,
a handful of very talented new architectural firms have managed to establish
themselves in the 1990s on the basis of architectural competitions and public tendering
(interview with Niels Albertsen, March 6, 1998). Due to the pressure that these very
talented actors put on the market, various respondents have indicated that one cannot
just send a standardized or usual proposal, one must be at the forefront of
architectural development all the time.

Finally, the problems of other EU countries not implementing the directive before the
deadline established by the EU and of the different interpretations of the directive with
regard to the use of negotiations have prompted substantial debate among Danish
architects and engineers (see e.g. Redder, June 16, 1995 and August 24, 1995;
Wittrup, September 26, 1997). This Danish debate prompted former Danish Minister
of Commerce and Industry Mimi Jakobsen to write to the EU Commissioner for the
Common Market, Mario Monti, in the summer of 1995 to ensure implementation and
uniform interpretation of the directive in all EU countries (Forchhammer, July 26,
1995). In August 1995, Commissioner Monti brought a case concerning
implementation of the directive against Belgium, Germany, France, and Greece before
the EU Court in Luxembourg (Redder, August 24, 1995).

Additionally, the Danish Association of Consulting Engineers or F.R.I. (March 1996 -
March 1999) began to compile statistics on the use of the Public Service Directive in
EU member states in the middle of the nineties. An example of these statistics with
regard to Denmark and Germany can be seen in Table 15 below.

188
Table 15. Percentage of Types of Calls for Tender and Use of the Accelerated
Procedure in 1997 with regard to Architectural and Engineering Consulting
Services.
Germany Denmark
Types of Calls for Tender
1. Design contest approx. 15% approx. 22%
2. Open Tendering Procedure approx. 6%
approx. 5%
3. Restricted Tendering Procedure approx. 6%
approx. 65%
4. Negotiated Tendering Procedure approx. 73% approx. 8%

Use of Accelerated Procedure 39.3 % of 3 and 4 4.7% of 3 and 4

Source: Danish Association of Consulting Engineers (March 1998: 2-4).

The statistics in Table 15 indicate that the restricted tendering procedure was the main
public tendering procedure used with regard to architectural services in Germany in
1997, whereas the most common procedure in Denmark was the restricted tendering
procedure. Additionally, the accelerated procedure was used in almost 40% of the
German cases, whereas it was only used in about 5 % of the Danish projects to be
publicly tendered.

With regard to the experiences of the individual architects of the case and pilot stu-
dies, of those asked, all architects with experience in Germany indicated an awareness
of national differences in the interpretation of the EU public services directive.
However, viewpoints and experiences with the directive diverged. A few Danish
respondents indicated that negotiation in their opinion was only to be allowed in
exceptional situations and that the German interpretation of the directive was wrong.
Other Danes indicated that negotiation was in some circumstances e.g. with regard
to the renovation of existing buildings built in a particular style by prominent architects
the most reasonable procedure and ought to be used a bit more often in Denmark.

A single Danish respondent mentioned a peculiar experience which had occurred
before the official implementation of the directive in Germany. This respondent had
found a tendering announcement and had called the responsible German authority in
question to inquire about it. Upon achieving contact with the authority in question, this
respondent was told that the authority already had found the firms needed to
undertake the restricted tendering procedure, which implied that the prequalification
selection process was only a pro forma procedure. The firm in which this respondent
189
works has subsequently made a habit of inquiring about German EU tendering offers
in telephone conversations to save it the trouble of preparing prequalification round
documents in cases in which the firms to participate in the final round have de facto
been chosen beforehand. On the other hand, many Danish respondents mentioned that
both before and after the official implementation of the directive, they have had the
impression that local firms were chosen very often in German public tendering
procedures and that they therefore believe it is advantageous to team up with a local
firm when tendering for a project.

With regard to the accelerated procedure, the response of Danish pilot and main study
respondents was more unanimous: Danish respondents criticized the widespread
German use of the accelerated procedure for being unfair and a de facto hindrance to
foreign participation in procurement procedures. Some respondents went so far as to
suggest that local or regional German interests were served by the relatively common
use of the accelerated procedure in Germany. Most German respondents asked also
agreed with this criticism.

It is more difficult to depict the foreigners perspective on Danish public tendering
procedures as relatively few foreigners have participated and won architectural
competitions and public tendering procedures in Denmark in the 1990s (see e.g.
Eurobuild, 1996). This may, however, at least in part be attributable to language
difficulties; few foreigners, aside from Norwegian, Swedes, Swedish-speaking Finns,
and Icelanders are able to understand Danish.

Two notable exceptions are the Norwegian architect Sverre Fehn who won a
competition concerning the Danish Royal Theatres Playhouse and the German
architect Gnter Behnisch who won the competition concerning the building that
houses the Danish National Archives. However, political struggles between the
Municipal Government of Copenhagen, the Royal Theatre, and Danish Ministry of
Culture resulted in a stoppage of all plans to build the new playhouse according to
Sverre Fehns prize winning proposal. Some of my respondents have perceived that
Denmark lost some architectural prestige after this incident, especially in Norway and
Sweden.

One German respondent I had interviewed had, however, had an extremely bad
impression of Danish public tendering procedures. This person, a renowned German
professor of architecture who is a founding partner in one of Germanys best known
architectural firms expressed his bitter opinion in an interview on October 14, 1999
190
that Denmark, as well as most other EU countries, are not open to foreign architects
despite the EU Public Services Directive. His firm had applied for prequalification in a
restricted tendering concerning a major infrastructure-related project in Denmark.
According to the renowned architect in question, although his firm had four references
concerning the type of project at hand, which was a specific criteria mentioned in the
prequalification announcement, his firm was not chosen, whereas several Danish firms
who did not have these qualifications were prequalified despite of their non-fulfillment
of this requirement.

6.5.4. Conclusions with Regard to the Implementation of the Public Service
Directive.

From the discussion of the previous three subsections, it is evident that the EU Public
Service Directive (Council of European Communities, October 13, 1997) has been
implemented in very different ways in Denmark and Germany, thus providing further
explanation to Drbyes (1999) mention of this topic in Appendix A, Subsection
A.6.2. Additionally, the implementation of the directive in both countries has been
seen by some parties as being non-optimally transparent and unable to truly guarantee
the high goal of equality of opportunity through free competition. This is also my
opinion on the basis of the discussion of the previous sections.

However, in the rest of this dissertation, I will not focus upon the lofty ideal of true
free competition or the general debate about proper administrative procedures.
Instead, on the basis of these different interpretations, in Chapter 8, I will look more
closely at the concrete knowledge which was a necessarily prerequisite for Danish
architectural firms to tender or participate in design contests in Germany. Furthermore,
in Section 9, German and Danish public tendering will be discussed in relation to
concrete project acquisitions and the model of Cova, Mazet and Salle (1994) depicted
in Figure 1 of Chapter 1. Finally, the role of the previous project work in relation to
German tendering procedures and architectural competitions will be dealt with in
Chapter 10.
191
7. A Description of Danish-German Architectural Internationalization Actors
in Germany in the 1990s.
7.1. Introduction.

This chapter contains a description of major Danish-German construction actors, in
answer to research question 2 as described in Chapter 1 as well as Section 5.3. In the
following subsections, I will first describe the activities of the various major Danish-
German actors described in Section 5.3, especially with regard to their relations to
other construction industry actors from whom they have worked or with whom they
have cooperated. Thereafter, in the concluding subsection, I will first define the major
governance structure(s) which have prevailed when these actors cooperated on the
German market in the 1990s and, second, categorize the activities of the major Danish-
German actors in relation to Johanson and Mattssons (1998) three modes of inter-
nationalization in foreign networks (see Subsection 2.2.2.).

7.2. The Danish Ministry of Housing and other Danish Ministries.
During the 1990s, it has been the policy of the Danish Ministry of Housing to assist
various actors connected to the Danish construction industry in their activities abroad
(interview with Special Advisor Peter Theibel, Architect m.a.a. from the Danish
Ministry of Housings Office for International Affairs, May 11, 1998). This policy has
been implemented by the following types of activities (ibid.):

1. The publication of Export Handbooks and reports about the construction
industries of specific foreign markets.
2. A number official visits in which the Danish Minister of Housing has met with the
corresponding Minister of Housing from other countries or, in countries with
federal political systems such as Germany, the Minister of Housing from a federal
state either at home in Denmark or abroad. These visits have often resulted in the
signing of official Cooperation Agreements.
3. The creation of two specific Construction Industry Attach positions in
cooperation with the Danish Ministry of Commerce and Trade and the Danish
Ministry of Foreign Affairs. These positions are financed by the Ministry of
Housing, yet the Construction Industry Attachs share some facilities with the
Danish embassies and/or Consulates General.
4. The inclusion of internationalization in various construction industry development
projects.

An example of a German-related publication (activity type 1) is a 1998 report entitled
Boligfinansiering i Tyskland (Financing Housing in Germany). With regard to the
second type of activity, the Danish Ministry of Housing entered into the following
192
Cooperation Agreements with German federal states (i.e. Lnder) or the German
federal government in the 1990s (see http://www.bm.dk/sam1.htm):

Saxony-Anhalt, April 6, 1992
Brandenburg, November 11, 1992
Saxony, April 11, 1994
Hesse, March 23, 1995
Federal government of Germany, May 16, 1995
North Rhine-Westphalia, May 15, 1996

Generally speaking, the cooperation agreements are written in a very broad language
which allows for a multitude for interpretations, depending upon the degree of interest
that private actors and local public authorities show for the cooperation agreement in
question. The former Danish construction industry attach in Berlin, Jrgen Skovgaard
Vind, regards these cooperation agreements as door openers, which can be used by
both Danish and the foreign actors in the private and public sector (interview with
Jrgen Skovgaard Vind, February 24, 1999). Whether private sector actors show
interest for a given cooperation agreement and attempt to establish contacts and forms
of cooperation within the framework of the given cooperation agreement, i.e. at
informational exchange meetings, is up to the private sector actors themselves,
according to Vind (ibid.).

The Cooperation Agreement with Hesse in 1995 resulted in a Danish-German bilingual
report Holzbau Kongress, i.e. Congress about Building with Wood (Danish Ministry
of Housing, 1997). Additionally, a joint, comparative report was published in German
in 1996 regarding ways to save money in construction in Denmark and Germany
(Danish Ministry of Housing, 1996); here the Federal German Ministry of Housing was
the involved partner (ibid.).

Concerning the third type of activity, the Danish construction industry attachs have
two main tasks:

1. To offer foreign market advisory and information-seeking services to Danish con-
struction industry firms for a fee.
2. To assist the Ministry of Housing with information gathering and administrative
tasks related to activity types 1, 2, and 4.

Until 1997 both Danish construction industry attachs were situated in Germany. Peter
Theibel worked as the Danish construction industry attach in Dsseldorf (Land:
193
North Rhine-Westphalia) from 1990 1994. In 1994, he was replaced by Architect El-
sebeth Terkelsen, m.a.a. who remained until Dsseldorf until 1997, when the Dssel-
dorf construction industry attach office was closed, and the position was moved to
the Danish Embassy in Warsaw, Poland and was taken over by Sren Lange Nielsen
who has a bachelors degree in Civil Engineering. The second Danish construction
industry attach position was created in February of 1992. Christian Lerche, who has
a Masters degree in Business, was the first attach in Berlin; on January 1, 1994, he
was replaced by Jrgen Skovgaard Vind who has a bachelors degree in Civil Engi-
neering as well as a part-time continuing education degree in Business Administration
(in Danish: Handelsdiplomuddannelsen, HD).

In addition to the two construction industry attachs who are financed by the Danish
Ministry of Housing, the Danish Ministry of Commerce and Industrys Agency for
Trade and Industry (in Danish: ErhvervsfremmeStyrelsen) has a total of 28 trade
commissioners (in Danish: eksportstipendiater) situated around the globe. They also
offer foreign-market related advisory and information-gathering services to Danish
firms for a fee. Four of these are currently placed in Germany, in Hamburg (Land:
Hamburg), Hannover (Land: Lower Saxony), Stuttgart (Land: Baden-Wrttemberg),
and Rostock (Land: Mecklenburg-Pomerania) (see http://www.efs.dk). The office in
Rostock is the newest of the four; it was created after German unification when the
previous office in Essen (Land: North Rhine-Westphalia) was closed (telephone con-
versation with Peter Theibel, August 17, 1999). The office in Hamburg has always
concentrated exclusively on the construction industry, whereas the offices in Essen
and, now, Rostock also deal specifically with the construction industry as well as
other industries. Peter Theibel has previously worked as a trade commissioner in
Hamburg from 1982 1986; in 1986, he was replaced by Sren Lange Nielsen, the
current Construction Industry Attach in Warsaw, who stayed in this position for
several years (ibid.). Additionally, the Danish Agency for Trade and Industry occasi-
onally publishes books and pamphlets on the construction industry; for an example,
see Erhvervsfremmestyrelsen, 1993. In these cases, the construction industry attachs
from the Ministry of Housing also assist in the necessary information gathering.

Finally, with regard to point 3, one of the Commercial Attachs at the Embassy of
Denmark in London works exclusively with construction industry exports; this
position is financed completely by the Ministry of Foreign Affairs (telephone
conversation with Peter Theibel, August 17, 1999). I will, however, not elaborate
further on this cooperation, as it pertains to Great Britain, whereas the focus of this
dissertation is Danish internationalization on the German market.
194

Concerning activity type 4, at the beginning of the 1990s, the Danish Ministry of
Housing arranged a number of meetings for executives of German public housing or-
ganizations to inform them about the structure of Danish public housing programs and
to establish a platform for potential cooperation between Danish and German actors
(interviews with Peter Theibel, May 11, 1998; Bendt Almvig, November 19, 1998; and
Jrgen Skovgaard Vind, February 24, 1999). Additionally, one architect-specific
cooperation project entitled Das Gesunde Haus was initiated in the first part of the
1990s; it entailed cooperation between Danish architectural firms and German
architectural firms situated in North Rhine-Westphalia concerning environmentally and
health-friendly housing (interviews with Peter Theibel, May 11, 1998, and Elsebeth
Terkelsen, November 1, 1999).

Das Gesunde Haus was, however, criticized by participants for the way in which
cooperation had been arranged: After the round of prequalification, the 12 Danish and
12 German firms were put together by a process of random selection (Arkitekten,
1993, No. 18:668). Furthermore, due to the boom on the German market, the German
firms that were prequalified were all small, idealistic, but unexperienced firms whereas
the Danish firms were well established (ibid.: 669). This resulted in many mismatches;
only 1 or 2 of the Danish firms were satisfied with their cooperation partners (ibid.).
Ministerial departmental head Ib Steen Olsen admitted that this aspect of Das
Gesunde Haus had been unfortunate (ibid.:671).

Later initiatives from the Danish Ministry of Housing included programs which encom-
passed both domestic and international measures. Two examples of this are Project
Renovation (in Danish Projekt Renovering), which ran from 1995 to 1998 and the
ongoing project Process and Product Development in the Construction Industry
which is scheduled to end in 2001 (see e.g. Drbye, 1998). 9 % of the money from
Project Renovation, i.e. DKK 45 million out of DKK 495 million, was earmarked for
international cooperation, e.g. joint projects between Danish and foreign firms,
including especially German and Polish firms (see http:/www.byggecen-
trum.dk/projektrenovering).

As the Danish Ministry of Housing and its Construction Industry Attachs guarantee
the firms they assist anonymity, I could not directly ask Peter Theibel or Jrgen Skov-
gaard Vind which firms they as representatives of the Ministry of Housing had been
most frequently in contact with. However, my interviews with respondents from both
my pilot study and main study architectural firms as well as my interviews with three
195
engineering consulting firms indicate that the Construction Industry Attachs assist
firms on all levels. Those firms who are just beginning their internationalization are
offered assistance and information regarding basic differences between the German
and Danish markets whereas more experienced and successful flagship Danish firms
are often invited to informational exchange seminars or official ceremonies, e.g. in
connection with visits of the Danish Minister of Housing, where they receive the
opportunity to meet importance decision makers in the German world of construction.

With regard to the initiatives of the Danish Ministry of Housing, several respondents
have indicated that in many instances German private sectors actors mainly participate
in the Danish-German initiatives to improve their relationships to the German public
officials who also participate and not necessarily because they are interested in the
Danish market or Danish building culture (see also e.g. Frisch-Jensen, 1999:13).
Furthermore two respondents from a Danish architectural firm and engineering firm,
respectively, warn Danish participants not to initially assume that they necessarily can
teach Germans better or more efficient ways to build. In the word of the respondent
from the engineering firm:

I took part in 3 4 of the different initiatives that took place on the German
market in connection with Project Renovation. Some were successful,
others were not. In cases where things did not work out, it was often seen
that Danes tried to import their Danish knowledge and abilities concerning
renovation onto the German market. I am, however, convinced that this
approach is not very realistic because Denmark really does not have that
much to offer the Germans seen in the light of the fact that the Germans are
very competent and also have a different construction industry structure
which implies that one cannot simply compete renovation tasks in Germany
the way one does in Denmark.

Furthermore, several of the most experienced Danish firms on the German market
have indicated that most of the work of the Danish construction industry attachs,
with the exception of arranging official receptions and the like, are no longer of use to
them as the level of advice offered by the Danish construction industry attachs no
longer matches their level of integration. A respondent from a Danish engineering firm
stated the following:

We have worked with them [i.e. Danish construction attachs and trade
commissioners] but we have also realized that they are more oriented
towards Denmark than we are. They try to be oriented towards Germany,
yet they are still very Danish. You can get a broad introduction to the
196
German market from them which may give you a good idea of the situation.
However, for our purposes, they are more useful on new markets such as
Poland and the Czech Republic which are more volatile and less structured
and regulated than the German market.

However, Fritsch-Jensen (1999:16) believes that the success rate of innovative
projects in Germany involving Danish firms with all levels of experience is higher if the
projects are related to a cooperation agreement between Danish and German
authorities. Additionally, the Danish Ministry of Housing has, during some years,
made use of a Danish panel of experts from the construction industry to ensure that it
has up-to-date knowledge concerning the practical problems that experienced Danish
actors experience on foreign markets (interview with Lars Kirkegaard, November 25,
1998).

7.3. Danish Civil Engineering Consulting Firms and their Organizations.
The Danish engineering sector is comparatively strong in relation to other European
engineering sectors and has been so for a number of years (Schaumburg-Mller and
Kuhn, 1988:417-8; Danish Association of Consulting Engineers, 1998:1-2). In previous
decades, Danish engineering export activities focused upon the regions of the Middle
East, Asia, and the developing countries of Africa and Latin America (Schaumburg-
Mller and Kuhn, 1988:424-5; interview with a director in a larger engineering firm,
April 8, 1999). Danish firms were able to focus on these countries because of, among
other things, the advantage of being from a small, non-committed country in contrast
to former colonial countries like France and Great Britain (Albertsen, 1997b:29).

In the 1990s, Danish consulting engineers remained heavily export-oriented. In 1995,
total turnover was 4.4 billion, with 1 billion coming from exports (ibid.) However,
during the nineties, Danish engineering firms substantially increased their efforts on
nearer markets, such as the German and the markets of Eastern Europe (three
interviews with respondents from large Danish engineering firms held on April 8, 1999,
August 18, 1999, and August 20, 1999; Danish Association of Consulting Engineers,
1998).

As previously mentioned in Subsection 6.4.3.2., the large Danish engineering consult-
ing firms are much larger than the corresponding Danish architectural firms. Addi-
tionally, the three largest Danish engineering firms are also approximately as large as
the largest German engineering firms (interviews with Jrgen Skovgaard Vind, Feb-
ruary 24, 1999, and the three respondents from Danish engineering firms). These large
197
firms have many different areas of expertise and sell a wide range of different services,
many of which have nothing to do with the construction industry. In this section, the
treatment of engineering consulting firms is however limited to the construction
industry; therefore it must be mentioned en passant that two of the three respondent
engineering firms also have activities in Germany that pertain to business areas outside
the world of construction.

Similar to architectural firms, Danish engineering firms showed substantial interest in
the German construction market at the beginning of the 1990s when this market was
booming (ibid.). Some larger firms engaged in mergers and acquisitions as well as
joint ventures both with well-established firms from the former West German region
and with former East German firms that were sold by the Treuhandanstalt, i.e. the
now abolished German agency responsible for the privatization of the previously state-
owned East German units of production. In most cases, the Danish engineering firms
in question relatively easily gained access to the acquired or merged companys
previous customers and cooperation partners, i.e. the network of social contacts.

These mergers and acquisitions were, however, far from always successful, and there
are many examples of subsequent sales of subsidiaries or, in the case of mergers, the
partitioning of companies among the shareholders (ibid.). According to the respond-
ents from three Danish engineering firms, typical reasons for these failed mergers and
acquisitions were as follows: poor annual results, a lack of agreement about the
strategic goals of the German firm, and/or a mismatch with regard to the corporate
cultures of the German and Danish firms. In this connection it must be noted that the
Danish engineering firms on the German market have charged relatively high prices in
comparison with German engineering firms in the nineties (Drbye, 1999:15; a
respondent from a Danish engineering firm) and that Danish architectural firms have
been comparatively more successful on the German market during the nineties than
Danish engineering consulting firms (see e.g. http://www.ai.raadet.dk/ar96/samar. htm).

As Danish architectural firms work closely with Danish engineering firms on specific
construction projects in Denmark (see e.g. the information from Albertsen, 1996 in
Subsection 6.4.3.2.), it seems natural to assume that Danish architects and engineers
also would work together to some extent with regard to activities in Germany. This is
the case with respect to Danish architectural and engineering firm organizations. There
is close contact and cooperation between the Danish Association of Consulting
Engineers (F.R.I.) and the Danish Council of Practicing Architects (PAR) on issues of
common interest to both groups through the Danish Council of Consulting Architects
198
and Engineers (in Danish: AI-Rdet). The Council of Consulting Architects and
Engineers was created in 1974 as a forum for discussing problems on export markets
and finding solutions to them, also in cooperation with actors from the Danish public
sector, e.g. from the Ministries of Housing, Commerce and Industry, and the Foreign
Ministry (see http://www.ai-raadet.dk/English/council.htm).

During the 1990s, this council has monitored i.e. the administration of the EU Public
Service Directive in other EU member states such as Germany and the development of
the Danish Construction Industry Attach and Trade Commissioner programs
(http://www.ai-raadet.dk/Aar97/samar.htm; interview with Managing Director Keld
Mller, PAR, November 1998). Additionally, the council also functions today as a
forum for dealing with common domestic interests and has increased its activities in
general during the 1990s (ibid. and Albertsen, 1997b:19). However due to a waning of
interest in the German market in the late 1990s, several planned council activities
concerning this market were either cancelled (e.g. a Danish conference on market
conditions in Southern Germany) or postponed (http://www.ai-raadet.dk/Aar97/
samar.htm).

Turning now to the individual engineering consulting firms, the extent and types of
cooperation with Danish architectural firms has varied. As previously mentioned in
Section 2.5., a survey undertaken by the Danish Council of Practicing Architects
(PAR) in 1992 found that 79% of PAR member and affiliated architectural firms with
activities in Germany had worked with Danish engineering firms with regard to these
activities (Arkitekten 1993: 3/120). When one looks at programs initiated by the Mini-
stry of Housing, e.g. Project Renovation, a substantial number of teams partici-
pating in the programs international projects have included varying constellations of
actors from Danish engineering consulting firms, Danish housing organizations, Danish
architectural firms, Danish contractors, as well as German actors (Fritsch-Jensen,
1999). However, aside from such governmental programs, all three respondents from
the larger Danish engineering firms have emphasized that their German subsidiaries
worked mainly with German partners even in the early nineties in order to enable the
Danish employees to learn the necessary fundamentals the German market. However
there were also some contacts to Danish architectural firms and Danish contractors
(see e.g. Arkitekten, 1993:3/120). These Danish respondents furthermore indicated that
cooperation exclusively among Danish actors had in many cases led to poor results in
Germany, at least in cases when the customer was German, as he or she often became
impatient with the Danish firms lack of knowledge about the German market. Fur-
thermore, all three respondents indicated that their firms also initially ran into many of
199
the typical knowledge-related problems summarized by Drbye (1999) in Appendix
A, Subsection A.6.2.

Today all three respondents emphasize that their main body of customers on the
German market are Germans and that almost all employees, save a small handful, in
their German offices are German nationals. In one firm, the German managing director
has years of experience in Scandinavia, albeit mainly from Sweden, and is thus
somewhat familiar with Danish/Scandinavian business culture. These German offices
are, however, very open towards serving Danish clients and believe that their presence
on the German market is a source of prestige on their domestic Danish market. One of
the Danish engineering firms interviewed has worked with one of my case study
architectural firms on the German market on a few projects on an ad hoc basis and
has been very content with this cooperation and the level of competency in the case
study firm. Additionally, one of the respondents from Danish engineering firms has
indicated that architectural firms hoping to commence internationalization efforts on
the German market could work with his firms German subsidiary. This respondent
would actually welcome establishing this sort of cooperation agreement with a few
innovative Danish architectural firms due to his perception that many German private
customers have high regard for what they consider to be Danish or Scandinavian
design and that his firm today has the sufficient critical level of competence on the
German market to assist Danish architectural firms with exceptional design qualities
onto the German market. However, his firm does not have this type of cooperation
agreement with Danish architectural firms today.

At the same time, respondents from two of the three Danish engineering firms that are
interested in contracts with German public sector institutions (the third firm works
almost exclusively with private sector actors in Germany) have perceived an increasing
tendency for German public officials to select a firm or a team of firms who have local
presence in public tendering procedures after the end of the boom on the German
market around 1995. (This was also the perception of Danish architectural firms, see
Subsection 6.4.3.) This has led to some increase in ad hoc cooperation agreements
between the Danish firms German offices and firms in the local area of a given public
tendering sometimes also to the detriment of cooperation with other Danish firms.

Furthermore, two of the three respondents indicated that they could see some poten-
tial in working with Eastern Europe from their Danish firms German office, due to the
fact that a lot of German money is being invested in Eastern Europe. One respondent
explained this situation as follows:
200

The big picture is, so to speak, that the projects requirements are set by
those who are paying for the project. And the Germans have invested a lot
of money in Eastern Europe. If you look at projects financed by state aid to
Eastern Europe, then you see a lot of projects from many countries e.g.
Germany, Denmark, and Sweden. In these cases you can work with these
rules of these respective countries. However, on the private market in
Eastern Europe, i.e. where private money is being invested, this is to a large
extent taking place via Germany, even though the capital invested sometimes
is from other area like the Middle East. However, when Germany is used as
a bridgehead, the investments are usually carried out in accordance with
German norms.

This means that we have a clear advantage in having an office in Germany.
[] Many foreign investors like Scandinavian design, and therefore we
suddenly sometimes find ourselves in a situation where investors would like
to have Scandinavian design according to German norms in Poland. Of
course, one really has to be careful with a complicated combination like
that, but if one is able to make all loose ends meet, one can contribute a
great deal to such a project.

Replies from the respondents indicate also that many Danish engineering firms are fol-
lowing the forefront of development in Germany. These firms are looking into the
increased possibilities for engineering firm participation in the construction process
through e.g. the Generalunternehmer (GU) and/or the Generalbernahme (G)
models previously described in Subsection 6.2. Additionally, facility management and
the market for renovation and building improvements are also of interest to the Danish
engineering firms present on the German market that I interviewed.

7.4. Danish Contractors.
In general, Danish contractors are the group of Danish construction industry actors
that achieved the smallest degree of success on the German market in the 1990s;
consequently, Danish contractors are almost non-existent on the German market today
and will probably remain inactive on the German market in the near future (Frisch-
Jensen, 1999:14). During the boom of the early nineties, many Danish contractors of
all sizes attempted to find work on the German market, also to some extent in
cooperation with other Danish actors; the survey previously mentioned in Sections
2.5. and 7.3. indicated that 88% of all PAR member and affiliated firms active on the
German market had worked with Danish contractors with regard to some of these
activities (Arkitekten 1993: 3/120).
201

However, contractors from all over Europe entered the German market at the same
time (Halskov, 1995; Kragballe, 1996). This resulted in lower prices as well as many
other unpleasant surprises, due to e.g. the foreign contractors lack of knowledge of
German construction industry law and norms (see e.g. Entreprenrforeningen, 1996).
As a result almost all Danish firms, including, most notably, some of the largest and
most well-known Danish contracting firms, e.g. Hjgaard & Schultz A/S and
Rasmussen & Schitz A/S, left the market again in the mid 1990s (Halskov, 1995;
Kragballe, 1996; Frisch-Jensen, 1999:14). Additionally, as previously indicated in
Subsection 6.3., the volume of foreign activities of Danish contractors declined in the
late nineties (Lubanski, 1999:312).

Some respondents from the Danish architectural and engineering firms active on the
German market that I have interviewed have indicated that they initially had some
contacts to Danish contracting firms that worked on the German market on an ad hoc
basis. Some also had the bitter experience of losing large amounts of money in their
cooperation with Danish contractors. Today, however, Danish architectural and engi-
neering firms main contacts are to German developer, contractor, and construction
management firms. Additionally, a few Danish architects/engineers have some contacts
to the large Swedish contracting firms on the German market like NCC and Skanska;
these same respondents believe that it is much more probable that they will work with
a Swedish contractor in Germany in the near future than with a Danish contracting firm
(see Section 6.3.s description of Danish contractors activities on the Danish market
for further justification of this statement).

7.5. The Danish Real Estate Developing Firm Kuben.
The Danish firm Kuben, which is specialized in arranging for housing to be built and
then selling it, has been active on the Northern German market (i.e. predominantly the
Lnder Schleswig-Holstein, Hamburg, and Mecklenburg-Pomerania) since 1992. The
firms German activities commenced in a very direct way after it had ordered an
analysis of the German market from a marketing research firm: Kuben bought German
property, had housing built on the property, and subsequently sold the housing. The
focus of the firms sales activities in Denmark and Germany is the broad middle class.
It has sold approximately 600 dwellings in Germany since 1992 and is currently
involved in approximately 10 German housing projects. (Interview with the Managing
Director of Kuben Bau GmbH in Hamburg, the Dane Jes Ltzhft, October 22, 1999).

202
In its early years on the German market, Kuben used Danish contractors, architects,
and construction firms to a great extent, supplementing these actors with German
actors in areas where the Danish actors were lacking expertise. At this time, Danish ac-
tors work was less expensive (ibid.). However, in the middle of the nineties, when the
Danish market had picked up and the rate of growth on the German market was
beginning to stagnate, this situation changed. Many of the Danish contractors were
considering leaving Germany; additionally it had become more inexpensive for Kuben
to use German contractors and construction firms. From experience in its first years
on the German market Kuben had learned that the best way to doing things in
Germany was to first ask an architect to draw the design of the housing for the
building permit and then, after the building permit had been obtained, to employ a
contractor who then subcontracted to an architect as well as German construction
firms because this way of dividing the work entails a clear delegation of legal respon-
sibility to one party at a time (ibid.). Today Kuben uses a mixture of Danish and
German architects in the following way for the following reasons (Jes Ltzhft,
October 22, 1999):

We believe that Danish architects are better at designing housing. Danish
architects are also good at designing production-friendly housing. German
architects are not that good at these two things. We use Danish architects to
make the initial design and project specifications up until we receive the
building permit. At this point we have a design concept that is not detailed
enough for us to use it in construction planning, yet still detailed enough to
enable us to receive a building permit. At this time we then begin to use
German architects [who work for the German contractors] to add further
details and adjustments in accordance with the DIN-norms, to do the
construction statics calculations, to deal with the German authorities, and to
prepare the diagrams that tell the skilled craftspeople where to install the
electricity, water, etc. []

Concerning the category of Danish architects that Kuben works with, Jes Ltzhft
stated the following (interview, October 22, 1999):

I think that there are many Danish architectural firms who have managed
their German business well during the nineties, including C.F. Mllers
Tegnestue with its subsidiary in Berlin, 3 x Nielsen who designed the Danish
embassy in Berlin and the firm DISSING+WEITLING which has many
years of experience on the German market. [].

However, we work more with smaller firms who do not have offices or large
projects in Germany, just a few projects once in a while. I believe that these
203
Danish architects who work with housing and other typical smaller firm
jobs also have something to give to the German market but that they are not
good enough at managing the German projects or speaking German. This
was a problem for us when we used Danish architects throughout the entire
project because they did not know enough about the German norms and
laws. []

We say to the Danish architect: Here is a piece of property. We believe that
it would be a good idea to build terraced housing here, taking this or that
into consideration. If you would like to make a proposal, we will look at it.
You will not receive any money for your proposal but if we agree that it is
good, you will then be paid. This means that in the initial phase, the
architectural firm must work for free according to the principle No cure, no
pay. Most firms will do this, but not [a large Danish firm]. And when a firm
has stated that it will not do this we have said, Then we unfortunately
cannot work together with your firm.

During the years 1992 1996 Kuben made profits on the German market but
subsequently the firms German activities have given losses. At the moment the firm
has approximately 50 unsold houses in Germany which means that a lot of the firms
capital is bound in property. The firm has diversified into (a) real estate advisory
services toward private persons, small firms, and governmental bodies as well as (b)
property management in Denmark and has therefore also diversified into real estate
advisory services in Germany as a way to avoid having large amounts capital bound in
unsold housing in the future. The firm hopes to remain on the German market in order
to (a) spread its risk and (b) learn from the best house building practices in both
countries (ibid.).

204
7.6. The Nature of the Internationalization of the Danish Architectural
Services Industry.

On the basis of the preceding subsections of this chapter, as well as Section 6.3. and
Appendix A, it can be concluded that Danish architectural firms had a relatively large
number of contacts to other Danish construction industry actors who also were active
on the German market. However, these contacts were often ad hoc and did not usually
relate to joint project acquisition or cooperation with regard to multiple projects over
time. Thus the network of Danish construction industry firms active on the German
market was more of a social than a project-acquisition nature. There were also few if
any resource and activity ties (see the treatment of the A-R-A model in Subsection
3.3.1.) at the level of multiple projects. The theory-related conclusion connected to
this observation is the need to distinguish between the term network in the narrow A-
R-A sense of the term and the broader definition of a network as a connection of
social relations. As illustrated in Subsection 3.3.1., IMP authors are not always clear
about which type of network they mean.

Furthermore, Danish architectural firms, Danish engineering firms, and Danish
contractors predominantly went about the task of establishing themselves on the
German market alone. Thus, as a rule, they accumulated their own separate knowledge
bases and had their own dealings with German actors concerning both subsidiary
establishment/acquisition of a German firm and acquisition of projects on the German
market. However, from time to time, they did work together, if all the involved parties
believed that such cooperation was advantageous.

Although many Danish architectural firms initially worked with Danish contractors on
the German market, this cooperation was short-lived, as most Danish contractors sub-
sequently left the German market in the mid-nineties. For the case of ambitious Danish
architectural firms interested in acquiring major projects such as huge sports arenas,
airports, or hospitals, it would also not necessarily have been advantageous for them
to cooperate too closely to Danish contractors because, as previously mentioned in
Section 6.1., 6.3., and A.4.2., the Danish contractors are much smaller in size than the
largest European contractors and not among the most international contractors in
Europe. Additionally, the Danish contractors mainly chose the strategy of building
more inexpensively using prefabricated components on the German market (see
Appendix A, Subsection A.4.3.). This means the potential customer of the Danish
contractor was not necessarily the potential customer of the Danish architectural firm
with its own activities on the German market, because German architectural firms
205
usually do not work independently with customers who wish to have these types of
industrialized building constructions (ibid., see also Subsection 6.2.) and German
contracting firms that offer this type of project usually have their own in-house design
departments instead of using external architectural firms (see Section 6.2.). These
factors may also have been further reasons for the lack of close, project-related
cooperation between Danish architectural firms and Danish contractors.

With regard to Danish architectural firms and Danish engineering firms, close
cooperation was not seen at the level of multiple projects, although cooperation at the
level of the individual project happened a number of times (see e.g. Frisch-Jensen,
February 3, 1999). Moreover, the perception that coalitions with local cooperation
partners are often chosen in German public tendering procedures (see Sections 6.4.3.
and 7.3.) seems to have deterred cooperation between Danish architectural and
engineering firms with regard to German public sector projects. Instead both Danish
architectural and Danish engineering firms consciously looked for local German
cooperation partners for tendering procedures (ibid., see also Appendix B).

The relationship between the Danish real estate development firm Kuben and
other Danish actors (here: mainly Danish architectural firms and contractors) also
occurred on a project by project basis, as Kuben has a no cure, no pay policy
with regard to individual architectural design projects and a policy of negotiating
with contractors. However, Kuben did repeatedly use some Danish actors that it
believed to be especially competent.

On the basis of the information in the preceeding paragraphs, the governance structure
between the Danish construction industry actors engaged in internationalization on the
German market was thus the socially-constructed market (see Figure 18 in Subsection
4.2.). The contacts between the Danish construction industry actors involved with
internationalization on the German market in the 1990s were not close or obligating
enough to regard them as a network of relationships in the terms of Easton (1992), as
described in Subsection 3.3.2. Instead they were merely as networks of social contact
or information spreading. This is because although the firms described in this chapter
had some degree of mutual orientation due to their common interest in the German
market, the levels of (a) mutual dependence or perceived mutual dependence, (b)
bonds, and (c) relationship investments between them were low. Thus Cova and
Ghauris (1996) proposal that project marketing occurs somewhere between markets
and networks (see Subsection 3.3.2.) was fulfilled here, making it important to have
concepts such as the social and cultural capital framework described in Section 4.4.,
206
which can be applied in both network and market governance structures.

In spite of the fact that one Danish engineering firm expressed an interest in
working closer with Danish architectural firms (see Section 7.3.), the firm that
came closest to working closely with a few other Danish firms on many projects
is Kuben. Through the nineties, Kuben had activities with Danish architectural
firms on the German market. However, although Kuben and a few of the Danish
architectural firms it worked with did invest in the relationship, these activities
probably were still more hierarchical than network-like, due to Kubens no
cure, no pay policy which to a large degree precluded the mutual dependence
characteristic of relationships in networks (see Easton, 1992: 107, 109-10).

Despite the networks being more of an ad hoc informational nature than of the
nature specified in IMP work, Johanson and Mattssons (1998: 200) con-
ceptualization of the possible modes of establishing positions in relation to
counterparts in foreign networks, which were described in Subsection 2.2.2.,
may still be used in an assessment of the type of internationalization. This is
because their contribution (see ibid.) does not make specific requirements
concerning e.g. dependencies, relationship investments, activity links, or resource
ties (see Subsection 3.3.1.).

In the terminology of Johanson and Mattsson (ibid.), the Danish private sector
actors were mainly involved international extension, i.e. the establishment of
positions in relation to counterparts in national nets that are new to the firm.
However the activities of one actor, namely the Danish Ministry of Housing, were
broader, as the Ministry sought to serve both firms new to the German market as
well as firms already active on the German market through the four types of
activities listed in Subsection 7.2. Furthermore, the generally formulated
cooperation agreements of the Ministry and the Ministrys reports about building
with wood or ways to save money in the Danish and German construction
industries were very general efforts that can be best described as attempts to in-
crease the level of international integration, to use the terminology of Johanson
and Mattsson (1988:20).

However, the Danish state cannot legitimately control or constantly push the
integration of two national nets the way a private firm might be able to. The
Danish state, and, more specifically, the Danish Ministry of Housing are instead
restricted to the role of the door opener, to use the term Danish Construction
207
Industry Attach Jrgen Skovgaard Vind. This means that the Ministrys chances
of success in the quest of pushing international integration are not necessarily
high, as there is no way in which the state can get a group of Danish construction
industry actors to form relationships with a group of German construction
industry actors.

On the basis of the above, it is not surprising that many of the Ministrys
cooperation agreements have only produced relatively short-term waves of
interest for Danish and German firms in Denmark as well as the respective
German Lnder. Additionally, the criticism that some private sector respondents
voiced about the Danish Ministry of Housing unrealistically pushing Denmark
and Danish solutions onto the German market may also at least in part be
explained by the fact that while the individual Danish private sector firms are
involved in firm-specific international extension and penetration to serve own
interests, the Danish Ministry of Housing is promoting general international
integration to serve the interests of the Danish construction industry (see ibid.).
This fundamental difference of goals cannot be eliminated, unless one eliminates
all of the Ministrys export-related activities save the advisory and information-
seeking services for which the firms must pay, because the Danish Ministry of
Housing cannot go in and directly support specific firms internationalization
efforts.

In connection with theoretical development, it must finally be mentioned that the
above application of Johanson and Mattssons (1998) modes of international-
ization model to public sector actors behavior is a promising novelty. I believe
that categorizing public sector actors internationalization-related efforts and
comparing them to the modes of internationalization chosen by private sector
firms may provide some explanatory power with regard to discrepancies between
policy intensions and actual policy outcomes. This, however, needs to be studied
further in a separate study.
208
8. Knowledge used in Acquiring Architectural Projects in Germany.
8.1. Introduction.

As previously mentioned in Section 5.4., an abridged English-language translation of
the responses of the persons from my case study firms is found in Appendix B. The
unabridged Danish- and German-language responses form the basis for my treatment
of research questions 3 - 5 in Chapters 8 10, yet in this and the subsequent two
chapters, I will refer to some of these responses found in Appendix B. In connection
with this, it is important to recall that whereas Appendix B has been read and
corrected by my main study respondents to insure that it is in accordance with their
own views, Chapters 8 - 10 are the results of my Bourdivin distancing or breaking
away from their views (see Section 4.2.). To emphasize this fundamental difference, I
have chosen to call all firms and respondents by name in Appendix B, but to refer to
them as firms and respondents (or, synonymously, interviewees, partners, employees,
etc.) in this chapter, the coming two chapters which deal with research questions 4
and 5, and Chapters 11 - 14, which contain my theoretical and managerial conclusions
as well as the English- and Danish-language summaries of this dissertation.

In Chapter 1, it was stated that research questions 1 and 2 are to be regarded as back-
ground information in relation to the case study research questions 3 - 5. It is therefore
pertinent to briefly review certain pieces of information which are relevant to research
question threes topic, knowledge, from Chapters 6 and 7 as well as from the pilot
study, which is described in Appendix A. This will be done in the following
paragraphs.

With regard to the extent of ties between the German and Danish construction indus-
tries, Chapter 7 and Appendix A, Subsection A.4.2. indicate that international ties are
generally weak, with the exception of a few areas in which large international
architectural firms, engineering firms, and contractors dominate, e.g. bridge building or
airport construction. This implies a large social distance between Danish and German
construction industry actors (see the discussion of Fords (1980) five distances in
Subsection 3.3.1.) and supports the argument that the German and Danish construc-
tion markets should be regarded as two different milieus, despite the spatiality chal-
lenge of Tikkanen (1998, see Subsections 3.3.2. and 4.4.2.). Furthermore, Chapter 6
and Sections A.4.-A.6. of Appendix A indicate that there are major national
differences in the rules and norms regulating the actions of building industry and
architectural firm actors, providing further support to the hypothesis that territoriality,
i.e. whether one is operating on the German national market or the Danish, does
matter.
209

Therefore it may be difficult for Danish architects to establish social capital in Ger-
many (see Figure 20a in Subsection 4.4.1.). They do not initially know the rules and
practices of the milieu which lead to the establishment of credibility through
demonstrating e.g. design-related and technical competence as well as the ability to
manage construction projects or to advise construction project managers. These
architects may thus be, in the terms of Ford (1980, see Subsection 3.3.1), culturally
and technologically distant from the German market. This lacking knowledge of the
milieu may, however, at least partially be obtained during the process of doing
business in Germany, i.e. through activities which lead to the generation of social
capital, if the architects in question and their firms obtain projects despite this initial
lack of knowledge (see Figure 20a). Thus social capital may be generated by Danish
architectural firms operating in the German construction industry milieu during a
knowledge acquisition process similar to the learning-by-doing process proposed by
the Uppsala Internationalization model (see Johanson and Vahlne, 1997, as well as
Subsection 2.2.2.), albeit with the specification that some initial knowledge is
necessary (see Sections 5.4. and A.6., Drbye, 1999, and Entreprenrforeningen,
1996). At the same time the accumulation of social capital and knowledge may also be
a hurdle to project activities in the German milieu if e.g. there are no initial activities;
this is the Catch-22 situation previously described in Section 5.4.

One logical way of avoiding the Catch-22 situation (i.e. the situation in which one
cannot acquire the necessary knowledge through project activities, as these are a
prerequisite for obtaining projects) would be to enter the foreign market in question in
a boom situation. This solution will be examined empirically in this chapter.

It is however mainly the use of knowledge by actors in the three Danish case study
firms that will be examined the following sections of this chapter; social capital will be
dealt with in Chapters 9 and 10. The case study firms were successful in obtaining
levels of both social capital and knowledge which enabled them to receive and
complete projects.

As mentioned in Section 5.3., the necessary project acquisition related knowledge lies
partially at the level of the broader environment. This is therefore the topic of the
Section 8.2. Thereafter project- and customer/cooperation partner-specific knowledge
is examined in Section 8.3. The issues of the case study firm-internal diffusion of
knowledge, the use of resources to acquire firm- or project-specific knowledge versus
the use of resources to acquire more general market knowledge, and the role of boun-
210
dary spanners/relationship promoters will thereafter be the theme of Section 8.4.
Finally, Section 8.5. provides a concluding assessment of the types of knowledge that
the case study firms used in their acquisition activities on the German market and how
they overcame the potential Catch-22 situation.

8.2. Knowledge of the Broader German Construction Industry
Environment.

On the basis of my previous remarks in Section 5.4., the case study firms knowledge
to be discussed in this section pertains to e.g. the regulative legal framework, the Ger-
man DIN norm system, the German language, German construction industry negoti-
ation practice, German public tendering procedures, and German architectural design
traditions, i.e. knowledge at the cultural and technological levels of Ford (1980, see
Subsection 3.3.1.).

8.2.2. Firm 1s Knowledge of the Broader German Construction Industry En-
vironment.

Case study firm 1, the internationally renowned and established architectural firm
(see Subsection 4.3.1. or Appendix B, Section B.2.), has had substantial knowledge
about the German DIN norm systems, the German language, architectural design tradi-
tions in Germany, and German construction industry negotiation practice throughout
the 1990s, mainly due to the fact that three of its current partners as well as a
substantial number of its salaried employees are German-born and educated (see
Appendix B: 414). However, in recent years, there has been an increasing tendency in
Firm 1 to also hire Danish architects who have spend a number of years on the
German market and thus also have knowledge of its milieu (ibid.: 436). In relation to
the potential division of architectural projects into the design and construction phases
(see Figures 8 and 9 in Chapter 2), Firm 1 has mainly solved design-related tasks,
although it has bid for certain German projects as the general contractor (see e.g.
Appendix B: 417).

With regard to recent developments in architectural design in Germany, these have
been broader and more pluralistic than the corresponding developments in architec-
ture in Denmark, as Germany has been very open for influences from all over the
world in recent years whereas Danish and Nordic architects have predominantly built
211
further on the legacy of Nordic design whose roots are related to functionalism,
modernism and the German Bauhaus movements (compare the total of all respondents
responses in Appendix B, see also e.g. Glaser, 1991:403-8, Hansen et al., 1994:15-20,
and Watkin, 1996:490-589). Against this context, Firm 1s architects have easily been
able to sell their Nordic architecture on the German market. However, they have also
discoursed critically about relevant trends in architectural design on the firms study
trips and have also kept up with international trends by e.g. reading architectural
periodicals (see Appendix B: 439 and 444).

Concerning the German legal framework, Case Study Firm 1 has also had a good
fundamental understanding of the workings and differences between the German and
Danish markets throughout the nineties (compare Appendix B: 417, 420, and 435).
However, the firm has experienced more than one case in the 1990s where a German
private client has refused to pay (Appendix B: 430 and 435). The knowledge from
these experiences resulted in the following changes during the course of the nineties:
(a) increased selectivity with regard to German private sector clients and (b) the
increased use of a German attorney, to supplement the firms own legal knowledge
(ibid.). Additionally, Firm 1 has worked hard to keep up with legislation and market
demands concerning e.g. environmental issues related to the German market and used
this knowledge in creating projects for German customers, as its German customers
demanded this (Appendix B: 438).

vironment.

Case Study Firm 2, the nationally renowned firm, as described in Subsection 4.3.1.,
had much less initial knowledge of the broader German construction industry
environment, and thus started by designing housing the way it is designed in Denmark
(ibid.: 449). However, Firm 2 was aware that it was lacking knowledge; this was one
of the reasons for its decision to establish an office in Berlin (ibid.: 467-8). However,
the extent and the types of broader national-level knowledge required took the firm by
surprise. In the words of the partner who manages the firms German subsidiary in
Berlin (ibid.: 468):

When we look back at how we started here in Berlin, we are forced to
smile at ourselves. We had done a lot of serious research about the market
and had made conservative budgets, yet not one of the projects that contri-
buted to our decision to open the Berlin office ever were realized! [...]

212
[Additionally,] we have made all the typical mistakes that were possible to
make. This happened because one does not ask questions that one does not
know are necessary to ask.

While the Germans generally are positive towards Firm 2s variation Nordic design
(ibid.: 449), the DIN norm system (ibid.: 448) and German use of quantity surveying
techniques in construction planning plans (ibid.: 449) were areas where Firm 2 very
quickly learned that it lacked knowledge. Through the nineties it has worked to acquire
this knowledge, i.e. through varying its coalitions of cooperation partners (ibid.: 455);
it however does not feel 100 % comfortable in doing all of the quantity surveying
details itself or managing the entire project. Thus today it still forms coalitions with
other German firms who then do this work (ibid.: 449-50), and mainly sticks to tasks
related to the design phase of Figures 8 and 9 (see Chapter 2). Aside from this,
however, Firm 2 is today able to follow the rules of the German market in practice
(Appendix B: 445).

In contrast, with regard to the German language, Firm 2 was from the very beginning
aware that speaking German well was a must for the person responsible for contacts
to German clients. The Danish-born partner who runs the German office therefore
speaks German well enough not to get into trouble because of language difficulties, yet
not without an accent (ibid.: 465).

With regard to public sector tendering, in contrast to Firm 1, Firm 2 not only had to
deal with the uncertainty related to the new Public Services Directive (Council of the
European Communities, October 13, 1997); its Danish representatives also had to
learn about German negotiation practice to be able to participate in the negotiated
procedures common in Germany (See Section 6.4.). However, today the firm has
knowledge of its strengths and weaknesses in relation to German public tendering
(Appendix B: 465) and the way public sector decisions often are made (ibid.:464-5),
and has also developed its public sector screening practice on the basis of this know-
ledge (ibid.:466-7).

Finally, with regard to other legal and accounting matters, Firm 2 initially took mea-
sures to insure the accumulation of the necessary knowledge. It very quickly found
competent German legal and accounting advisors who were able to assist the firm in
accumulating knowledge when mistakes were made, e.g. in the area of the amount of
documentation necessary for the potential court case (ibid.: 473). Since the establish-
ment of its German office, it has accumulated knowledge about these areas which it
uses in its daily practice as a precautionary measure (ibid.).
213

vironment.

As previously mentioned in Section 4.2 and Appendix A, Section 6, Case Study Firm
3 is the successful and innovative younger firm of this study. At the beginning of the
1990s, Firm 3s founder had a good command of the German language, due to the
facts that he had worked as a carpenter in Switzerland in his younger years and had
spent a large part of the 1980s in Germany (ibid.: 507). However he did not have de-
tailed knowledge of the regulations concerning construction and companies (ibid.:
Subsection B.4.3.). This knowledge was therefore accumulated after 1992, when the
firm was preparing to open a subsidiary, with the help of the solicitor that it employed
(ibid.: 483).

With regard to design traditions, Firm 3 demonstrated its understanding of German
design heritage when it won a project concerning the renovation of housing designed
by the deceased world-renowned German expressionist architect Bruno Taut (ibid.:
485); in other competitions, its Nordic design was also lauded by German decision
makers (ibid.: Section A.4.).

As for public tendering procedures, Firm 3 like Firms 1 and 2 experienced a new and
unknown situation after the EU Public Services Directive had been voted upon by the
EU Council of Ministers. Furthermore, similarly to Firm 2, this uncertain situation was
compounded by the fact that Firm 3 had not participated in German negotiations
before (ibid.: 485 and 509). Thus knowledge about the negotiated procedure had to
be gathered through experience (ibid.: 509). With regard to architectural design com-
petitions, Firm 3 has also accumulated knowledge about how German proposals that
have won have looked by e.g. systematically reading German architectural periodicals,
to enable it to made its submissions as close to the expectations of the German jury as
possible (ibid.: 508 and 517). However, the results of these efforts cannot be
determined (ibid.: 517), as the reasons from having chosen one project as the winner
that German (and Danish) juries mention in their official verdicts are not very detailed.

On the basis of its general knowledge acquired, Firm 3 judged in 1998 that it had
sufficient experience to begin managing the construction process in Germany (see
Figures 8 and 9 of Chapter 2). However, in the aftermath, its knowledge has proved to
be insufficient as its first project management client firm used an opportunity to take
Firm 3 to court (ibid.: 493). This court case was so costly for Firm 3 that it decided
to close its German subsidiary in the late spring of 1999 (ibid.). Thus one can speak
214
of a lack of knowledge of risk (see Messner, 1994:92 as mentioned in Section 3.2.) as
a key factor that led to the termination of project acquisition activities from Firm 3s
subsidiary on the German market.

8.2.5. Conclusion concerning the Knowledge of the German Construction
Industry.

With regard to the knowledge related to the broader German construction industry
environment, it can be concluded that only Firm 1 had an acceptable knowledge of the
German market during the entire decade. Firm 2 and 3 had to accumulate knowledge
about German construction law, the DIN norm system, and German negotiation
practice, i.e. factors relation to Fords (1980) cultural and technical distance, because
they needed to use these types of knowledge in order to function as credible firms on
the German market. This knowledge was acquired first in relation to the design phase
of the construction project (see Figures 8 and 9 of Chapter 2).

With regard to architectural design traditions native to Germany, all firms showed
knowledge of this field, yet knowledge of this type did not unequivocally seem to be
useful in project acquisitions, due to the openness of the German architecture market
to international influences. Firm 3 did, however, systematically work with insuring that
its design contest material looked as native German as possible; unfortunately,
however, the effect of this move cannot be discerned.

Firm 3 began work in the area of construction management (i.e. the construction phase
of Figures 8 and 9) on the German market at the end of the 1990s, as it believed that it
had sufficient general knowledge to make this move. However, this move proved to be
fatal for its German subsidiary, as the subsidiary was taken to court by a client who
refused to pay for the work completed, yet demanded that the firm, in accordance
with German law, continue to work on the project. Firm 3 subsequently closed this
subsidiary to minimize its losses.
215
8.3. Knowledge related to Specific Actors and Potential Projects.

The knowledge covered in this section is project-specific, customer-specific, cooper-
ation partner-specific, or specific in several of these ways. As previously mentioned in
Subsection 5.4., interviewees from the three case study firms had been requested to
tell about their ability to (a) make social contacts to potential clients and cooperation
partners, (b) act in concrete situations, i.e. situations requiring discretionary effort and
personal judgment (see Lwendahl, 1997:20, as described in Section 2.4.) on the basis
of their understanding of the German construction industry, and (c) undertake the
process of looking for projects. These were the most difficult topics of the interviews
for both the respondents and me, as the interviewer, to converse about, probably
because we usually neither converse about our ability to communicate or act nor about
the cognitive preconditions for our ability to communicate or act (see e.g. Skaates,
1997:17-20).

Therefore these topics were approached indirectly in situations where the respondents
found themselves at a loss for words, as it was my impression that it was much easier
for my respondents to speak about the details of the project once it had been started
than to recall the steps which had led to this happening and the knowledge that had
been used. I therefore also asked more specifically about knowledge of other actors
as well as the perceived importance of differences and similarities in taste, climatic
conditions, cultural values, traditions, topology (see Sharma, 1991, as described in
Section 2.4.), and levels of customer and supplier know-how (see Gnter and Bonac-
corsi, 1996, as described in Section 3.2.) in relation to the architectural project(s) in
question.

8.3.2. Firm 1s Knowledge related to Specific Actors and Potential Projects.
With regard to Firm 1, the respondents with whom I spoke about project-specific,
customer-specific and potential cooperation partner-specific knowledge were all Ger-
man-born. I therefore did not ask them to describe their abilities to make contacts to
German actors or act in concrete situations on the basis of knowledge about the Ger-
man market. My reasoning for this was as follows: Although German society has
changed and developed in the decades that these German-born partners have lived in
Denmark, they would not be useful respondents concerning these issues as they
would not perceive the German market as being foreign the way Danish-born actors
do.

216
Concerning Firm 1s German project activities, the main area of acquisition in the
1990s has been the public sector (see Appendix B: 415 and 423). In this sector, the
relationships between the customer and client on the German market have been in-
fluenced by the rules of the EU Public Service Directive since the date of its accept-
ance by the Council of Ministers (see Section 6.4.). Firm 1 has had no trouble being
prequalified in German public tendering procedures (Appendix B: 423); however, it
did learn during the nineties that it had more success in specific German public
tendering procedures if its Copenhagen office applied than if its German office applied
as it is world-renowed as a Danish firm (ibid.: 422-3).

Respondents also indicated that negotiations with individual actors had not posed
substantial difficulty (see e.g. ibid.: 419-20), although one respondent indicated that
Firm 1 had felt somewhat unsure about the directive in the beginning because of the
lack of general knowledge about how it would be administered (ibid.: 424). Thus,
despite initial uncertainty, Firm 1 has generally had the necessary actor- or project-
specific knowledge to acquire projects from actors of the German public sector
during the nineties.

In the private sector, Firm 1 knows that it is positioned such that it can compete with
the most prestigious nationally and internationally renowned German firms for projects
concerning e.g. the headquarters or other important buildings of large, serious firms,
that in turn are willing to pay Firm 1s fees (ibid.: 430, 431). However, responses
show that, in contrast to Denmark, this body of firms in Germany is so large that Firm
1 only knows very few of the actors in these German companies and only knows of a
few of the relationships and/or project dealings between other, comparable German
architectural firms and the large, serious [German] firms (ibid.). Firm 1 does not
make an effort to acquire this type of knowledge systematically or to concentrate on a
specific subgroup of these firms (ibid.). Thus, to use the terminology of Mattsson
(1984) as explained in Subsection 3.3.2, in the segment that Firm 1 has chosen to
work and also has the necessary cultural capital to work in (this point will be explained
in Chapter 10), Firm 1 is only aware that its general identity is that of a prestigious
architectural firm and that its function is to deliver the prestigious architecture that is
associated with its name and reputation. In terms of Ford (1980, see Subsection
3.3.1.), Firm 1 may have had a higher total level of social distance to all firms than
would have been the case had it worked to systematically concentrate on building
relationships to certain of these potential client firms.

217
Furthermore, among the comparably larger population of prestigious architectural
firms who deliver premium architectural solutions in Germany, Firm 1 is also aware
that its name is associated with e.g. modernism and functionalism to the detriment of
more showy styles in architecture and that its client firms prefer its architectural style
to others (Appendix B: 438 and 441). However it neither has systematic knowledge of
e.g. construction technical preferences of potential German clients who are in regular
contact with the firms for whom it has built or of similar potential German clients who
have no indirect contacts to Firm 1. Thus Firm 1 has little knowledge of the further
details of its specific identity in the constellation of firms that it works with and of the
current variation of identities and segments on the German market for prestigious
architecture.

With regard to differences and similarities in taste and traditions, the knowledge that
Firm 1 stands for non-obtrusive, functional design (Appendix B: 430, 431) has not
been directly used, i.e. communicated, in relation to specific projects, clients or coop-
eration partners, as it has been evident to all parties that have selected Firm 1 that Firm
1 has chosen to remain placed within the functionalist/modernist tradition in its
architectural projects, instead of breaking with these traditions and building buildings
from e.g. the deconstructivist position (see Appendix B: Section 2 as well as Hansen
et al., 1994:79). The knowledge of how this was communicated to clients or to what
extent it was evident from their previous works (or manifest cultural capital, to use
Bourdieus (1983) term; see Figure 20b in Subsection 4.4.1) was, however, not
discernable in my interviews. Knowledge related to this topic may therefore still be a
part of the body of tacit knowledge of practice (see Section 2.3.).

Concerning building traditions and values, Firm 1 has also had few problems convin-
cing German clients that it could fulfill their needs and objectives (see Section 2.6.)
and subsequently design buildings that would accepted by their individual customers,
in accordance with their traditions and values (see Sharma, 1991:23, as cited in
Section 2.4.). This is e.g. illustrated by the fact that the firm was prequalified so many
times in Germany (Appendix B: 423) and that a private German investor readily began
to do business with Firm 1 concerning a housing project he took over from another
party who had initially hired the firm (ibid.: 416-7). It has, however, not been possible
to specify exactly what knowledge was used in the judgmental tasks (see Section 2.4.)
of serving and fulfilling client expectations.

As for the factors climatic conditions and topology (see Sharma, 1991:23), respond-
ents from Firm 1 indicated that these played a minor role in dealings with specific
218
customers on the German market, although the solutions used to solve similar pro-
blems related to climate and topology often vary between the two markets.

With regard to the issue of the centralization and professionalization of the pro-
curement function (Gnter and Bonaccorsi, 1996, see Section 3.2.), two respondents
from Firm 1 (see Appendix B: 428-9) indicate that they have observed that the pro-
curement function has been significantly professionalized in recent years. While
Firm 1s German private sector clients always have had substantial knowledge of own
construction needs as well as of relevant legal requirements and construction methods,
these potential clients have recently increasingly begun to use in-house construction
specialists who judge the proposals of an architectural firm individually by their
perceptions of quality and price, instead of maintaining relationships with one or more
esteemed architectural firms. The knowledge-related implication of the new trend is
that Firm 1, similar to the firm of the renowned German professor of architecture
mentioned in the quotation at the end of Subsection 6.2., must have the necessary
knowledge to be able to convince a professional construction procurement committee
or department that they are the more able firm for the job (see Appendix B: 428). Firm
1 seems to have the necessary knowledge for this endeavor, as it has been successful
in relation to several German private clients (quotation omitted from Appendix B for
reasons of confidentiality).

However, at the same time, the respondent responsible for the finances of Firm 1
would also not rule the possibility of new long-term relationships out (ibid.). Thus
while Firm 1 has evidence that long-term relationships increasingly are being called into
question by popular professional procurement techniques, it may still be possible
for Firm 1 to establish another long-term relationship to a German client. Firm 1 seeks
to ensure that both possibilities are kept open (ibid.).

Concerning the mobilization of support from other actors for general export activities
beyond the level of an individual project (see Axelsson and Johanson, 1992, as ex-
plained in Section 2.2.), this possibility only generally exists in situations where the
relationship between the architectural firm in question and other firms are more than
arms-length, i.e. where there exists some sort of relationship, as defined by Easton
(1992) in Subsection 3.3.1. One such situation is Firm 1s long-term relationship to a
Danish multinational firm (ibid.: 412). This multinational firm has used Firm 1 to
design its buildings in Germany for many years. However, a partner in Firm 1 believes
that while it is certain that Firm 1 receives industry and building type-specific
knowledge that can be used for other German projects from this relationship, it is un-
219
certain whether the Danish multinational firm will refer the German firms that it knows
to Firm 1, as Firm 1 never poses questions concerning this matter (ibid.: 422). Firm 1
also has a longstanding relationship to a German client firm (ibid.: 413); however, this
firm also does not regularly recommend or actively assist Firm 1 in finding other pro-
jects (ibid.). Thus Firm 1 does not have knowledge or a practice concerning mobiliz-
ing clients with regard to acquisitive activities beyond the for the clients themselves.

On the other hand, an acquaintance of one of the partners of Firm 1, a former con-
struction manager on one of the firms projects, contributes actively to Firm 1s acqui-
sitive activities by introducing the partner in question to potentially relevant decision
makers (ibid.: 446), and a few German engineering firms very occasionally mention
projects of potential interest to Firm 1 (ibid.: 425). Firm 1 does not, however, make
any effort to suggest this type of extended cooperation to firms with whom it has
social contacts, because its partners perceive that this is not the way things are done
and that this might be considered too forward or aggressive by cooperation
partners, as eagerness to be informed of coming potential projects might be
interpreted as a sign of a firms declining ability to attract projects independently (see
e.g. Albertsens remarks about the professional sub-field in Subsection 4.4.1). Thus
Firm 1 uses its knowledge of the rules of the professional sub-field concerning caution
when mobilizing potential German partners; it seeks to insure longstanding trust
through using the rules of this sub-field rather than developing knowledge and
practices of acting more directly to achieve improved short-term results.

Similar to Firm 1, Firm 2 sees its strength in the typical Nordic design strongholds of
functionalism and modernism (Appendix B: 460-1 or Arkitektfirmaet C.F. Mllers
Tegnestue, 1997:78), yet it does not consciously use this knowledge in relation to
most specific customers or cooperation partners, as these third parties very quickly
realize this themselves (Appendix B: 460-1). Similarly to the situation of the inter-
nationally renowned Firm 1 on the German market, this knowledge is in most circum-
stances also not in itself sufficient to ensure initial social contacts (see the exception in
ibid.:447).

After the opening of its office in Berlin, Firm 2 learned from experience that its Danish
references had much less value on the German market. In the words of a respondent
(Appendix B: 478):

A Danish reference is often impossible to use because there are so few
Danes who speak technical German fluently. Therefore the German must
220
speak English very well if he decides to call Denmark. But why would one
call Denmark concerning a Danish architect when one can find a German
architect with similar German references? [] One does not think about this
in the beginning. One only thinks about the fact that we are a large archi-
tectural firm in Denmark, which we are, but when we arrived in Germany,
we suddenly became a much smaller firm without references.

This realization was expensive for Firm 2. Its German office made losses for a much
longer period than expected, as it took several years more than anticipated for Firm 2
to achieve the situation that German actors begin to contact the Berlin office regularly
(ibid.: 454).

Firm 2s Germany-related knowledge of direct and indirect firm relationships with its
customers and cooperation partners was acquired through its presence and activities
in Germany (ibid.: 460); this knowledge eventually provided it with the social capital
necessary for regular social contacts to German actors (see Chapters 9 and 10).
However, although Firm 2 uses this social capital and knowledge of direct and indirect
firm relationships in its project acquisition activities, its knowledge acquisition with
regard to this topic has not in any way been planned (ibid.).

Today Firm 2 receives tips from several cooperation partners and also informs coop-
eration partners with regard to potential projects (ibid.: 469), indicating that it knows
how to mobilize certain potential German cooperation partners in relation to its
activities at the level of the individual project by using its knowledge as a credential of
credibility in the generation of social capital (see the remarks on credibility in
Subsection 4.4.1.). This also indicates that initial social distance (Ford, 1980, see Sub-
section 3.3.1.) has been overcome with regard to these potential cooperation partners.
Firm 2 also has knowledge of some of its cooperation partners strengths and posi-
tions on the market; a case in point is its continual cooperation with a large construc-
tion management firm with a good reputation for taking responsibility for large and
prestigious clients money (ibid.).

Firm 2 has a tendency to approach the same firm twice, if both firms have worked on
a similar German project together and the cooperation went well, which is also the way
it is treated by other firms on the German market (ibid.: 454). On the other hand, Firm
2s cooperation with a Danish multinational firm is not mobilized in any way in relation
to its international activities on the German market, aside from when it builds for this
firm. Thus, similar to Firm 1, Firm 2 has a knowledge of how to mobilize support for
221
its internationalization activities at the level of individual projects, yet not at the level of
multiple projects.

In relation to the knowledge of where different actors stand in relation to each other,
Firm 2 is aware of e.g. that it is the smaller party in its dealing with the large con-
struction management firm, and that this firm also uses market-like selection mecha-
nisms such as competition between architectural firms when dealing with potential
construction project clients (ibid.: 455). Similar to Firm 1, Firm 2 is, however, not
aware of its general identity and function in the constellation of German construction
industry firms at other levels of aggregation than the level of the individual project nor
of its specific strengths and identity in nets in comparison with other architectural
firms in the net and thus cannot use such knowledge in its acquisition activities.

Firm 2s selection practice is an uneasy compromise between concentrating on certain
types of projects for the time being and anticipating the day when it will acquire
projects in many different fields in many parts of Germany, which is its goal (ibid.:
458). On the short term, its German office uses its knowledge of the general market
conditions as well as of the types of projects which may lead to other types of pro-
jects in determining the focus of its acquisition work. In the words of a respondent
(ibid.: 459):

We know that the former East German regions will need to build or
renovate their stadiums because they do not fulfill the requirements of the
International Soccer Association. Thereafter we can sit down and try to fig-
ure out when this problem will be solved. And one can also look at the Ger-
man professional soccer teams and their stadiums and figure out when they
will consider renovations. This is one way to anticipate projects. []

[W]e are working our way into [the market for hospitals] but in a different
way because we have now been working on nursing homes and a nursing
home is in some ways similar to a hospital. And we have designed a re-
search and development center in Germany which included some laborator-
ies, and laboratories are also a part of a hospital.

With regard to the level of the customers and suppliers know-how (see Sharma,
1991, as cited in Section 2.4., as well as Gnter and Bonaccorsi, 1996, as cited in
Section 3.2.), Firm 2 has both met professional buyers that choose firms on the basis
of the market mechanism (Appendix B: 445) and professional buyers for whom non-
specific personal factors also have played a decisive role in selection processes (ibid.:
447-8). During the completion of Firm 2s initial two projects, which both concerned
222
housing, Firm 2 had one private client who had used a professional selection model,
namely a competition in accordance with the EU Public Services Directive, and
another who used personal preferences in his selection (ibid.). In both situations the
client had more know-how with regard to dealing with the specific rules and actors on
the German market, e.g. the DIN norms and the local authorities, than Firm 2 (ibid.).
Firm 2 was, however, always aware of the potential problems that this situation might
entail; according to its respondents, this situation was initially difficult to change, as
the German architects whom they could have employed to help them with these mat-
ters were not initially available or very expensive to employ due to the boom at the
beginning of the decade (ibid.: 448). However, Firm 2 did obtain German employees
as soon as possible to give it the knowledge that it lacked (ibid.).

Thus, in relation to the Catch-22 situation described in Section 5.4., the boom on
the German market (and the resulting undercapacity problems) may have led German
clients to choose Firm 2 despite its lack of knowledge, yet the boom also made it
more difficult for Firm 2 to find knowledgeable persons to help it overcome these
deficits through cooperation on its project activities.

With regard to taste and building traditions, Firm 2 designed the apartments for its first
German client the way comparable Danish apartments would be designed. However,
these apartments contained some features which are not nearly as common in
Germany as in Denmark i.e. a combined kitchen/dining room with windows and a
door to the balcony (ibid.). One of the reasons for this was that Firm Bs architects
had trouble designing the more common German variation of a small enclosed and
separated kitchen, as they did not comprehend how such kitchens could be con-
sidered acceptable by users. Firm B thus took a chance in its design choice; its
Danish-style kitchen/dining room combination was, however, a success with the Ger-
man residents (ibid.). There may have, however, been other incidents in Firm 2s early
participation in architectural competitions where the presence of features common in
Denmark were not acceptable to the particular German jury or potential client who
examined the proposals. This is however impossible to discern, as potential clients
often do not give a reason for terminating conversations and juries justifications of
their choice of firm in the official announcements published at the end of architectural
competitions are most often short and very general. Thus Firm 2s knowledge of
fulfillment of perceived client needs is necessarily lacking in some respects.

Concerning climatic conditions and topology, Firm 2 has been able to satisfy the
needs of customers. As the climate and topology of Germany are not that different
223
from Denmark, as was the case with Firm 1, the issue with regard to these factors was
more that German law in some cases demands different solutions than Danish law (see
ibid.: Section B.3); however, Firm 2 had the knowledge to provide the credible
promise in these situations.

With regard to the cultural values of specific customers, Firm 2 acquired the know-
ledge through its first projects on the German market that a higher level of precision
and detail than is common in Denmark with regard to presenting figures is very im-
portant for many German actors and officials in the building process (ibid.: 468). Firm
2 now uses this knowledge in practice in order to be able to establish credibility
towards its specific individual German clients and cooperation partners (ibid.). Addi-
tionally, Firm 2 also acquired the knowledge that many German clients have strong
preferences for dealing with the man in charge (ibid.: 470), also in situations where a
similar Danish client probably would expect the person in charge to have delegated the
responsibility concerning details to an assistant and would have dealt with the
assistant. This knowledge, however, presents some organizational dilemmas because
the Danish head of Firm 2s German subsidiary finds himself asked to attend meetings
in situations where he would prefer to delegate the responsibility to one of his salaried
employees who are working on the part of the project that is the topic of the meeting
(ibid.). He thus chooses to follow his clients preferences some of the time; at other
times, he insists upon delegating responsibility to his employees.

Yet another difference in cultural values concerns the emphasis placed upon employee
empowerment in public discourse. In Firm 2s Danish and German language presen-
tation book (Arkitektfirmaet C.F. Mllers Tegnestue, 1998:138-9, see also Appendix
B: 476), in a passage entitled The Future of Buildings for Commercial Use, one
partner speaks very positively of the increasing use of participatory and democratic
management styles. However the effect of this passage upon individual potential
Danish and German clients may be very different, as there is more unequivocal norma-
tive discourse in support of these particular management styles in Denmark than in
Germany (see e.g. Glaser, 1993; Hofstede, 1983; Wagner, 1990; and Schramm-
Nielsen, 1997, 1992, and 1991). Respondents from Firm 2 who had direct dealings
with Germany demonstrated knowledge of this issue (see e.g. Appendix 2: 471), and
indicated that, if asked or if they judged it wise, they would also be to use this know-
ledge to convince individual German customers of their ability to also build
workplaces suitable for more traditional chain-of-command management styles.

224
Other client- or actor-specific norm- and tradition related dilemmas of judgment that
Firm 2 runs into concern (a) when to accept poor treatment from a client and when to
take the client to court (ibid.: 472) as well as (b) when to demand documentation from
authorities (ibid.: 472-3). In these situations, Firm 2 knows that it has the legal right to
demand compensation or documentation, yet also knows from experience that this is
not always done by German firms and that taking these steps could lead to coop-
eration problems in the future due to destroyed trust or a depleted stock of social cap-
ital. In such situations, Firm 2s Danish partners sometimes lack the feeling of
instinctively knowing what is the right thing to do (ibid.); they are thus forced choose
their course of action based on e.g. advice from their attorney as well as their current
level of knowledge and the knowledge that they are still not 100 % home in the milieu
of the German construction industry.

However, in other areas of Firm 2s business, its actors know that national norms play
less of a determining role. This is e.g. true in the area of sports stadiums. The regu-
lations of the International Soccer Federations are, as the name suggests, international.
Therefore Firm 2s Danish and Norwegian knowledge of experience with stadiums
helped it become a consultant to a German professional team with regard to project
proposals concerning the construction of a new stadium in Germany (ibid.: 451).

Firm 3 had no trouble making initial social contacts to potential German customers,
due to the contact-establishing flair of the German-speaking founding partner who is
the main person responsible for establishing contacts both in Denmark and abroad
(ibid.: 494). Thus initial social, cultural, and technological distance (Ford, 1980) ap-
pears to have played less of a role in Firm 3 than was the case for Firm 2. However
actually acquiring projects from German customers turned out to be far more difficult
than expected (ibid.: 482), which means that these factors may have played a role in
relation to the establishment of credibility and that social capital accumulation through
common conversations and other activities (see Subsection 4.4.1.) may have been slo-
wer or less than anticipated or perceived by Firm 3s actors, due to a lack of know-
ledge of the fine points concerning the fitting personal judgment and discretionary ef-
fort necessary to generate social capital during these activities (see ibid.). Some initial
tips concerning the generation of credibility, i.e. the importance of having an office in
Germany as a signal that ones firm is serious, were, however, received from
German contacts (ibid.: 482-3); this knowledge was subsequently incorporated into
Firm 3s acquisition strategy.
225

Firm 3 has been specialized in housing and renovation on the German market of the
1990s (ibid.: 489). From this position, it has used its body of Danish housing-related
know-how in its efforts to create projects that could meet potential German cust-
omers needs (ibid.: 493) and in conversations and negotiations concerning potential
projects (ibid.: 481 and 491-2). However Firm 3 did not always know to what extent
and in what specific respects the German customer would accept or welcome a
Danish-inspired solution (ibid.: 493, 515-6); thus it still sometimes lacked knowledge
of the specific potential customers norms and judgment criteria in its project
acquisition activities. Greater knowledge of these things might have lead to the
generation of greater levels of social capital and, in turn, to a higher level of project
activity (see e.g. ibid.: 482, 492-3, and 494).

However there are discrepancies of opinion about this topic among Firm 3s employ-
ees. One respondent, the head of the Firm 3s daily subsidiary operations in Germany,
is of the opinion that Firm 3 did not gather enough knowledge of specific segments
and specific customer needs in Germany (ibid.: 504 and 515-6) and thus was also
lacking knowledge about where actor firms on the German market stand in relation to
each other (see Axelsson and Johanson, 1992: 231 or Section 2.2.). This is my
conviction as well.

On the other hand, the founding partner responsible for establishing contacts is of the
opinion that this sort of planned information gathering is less useful (ibid.: 512) as he
perceives acquisitive work in Germany as not being that different from acquisition in
Denmark (ibid.: 487). His mental model for the acquisition of projects does not
include systematized information gathering of the nature envisioned by the head of the
German subsidiary (ibid.: 489 and 514). He thus preferred to concentrate on the social
aspect of projects, using his social skills (ibid.: 497) which have been acquired on the
basis of tacit knowledge of experience, and thus attributed many of the project
acquisition failures to the fact that the German networks are larger than the corre-
sponding Danish networks, especially in metropolitan areas (ibid.: 495).

With regard to understanding the German construction industry in general terms and
acting on the basis of this understanding in relation to specific potential clients, Firm 3
knew, however, throughout the nineties that it was not an influential firm with regard to
discussions of which type of design is best; it also knew that it was not realistic for it
to attempt to influence these discussions or make a name for itself exclusively or
mainly on the basis of design (ibid.: 502). It has therefore perceived its relative
226
position on the German market in the nineties as that of a firm strong on some type of
traditional Nordic design and has aimed at the professional sub-field of architectural
firms as the other two case study firms (see Albertsen, 1996 or Subsection 4.4.2. for a
definition of this sub-field) on the basis of this perception. However it has also per-
ceived a need to convince potential clients that its projects also excell with regard to
e.g. economic or logistical solutions (ibid.: Section B.4) and has used this know-
ledge in its acquisition work.

Concerning knowledge of firm relationships, Firm 3 used its knowledge of certain rela-
tionships in its acquisition; an example of this is its contact to construction industry
actors who had social contacts to Firm 3s attorney (ibid.: 484). It also made an effort
to get to know German construction industry handcraft firms in the area of Leipzig so
that it could propose a new way to organize the building process to receive a total
optimum across the boundaries of the traditional building fields of specialization in a
specific project (ibid.: 491-2). However it did not by any means have comprehensive
knowledge of (a) the German net of firms that work with housing projects, (b) a
specific net in a local area, or (c) the way that this net may be segmented or was
divided into social groups. With regard to a net in a local area, Firm 3s founder
believes that, in retrospect, it would have been easier for Firm 3 to obtain this type of
local knowledge, had it placed its subsidiary in a city smaller than Berlin, i.e. a city
where the local nets are comprised of fewer actors (ibid.: 495).

With regard to mobilization of other actors with regard to export activities, Firm 3
completed several projects on the German market in succession for a petroleum com-
pany from a Nordic country (ibid.: Section B.4). However, before its activities on the
German market, Firm 3 had not had any contact to this firm; both firms were thus
concurrently internationalizing. Firm 3 also worked together with a Danish housing
association concerning a couple of potential projects (see Appendix B: 491), as well
as other Danish actors concerning other potential housing projects, some of which re-
sulted in project orders. Furthermore, the contact that Firm 3s German attorney esta-
blished for Firm 3 resulted in a project (ibid.: 484, see also above). Thus Firm 3 was
able to use its knowledge of projects and the German market to mobilize some other
actors in its network with regard to its activities on the German market at the level of a
specific, individual project.

Concerning knowledge of taste, climatic conditions, cultural values, traditions, and
topology, climatic conditions and topology did not present problems for Case Study
Firm 3, although the German regulations in some instances promote different sorts of
227
solutions to these types of problems (see the previous subsection). With regard to
taste, respondents from Case Study Firm 3 demonstrated knowledge that German
submissions to design competitions often include different color combinations and il-
lustrative effects than Danish submissions (Appendix B: 508); they furthermore used
this knowledge in systemized efforts to attempt to become more German in their
specific proposal submissions (ibid.). With regard to values and traditions,
respondents from Firm 3 demonstrated knowledge of the circumstance that inexpen-
sive housing construction as understood by the German potential client in question
may be something totally different than that which the Danish architectural firm has in
mind or that which is typically considered inexpensive in Denmark; this knowledge
was also used in project acquisition attempts (ibid.: 490).

In some situations, e.g. a renovation project concerning the housing designed and built
by Bruno Taut in Magdeburg (ibid.: 485), this knowledge of the customers
perception of values and traditions resulted in a project, whereas in other situations,
e.g. the proposal concerning the renovation of a large Leipzig neighborhood which in-
cluded a tenant empowerment program as well as a different way of organizing
renovation work to insure a totally optimal solution (ibid.:491-3), the ideas developed
by Firm 3 to satisfy problems were innovative and did in theory solve certain general
structural problems of the German market, yet did not sufficiently capture the
conviction of the potential customer. Therefore it can be said that Firm 3 did not
always have sufficient knowledge of customers values and traditions.

Similarly to Firm 2, Firm 3 sometimes found itself in situations where it knew the
formal rules of the German construction industry and it knew that these rules were not
always followed, yet it did not know how other actors acted in practice or the effects
of their action upon constellations of cooperation (ibid.: 510).

With regard to the level of knowledge of potential and actual clients, similar to Firms 1
and 2, Firm 3 generally had very knowledgeable cooperation partners. As was the case
for Firm 2, client knowledge exceeded Firm 3s knowledge in several initial projects.
Thus Firm 3 was dependent upon the good-will of certain German clients in its initial
business transactions (see e.g. ibid.: 484), yet, similar to Firm 2, was aware of this
precarious situation and sought to remedy it through the employment of German
employees. With regard to procurement, most public sector clients used models of
professional procurement which excluded the potential influence of personal factors,
save the impression that one makes when one presents a project in the negotiated pro-
cedure. Firm 3s private clients (see e.g. ibid.: 483 and 484), on the other hand, mainly
228
used more unsystematized procedures, which also allowed social contacts established
by the firms founding partner to play a role in their selection of Firm 3.

8.3.5. Conclusion concerning Actor and Project-Specific Knowledge.
The presentation in the previous three subsections indicates that all three case study
firms do not systematically attempt to gather information about their respective posi-
tions (in terms of Mattsson, 1984, and Easton, 1992, as described in Subsection
3.3.1.) in the milieu of the German construction industry or use such knowledge in ac-
quisition activities. However they have an idea of their general level of prestige and re-
nown in relation to Albertsens (1996) three sub-fields (see Subsection 4.4.1.).

With regard to knowledge of direct and indirect firm relationships, all three firms have
little knowledge of these factors both with regard to the German milieu as a whole and
with regard to the potentially relevant segments/nets of the milieu. Firm 2 and 3 have,
however, unsystematically gathered knowledge of direct and indirect firm relationships
in their daily doings on the German market which they have used in subsequent deal-
ings with cooperation partners and potential clients. They have, however, not used this
knowledge to achieve an increased focus upon specific segments or networks of the
milieu and have indicated that they are reluctant to do so, as they and Firm 1 all prefer
to follow a more generalist strategy on the German market, a strategy which is
similar to their strategy on the (smaller) Danish market.

With regard to the mobilization of support for activities on the German market, at the
level of multiple projects, support from actors and firms that the case study firms
know well is not given beforehand for any of the case study firms, as was previously
indicated in Chapter 7. Instead, coalitions are formed mainly at the level of the
individual project, and if the involved firms are content with the project cooperation,
they often in practice notify the some of the same actors when they receive notice of
or acquire another similar project. This happens most infrequently for Firm 1,
probably because a large part of Firm 1s project acquisitions are prestigious public
sector projects which it acquires individually through public tendering procedures.

Climatic differences and topology do not pose knowledge-related problems for the
case study firms, although the way that German actors deal with problems in these a-
reas differs in important respects from common Danish solutions. With regard to
taste, cultural values, and traditions, Firm 1 has the knowledge necessary to establish
credibility with potential customers, despite their individual wishes or idiosyncrasies.
229
Firm 2 and 3 started on the German market during the post-unification boom with
substantial knowledge deficits in these areas; during their first projects they were
therefore dependent upon the flexibility and good-will of their German clients. Since
their initial projects, Firms 2 and 3 have acquired substantial knowledge in these areas
and have put this knowledge to use as soon as it was acquired. However both firms
still have some blind spots in this body of knowledge, some of which they are aware
of. Firm 2 also learned from its initial experiences that its many Danish references were
of much less value to in Germany than it originally had anticipated.

In relation to the Catch-22 knowledge problem (see Section 5.4.), the boom on the
German market at the beginning of the nineties and the resulting undercapacity
problems may have helped firms 2 and 3 to get the project activities that enabled them
to acquire knowledge. However, at the same time, it was more difficult for them to
acquire knowledge during these activities, as German-born and tranined aides in these
initial project activities could not be easily hired.

Concerning potential differences in know-how, the clients of Firms 1 3 are most
often very knowledgeable about construction. Additionally, arms-length, centralized
professional models of procurement are perceived as being increasingly used by a
large number of clients on the German market, although some large clients still have
relationships to specific architectural firms. However, Firm 3 acquired many of its
private sector projects on the German market through its founding partners ability to
establish contact with other firms. Thus it had almost no contact to private sector
entities which use professional, i.e. impersonal procurement procedures.

Additionally, Firm 3 attempted to offer a German public client innovative solutions to
some of the structural problems it saw on the German market with its Danish view-
point. Unfortunately it did not achieve success with its most innovative proposal, as it
was not able to convince the client of the value and implementability of the proposal.

8.4. Degree of Knowledge Diffusion in the Case Study Firm and the Acquisition
of General versus Project-Specific Knowledge.

In the previous two sections, the focus has been upon the types of knowledge used
by the case study firms in obtaining projects. In this section, the focus moves to the
location of the knowledge used and the dilemma of using resources to acquire relevant
general versus relevant project-specific knowledge (i.e. the adaptation/flexibility
dichotomy of Cova et al., 1993; see Figure 13 of Subsection 3.3.2.).

230
With regard to the degree of knowledge diffusion, patterns vary widely among the
three case study firms; however all three firms have one thing in common: They do not
formally and systematically attempt to diffuse knowledge of the German market to all
or certain specific firm-internal actors. Instead diffusion within the firm takes place on
a word-by-mouth basis and usually only when necessary, i.e. in the case of a
specific project (see Appendix B).

Being a large firm with a large percentage of German-born employees (see ibid.: 412
and 414) and many previous German projects, knowledge of the German market and
of specific German customers was broadly diffused in Firm 1 throughout the nineties.
Firm 2 is also a large firm, but the number of employees of Firm 2 with specific
knowledge of the German market has, with the exception of a renovation project
(ibid.: 475), which entailed interaction between a German and a Danish team, been
limited to the individual employees of the German subsidiary as well as the individuals
who have moved from one of Firm 2s Danish offices to the German office for the
weeks or months it has taken to complete a specific project proposal. Finally, Firm 3
is much smaller and more specialized than Firm 1 and 2. During the nineties, certain of
its employees in both Denmark and in Germany have formed ad hoc teams again and
again to deal with German projects; the Danish employees in the teams have included
persons with some experience on the German market. Thus the knowledge of the Ger-
man market has been found at the level of a team in Firm 3.

The specific placement of knowledge in the three firms is depicted in Figure 24; this
figure is an adaptation of Alajoutsijrvi and Tikkanens (1999) Competencies in the
Context of Relationships (see Figure 6 of Section 2.4.), in that the definition of the
vertical axis has changed from increasing codification/utility versus increasing con-
textuality/tacitness to increasing universality versus increasing contextuality, as no
evidence was found indicating that generic knowledge was more codified or had
greater utility.

Figure 24. The Case Study Firms Germany-Related Knowledge in the Context
of Relationships.
Increasing universality
Generic
Firm Firm Firm
Generalizability 2 3 1
Portfolio-
of the specific/
Substantial
Information
231

Relationship-
specific 1, 2 and 3 1and2

Individual Team-based Intra- Inter-
Increasing contextuality organizational organizational

Source: Adaptation of Alajoutsijrvi and Tikkanen (1999); see Figure 6 in Section 2.4.

Furthermore, in Figure 24, Case Study Firm 2 is depicted as having the least level of
diffusion of information; diffusion in Firm 2 has mainly been to selected few
individuals, with the exception of the previously mentioned renovation project. For
Firm 3, which is smaller and more specialized on the German market than Firm 2, in
that it has almost exclusively concentrated on housing, the knowledge is diffused at
the level of the team. Firm 1s knowledge is, on the other hand, diffused broadly
throughout the firm, due to the relatively large number of German employees and
Danish employees with experience from the German market.

As in Alajoutsijrvi and Tikkanens original figure (1999), with regard to the structuring
of the information, relationship specific information means that the information
concerns a specific client and is only relevant to that client, whereas portfolio-
specific information refers to the information on e.g. a building of a certain type (i.e.
hospitals or gas stations) or for certain purposes which could be of use when dealing
with the firms portfolio of clients. Finally, generic information is broad information
about the German market which is relevant when dealing with all German actors.

Firms 1 3 all possess relationship specific information which is used by the indi-
viduals who deal with the clients in question, i.e. the boundary spanners or relationship
promoters (see Subsection 3.3.3.). Additionally, Firms 1 and 2 have inter-organ-
izational, relationship specific knowledge that is shared by them and their long-term
clients, the two Danish multinationals and the one German firm that has a relationship
to Firm 1. This knowledge is, however, not widely dispersed among the organizations
of Firms 1 and 2; it is mainly placed in the hands of the specific individuals and/or
teams who have worked extensively with the two long-term clients (see Appendix B,
Sections B2 and B3). Thus it is analytically wise to further divide the inter-
organizational level of the Alajoutsijrvi and Tikkanen (1999) model into sub-
categories describing the concurrent intra-organizational knowledge-sharing.

232
Moreover all case study firms possess tacit knowledge at the portfolio and generic
levels as well. However, with regard to this knowledge, it is difficult for these firms to
draw an exact boundary between these levels, due to the fact that they make inferences
about their portfolio of clients as well as the German market in general based on
specific experiences (see Section 8.3.), when no codified information is available.
Furthermore, it is not necessary in practice for these firms to know the exact boundary
of the applicability of the knowledge, as they on the short- and medium-term only
need to possess knwoledge about their portfolio of clients and potential clients. On
the basis of the above comments, I have suggested a revision of Alajoutsijrvi and
Tikkanens (1999) competence framework for the case of tacit knowledge (see
Figures 6 and 24), as depicted in Figure 25:

Figure 25. The Case Study Firms Germany-Related Tacit Knowledge in the
Context of Relationships Revised Figure.
Increasing universality
Generic/
Generaliz- Portfolio Frim
ability specific
of the
Information
Relationship-
specific

Individual Team-based Firm-wide Individual Team-based Firm-wide
Increasing contextuality Intra-organizational Inter-organizational

Firms 1
and 2
Firm
1
Firm
3
Firm
2
1, 2,
and 3
233
Figure 25 eliminates the distinction between generic and portfolio-specific com-
petence, as the firms are not able to make a clear distinction between these two types
of knowledge in their tacit learning-by-doing. Furthermore, Figure 25 better depicts
the intra-organizational spread of knowledge that is also shared with another firm that
Figures 6 and 24; this aspect is also relevant to codified knowledge.

Before insights from the literature about boundary spanners and relationship pro-
moters are brought into this description of the use of knowledge, it is relevant to look
at the structural features of each firms private sector project acquiring practice. These
features are depicted in Figure 26 on the next page.

In Figure 26, the clients are depicted as black boxes because their individual charac-
teristics are of no interest in relation to the case firm-internal structural features.
Likewise, the actors of the case study firms who acquire projects are characterized as
anonymous clear circles; however, in some cases their nationality is identified as it
varies systematically in one firm.

In Firm 1, on the Danish market, specific actors, who often are partners, acquire pro-
jects. The nationality of the project acquirers is mixed, i.e. either Danish or German or
a third nationality. This is indicated by the distinction DK/G within each clear circle.
On the German market, on the other hand, the German-born partners almost always
are those who acquire the projects. This in indicated by the label G within the
corresponding circles.

With regard to Firm 2, the partners on the Danish market as well as other employees
acquire the projects. However, on the German market, the Danish-born partner who
heads the German office is specifically responsible for finding suitable projects and
telling the Danish partners about them (possibility one in Figure 26). If Firm 2 then de-
cides to pursue a project, the initial design proposal is made by Danish architects then
checked and elaborated by Firm 2s German employees in accordance with German
rules and norms.

In subsequent project acquisition activities, the Danish head of Firm 2s German
office is still responsible for contact to the potential client. In Figure 26, he is therefore
labelled Gdk to indicate that he is a Dane working exclusively with Germany. If a
partner in Denmark, however, happens to hear of an interesting project on the German
market or is contacted regarding such a project, then the communication concerning
the project is handled both by the Danish head of the German office and
234
Figure 26. The Structure of Project Acquisition Work by Case Study Firm
Project Acquirers.

= Project Acquirer in Case Study Firm = Client or Potential Client

Firm 1, the International Renowned Firm.
The Danish Market. The German Market.

P1 P2 P3 P1 P2 P3
DK/G DK/G DK/G G G G

Firm 2, the Nationally Renowned Firm.
1. or 2.
P, DK
P1 P2 P3 P P P
Gdk Gdk DK

Firm 3, the Innovative Young Firm.
FP FP
DK DK

Source: Authors own conception on the basis of interviews with the case study firms
(see Appendix B)

235
the other partner (possibility two). Thus Firm 2s structure of project acquisition is
substantially different on the German market than on the Danish market.

In Firm 3, the structure is on the other hand exactly the same. The founding partner,
who is Danish, is responsible for contacts both on the Danish and the German mar-
kets due to his social skills and the fact that he has done this work since he founded
the firm.

Concerning the characteristics of the boundary spanner and relationship promoter
roles (see Subsection 3.3.3.), in all three firms the actors in the German offices have
been distant in physical terms from the case study firm in Denmark. In formal organi-
zational terms, however, this distance was not necessarily present; thus the knowledge
of the boundary spanners could potentially relatively easily be put to use in the firm
at large. This is illustrated by the fact that the head of Firm 1s German subsidiary,
who is a partner in the firm, was present at partner meetings in Copenhagen (see
Appendix B: Section B.2), and by the fact that the head of Firm 2s German office
became a partner during the 1990s (see ibid.:462) and also worked on the future
strategy of Firm 2 in a working group with the other younger partners of the same
firm. In Firm 3, the founding partner, who was formally situated in Denmark yet often
traveled to Germany, played the role of boundary spanner/relationship promoter for
years while at the same time playing a leading role in the general management of the
firm. On the German market, he was assisted in his boundary spanning activities by
the head of the German subsidiary who often also traveled to Denmark to be present
in meetings (see ibid.: Section B.4). This general lack of organizational distance may
however be related to the relative small size of the case study firms. Thus future
contributions to the boundary spanner literature might contribute to further
theoretical development of the concept by focusing on the role of variations in
organizational size.

However, in accordance with Adams (1976:1176) theoretical remarks on boundary
spanners (see Subsection 3.3.3.), there was still some psychological distance in Firms
2 and 3, in that many persons in the Danish offices of Firms 2 and 3 were not always
aware of how things functioned on the German market and did not necessarily find the
stories told about the German market credible (ibid.: 474 and 503). In Firm 3, one
partner was actually against the activities on the German market (ibid.: 503).

In all three firms, the firms boundary spanners on the German market undertook
tasks of information processing as well as external representation (see Aldrich and
236
Herker, 1977:218-221). The information processing function was, however, implicit
and not very visible to the other members of the firm in question, as it was to a great
extent up to the discretion of the boundary spanners in question which cooperation
partners and projects were chosen. Thus the boundary spanners were relatively free to
use the knowledge they had obtained in their information processing to select the areas
of external representation that they would work with in the future. However, in Firm 2,
this sometimes lead to psychological distance problems as the other partners in
Denmark could not always understand that the head of the German offices actions
(Appendix B: 474). These problems of firm-internal communication in Firm 2 were
probably also related to Firm 2s different way of obtaining projects on the German
market in comparison with the domestic Danish market (see Figure 26) as well as the
lack of a specified (and thus codified, see Section 2.4.) marketing strategy - a char-
acteristic that has marked all three case study firms throughout the nineties.

Furthermore, regarding the selection of information to process, in the beginning of
Firm 2 and 3s activities in Germany, the boundary spanning representatives of these
firms first had to learn what knowledge was relevant for their duties in Germany (see
Appendix B, Sections B.3. and B.4. as well as Sections 8.2. and 8.3.), as they did not
have any initial knowledge of how exactly the German market differed from the Dan-
ish. This implied that their information processing efforts had to be broader and less
focused than they would have been, had they been operating on the Danish market, as
they did not know what questions are necessary to ask (Appendix B: 468). How-
ever, as they acquired knowledge of the differences between the Danish and German
markets for architectural services, this knowledge was put to use in more selective
scanning routines; the boundary spanners from Firms 2 and 3 subsequently narrow-
ed the information processed in specific German market situations on the basis of
their portfolio-specific knowledge of experience as to what was important on the
German market (see ibid., Sections B.3. and B.4.). Thus the firms newly acquired
portfolio-specific knowledge helped them narrow their searches for new, relationship-
specific knowledge (see Figures 6, 24, and 25) in their initial years on the German
market.

Moreover, in all three firms, there was a loop of knowledge used across the two
boundary spanning functions specified by Aldrich and Herker (1977:218-221; see also
Subsection 3.3.3.), in that knowledge actors obtained from information processing in
Germany was subsequently also used in German external representation tasks and,
similarly, knowledge obtained during German external representation was also used in
237
subsequent information processing in Germany. Future theoretical development could
fruitfully focus upon the nature of these loops.

The representatives in all three firms were relationship promoters by know-how
(Gemnden, 1996), in that their ability to obtain potential clients depended upon their
knowledge and their levels of social capital which, in turn, assured potential clients of
their credibility, i.e. that they, and thus their firms, were very qualified to undertake the
projects in question (see e.g. Figure 20 of Subsection 4.4.1.). The role of the
relationship promoter by power on the other hand was not decisive in the way it was
defined by Gemnden and Walter (1994), in that the internal hierarchical rank of the
persons who represented the firm in question or their personal network of contacts
only played a minor role in relation to achieving social contacts and projects on the
German market (see Appendix B). The persons fulfilling the relationship promoter
roles in the case study firms were also aware of this and therefore did not excessively
emphasize their rank or network in their business dealings with potential German
clients or cooperation partners (ibid., see also Lwendahls, 1997, remarks on the
altruistic service ideal of the professional services in Section 2.4. and Albertsens,
1996, remarks about the professional sub-field in Subsection 4.4.1.). Instead they
merely concentrated on accumulating knowledge and following the rules of the
German construction industry milieu and, thus, on generating social capital (see Figure
20 in Subsection 4.4.1. and Chapters 9 and 10).

On the other hand, the rank of prestige of the firm which the relationship promoter
represented probably played a large role in acquiring projects; this will be discussed
further in connection with research question five in Chapter 10 as well as in connection
with the discussion of three case study research questions seen as a whole in Chapter
11 and in the managerial implementations of Chapter 12.

The persons who had been selected to represent case study firms 1 and 2 in their Ger-
man offices had not been selected on the basis of the personal characteristics listed by
Gemnden and Walter (1994:5-6). Instead the factor willingness to move to the Ger-
man market had played the decisive role (see Appendix B, Sections B.2. and B.3.).
In Firm 3, in contrast, there was never any question as to who would be the
relationship promoter on the German market; it was the founding partner, who had
been responsible for most of the previous establishment of contacts in Firm 3 and
who was perceived by other members of firm 3 as having the personal characteristics
listed by Gemnden and Walter (ibid.: 494).

238
With regard to the dilemma of whether (a) to process general information about
general market developments in order to remain flexible on the German market at large
in specific relation to potentially important others versus (b) processing more specific
information in anticipation of certain more narrow developments (see Cova et al.,
1993, as described in Subsection 3.3.2.), responses from the representatives of all
three case study firms (see Appendix B) indicated that the actors active in information
gathering prioritized the anticipation of narrower, more concrete developments in their
information gathering activities more highly, although their firms aimed at remaining
generalists (see ibid.). This prioritization was based on their (correct) belief that this
type of activity was more directly connected to acquiring projects (compare also with
the model in Figure 1). These actors only gathered broader information to ensure
flexibility when the opportunity to do so by chance turned up or when they found
themselves with some spare time. At the same time, however, respondents indicated
that information about broader networks or trends could be of great use to them
because if they did not have this information, they might miss out on some very
important broader developments which might affect all of their business. Thus the
choice of using resources to gather broad versus narrow knowledge on the German
market for practical use was problematic for the respondents of the three case study
firms, as Cova et al. (1993) suggest.

8.5. Conclusions concerning the Knowledge Used in Obtaining Architectural
Projects.
With regard to both the broader knowledge of the German market (e.g. knowledge of
the DIN norm systems, construction law, typical German negotiation procedure) and
the knowledge of German clients possible interpretations of traditions, values, and
tastes, Firm 1 had more initial knowledge than Firms 2 and 3, due to its years of
experience on the German market and its many German-born employees. Actors from
Firms 2 and 3 were initially dependent upon the good-will of their German clients in
many respects due to this lack of knowledge. This good-will, in turn, may have been
given to them due to the unique boom undercapacity situation at the beginning of the
nineties, thus enabling them to overcome the Catch-22 situation.

However, although Firm 3s acquisitive strategy was based on the personal skills of its
founding partner in creating and nurturing relationships, sometimes Firm 3 did not
sufficiently understand the needs of its customers or of potential target customers.
Firm 2, in turn, had to initially realize that its position on the German market was
markedly different than its position on the Danish market due to the fact that its Danish
references meant little to the potential German customer. After it realizing this, Firm 2
239
had to then acquire further knowledge, to enable it to develop practices and social
capital for acquiring projects without a wealth of references on the German market.

Firms 2 and 3 worked actively to make up for deficits in Germany-specific know-
ledge, often putting their newly acquired knowledge of Germany to use almost
immediately after it had been acquired in efforts to fulfill the norms and practices of
the German construction industry and thus generate social capital. In connection with
this, the newly acquired portfolio-specific knowledge of Firms 2 and 3 enabled them
to subsequently narrow their searches for relationship-specific knowledge, as their
experience taught them which information to scan. The general knowledge of design
traditions which all three case study firms possessed was, on the other hand, not put
into direct use in connection with obtaining specific architectural projects, as the
German clients also had knowledge of this area. On the basis of the above findings, a
new model of relevant competence types was developed (see Figure 25).

All three case study firms did not systematically gather information about broader
trends in the German construction industry, their positions in the milieu of this indus-
try, and direct and indirect firm relationships. Furthermore, with regard to actors
personal information processing, in concrete situations, key boundary spanners
from all three firms chose to prioritize more specific information which could lead to
concrete projects to the detriment of broader information about trends on the market,
although they indicated that the latter type of information potentially could be just as
important. Thus the anticipation-flexibility dilemma of Cova et al. (1993, see Sub-
section 3.3.2.) was very present.

The knowledge that was used in the case study firms project seeking activities was
typically tacit, i.e. uncodified knowledge of experience and practice at the levels of the
relationship and the portfolio. With regard to boundary spanner theory (see
Subsection 3.3.3.), the previously mentioned knowledge of experience - from e.g.
previous project actor coalitions was used in both relationship promoting and
information seeking activities. Furthermore, the boundary spanners of all three firms
generated credibility in the eyes of their potential clients or cooperation partners on the
basis of their knowledge and possibility the rank of prestige of their firm. However,
contrary to Gemnden and Walter (1994), they did not generate credibility on the
basis of their firm-internal rank or their network of contacts.

German-specific knowledge was diffused with the case study firms through use or
word of mouth, e.g. at partner meetings; it was not usually codified through reports or
240
formally taught to other organization members. Firms 2 and 3 experienced some
problems of firm-internal psychological distance, in that some firm actors in Denmark
had difficulty comprehending the situation in Germany seen from the viewpoints of the
boundary spanners who worked with the German market. However, the problem of
distance generally did not seem to be as large as the boundary literature suggests
(see e.g. Adams, 1976 and Aldrich and Herker, 1977, as described in Subsection
3.3.3.). This may have been due to the relatively small size of the case study firms in
comparison to firms in other industries.
241
9. The Acquisition of Architectural Projects by the Case Study Firms.
9.1. Introduction.

As indicated in Chapter 1 and Section 5.5., this chapter deals with research question
four, i.e. how concrete architectural projects were obtained by the case study firms.
The foundation for this research question is Cova et al.s (1994) General Marketing
Configuration for Project-to-Order Supplier Firms as depicted in Figure 1 of Chapter
1. On the basis of this figure, two modified models are presented in Section 9.2. They
describe the way that the three case study firms have acquired projects on the German
and Danish private and public sector markets. Section 9.3. deals with the location of
the accumulation of social capital (Bourdieu, 1983, see Section 4.4.) within the general
acquisition process. Thereafter Section 9.4. examines the issue of discontinuity (see
Ahmed, 1993; Andersen, 1995; Cova et al., 1996a; and Kallinkos, 1989, as described
in Subsection 3.3.2.), the possibility of relationships and sleeping relationships
(Hadjikhani, 1996, also described in Subsection 3.3.2.), and the governance
structure(s) of the German construction industry milieu (see Figure 18 in Subsection
4.2.). Finally, Section 9.5. contains a summary of the answer to research question
four.

With regard to insights from the previous chapters, Chapter 8 focused upon the
knowledge used by the Danish case study firms in project acquisition in the milieu of
the German construction industry. Furthermore, in Section 4.4. (see Figure 20a), it
was indicated that acquiring knowledge about a milieu and its actors through experi-
ence from relations occurred parallel to the generation of social capital which could be
used to establish credibility with clients and other potential cooperation partners. In
this chapters Section 9.3., these insights will be built upon further in that the location
of the generation of social capital will be specified in relation to the sequence of activi-
ties undertaken by the three case study firms to acquire architectural projects.

9.2. The Process of Architectural Project Acquisition.
In descriptions of their personal steps toward acquiring individual architectural pro-
jects as well as direct commentary to the General Marketing Configuration for
Project-to-Order Supplier Firms of Cova et al. (1994, see Figure 1 in Chapter 1),
respondents from the case study firms indicated that their acquisition work functions
in the following ways:

242
The respondents believe that they work within a network and that this network is of
importance in determining which projects they obtain. This is especially true in the
private sector, as they often receive news of potential projects through their
network (Appendix B: 446, 482-3, and 484). However, as also previously indicated
in Chapter 7, the network is not a network in the terms of Easton (1992, see
Subsection 3.3.1.). This is because although actors are to some extent mutually
oriented towards each other, the level of perceived mutual dependence, of
economic, technical, logistical, legal, and administrative bonds, as well as
relationship investments are very low. Instead the networks between actors are
more of a social, informational, and time-based nature (see ibid.); these networks
will therefore be referred to as social networks. A representative of Firm B
described these networks in this way (see Appendix B: 453):

Your network - and by network I mean the persons you know from your
doings in the industry and who have a good impression of you - is very
important for your ability to acquire projects.

The partners in the three case study firms do not first explicitly agree upon a
strategy and then use it to determine which elements of their network to invest in or
which elements of the environment should be scanned, as suggested by Cova et
al.s (1994) model (Appendix B: 421, 428, 459, 501). Instead their strategies are
long-term (ibid.: 454, 455, 460, 501, 504), yet emergent (see Mintzberg and Quinn,
1992:13-16), tacitly socialized (see e.g. Nonaka and Takeuchi, 1995:61-72 as
described in Section 2.4. and Chapter 8), and based upon knowledge of e.g. the
market for housing, hospitals, stadiums, environmental-friendly technology, and
sources of energy, as well as knowledge of the rules of the milieu (Appendix B:
419, 435, 438, 444, 459, 504, 505, 514, compare also to Subsections 3.3.2., 4.4.1.,
and 4.4.2. as well as Chapter 8). This general market knowledge is usually obtained
on an off-and-on basis through e.g. critical events (see Appendix B: ibid.: 482-3
and Chapter 8).

On the other hand, the three case study firms have systematized their efforts to
acquire public sector projects through the EU Public Services Directive. The
information acquired about these types of projects is gathered continually (and thus
not on an on-and-off basis) through the regular, systematic reading of the relevant
EU public tendering publications (Appendix B: 433, 459, 488, 505).

The case study firms most often hear of private sector projects from the potential
client or other actors in their social networks (see e.g. ibid.: 455, 494, 514).
243
Additionally, it is often difficult to initiate contacts with potential clients to whom
one has had no dealings with beforehand (see e.g. ibid.: 452, 462), thus indicating
the presence of sticky markets (Hedaa, 1996). However, occasionally contacts
are initiated by a potential client whom the case study firm in question has no
previous knowledge of (Appendix B: 416, 447).

Decisions concerning whether to show interest for a concrete project are of a
go/no go nature (see Appendix B, compare also with Cova et al., 1994:32 as
described in Subsection 3.3.2.). The decisions are based on assessments of feasi-
bility, the case study firms ability to complete the project, the other projects
currently being completed in the firm, the total amount of human resources
allocated to other projects, and the risks involved in the potential project (see
Appendix B, compare with Messner, 1994:92 as cited in Section 3.2.). Addition-
ally, in the assessment of feasibility, the case study firms ability to perform and the
risks involved, project-, firm-, and market specific factors are assessed, as are
potential external resources (see Appendix B, compare with Ahmad (1990) as cited
in Section 3.2.).

The case study firms do not develop core offers, which they then adapt to the
specific project in question, as is suggested by Cova et al. (1994). Instead each
architectural project proposal they create is unique (see Appendix B). However the
case study firms develop competencies based on their perception of what is
important in the milieus and social networks that they work in and use these com-
petencies in concrete project proposals and projects (ibid.: 431, 434, 467-8, 475,
505-6, 513, see also Chapter 8).

The case study firms already begin to allocate resources for the project proposal
and the project when they decide to work on the initial project proposal (see
Appendix B).

In the private sector, the proposal that the case study firms create is often
creative (see Cova et al., 1994) in the sense that it redefines or enlarges the
scope of the client needs that it attends to. On the other hand, in the public sector,
where public tendering procedures are used, case study firms take care to meet the
client needs mentioned in the tendering and possibly meet other needs which might
differentiate themselves from the other competitors without changing or challenging
the specifications of the announcement in any way (see Appendix B, compare also
to Cova et al., 1999).
244

The three case study firms mainly follow deterministic as opposed to constructivist
strategies (see Cova and Hoskins, 1997, as described in Subsection 3.3.2.), in that
they follow the existing rules of the milieu (see Appendix B). As these firms are
small and there are many other firms in the milieu, changing its norms and rules
would be extremely difficult. Firm 3, however, used a constructivist approach
unsuccessfully on the German market when it attempted to renew the former GDR
Taktstraen principle of construction management (ibid.: 491-2).

As previously indicated in Chapter 6, in the German public sector, negotiations
concerning the project proposals are common because the German authorities
most often use the Public Service Directives (see Council of the European Com-
munities, October 13, 1997) negotiated procedure. This is however not the case in
the Danish public sector (see Appendix B and Section 6.4.); here projects are
awarded without negotiations.

On the basis of the above points, I have created two new models of the architectural
project acquisition process of the case study firms. They are depicted in Figures 27
and 28 on the following pages. In Figure 27, as in Cova et al.s (1994) model
(depicted in Figure 1 of this dissertation), the activities about the thick horizontal line
are general activities at the level of multiple projects, and the activities below the line
concern a specific project that the firm in question is seeking to acquire.

Furthermore, the first three steps of Cova et al.s model have been replaced by a gen-
eral acquisitive strategy and practice box which includes (a) the individual firms off-
and-on analysis of strategy, (b) the individual firms off-and-on environmental scan-
ning, and (c) the firms off-and-on contact to other social network actors. The inter-
play between these three activities constitutes the general strategy as well as the more
general, i.e. non-project specific, acquisition practice of the firm.

On the basis of these three types of activities, the policy concerning the development
of competencies that are perceived as important is developed and implemented by the
firm in question (Appendix B:438, 458-9, 508). Furthermore, the main source of
information about potential private sector projects comes from cooperation partners
and former clients whom the architectural firm in question already knows, although
245
Figure 27. The Architectural Project Acquisition Process in the Private Sector.

General strategy and acquisition box
Off-and-on analysis of Strategy

Off-and-on Off-and-on Contact
Environmental Scanning to Social Network Actors

Other, previously
unknown actors

Development of News of Projects
Competencies

Project Decision: Go/No Go

Concrete Design Proposal Socio-Economic Considerations

Creative Project Proposal

Negotiations with Potential Client
Concerning Design

Design- Phase Project Completion, if
Negotiations are successful

Concerning Construction Management

Construction Phase Completion, if

Source: Authors own conceptualization on the basis of Cova et al. (1994) and case
study interviews.
246
unknown actors do, from time to time, approach the firm in question with information
about or requests concerning a potential new project (ibid.:425).

When the firm in question has received news of a new project, it decides whether it
will attempt to acquire the project in question, on the basis of e.g. general and project-
specific considerations concerning resources (e.g. finances, level of knowledge, levels
of social and cultural capital and the like). This decision has both project-specific
dimensions and dimensions that relate to multiple projects, i.e. the firms portfolio of
projects; hence it is placed between the general, non-project specific level and the level
of the individual project.

If the firm decides to prepare a project proposal, it uses the physical resources it can
make available for the project as well as its competencies to create its initial creative
project proposal. Sometimes this takes place in cooperation with other firms that also
plan to work on the project. Further social-economic considerations are also made at
this time, e.g. concerning the extent of resources to be used on each phase of acquir-
ing the project as well as the potential mobilization of yet other project cooperation
partners in connection with the project, if the firm(s) in question receive the project.

The architectural project may only concern design-related tasks or it may contain tasks
related to both design and construction management (see Figures 8 and 9 in Chapter
2). The construction management-related activities are therefore depicted by dotted
lines.

If the potential client in question views the firms design proposal as being a
satisfactory basis for further work on the project in question, negotiations are begun.
During the process of these negotiations, it is often the case that questions of
clarification are answered and that further details concerning the project are supplied
(see Appendix B). These activities also require resources and possible further social
economic adaptations, hence the arrow going in both directions in connection with
this point. If the negotiations are successful, the design phase of the architectural
project in question is completed with the assistance of the architectural firm that
sought to acquire the project. If construction management tasks are included in the
architectural project, a second round of negotiations occurs before construction is
begun.

With regard to the public sector, some modifications of the model of Figure 27 are
necessary. These modifications are depicted in Figure 28 on the next page. With
247
regard to new projects, the main way that the architectural firm in question learns of
potential projects is by reading announcements in the relevant bulletins of the Euro-
pean Union; these announcements are read by the case firms on a continual basis.

Figure 28. The Architectural Project Acquisition Process in the Public Sector.


Continual Off-and-on Contact
Environmental Scanning to Social Network Actors

Other, previously
unknown actors

Development of Key News of Projects
Competencies

Project Decision: Go/No Go


Proposal in Accordance
with Announcement
Specifications

Negotiations if
Negotiated Procedure

Project Completion, if firm is success-
ful in winning the project

study interviews.
248
This is indicated by the boldface filled-in arrow from the box Continual Environ-
mental Scanning to the News of Projects box. However, it occasionally happens
that relevant public sector projects are mentioned in the firms social network or by
previously unknown actors who would like to submit a proposal as a team (see e.g.
ibid.: 425).

The proposal made by the architectural firm in question corresponds to the
specifications of the EU Public Tendering announcement. Thus creativity in redefining
the needs of the public sector client is not used in the initial proposal (see Appendix
B, compare also to Cova et al., 1999); this is indicated by the wording proposal in
accordance with announcement specifications. The proposal may, however, also
include some extra features to differentiate it from other proposals.

Finally, negotiations with the client are only used in cases where the public tendering
announcement specifies that the negotiated procedure is to be used. In the case that
negotiations are used, the situation is similar to that of the private sector in that modifi-
cations of the proposal and further mobilization of firm-internal and firm-external re-
sources may be used in efforts to convince the potential clients that the bidding firm is
the most qualified candidate for the potential project in question; however, in the
public sector, negotiations concerning both the design and project management-
related tasks occur concurrently (as opposed to the division present in Chapter 2s
Figures 8 and 9 and Figure 27).

9.3. The Role of Accumulated Social Capital in Relation to Project Acquisition.

With regard to social capital, evidence in Chapters 6, 7, and 8 suggests that German
and Danish construction industries can be regarded as different milieus due to (a) the
relatively small number of social ties between the Danish and German construction
sectors in the 1990s and (b) the differences in the norms, rules, and traditions of the
sectors of these two countries during this time period. Thus spatiality should matter
(see Tikkanen, 1998 in Subsection 3.3.2.) for the architectural services industry, and
one limit to the transferability of social capital (see Bourdieu, 1983:248) should be the
national boundary between Denmark and Germany.

My case study material indicates that this is the case; social capital is only to a limited
extent transferable across markets. In the words of a respondent from Firm 2 (Appen-
dix B: 478):

249
speak English very well if he decides to call Denmark. But why would one call
Denmark concerning a Danish architect when one can find a German architect
with similar German references? We could also look at the situation from the
opposite viewpoint. There are no Danish customers that would call Germany
to inquire about a German reference if they know Danish architects who have
references that are equally solid. []

As indicated by Figure 20a of Subsection 4.4.1., social capital is generated when a
boundary spanner or relationship promoter (see Subsection 3.3.3.) is present in the
milieu of the German construction industry and acts in a way that is recognized as legi-
timate by the other actors of this milieu. Moreover, social capital accumulation takes
places predominantly in the general strategy and acquisition boxes of Figures 27 and
28, as these boxes encompass the social contact to other social network actors.

A Danish architect from a non-case study Danish-German architectural firm inter-
viewed during the case study interviews described his general social capital acquisition
practice as follows (interview in Berlin on April 12, 1999, see Appendix C):

We have a number of personal contacts - i.e. people whom I and [my Ger-
man partner] have met on many different occasions. [...] It is important to
reach the people that you have met at gatherings. If e.g. there is a reception
someplace, then you attend it and speak with the other participants, and that
is how you get one or more personal contacts which you can follow up on.
[...]

We have also experienced that a customer we have had has recommended
us to another person. He said They are a good firm, technically
knowledgeable, inexpensive and quick. This is almost the best way to
acquire work - apart from making sure that one keeps the customers one
has by fulfilling their demands to their full satisfaction.

The first paragraph of the above citation refers to the general level social capital accu-
mulation in the general acquisitive strategy and practice box of Figures 27 and 28.
However, some social capital generation occurs in other instances as well, as the
second paragraph of the above citation indicates, e.g. (a) when the architectural firm
fulfills the demands of a given customer to her full satisfaction and (b) when one
customer refers the architectural firm in question to another potential client.

250
The process of referrals by third parties are not a part of the project acquisition mo-
dels of Figures 1, 27, and 28; they will therefore be dealt with further in Chapter 10. In
contrast, the generation of social capital through the fulfillment of client demands can
be said to take place during the negotiations and the subsequent project completion
steps of these three figures. Thus during these steps it is wise to focus on servicing of
client demands, as suggested by Lwendahl (1997:18) in Subsection 2.2.3., as this
leads to the generation of social capital (see also Harrigan and Neel, 1996, for further
support).

With regard to public sector tendering, social capital effects are reduced by the frame-
work of the EU Public Service Directive (Council of the European Communities,
October 13, 1997) in the procedures which do not involve negotiation in the sense that
there is no personal, project-specific contact between party offering a project for
tendering and (a) the bidding firms and (b) actors who might otherwise refer a specific
firm to the public authority in question. In the negotiated procedure, the social contact
occurs between the offering authority and the architectural firm in question when the
architectural firm participates in negotiations. In this situation a high level of social
capital must be built up very quickly, as one in order to win the project at hand must
convince the clients jury that one is the most credible and qualified firm. Thus firms
compete on their ability to build up social capital quickly when they compete in the
negotiated procedure, meaning that it is especially important for foreign firms to have a
very good practical understanding of the negotiation rules of the milieu and to have
overcome potential social, cultural, and technical distances (see Ford, 1980, as
described in Subsection 3.3.1.) in relation to the foreign public authority.

Furthermore, as anonymity is not guaranteed in the closed or negotiated procedures, it
is quite likely that other social capital effects sometimes play a role in the selection
process in situations where the names of the bidding firms are known. For example,
the individuals on the jury probably cannot avoid judging the proposals of firms both
on the basis of the quality of the proposal as well as the previous conversations with
firm actors or people who know the firm, when (a) the firms name and reputation are
known to them or (b) they can recognize the firm by the proposal it has submitted and
otherwise know something about the reputation of the firm (see e.g. Appendix B: 418,
420-1, 453-4). On account of this, the three case study firms attempt to also present a
good general, non-project specific image in closed and negotiated tendering
procedure, by e.g. including the names of local partners in tendering proposals (see
e.g. ibid.: 426), as they perceive that this could make a difference, if the public
authority in question knows of these firms (see Appendix B).
251

9.4. The Role of Discontinuity in Project Acquisitions.

As previously mentioned in Subsection 3.3.2., discontinuity is considered by most
IMP scholars to be an inherent characteristic of project marketing. The management of
discontinuity is, however, neither covered by Cova et al.s (1994) project marketing
model (see Figure 1) or my models as depicted in Figures 27 and 28 of Section 9.2.
Thus some comments must be made on this issue in relation to these models.

First of all, respondents statements as presented in Appendix B confirm that discon-
tinuity is an inherent characteristic of architectural projects as (a) many clients are only
looking for a solution to one or a few specific project(s) at a specific point in time and
(b) in cases where the client has multiple projects at the same time, these often differ
vastly from one another and therefore often are solved by different construction
industry firms. Thus, after completion of most of the case study firms architectural
projects on the German market in the 1990s, the client and the architectural firm in
question went their separate ways. Subsequent facility management was neither offer-
ed to clients or proposed by clients in connection with the architectural projects
completed by the three case study firms. Firm 2 did, however, work with facility
management on the German market independent of its other construction and
renovation-related projects (See Appendix B, Section B.2.).

In the above-mentioned situations, it can be said that the governance structure of the
relationships between the client and the architectural firm on the Danish and German
construction industry milieus was that of a socially constructed (see Figure 18 in
Subsection 4.2.) and also somewhat sticky (Hedaa, 1996) market, due to the presence
of loose social networks through which information was spread as well as the social
capital created in previous dealings with one another. Thus the governance structure
was similar to that which existing among the Danish actors on the German market (see
Chapter 7). Networks as commonly narrowly defined by the IMP Group (see Section
3.3.1.) were not present on these markets.

However, large corporations or housing associations are most often involved in some
type of construction work on a fairly regular basis; thus their demand is less discon-
tinuous than that of smaller clients. Firm 1 and 2 have completed projects for two
Danish multinationals with subsidiaries on many markets, including the Danish and
German markets, for well over two decades; additionally Firm 1 has completed pro-
252
jects for one German firm over a comparable period of time. In these situations, it is
acceptable to speak of relationships in the IMP sense of the term (see Easton, 1992,
as described in Subsection 3.3.1); thus here one is placed in the governance structure
of the network as defined in Figure 18 of Section 4.2. In these on-going relationships
the project acquisition process is somewhat different than the normal private sector
processes previously depicted in Figure 27. The differences are illustrated in Figure 29
on the next page and explained further in the following paragraphs.

The large client firm with whom the architectural firm in question has a continual
relationship has a special status in the network of predominantly social and
informational firm relationships. It thus is given special mention and underlined in the
general strategy and acquisition box of Figure 28. Furthermore, the client firm will, of
course, directly suggest the projects it envisions to the architectural firm in question
(hence the boldface arrow), yet the architectural firm could in theory also suggest
projects to the client firm. As this has not been done by my three case study firms, the
arrows to the box are dotted and unfilled. After the potential project has been
discussed, fewer steps are needed to reach the final negotiation stage than is the case
in Figures 27 and 28, as both parties know each other well.

In terms of Easton (ibid.), these long-term client-customer relationships are based
upon mutual orientation, relationship investments, a certain level of mutual depend-
ence, social, informational, and time-based bonds as well as some technical and
economic bonds. The technical, economic and informational bonds primarily concern
the specialist knowledge needed for the construction of the particular types of pro-
duction or research and development facilities; both parties have invested resources in
creating this relationship-specific knowledge (see e.g. Appendix B: 457). There are, on
the other hand, usually no chains of material resources or continual activities (see the
discussion of the A-R-A model and Figure 10 in Subsection 3.3.1.).

In Hadjikhanis (1996) theoretical contribution on sleeping relationships (see
Subsection 3.3.2.), it is suggested that client dependence and/or trust are factors that
will make the clients in question more inclined to use the same project supplier again
and again. In the relationships between the large companies and their architectural
Figure 29. Architectural Project Acquisition Process in a Client Relationship
Situation.

253

Off-and-on Off-and-on Contact
Environmental Scanning to the Firm of Relationship
and other actors

Client Firm Architectural Firm
Development of Key Suggests Suggests Potential
Competencies Project Project

Discussion of Potent. Project


Concerning Design

Design- Phase Project Completion, if

Concerning Construction Management

Construction Phase Completion, if

study interviews.
firms, trust plays the greater role of these two factors (see e.g. Appendix B: 457).
Although the firms as previously mentioned are involved in networks of long-term
specific relations, the dependence is only short or, at most, medium term, as the archi-
tectural firms could be replaced by the three large companies over a period of time at
some initial cost due to the need to transfer knowledge to the new architectural firms.
To avoid this possibility, case study firms 1 and 2 make a point of e.g. adapting to the
large firm in questions new technology or informing this firm of improvements in their
254
ability to complete certain tasks in an attempt to maintain the level of mutual trust and
thus insure future business with these large firms (see ibid.: Sections 2 and 3).

Firm 3 had a shorter term relationship on the German market in that it built a number
of service stations for a Nordic oil company; here it temporarily operated in the realm
of specific relations. However when the Nordic oil company asked Firm 3 to expand
onto the Polish market by building its gasoline stations there, Firm 3 declined because
its owners were not prepared to expand operations upon yet another market. This lead
the Nordic oil company to find another cooperation partner. In this situation the break-
up was not caused by a lack of trust, but by incompatible interests. With regard to
dependence, the small Firm 3 was more dependent upon the Nordic oil company than
vice versa; it is furthermore improbable that a situation of more than short-term
dependence could have been created by Firm 3, as gasoline stations are a fairly
uncomplicated, standardized, and common type of construction, and a number of
other architectural firms also have experience in designing them.

At a more general and thus theoretical level, dependence and/or specific relations
in architecture project markets are relatively difficult for architectural firms to
unilaterally create, due to the fact that substitute architectural firms with comparable
specialist knowledge can easily be found with some effort. Incorporating facility
management services is the best existing possibility for creating dependence; however
the case study firms have not considered including a facility management packages in
their creative project proposals as this move might have been regarded as pushy
by clients and thus ruin the impression that the case study firms would like to give of
serving the clients best interests altruistically with regard to the specific project in
question (see e.g. Lwendahl, 1997, as described in Section 2.3. or Albertsens,
1996:6-7 remarks about the credibility of the professional sub-field covered in
Subsection 4.4.1.). The case study firms have also not allocated resources to improve
their competency in the area of facility management.

Concerning the wisdom of the above effects to avoid being pushy, it is probably
important that architectural firms exercise extreme caution in choosing new offerings,
as a single architectural firm alone cannot change the norms of the milieu. However a
carefully presented improvement that is perceived by the clients as being in their best
interests may be cautiously attempted. Here, however, caution must be also used when
allocating resources to such attempts as one does not know the clients reaction
beforehand.

255
With regard to relations to private sector construction industry actors with whom the
case study firms sometimes form teams to complete projects, all three firms have used
some of the same partner firms repeatedly in their project-seeking activities. In this
situation, the relationships have been based on trust. However, the dependence has
been less than was the case with the three long-term relationships to large firms, due to
the lesser extent of the joint accumulation of unique, relationship-specific knowledge
which also could be used in future projects. Thus, in this situation, the case study
firms once again were in the regime of purely social information networks previously
described in Section 9.2 which are closer to the socially constructed market of Figure
18 than the network in the traditional IMP understanding of the word (see Subsection
3.3.1.).

In these social network constellations, the private sector project acquisition practice
often resembled Albertsens (1997b:6) Last Dance of the Season, as described in
Subsection 6.4.3.2: After firms received news of potential projects, they initially
approached their most trusted previous cooperation partners, whom they preferred on
the basis of the accumulated social capital from previous experience. (These prefer-
ences also meant the existence of sticky markets, see Hedaa, 1996). However if
these cooperation partners did not have the possibility of participating in the project in
question, the firm with the initial contact to a potential client was quick to find another
potential cooperation partner. Additionally, all firms indicated that their cooperation
partners, who also were interest in participating in the project in question, accepted
that the client had the final say with regard to the constellation of the team in question
and thus also accepted situations in which the client changed the proposed
constellation of cooperation partners (see Appendix B).

Some of the larger cooperation partners, such as the Danish real estate developing
firm Kuben (see Subsection 7.5.) or the German project management firm with whom
Firm 2 cooperates with from time to time (Appendix B: 455) also incorporate market-
like mechanisms in cooperation partner selection. In these situations the social capital
generated was merely a precondition for the final selection process, and dependence
was one-sided to the detriment of the smaller and less-powerful partner, i.e. smaller
and less well established architectural firms.

In the public sector, as mentioned in Section 6.4., the implementation of the EU Public
Service Directive has led to the break-up of many social relationships between local
authorities and architectural service firms. This may, however, not have been the case
in all circumstances as non-anonymous closed or negotiated tendering procedures
256
may not have prohibited the public authority in question from purposefully, yet under
the guise of impartiality choosing the firm that is has previously worked with and trusts
on the basis of accumulated social capital from the past. Thus, as previously
mentioned in Section 6.4., although the intention of the EU's public procurement
directives is to break up networks of relationships between public and private sector
actors to insure fair competition (implying discontinuous, arms-length relationships),
this probably has not happened 100 % in practice (respondent citations omitted for
reasons of confidentiality).

The discontinuity aspect also has implications for the dilemma of whether one should
invest in broad competencies to remain flexible or whether one should develop spe-
cific competencies in anticipation of concrete projects (see Figure 13 of Subsection
3.3.2.). As most actors in the milieu only use their loose social networks to obtain
information, the projects themselves will, with the exception of a select few, not result
in further projects with the same client, but rather in social capital which can be used
on the predominating socially constructed market governance structure. Therefore a
new flexibility versus anticipation dilemma statement may be reformulated as follows:
It is important for firms to be aware of and also balance their practices which lead to
the accumulation of general social and cultural capital (cultural capital is covered in the
next chapter) on the one hand with their practices that are intended to maintain or
create new relationship-like situations on the other. Some practices may be suitable for
both general capital accumulation in the given milieu and specific relationship
maintenance, yet others may not be; therefore this dilemma situation, when difficult
choices must be made, may be anticipated. Firm 3 stood in the dilemma situation
when it was confronted with a key customers (i.e. the Nordic petroleum company)
wishes for it to expand its operations onto the Polish market, a market it did not wish
to enter.

257
9.5. Conclusions Concerning the Acquisition of Architectural Projects.

In relation to Cova et al.s (1994) General Marketing Configuration for Project-to-
Order Firms, the three case study firms had emergent strategies which were formed on
the basis of their on-and-off environmental scanning and social contacts to other con-
struction industry actors in their social networks. Furthermore, the firms did not
develop a core offer, as each of their projects were unique; instead they developed
competencies to improve the quality of their offers.

The social capital which the actors in the firms used to establish credibility was mainly
generated during contact episodes with actors from the case study firms social
networks; this is depicted in the general strategy and acquisition boxes of Figures 27
29. Additionally, further social capital was generated during the project specific
activities with clients and by referrals by previous clients. With regard to project
acquisition in the public sector, the EU Public Services Directive reduced some, albeit
not all of the social capital effects.

The governance structure of the German and Danish construction industry milieus is
predominantly that of the socially constructed market. Although the firms receive in-
formation about projects through social contacts and informational networks, contact
to clients usually only occurs on a single project basis due to the discontinuous nature
of architectural project and construction project business. In a few instances,
however, long-term relationships between a client and an architectural firm exist. These
relationships are characterized by trust and a certain level of technical and economic
bonds which are related to the specific knowledge necessary to build optimally for the
particular client in question. Contrary to the suggestion of Hadjikhani (1996), the level
of dependency is, however, still low.

Due to the discontinuous nature of architectural services, the dilemma of specialization
versus flexibility is an important issue for the case study architectural firms. This
dilemma encompasses the dilemma of using resources in an attempt to create long-
term relationships versus using resources to operate optimally on the socially
constructed markets of the German milieu.
258
10. The Role of Previous Project Work in Acquisitions on the German
Market.
10.1. Introduction.

As previously mentioned in Chapter 1 and Section 5.6., research question five deals
with the relationship between awarded projects and subsequent projects awards. In
Section 10.2. the role of the references of the three case study firms is examined in
relation to Holstius (1987) reference value, Bourdieus (1983) cultural capital, Sal-
minens (1997) conceptualization of the value and possible uses of references, and the
discussion of the role of social capital in Section 9.3. Thereafter, in Section 10.3., the
way in which the three case study firms have been positioned within the German
construction industry milieu of the nineties is assessed in Bourdivan terms. Finally,
Section 10.4. contains a summary of the role that previous project work played in
relation to the three case study firms architectural project acquisitions on the German
market.

Once again, before commencing the answer to research question five, it is relevant to
review relevant insights of previous chapters. Chapter 7 indicated that Danish architec-
tural firms as well as other Danish construction industry actors internationalizing on the
German market during the nineties had primarily oriented themselves towards German
clients and construction industry actors, as most potential clients were Germans; there
were few coordinated internationalization efforts among Danish actors. Certain types
of Germany-specific knowledge were, as described in Chapter 8, a prerequisite for
project acquisition activities in the German construction industry milieu as well as a
consequence of project activities hence the so-called Catch-22 dilemma (see
Section 5.4., Chapter 8 and Figure 20); this was also the case concerning social capital
(see Section 9.3.). This chapter will tie the insights on the accumulation of project-
specific social capital of Section 9.3. to the role of references and the role of the
partially concurrent accumulation of project-specific cultural capital.

10.2. The Role of References in relation to Cultural and Social Capital.
In her 1987 study, Holstius (1987:63) stated that projects completed by firms have a
reference value, in that they are useful when these same firms seeks to acquire new
projects. The data presented in Appendix B concerning all three firms unequivocally
supports this general assertion; however, in order to understand patterns of architec-
tural firms project acquisitions over time, it is necessary to examine in detail what
exactly this reference value entails, with the help of Bourdieu (1983) and Salminen
(1997).
259

Using the language of cultural capital, in terms of Bourdieu (1983, see also Section
4.4. and Figure 20b), the three Danish case study firms have throughout the nineties all
had Danish institutionalized cultural capital in the form of (a) employed architects
with Danish architectural training and degrees, (b) membership in Danish architects
organizations, and (c) reference lists of previous work on the Danish market as well as
objectified cultural capital in the form of the buildings completed in previous
projects. Additionally, Firm 1 started the nineties with German institutionalized and
objectified cultural capital because it (a) employed architects with German architec-
tural training and degrees, (b) had two partners who were honorary members in the ex-
clusive German architects organization Bund deutscher Architekten, and (c) had
reference lists that included previous work on the German market for German clients
which had resulted in the construction of buildings (see Appendix B, Section B.2.).

With regard to Holstius reference value of projects, the institutionalized cultural capi-
tal related to architectural projects and competitions is relevant as is the corresponding
project-related objectified cultural capital (e.g. in the form of buildings or the like),
whereas cultural capital related to educational qualifications and membership in
professional organizations are not directly reference value-relevant in terms of Holstius
(1987), as they are not architectural project-specific. The institutionalized project-
specific cultural capital (e.g. references and prizes) signals to potential clients that the
firm already has experience with similar projects and thus probably has overcome
potential social, cultural, and technological distance problems (see Ford, 1980, as
described in Section 3.3.1.; compare with respondents statements in Appendix B:
423, 453-4, 478, 518). Additionally the institutionalized project-specific cultural capital
signals that the firm possesses the necessary knowledge to make relevant judgmental
decisions (see e.g. Lwendahl, 1997:20, as described in Section 2.4.) concerning the
clients potential project. All three case study firms engaged in the types of activities
which led to the accumulation of the reference value-relevant types of cultural capital
on the German market in the nineties (see Appendix B: 423, 478, 518). For Firm 1,
one can speak of further cultural capital accumulation, as Firm 1 already had sub-
stantial German cultural capital at the beginning of the nineties (see Appendix B,
Section B.2).

Furthermore, with regard to the reference value of institutionalized cultural capital, my
empirical data (see ibid.: 443) indicates that, contrary to Holstius (1987) and Salmi-
nens (1997) theory, it is not only the completed project which is relevant; also prizes
in architectural competitions and/or public tendering procedures have also resulted in
260
useful references that can be classified as institutional cultural capital before the
project in question had been completed. This is illustrated by the following statement
from a representative of Firm 3 (Appendix B: 518):

The most effective way to establish a network in Germany is to win to a
first prize, then another, then yet another... When things happen like this, the
projects come by themselves.

Firm 1 experienced this effect. After winning its first project concerning a hospital in
Germany, it was much easier for Firm 1 to be prequalified in other German competi-
tions or public tendering rounds concerning hospitals, even though the hospital project
it had won had not yet been completed (ibid.: 418). On the other hand, brand name
(i.e. the institutionalized cultural capital connected to the name of the firm or architect,
see also Section 2.4.) did not appear sufficient in itself for prequalification or selection
(see Appendix B, Section B.2.).

In relation to internationalization, similar to the discussion of the transferability of
social capital across national markets in Section 9.3., it must be established to what
extent Danish project-related institutionalized and objectified cultural capital has been
recognized by relevant actors (e.g. clients) in Germany. The answer to this question is
once again important for the assessment of the extent to which the Danish and the
German construction industries are separate milieus. As was the case for social capi-
tal, my empirical material (see Appendix B) indicates that Danish reference value-
relevant cultural capital is only to a limited extent convertible to German cultural capi-
tal, thus providing further support for the hypothesis that the Danish and German
construction industries should be regarded as two milieus.

The circumstance that Danish cultural capital is usually not convertible to German cul-
tural capital has been stated in the following way by a respondent from Firm B (Ap-
pendix B: 478):

[Our firm] has a long list references from a country of only 5 million
inhabitants. Therefore the act of coming from Denmark with references that
pertain to 5 million inhabitants corresponds to drowning in the sea of
German firms as Germany is a country with 80 million inhabitants.

Case study firms 2 and 3 have almost always been in the situation described by the
above statement (ibid.:Sections B3 and B4): Little of their Danish cultural capital has
been convertible to the German market because the comparable architectural projects
261
in Germany are solved by German architects operating on local, regional, or national
levels (see Gerkan in Der Architekt, May 1990, as described in Appendix A,
Subsection A.4.3.). However there may be some exceptions to this rule. Case study
firms 2 and 3 believe that Danish/Scandinavian projects concerning nursing homes,
homes for the elderly and handicapped, and day care centers are perceived as having
some reference value in Germany. They have experienced that some German officials
perceive that Denmark and the other Nordic countries have a more advanced infra-
structure concerning these types of housing and institutions and are therefore more
open towards expertise from Nordic architectural firms in these areas (see Appendix
B: 472 and 518). Additionally, Firm 2 has been able to use its Danish/Scandinavian
cultural capital in projects related to stadiums on the German market, due to the
presence of international soccer stadium standards (ibid.: 477).

On the other hand, cultural capital accumulated in the most prestigious international
sphere of architectural competitions, e.g. the competition concerning the construction
of a new World Bank headquarters in Washington, D.C. where Firm 1 won a second
prize (see Appendix B: 432), is convertible. As firms of international repute from all
over the world participate in such a prestigious competition, the capital won from the
competition is also internationally convertible with regard to other competitions
concerning prestige projects(see also Gerkan in Der Architekt, May 1990). Addi-
tionally, in this category, the name of the architectural firm or architect may also be
connected to institutionalized cultural capital which can be transferred from country to
country (see Section 2.4., Gerkan in Der Architekt, May 1990, as well as Appendix B:
432).

Danish objectified cultural capital may have also played a role on the German market
in certain circumstances. Firm 1 believes that certain German actors have been familiar
with its renovation of a Copenhagen playhouse and its work for a Danish multinational
company and that the objectified cultural capital connected to these projects may have
been instrumental in receiving related projects on the German market (ibid.: 418, 438,
and 443). Firm 2 also used Danish cultural capital in that it received its first housing
construction project in Germany in the beginning of the 1990s after a German manager
visited a public housing project built by the firm in Denmark (ibid.: 447). Finally, the
Danish Ministry of Housing tried to utilize an objectified cultural capital effect during
the first years of the 1990s by inviting German officials responsible for public housing
to Denmark to look at public housing projects in Denmark (see Section 7.2.). My data,
however, indicates that the effects of these general ministerial efforts were, however,
not as large as expected (see e.g. Appendix B: 482-3 as well as Section 7.2.);
262
interviews with respondents from architectural firms that had made presentations at
official ministerial arrangements, including e.g. Firm 3, indicated that although the
Germans liked the newer Danish public housing neighborhood and housing designs,
they were not convinced that the Danish architects had enough knowledge of the
German market to build the same projects there and therefore did not sign contracts
on the basis of the visit alone. Thus there is a further need for refinement of the
discussion of reference value-relevant cultural and social capital; the concepts of
Salminen (1997) will be used to this end.

In his 1997 dissertation, Salminen (1997:166) mentions a number of potential uses of
references in marketing; these are depicted in Figure 15 of Subsection 3.3.2. In relation
to Salminens list, articles, press releases, reference lists, promotional material, and
detailed written descriptions of similar contracts pertain to cultural capital, whereas
seminars, conferences, requests to reference customers to promote, and visits to
reference sites encompass both social and cultural capital effects. In comparison to
Salminens list (see Figure 15), the three case study firms have to a greater extent used
reference-specific cultural and social capital to acquire new customers than to keep
present customers (see Appendix B) because, as previously hypothesized in
Subsection 3.3.2. (see e.g. Ahmed, 1993) and empirically supported in Section 9.4., it
is relatively difficult to keep current customers at the level of multiple projects due to
discontinuous demand. The case study firms have therefore used their project-specific
cultural and social capital by giving new and present clients their reference lists and
other promotional material as well as in some instances arranging client visits to
buildings designed by them (see Appendix B:447 ).

Salminen (1997, see Subsection 3.3.2.) states that environmental, party-specific, and
project-specific factors determine the usability of a reference. With regard to
environmental factors, as previously mentioned in this section and Section 9.3., the
empirical material indicates that the home country of a reference customer plays a role
in determining the value of a reference. Also party-specific factors, e.g. the languages
spokes by the boundary spanners (see Subsection 3.3.3.) in the reference firm, are
relevant, as indicated in Section 9.3., as are factors relevant to the project, i.e. the
building, completed (see the previous paragraphs of this section).

Furthermore Salminen conceptualizes that a reference will be more useable (a) when
the user of the project in question (i.e. most often, but not always, the client) has had
some experience with the result, (b) when there is openness with regard to the project,
i.e. clients name may be mentioned by name, (c) when someone in the client company
263
expresses satisfaction with the project in question (see the discussion of Figure 14 in
Subsection 3.3.2. of this dissertation). Points (a) and (c), experience and satisfaction,
encompass both social and objectified cultural capital, in that there is an implicit
presupposition is that there usually is contact between a previous client and a potential
client who e.g. inquires about the reference in question as well as physical evidence of
the project in question. This means that social capital is involved, as well as the
physical artifact of the building, which is objectified cultural capital.

My empirical material indicates that the potential client does not always contact a pre-
vious client. In e.g. public sector prequalification, previous projects are listed in the
initial bid, yet public authorities most often choose the firms that go on to the next
round of closed or negotiated tendering without contacting the previous references to
hear their experiences with the firm in question (see Section 6.4. as well as Appendix
B). This is one of the reasons that Firm 1, as previously stated, was more easily quali-
fied in public tendering procedures concerning hospitals after having won the first
German hospital project in the period in which the hospital had not yet been built (see
Appendix B: 418).

In some instances this is also the case in the private sector, as in many areas of the
construction industry there are a large number of architectural firms who have built
comparable projects. This makes it difficult to distinguish between the architectural
firms on the basis of the opinions of randomly chosen and previously unknown
reference persons, as one literally drowns in a sea of firms (see ibid.: 478 as well as
511).

Moreover, as a building is a physical object or objectified cultural capital, it often can
be examined by the potential client in question. Thus inquiries to the persons for
whom it was built are less necessary and, consequently, social capital accumulation is
less necessary. For e.g. the German private sector client of Firm 1 who originally con-
tacted the firm after having visited a museum built by it in Dsseldorf (see ibid.: 416,
445), Salminens client experience and satisfaction can be replaced with the personal
impression that the private sector client received when he visited the museum or, in
terms of Bourdieu (1983), his impression of Firm 1s objectified cultural capital.

The lack of contact also means that other factors become more important, e.g.
Salminens (1987) environmental factors such as the home country of the project or,
as in the case of the previously mentioned Ministry of Housing example, party-specific
264
factors such as presence in Germany. This last factor is firm-specific, yet independent
of concrete architectural projects.

With regard to openness, i.e. the second point in Salminens conceptualization of
usefulness, I cannot make any statements, as all of the projects that I discussed with
my case study firms were open.

Concerning Salminens (1997:166) uses of references in case study firm-internal tasks
(see Figure 15), cultural capital from projects was used internally in decisions
concerning bidding by all three firms because the case study firms know that it is
much more easy to acquire a project if the firm in question has relevant project-
specific cultural capital from references (Appendix B: 423, 454, 518). This cultural
capital proves that the firm in question has previously worked with comparable
projects (see ibid.) and is furthermore a signal that potential technological, cultural, or
social distance problems (see Ford, 1980) have been overcome. Thus project-specific
criteria (compare with Ahmad, 1990, as described in Section 3.2.) concerning pre-
vious projects are used by the case study firms in the screening of projects.

The project-specific cultural capital is, on the other hand, not used internally to
improve sales force performance by the architectural firms nor to prove the
functionality of technology to suppliers, despite Salminens suggestion of this in
Figure 15, as architectural firms do not have sales forces and only have a few, non-
project specific suppliers, i.e. of office supplies or modeling equipment.

The purposes mentioned by the case study firms for supplying project-specific refer-
ences are, in accordance with Salminen (1997), to be prequalified in public tendering
procedures, to signal quality to potential or current clients, to develop the architectural
firms image in the eyes of potential clients, and to reestablish credibility, in the case
that a former client approaches the architectural firm in question with another project
(see Appendix B). Here, in situations where personal contacts have played a role, the
social capital accumulation processes described in Section 9.3. have also been at
work; otherwise, only cultural capital has played a role. The case study firms have on
the other hand not tried to break other architectural firms long-term relationships to
clients on the Danish and German markets of the 1990s, and they also do not directly
use their cultural capital in the final selection round of public tendering procedures, as
the EU Public Procurement Directive (Council of the European Communities, October
13, 1997) specifies that the final decision is to be made on the basis of the concrete
project submitted (see Section 6.4. and Appendix B). However, similar to the situation
265
regarding social capital as explained in Section 9.3., it cannot necessarily be assumed
that cultural capital plays no role in the final selection, as jury members may in fact
make the final decision based both on the concrete proposal submitted as well as their
knowledge of the firms objectified and institutionalized cultural capital in the form of
previous prizes and buildings.

Project-specific cultural capital is furthermore used in attempts to enter new market
segments, in accordance with Salminen (1997:166). As a case in point, Firm 2 has
tried to enter the German market for hospitals throughout the nineties, yet it has had
substantial difficulties in this endeavor, despite its Danish hospital references
(Appendix B: 459). It has therefore developed a strategy of accumulating references
on the German market concerning laboratories and nursing homes, as hospitals
contain both laboratories and wards with nursing care (ibid.).

Project-specific cultural and social capital has, on the other hand, not been used by
the case study firms in attempts to legitimate a new technology paradigm, although this
is suggested by Salminen (1997:166). The reason for this probably has, once again, to
do with firm size and the number of firms on the market. As previously indicated in
Section 9.2., the case study firms mainly follow deterministic, as opposed to
constructivist (see Cova and Hoskins, 1997) approaches to acquisitions, as it would
be very difficult for a single firm to change the rules of the milieu. As an architectural
project is a part of a larger construction project (see Section 4.4.), the case study
firms view themselves instead to a larger extent are technology takers or technology
utilizers in that they define their expertise as the ability to integrate existing con-
struction technology in the best way and thus provide their clients with the best
professional service (see Appendix B as well as Gerkan, 1995, Lwendahl, 1997, and
Lundgaard in Arkitekt- og Byggebladet, November 1992:31; contrast with Bonaccorsi,
Pammolli, and Tanis 1996 recommendations for large firms).

Furthermore, as previously mentioned in Section 9.3., the three case study firms make
little overt effort to entice customers to promote the architectural firm, as suggested by
Salminen (1997), as this is not in keeping with the norms and rules that govern the
professional sub-field of architecture (see Appendix B and Albertsen, 1996:6-7, cited
in Subsection 4.4.1.). However, when client firms choose to mention their architectural
firms in promotional material, thus creating institutional cultural capital for the
architectural firm, or in personal conversations, thus creating social capital for the firm
in question, the case study firms welcome this. Moreover, the case study firms often
contact journalists whom they know with information about the projects they are
266
working on (see Appendix A, Subsections A.3.3. and A.4.3. and Appendix B). This
course of action may be regarded as an effort to generate further cultural capital by
indirectly taking measures to ensure that articles about the firm in question appear in
relevant newspapers and journals. Finally, the case study firms accept invitations to
speak about their architecture at seminars and conferences, sometimes even without
pay, in efforts to generate further cultural and social capital (see Appendix B:454).

10.3. The Positioning of the Three Case Study Firms.
On the basis of the previous section as well as Chapters 6 - 9, it can finally be con-
cluded that the German construction industry milieu (see Cova et al., 1996a) should
be viewed as a milieu separate and distinct from the Danish construction industry mil-
ieu, as the norms, rules, and mental representations of the actors on the two national
markets differ to an extent that limits the use of social and cultural capital from one
market on the other. Within these national milieus, however, it is difficult to perceive
the exact position in terms of Mattsson (1984, see Subsection 3.3.1.) of the case
study firms, as they know little of their customers perception of themselves in relation
to other architectural firms and, especially on the German market, little of the relation-
ships between other, comparable architectural firms and potential clients (see Chapter
8 and Appendix B).

On the other hand, it is possible to generally describe the position of the three case
study firms throughout the nineties in terms of social and cultural capital. This will be
done in the following and subsequently illustrated in four figures.

Firm 1, the internationally renowned and established architectural firm, already had a
substantial level of cultural capital on the German market as well as other international
markets at the beginning of the 1990s, due to three decades of experience during
which it had won many prestigious German and international competitions. This
institutionalized cultural capital played a role in Firm 1s being short-listed for major
German projects offered through restricted tendering procedures and their being
invited to participate in prestigious, restricted architectural competitions in the 1990s.

With regard to social capital, in previous decades, Firm 1 had been a market-seeker
and a client follower (see Section 2.1. or Majkgrd and Sharma, 1998); it had both
actively sought German customers as well as designed several buildings for a Danish
multinational firm on the German market. It currently also has one long-term
relationship with a German client; with regard to these relationships it operates in a
network governance structure, as previously indicated in Section 9.4. However,
267
during the nineties, representatives from Firm 1 have not worked intensely to create
further social links to German customers; they have instead concentrated mainly on
capitalizing on their already accumulated cultural capital through public tendering and
architectural competitions in many German regions.

For its part, Firm 2, the nationally renowned and established architectural firm, had
substantial cultural and social capital on the Danish market at the beginning of the nine-
ties. However it was almost without social and cultural capital on the German market
at the beginning of the decade, as it had previously mainly been a client-follower on
foreign markets with the exception of Norway and Sweden, in cooperation with a
(different) Danish multinational firm (see Appendix B:446).

Firm 2 made the decision to enter the German market in 1992 (ibid.:447), at a time
when the German market was booming, and the Danish market was in the midst of a
severe slump (Eurostat, 1995). The partners of Firm 2 originally believed that their
Danish references would open the door to German projects to a greater extent was
actually the case, due to the inconvertibility of its Nordic references and prizes, i.e. its
Danish institutionalized cultural capital as well as the extra work involved in contacting
Danish references (see the previous section and Section 9.3.).

In subsequent years, however, Firm 2 stuck to its long-term commitment with regard
to its investments on the German market. It was able to learn by doing, and thus also
establish German social and cultural capital, also after the level of construction activity
on the German market began to decrease in 1995 (Appendix B: Section B.3.). How-
ever, the processes of the accumulation of cultural and social capital are relatively
slow; in the words of the Danish-educated partner who manages Firm Bs German
office and used the terminology of Gerkan (see Appendix A, Subsection A.4.3.), the
firm is currently closest to a regional German firm (Appendix B: 458, see also Gerkan
in Der Architekt, May 1990).

Due to this position, the projects that Firm 2 works with on the German market today
are somewhat different than the project that the firm receives on the Danish market.
Firm 2 does not take part in as many projects of national importance in Germany as in
Denmark, as it still finds it more difficult to be prequalified and win tendering pro-
cedures for these types of projects in Germany.

Firm 2 has, however, also explored some innovative fields of work for architects on
the German market in the 1990s, e.g. in the field of renovation and as part of
268
bidder/supplier coalitions that bid on facility management responsibilities. Facility
management contracts allow the bidder/supplier coalitions to create long-term activity
bonds between the coalition and a customer, thus overcoming the discontinuity
otherwise inherent in project marketing (see Subsection 3.3.1.). However these
contracts are not common on the German market yet and are sometimes snubbed by
actors from the artistic and professional sub-field as being too much a part of the non-
artistic technical-economic sub-field of the market for architectural services (see
Albertsen, 1996, as described in Subsection 4.4.1.).

In contrast to Firm 2, Firm 3 was a Successful and Innovative Younger Firm on the
Danish market, in that it had had to establish its own social and cultural capital on its
domestic market in its recent history. At the time of its establishment of a subsidiary
on the German market, it will still following practices of accumulating the social and
cultural capital necessary to enter the most exclusive circles of the Danish construction
industry. It therefore came as less of an initial surprise to Firm 3 than to Firm 2 that it
was necessary to use resources and develop a practice to acquire Germany-specific
social and cultural capital. Firm 3, however, still had problems with e.g. the
accumulation of social capital, despite its founders previous German work experience
and social skills, due to the many differences in construction regulations and cultural
differences described in Chapter 6 and 8, which made the establishment of credibility
more difficult (see Appendix B:492 and Subsection 8.3.4.).

With regard to cultural capital, Firm 3 is still a Successful and Innovative Firm at the
end of the nineties in Denmark, with far fewer contacts to the largest firms and
references from prestigious national competitions than Firms 1 and 2. Instead it has a
relatively large amount of public housing projects in its Danish project portfolio (Ap-
pendix B:488). These factors meant that Firm 3 started with even less cultural capital
on the German market than Firm 2. Additionally, although Firm 3 had plans to even-
tually diversify in Germany, it started by concentrating on its Danish strengths, i.e.
housing, in its establishment efforts; therefore, on the German market, housing con-
struction and renovation projects comprised about 80 % of its portfolio (ibid.:489).

After establishment of its Berlin office, Firm 3 proved itself as a Successful and
Innovative Firm also in Germany by its ability to slowly but surely accumulate social
and cultural capital on the German market. Firm 3 accumulated cultural capital by
winning several public sector competitions and tendering procedures concerning e.g.
housing renovation, and accumulated social capital by entering social networks which
worked with some innovative fields of work for architects. These incorporated both
269
design and renovation-management solutions and also may have incorporated some of
the methods most commonly used by the technical-economic sub-field of architects
(see Albertsen, 1996 and Subsection 4.4.1.). After an unsuccessful, very expensive
attempt at project management, Firm 3 was, however, forced to close its German
subsidiary and thus restricted in its future activities on the German market. This has
had a negative affect upon its social capital on the German market due to the fact that
it cannot be physically present on this market in the near future and thus also cannot
take part in these more innovative social networks. The above descriptions of the
capital accumulation strategies of the three case study firms are depicted in four
figures in the following passage:

Figure 30. The Initial Position of the Case Study Firms on the Danish Market.

1. Very Few Firms of international renown (Case Study Firm 1)
2. A Few Firms of some national renown (Case Study Firm 2)

e.g. Firms climbing the social ladder, (Case Study Firm 3)
or

Local or regional firms without high ambitions,

or

Chronically floundering firms

Source: Figure 22 in Subsection 4.4.1. and Figure A.3. from Appendix A, which are
based on Albertsen, 1996; Gerkan in Der Architekt, May 1990; various other articles
in Arkitekt- og byggebladet, Arkitekten, Der Architekt, and Deutsche Bauzeitung, and
the empirical data of Appendix B.

In Figure 30, the initial positioning of the three case study firms on the Danish market
is depicted. At the beginning of the nineties, both Firms 1 and 2 enjoyed a positioning
in the most exclusive circles of the Danish construction industry, with the possibility
of bidding for all major Danish projects. Firm 3, in turn, was located much further
down on the hierarchy of Danish firms. During the nineties, these positions remained
much the same. Firm 3 has, however, probably succeeded in climbing the social
270
ladder of the world of architecture by accumulating further Danish social and cultural
capital through its project acquisition on the Danish market.

The corresponding situation on the German market is depicted in Figure 31:

Figure 31. The Initial Position of the Case Study Firms on the German
Market.

1. Very Few Firms of international renown (Case Study Firm 1)

e.g. Firms climbing the social ladder, (Case Study Firms 2 and 3)
or


or


Source: Figure 22 in Subsection 4.4.1. and Figure A.3. from Appendix A, which are
based on Albertsen, 1996; Gerkan in Der Architekt, May 1990; various other articles
in Arkitekt- og byggebladet, Arkitekten, Der Architekt, and Deutsche Bauzeitung, and
the empirical data of Appendix B.

On the German market, the original situation for Case Study Firm 2 is markedly
different from that of the Danish market. Whereas Firm 1 also was a part of the most
exclusive circles of the German construction industry (the same position it held on the
Danish market) and Case Study Firm 3 also was a firm of lesser renown on the Ger-
man market (ditto), Case Study Firm 2 had to initially realize that it was a firm of lesser
renown on the German market, although it was a nationally renowned firm on the
Danish market (see Appendix B).

These positions remained much the same throughout the nineties. Case Study Firm 1
did, however, succeed in accumulating further cultural capital through successful
participation in public tendering procedures, whereas Case Study Firms 2 and 3 also
271
did succeed in obtaining a certain level of cultural and social capital on the German
market after their initial entry. This is depicted in Figure 32:

Figure 32. The Three Case Study Firms Accumulation of Social and Cultural
Capital in Germany During the Nineties.

High

Level of Accumu- Firm 1
lation of Cultural
Capital in the
German field

Firm 2

Firm 3

Low

Low High

in German social groups

Source: Authors interpretation of Bourdieu, 1979, 1983, 1986 (see Chapter 4); the
authors empirical data.

As previously described, Figure 32 depicts Case Study Firms 2 and 3s acquisition of
substantial levels of both cultural and social capital after the founding of offices on the
German market. The partners and employees of these offices were able to establish
contacts to German actors, thus creating social capital, as well as winning some
competitions and public tendering procedures, thus establishing cultural capital. Firm
3 was, however, also forced to stop the activities of its subsidiary on the German mar-
ket after the project management court case; this meant that its level of social capital
fell again, as presence on the market was necessary for it to maintain many of its social
contacts to the actors on the German market.

Firm 1, on the other hand, mainly generated additional cultural capital during the nine-
ties by winning architectural projects; its social capital generating activities were much
less emphasized. Firm 1, however, started with a much higher level of social capital
due to decades of experience on the German market and the substantial long-standing
272
contacts to this market of its many German-born employees. It did not need market
presence to maintain its social contacts, and the founding of a subsidiary in Wies-
baden in connection with the completion of a major renovation project at the Goethe
University in Frankfurt am Main did not influence its social capital to any great extent,
as the subsidiarys main function was to complete this project.

The final step in the discussion of the accumulation of social and cultural capital is to
insert the above figure in Figure 21 (see Subsection 4.4.1.) concerning Albertsens
Three Architectural Sub-fields. This is done in Figure 33 below.

Figure 33. The Position of the Three Case Study Firms on the German Market
in relation to Albertsens Three Architectural Sub-Fields.

High

Level of Accumu- Artis- Firm 1 Professional
lation of Cultural tic Sub-field
Capital in the Sub-
German field field

Firm 2

Firm 3

Low Technical-Economic Sub-field

Low High

in German social groups
Source: Figure 21 which is based on Bourdieu, 1979, 1983, 1986; Albertsen, 1996
(see Chapter 4); the authors empirical data.

Figure 33 indicates that Firm 1 was placed within the upper spheres of the profession-
al sub-field on the German market throughout the nineties. Both Firms 2 and 3 were
aiming for this field and were working on the slow move to this sub-field in the years
after the founding of their German offices. Although they sometimes completed pro-
jects (e.g. facility management for the case of Firm 2, project organization and man-
agement for the case of Firm 3) that are often perceived to be a part of the technical-
economic sub-field, they were keen on accumulating a certain amount of cultural
capital through participation in competitions and public tendering where architectural
273
design is one of the key criteria, and thus moving towards the professional sub-field,
as the professional sub-field is more respectable in the world or arhcitecture (see
Albertsen, 1996:6-7 in Subsection 4.4.1) and furthermore corresponds to their
position or sought position on the Danish market.

Firm 3 was, however, thrown off course by a major court case concerning its first
project management project. This made its level of social capital fall substantially, as it
is difficult for it to maintain social relations to German actors without a subsidiary in
Germany. Firm 3 must solve this problem if it decides it wants to continue on the road
to establishment in the German professional sub-field.

10.4. Conclusion Concerning the Relation of Previous Project Work to Obtain-
ing Projects.
Previous project work provided all three case study firms with a reference value
(Holstius, 1987). It can also be said that project work led to the accumulation of pro-
ject-specific institutionalized and objectified cultural capital as well as social capital
(Bourdieu, 1983). The cultural and social capital accumulated was, however, usually
specific to the country of origin, thus further strengthening the hypothesis that the
German and Danish construction industries are two different milieus.

Contrary of the theory of Salminen (1997), both completed projects as well as prizes
in public tendering procedures and competitions provided institutionalized cultural
capital. Additionally the user experience in connection with a specific project often did
not play a large role with regard to the accumulated social capital, as many potential
clients merely accepted a list of projects acquired as cultural-capital related proof of
capabilities and/or visited the buildings (or objectified cultural capital) themselves to
get a personal impression and thus did not contact the references in question.

Acquiring new customers played a larger role in the capital use acquisition practices of
the case study firms than keeping present customers, due to the discontinuous nature
of architectural project business. The case study firms put their cultural capital to use
in their reference lists and other promotional material and also took contacts to the
press to inform them of projects they had won. However direct promotional efforts,
such as asking the client to promote the architectural firm in question in brochures or
advertising were not used, as this was not keeping with the norms of the professional
subfield (see Albertsen, 1996, as discussed in Subsection 4.4.1). Similarly clients were
not directly asked by the case study firms to use social capital-related mechanisms
such as word-of-mouth.
274

Throughout the nineties the three case study firms accumulated cultural capital on the
German market. Firm 2 and 3 also accumulated substantial amounts of social capital,
whereas Firm 1 already had a large stock of social capital which it did not concentrate
upon increasing. Firm 1 strengthened its position in the German professional sub-field,
whereas Firms 2 and 3 made efforts to establish themselves in this sub-field and came
closer to this goal during the nineties.
275
11. Conclusions regarding the Scientific Contributions of this Dissertation
Study

As previously mentioned in Chapter 1 and Section 4.3., this study was undertaken
using an abductive (Andersen, 1988; Denzin, 1978; Dubois and Gadde, 1999) and
explorative-integrative (Maale, 1996) methodology, which entails a combination of
inductive and deductive analysis. There are four ways in which such a study can con-
tribute to scientific progress (see e.g. Andersen, 1988 and Flick et al., 1995):

1. By providing further empirical evidence supporting previous scientific results and
the corresponding theories
2. By providing evidence that existing theories and conceptual frameworks may need
to be modified
3. By providing the basis for theoretical and conceptual syntheses
4. By contributing with totally new theories, models, and conceptual definitions

With regard to points 1 and 2, providing further or contradicting evidence is always
positive in relation to both quantitative and qualitative research. However, due to the
inherently larger problems of external validity (see Subsection 4.3.3.), these points are
especially relevant when applied to previous contributions based on qualitative
analysis. This study scrutinizes a number of qualitatively developed concepts and
models, including Alajoutsijrvi and Tikkanens (1999) Competencies in the Context
of Relationships model (see Section 2.3.) as well as the following concepts from
Chapter 1 and Subsection 3.3.2.: Cova et al.s (1996a) milieu, their General Config-
uration for Project-to-Order Firms (Figure 1, which is from Cova et al., 1994) and
Anticipation-Flexibility framework (Figure 13 from Cova et al., 1993), concepts
from Salminens (1997) dissertation on references (see e.g. Figures 14 and 15), the
sleeping relationship of Hadjikhani (1996), and the social construction of demand
issue (see e.g. Cova and Hoskins, 1997). A summary of the results of this scrutiny will
be presented below, in connection with the treatment of research questions 3 5.

Concerning point 3, the model depicted in Figure 9 of Chapter 2 shows key charac-
teristics of architectural project offerings. It was developed on the basis of the pro-
fessional services literature (e.g. Alvesson, 1995; Lwendahl, 1997; Sharma, 1991),
seminal contributions to the project marketing literature (Mattsson, 1973; Holstius,
1989; Backhaus, 1995), and literature concerning construction projects in particular
(e.g. Day, 1994; Hellgren and Stjernberg, 1995; Oxley and Poskitt, 1996). Further-
more, the commensurability of the project marketing milieu-concept (Cova et al.
1996a, see Subsection 3.3.2.) and Bourdieus (1983, 1990, 1996) and the institutional
276
theoretical (see e.g. DiMaggio and Powell, 1983; Melin, 1989, Scott, 1994) concept of
the field was demonstrated in Subsection 4.4.2. on the basis of conceptual and meta-
theoretical analysis. This, in combination with the identification of two possible
governance structures for project services industries (see Figure 18 in Section 4.2.,
which is based on Hkansson and Johanson, 1993 and the literature in Sections 2.4.-
2.6. and Subsection 3.3.2.), enabled this study to draw on and combine insights from
both INPM-contributions (see Subsection 3.3.2.) and Bourdivan theory (see Chapter
4). In contrast, this study did not develop any truly new models (point 4) above.

With regard to the studys research questions (see Chapter 1), these were descriptive
in nature. However Chapter 5 linked the multiplicity of theories and concepts scrutin-
ized in Chapters 2 4 to each research question, thus structuring the abductive analy-
sis. Concerning research questions 1 and 2, these provided the general macro-
economic and structural context (see Chapter 1, Figure 17 in Section 4.2. and
Sections 5.2. and 5.3.) for the more directly theory-related research questions 3 5.
Therefore no theoretically relevant insights were achieved based on the answers to
research questions 1 and 2 alone. However one new application of an existing theore-
tical model did occur in Chapter 7, which contains the treatment of research question
2. In this chapters Section 7.6., the network model of internationalization of Johanson
and Mattsson (1988, see Section 2.2.) was used both to determine the type of
internationalization undertaken by key Danish actors as well as to discuss the lack of
long-term effects of the Danish Ministry of Housings German-Danish cooperation
agreements. The latter application, i.e. using this model to analyze public sector policy
effects, was a novelty.

Furthermore it should be noted en passant that results from research question 2 (see
Section 7.6.) indicated that the Danish networks in which Danish construction industry
firms active on the German markets participated were more of a social nature than of
the nature of networks as typically defined by IMP researchers (see Subsection
3.3.1.). This is because activity links and resource ties (Hkansson and Johanson,
1992) were not present, and mutual dependence and relationship investments (see
Easton, 1992; Johanson and Mattsson, 1986) were very low. These results were built
upon further in the subsequent treatment of research questions 4 and 5, as will be
indicated in the following.

Chapter 8 contains the answer to the first case study research question, research ques-
tion 3 concerning knowledge. On the basis of this chapter and the discussion of Sec-
tions 2.3. and 5.4. as well as Figure 20a in Subsection 4.4.1., it can be concluded that
277
context-specific knowledge of the German construction industry milieu (see e.g.
Axelsson and Johanson, 1992, as described in Section 2.2.) was a significant prere-
quisite for the German project acquisition activities of the Danish case study
architectural firms. With regard to theory, this conclusion goes beyond the insight of
the so-called Uppsala Internationalization Model (see e.g. Johanson and Vahlne, 1977,
as described in Section 2.2.) concerning the importance of knowledge in the inter-
nationalization process of the firm. The Uppsala model merely relates the international-
ization path of the firm to an experiential learning process (see ibid. and Petersen and
Pedersen, 1996); it does not specify the nature of knowledge as a prerequisite for
acquisitive activities.

The fact that context-specific knowledge is a prerequisite for project acquisition acti-
vities leads to a Catch-22 situation (see Section 5.4. and Subsection 8.3.5.), in
which the knowledge that is a necessary prerequisite for obtaining projects can only be
obtained through projects. However, the unique boom situation of the German market
at the beginning of the nineties as well as the resultant under-capacity problems helped
the two Danish case study firms without previous German market-seeking project
experience (i.e. firms 2 and 3) overcome the Catch-22 dilemma. During this period,
German clients were more open to working with foreign firms who did not have the
normal level of contextual-knowledge about the German field. The theoretical impli-
cation of this is the following proposition:

Entering foreign markets in boom situations enables a firm to better over-
come potential Catch-22 situations than entering foreign markets in other
circumstances.

Furthermore, contrary to the theory of Boisot et al. (1997, see Section 2.3. and Figure
5), the case study firms knowledge acquisition process did not follow a cycle of
codification/de-codification and inter-firm diffusion. Instead much of the knowledge
seemed to remain in the from tacit knowledge to tacit knowledge socialization
quadrant of the Knowledge Conversion and Sharing Matrix of Nonaka and Takeuchi
(1995, see Figure 4 in Section 2.3.). Furthermore, in contrast to the theory of
Alajoutsijrvi and Tikkanen (1999, see Section 2.3. and Figure 6), knowledge that was
codified and generically applicable did not always have greater utility than relationship-
specific tacit knowledge. Thus this study identified two relevant questions that should
be addressed in further research:

1. What triggers and hinders the social learning cycle proposed by Boisot et al.
(1997)?
278
2. What is the relationship between the degree of codification of knowledge,
the level of applicability of knowledge (i.e. generic versus relationship-
specific), and the utility of the knowledge?

Moreover, with regard to the tacit knowledge, the responses of respondents showed
that they had difficulties in determining the boundary between the generic and the port-
folio levels of Alajoutsijrvi and Tikkanens (1999) levels of information structuring
(see Figure 6). However, knowing the exact boundary was also shown not to be
managerially relevant. On this basis, a new model of Tacit Knowledge in the Context
of Relationships (see Figure 25 in Section 8.4.) was developed, which eliminated the
distinction between generic and portfolio-specific knowledge. Furthermore, the
developed model included a more precise classification of how knowledge may be
shared at the inter-organizational level (i.e. between two firms).

Finally, in relation to tacit knowledge, it was found that increases in the tacit and
experiential portfolio-specific knowledge lessened the amount of relationship-specific
knowledge the two new firms on the German market (2 and 3) needed to acquire in
specific situations. This leads to a second proposition:

For firms in the initial stages of internationalization, increases in their
amounts of portfolio-specific knowledge result in decreases in the level of
relationship-specific knowledge they need to obtain.

Concerning the boundary spanner literature (see Subsection 3.3.3.), Section 8.4.
showed that there is a learning loop between the information processing and external
representation roles (see Aldrich and Herker, 1977) of boundary spanners, in that the
knowledge actors obtain from information processing is used in external represen-
tation and vice versa. Thus boundary spanners also learn in external representation
situations a factor not sufficiently accounted for by the existing boundary spanner
literature. Furthermore, less psychological and organizational distance was found
between the boundary spanners active on the German market and the other case firm
organizational actors than the reviewed contributions (Adams, 1976; Aldrich and
Herker, 1977) suggest. It was hypothesized that the reason for this could be the
relatively small size of the studied firms in relation to firms in other industries. This
leads us to the studys third theoretical proposition:

Organizational and psychological distance between boundary spanners and
other firm actors will vary positively with firm size.

279
Similar propositions concerning size have been put forth in general organizational
theory (see e.g. Barney and Ouchi, 1986; Milgrom and Roberts, 1992; Williamson,
1975), yet not with specific regard to the boundary spanner role.

In relation to the literature on relationship promoters (e.g. Gemnden, 1996;
Gemnden and Walter, 1994, as described in Subsection 3.3.3.), support was found
for the role of relationship promoters by know-how, i.e. promoters who used their
knowledge to obtain social capital and orders (see also Figure 20a in Subsection
4.4.1.). However, conversely, contrary to Gemnden and Walter (1994), power did
not play a positive role for relationship promoters, indicating that knowledge-related
factors played an even more important and unequivocal role than suggested in the
previously mentioned contribution.

Finally, in relation to research question 3, the generated data provided further support
for the presence of a fundamental knowledge-related dilemma concerning flexibility
versus anticipation (see Cova et al., 1993, as described in Subsection 3.3.2.).

Research question 4 concerns the process of architectural project acquisition (see
Chapter 1). As previously mentioned in Section 5.5., the research question formula-
tion comes close to a qualitative test of the General Marketing Configuration for
Project-to-Order Supplier Firms (Cova et al., 1994, see Figure 1), yet the purpose of
the research question is not to validate or refute the model in its entirety, but to use it
as the point of departure for a rich description of the process of obtaining project or-
ders on the German market. Therefore three similar models which depict the project
marketing process in the private sector, the project marketing process in the public
sector, and the project marketing process in a relationship situation are developed and
described in Chapter 9 (see Figures 27-29). They are the result of the scrutiny of em-
pirical data, the original Cova et al., 1994 model, and the architectural services project
phase model of Figure 9, which, as previously mentioned in this chapter, was
conceptualized on the basis of professional services and project marketing
contributions as well as literature concerning construction projects.

Chapter 9s only major theoretical criticism of the original Cova et al. (1994) model of
Figure 1 is as follows: Their model depicts strategic analysis and priority setting as
activities mainly completed before investments in social networks and scanning in the
environment are undertaken. This is not in accordance with firms practice. The
answer to research question three has shown that some scanning and knowledge-
acquisition must necessarily proceed strategic analysis and determination of strategic
280
priorities. Furthermore, strategy formulation has a strong emergent (Mintzberg and
Quinn, 1992) element as well as an element of tacit socialization (see e.g. Nonaka and
Takeuchi, 1995, as described in Section 2.4.). Thus, in relation to further refinement of
the Cova et al. (1994) framework, it would be relevant to test the following
proposition:

Strategic analysis and priority setting in project marketing firms occur
organically and emergently (e.g. la Mintzberg and Quinn, 1992).

Paradoxically, initial empirical support for this proposition already exists in a pre-
vious work (Cova et al., 1993) by the very same authors of the General Marketing
Configuration for Project-to-Order Supplier Firms!

Additionally, in relation to Cova et al.s (1994) configuration model as well as the
results from research question 3, data indicates that architectural firms do not develop
core offers to be used in multiple architectural projects; instead they develop com-
petencies to put to use in multiple architectural projects. On the basis of this data, a
further proposition can be put forth in relation to potential future model refinement:

Firms that offer customized services in project marketing do not develop
core offers, but rather core competencies.

In relation to the above proposition, some related general professional services
management theory already exists (see e.g. Lwendahl, 1997). This could fruitfully be
incorporated in a study of the issue.

The examination of research question 4, together with the previously mentioned results
concerning research question 2 and evidence related to research question 5, indicates
the following: The networks in which Danish construction industry firms active on the
German markets participated in were more of a social nature than of the nature of
networks as typically defined by IMP researchers (see Subsection 3.3.1). This is
because activity links and resource ties (Hkansson and Johanson, 1992) were not
present, and mutual dependence and relationship investments (see Easton, 1992 and
Johanson and Mattsson, 1986) were very low.

One implication of these results concerns the governance structure: It is that of a
socially constructed market (see Figure 18 in Section 4.2.). This finding may have
broader relevance than this particular study or the realm of architectural alone. It is
probable that the socially constructed market is fairly common governance structure in
281
project marketing situations, due to the presence of discontinuity (see e.g. Ahmed,
1993; Cova and Ghauri, 1996; Tikkanen, 1998, as described in Subsection 3.3.2.).
Furthermore this governance structure may be key in the professional services, due to
the role that socially constructed factors such as judgment and credibility play in
these services (see Lwendahl, 1997, in Section 2.4. and the description of the
Interpersonal World of Storper and Salais, 1997, in Section A.2., Figure A.2.).

Lastly, the socially constructed market governance structure may furthermore be the
dominating governance structure for smaller types of projects, i.e. projects often
offered by architectural and engineering service firms as well as by software solution
developing firms. Here, in addition to the discontinuity of offerings, there are many
potential sellers, thus making socially-constructed market conditions all the more pro-
bable. This leads to the following theoretical proposition:

The socially constructed market governance structure prevails in situations
where there are many potential offerers of projects.

On the basis of the above arguments, it is highly relevant to develop and use INPM
conceptualizations of the environment that have the power to capture the key
characteristics of this governance structure. This study confirms that the milieu of
Cova, Mazet, and Salle (1996, see Subsection 3.3.2.) is one such conceptualization.
More, as previously indicated, the milieu-concept (Cova et al. 1996a, see Subsection
3.3.2.) is commensurable and almost identical to Bourdieus (1983, 1990, 1996) and
the institutional theoretical (see e.g. DiMaggio and Powell, 1983; Melin, 1989, Scott,
1994) concept of the field. This identity enables the Bourdivan concepts of social and
cultural capital to be used in conjunction with the concepts of Cova et al. In
connection to research question 4, the accumulation of social capital is specified in
relation to the steps of the architectural project acquisition process in both the private
and public sectors. Furthermore, the adaptation-versus-flexibility dilemma (Cova et
al., 1993) is reformulated such that most flexibility-investments concern general
operations on socially-constructed markets, whereas some adaptation-investments
concern efforts to create the long-term relationships that are the exception in the field
of architectural services.

Research question 5 deals more in depth with the theoretical issue of how previous
project work influences obtaining new projects. In this studys Chapter 10, which
contains the empirical treatment of research question 5, the results of research ques-
tions 3 and 4 concerning the role of knowledge and social capital are built upon (see
282
Chapters 8 and 9, as well as Figure 20a in Subsection 4.4.1). Bourdieus concepts
(1983) of social and cultural capital are used to explain struggles for achieving a
position on a national, i.e. German, milieu of the construction industry, as is illustrated
in Figures 32 and 33.

This application of the Bourdivan capital framework is a new contribution to project
marketing theory as well as to professional services marketing theory. Additionally,
although the Bourdivan capital framework has been previously used in theories about
the field of architecture Albertsen, 1996, uses the capital framework to describe how
architects from the three sub-fields of architecture distinguish themselves from one
another and Stevens, 1998, uses the capital framework to describe the reproduction of
architects habituses and a hierarchy of architectural taste through the educational
system none of the previous contributions have specifically dealt with issues related
to internationalization and marketing. Thus the business-related application of Bour-
divan theory to the field of architecture in this dissertation is also a novelty.

In further attempts at theoretical synthesis, the reference-framework of Salminen
(1997) is scrutinized and used as a supplement to the Bourdivan framework, in cases
where the empirical material supports this use. General support is found for Sal-
minens reference theory with two exceptions:

1. Contrary to Salminens suggestion, evidence is found that some projects not yet
completed already have a reference value and that the reference value does not
necessarily further increase after project completion, e.g. as the potentially referring
client gains experience with the facilities provided by the project.
2. Verbal communication between the potential project purchaser and the potentially
referring client is the exception, not the rule, as conversations with former clients
often do not provide further relevant information for potential project purchasers
that could not be acquired through other, better means.

Furthermore, Salminens description of the uses of references is translated into the
Bourdivan capital framework, to enable future theoretical synthesis. The same is true
of Hadjikhanis (1996) sleeping relationship concept. In relation to this term, it is
found that it is extremely difficult for architectural firms as relatively small firms with
many potential competitors to create dependence in relations, which would otherwise
result in relationships or even a network governance structure (see Figure 18 in Section
4.2.). Thus trust, which is directly related to social and cultural capital, plays an
extremely important role in the management of often very discontinuous sleeping
relationships. Moreover, in relation to the social construction of demand issue (see
283
Cova and Hoskins, 1997), the case study firms have mainly followed the determinist
approach as opposed to the constructivist approach. This is probably because they
did not have the size and power to actively shape the competitive arena and the rules
of the milieu. The statements in this paragraph lead to two theoretical propositions:

In relation to the sleeping relationship concept, small project selling firms
rely on trust creation more than creating dependency.
With regard to the social construction of demand issue, small project
selling firms mainly follow the deterministic approach.

With regard to the territoriality issue of the concept of the milieu (see Tikkanens
1998 remarks in Subsection 3.3.2. as well as the remarks at the end of Subsection
4.4.2.), the empirical treatment of all five research questions provides support for the
original geographical delimitation of this concept (see Cova et al., 1996, as described
in Subsection 3.3.2.) with regard to the architectural projects as well as other con-
struction industry projects. This result should therefore, as suggested at the end of
Section 4.4.2, be included in any future research about when it is acceptable to define
the boundaries of the milieu (or the field, see Section 4.4.) in geographical terms.

The discussion in the previous paragraph leads to a final general issue which must be
elaborated upon in connection with the scientific contribution of this study, namely the
issue of generalizability. As a qualitative research contribution, this study is somewhat
problematic with regard to external validity (see Subsection 4.3.3. and the beginning of
this chapter). Furthermore, this study draws on a large number of other qualitative
contributions which share this same weakness (see Chapter 3 and Subsection 5.7.).
Therefore the ambition of this study has neither been to present universally valid
results nor to develop grand theory (see Chapter 1). Instead the aim has been to
develop a local conceptual framework based on synthesis and to provide further
empirical evidence concerning a multitude of existing frameworks.

One may of course discuss the usefulness of this endeavor. However, in connection
with this issue, the question of usefulness for whom is highly relevant to ask. From
e.g. a practitioners and societal perspective, it can be argued that such an in-depth
study, although not universally generalizable, is especially useful for practice in the
country which has financed the research, namely Denmark. Furthermore, from a scien-
tific viewpoint, it is often not possible to do quantitative research about
internationalization and export trends, if one limits ones research to firms from
specific small countries, as the sample size in many industries will be too small.
Including firms from several different countries is admittedly an option, but this option
284
is only feasible if the firms are comparable across countries. For the case of
architecture, sources such as Stevens (1998:29, see Section 2.1.) as well as Button
and Fleming, 1992; Drbye, 1999; and Oliver-Taylor, 1993 (see Appendix A) indicate
that this is not the case. Thus, in this case, a researcher with a specific interest in the
situation in a small country only has two options:

1. Doing a qualitative study or 2. Doing no study whatsoever

On the basis of the above, I justify and defend my qualitative study design. Through
this study, I have taken the initial steps to develop the concepts of social and cultural
capital for use in business-to-business research. These concepts may also prove to be
powerful descriptive tools in other socially constructed market situations, e.g. in other
project marketing and professional services settings. However, as I have not been able
to create more than local theories, in each specific case, the rules of the generation of
social and cultural capital as well as the laws of the milieu (cf. Cova et al., 1996) must
be assessed anew. This is because no researcher has enough knowledge to make
general, a priori statements about rules of social and cultural capital generation that
apply to all milieus (see e.g. Araujo and Easton, 1999; Bourdieu, 1996). However, it is
my hope that yet other researchers will undertake similar abductive studies, which the
aim of contribution to a cumulative base of knowledge about the operationalization of
these concepts in varying business situations as well as the further refinement of these
concepts on a general level for middle-range theory pertaining to business-to-business
marketing situations.

In contrast, the eight theoretical propositions that I have presented in this chapter are
well-suited for quantitative theory testing.
12. Managerial Implications for Architectural Firms and other Construction
Industry Actors.
As previously mentioned in the foreword to this dissertation, a number of Danish
construction industry actors commenced operations on the German market at the
beginning of the previous decade. However, most of their aspirations were dashed. By
1996, many of the largest Danish civil engineering and contracting firms had lost
billions of Danish kroner (Halskov, 1995). Additionally, a great number of small firms,
typically architectural firms or subcontractors in the construction process, experien-
ced severe losses, some of which jeopardized the very existence of these firms (ibid.).

In contrast, this dissertation focuses upon the internationalization activities of three
Danish architectural firms that achieved a degree of success in their market-seeking
(Majkgrd and Sharma, 1998, see Section 2.2.) activities on the German market during
285
the 1990s. It provides managerially relevant insights into four areas of importance to
construction industry firms: internationalization, knowledge management, marketing,
and via Appendix A the economic dynamics of the construction industry. These
insights will be summarized briefly in this chapter.

First, with regard to internationalization, the empirical data provides unequivocal sup-
port for the territory-related statement that there are substantial national variations in
the way the construction industry is organized in Western Europe. Acquiring know-
ledge of these variations was paramount to the success of Danish firms operations in
Germany. As indicated in the pilot study (see Appendix A), Danish firms that did not
know or quickly learn about e.g. the German laws, norms, practices, typical solutions
offered, and environmental discourse during operations on the German market, but
instead operated with the assumption that Danish construction work is good, so we
should be able to find and complete projects on the German market were severely
disappointed and in some cases even involved in extremely expensive court cases
which jeopardized their very existence.

Thus Danish or other foreign construction industry firms wanting to commence oper-
ations on the German market need to take into account that knowledge of the highly
regulated German construction industry is a precondition for operations in Germany
34
.
This knowledge may partially be acquired from knowledgeable experts, e.g. the
construction industry attachs of the Danish Ministry of Housing or German attorneys
experienced in servicing foreign clients. However, part of this knowledge, e.g. the part
concerning negotiations and the unwritten rules of dealing with other actors, is tacit
(see Section 2.3. and Chapter 8) and must be acquired through experience because
one does not usually communicate verbally about these aspects (see Section 8.3.).

34
In Skaates, Tikkanen, and Alajoutsijrvi (1999b), the following hypotheses are presented concerning
territoriality on the basis of four Nordic case studies of architectural firms:
1. When moving from one national market with a set of well-established norms, rules, and actor
representations to another market with a different set of well-established norms, rules, and actor
representations, territoriality does matter. Therefore the two markets should be regarded as two
different milieus.
2. When moving from one national market with a set of well-established norms, rules, and actor
representations for a given industry to another national market that is not so well-developed,
territoriality may matter much less, thus enabling the foreign firms to credibly sell and deliver similar
solutions to those that they would sell in their home market milieu.
3. Certain projects (e.g. major bridges, art museums, and major sports stadiums) may be so innovative or
prestigious that firms from all over the world may compete for them. With regard to this class of
projects, the rules of the game are most often truly international. Territoriality is thus not a deciding
factor - and the firms who are awarded these projects usually are so well-established that they have
learned the international rules of the game.
286
Additionally, as a respondent from Firm 2 stated, one does not ask the questions that
one does not know are necessary to ask (see Appendix B: 428).

In relation to much of this tacit knowledge, there exists a fundamental Catch-22
dilemma, in that this knowledge on one hand normally is a precondition for acquiring
projects, yet on the other hand can only be acquired through project activities on the
market in question (see Sections 5.4. and 8.3.). This problem may be especially
difficult for architectural firms and other construction industry-related professional
service firms (e.g. civil engineering companies) to overcome, as they have little proof
of their abilities to fulfill their foreign clients requirements if they do not have referen-
ces from the given foreign country. However, with regard to the two Danish case
study firms without previous market-seeking activities in Germany, the boom on the
German market at the beginning of the nineties and the resulting under-capacity prob-
lems helped overcome this obstacle. During the boom period, German clients were
more flexible and open toward working with foreign firms without previous experi-
ence, as they otherwise would have had to wait months for the services of a com-
parable domestic firm.

On the basis of the above, it can be said that it is easier to overcome the Catch-22
dilemma, if one enters a foreign market during a boom situation marked by domestic
under-capacity problems. In this situation, ones potential foreign clients will more
likely be flexible and open to working with foreigners. However, at the same time, the
firm from abroad should prepare itself thoroughly for work abroad e.g. by insuring
that the relevant boundary spanner/relationship promoter employees (see
Subsection 3.3.3.) acquire as much knowledge as possible beforehand about the
organization and traditions of the foreign construction industry. Furthermore, if the
firm does commence foreign operations in a country whose construction industry is
booming, it must count on also having more difficulties in hiring relevant foreign-born
employees and experts, as they will be in high demand.

In relation to knowledge management, it is wise for firm actors to ponder beforehand
how to insure a continued increase in the knowledge of the foreign market after opera-
tions abroad have been started and who in the firm will need to possess this know-
ledge. Considering these issues is important because the diffusion of knowledge to
relevant firm actors is not an automatic process (see Section 8.4). Moreover, the
following specific knowledge-related developments may need to be addressed before
and during the internationalization process, as they inherently encompass the possi-
bility of intra-firm conflict:
287

1. The profile of the firm may change and perhaps even become muddy as it
internationalizes, as the types of projects it acquires on the new market in its
establishment phase may be very different from the types of projects it is used to
working with on its home market (see Chapter 10).
2. Not all employees in the firm will have the same knowledge of the foreign market as
the relationship promoter/boundary spanner employees who work abroad. This
may cause tension within the firm concerning e.g. goals and means (see Chapter 8).

In relation to point 2, Figure 25 (see ibid.), which depicts the location of knowledge in
the context of client relationships, is a helpful tool for determining the location and
spread of knowledge at given points in time.

Furthermore, in relation to the decision of who should head the firms operations
abroad, considerations should be made concerning the personal characteristics neces-
sary for this position (see e.g. Gemnden and Walters 1994 description of the per-
sonal characteristics that a relationship promoter should possess in Subsection
3.3.3.). A knowledgeable professional, e.g. a competent and experienced architect or
engineer, is not necessarily a good relationship promoter abroad. He or she may have
the necessarily skills for solving problems for existing clients, but not be good at cre-
ating the social and informational relationships that are a prerequisite for obtaining
project orders from previously unknown foreign clients, due to e.g. a lack of personal
presentation skills or the ability to adapt to a foreign environment. (Source: interviews
with 4 respondents.)

Internationalizing architectural firms may, however, find conversations about this point
difficult due to the fact that promotional activities are not so often discussed in daily
business conversation (see e.g. Chapter 8 and Skaates, Tikkanen, and Alajoutsijrvi,
1999a:41; compare also to Albertsens 1996 statements about the professional sub-
field in Subsection 4.4.1. as well as Harrigan and Neel, 1996; Sommer, 1996). Thus
leading employees or partners in a firm contemplating internationalization should
consider working with this point at a higher level of abstraction, by introducing the
vocabulary of the boundary spanner and relationship promoter literature (see
Subsection 3.3.3.) in the firm to facilitate communication about these issues.

Yet another reason for difficulties in discussing promotional activities relates to
opinions and prejudices concerning marketing. In this study, many of the respondents
from the case study firms as well as the other firms interviewed were skeptical the role
of marketing. Opinions such as marketing is not relevant for the architectural
288
profession could be discerned in many conversations. These opinion seemed to be
based on an understanding of marketing as encompassing rigid planning, product
parameter strategies for standardized products, advertising, and/or showy selling.
These practices are not comme il faut for the professional self-understanding of most
Danish architects (see e.g. Albertsens 1996 remarks concerning the professional sub-
field in Subsection 4.4.1).

Marketing can, however, be understood alternatively as (a) acting on ones under-
standing the rules of the market in which one operates and (b) acting on ones
understanding the needs and wishes of clients and potential clients (see e.g. Ford,
1997). This understanding of the term is much more applicable for the sale of profes-
sional services in the construction industry; thus it is recommended that architects as
well as others in business-to-business markets take this perspective.

Concerning the role of planning, markets for construction industry products and
services are relatively volatile, due to the influence of the fluctuating cost of borrowing
money on demand as well as the continual appearance of new environmental
regulations and new building components. This volatility makes it very risky to
produce long-term demand forecasts or plans for the future use of capacity. Thus the
often mechanistic prescriptions of the strategic planning school (e.g. Porter, 1980 and
1985 as well as Boughton, 1987) where one gathers information first, then plans,
then implements the plans - are not especially applicable to the construction industry
(see e.g. Cova et al., 1993 as described in Subsection 3.3.2.). Instead information
must be gathered at the same time one is making, implementing, and constantly
revising ones plans (see Figures 27-29 in Chapter 9).

In connection with the above, marketing is best understood as being about under-
standing the rules of the game in a way that enables one to act spontaneously, yet also
in a suitable way, in a given situation to insure a project order. After e.g. firm has
decided whether to seek a given project on the basis of its understanding of its goals
and preferably also on the basis of the use of e.g. Messners (1994, see Section
3.2.) marketing decision model for architectural firms, its marketing activities are not
yet finished. Marketing also encompasses the spur-of-the-moment, spontaneous
actions that are a part of the discussions of potential projects with potential clients.
During these discussions, one either argues and plans projects in a reactive way, by
following the existing recognized rules of the game, or in a proactive way, i.e. when
one becomes active in shaping the rules of the game to ones own and/or to clients
potential advantage (see Cova and Hoskins, 1997, as described in Subsection 3.3.2.).
289

The knowledge that is necessary to market architectural services professionally
pertains first, with specific regard to foreign markets, to the previously mentioned
rules and practices of the market in question at the levels of the client portfolio
and individual client (see Section 8.4.). Furthermore, with regard to all markets,
domestic or foreign, it is paramount to understand the different sub-fields of the world
of architecture (see Section 4.4.) and the modes of credibility generations in the eyes
of clients (see ibid. and Chapters 9 and 10). In this dissertation, these modes have
been described by building a framework based on the cultural and social capital of the
French sociologist Pierre Bourdieu (1979, 1983, 1986; see Section 4.4. as well as
Chapters 9 and 10). Additionally, relevant concepts and theories from the body of
project marketing literature, such as the sleeping relationship (Hadjikhani, 1996, as
described in Subsection 3.3.2.) and reference theory (Salminen, 1997, as described in
ibid.) were included in the framework (see also Chapters 9 and 10).

The proposed framework is meant as food for thought in managers evaluation and
discussion of their acquisitive practice. It is also envisioned that it may be fruitfully
presented to students of architecture as well as professional architects at e.g. semi-
nars, as these persons most often have not received much formal management edu-
cation (see e.g. Sommer, 1996; Stevens, 1998; stns, 1984; stns and Svensson,
1986) and there are few books and articles about marketing architectural services. For
these audiences, the presentation of such a description is managerially relevant in that
it provokes discussion at a higher level than otherwise, as a new vocabulary for the
description of the marketing process has been created. In contrast, it is not a ready-
made model of how-to-market architectural services, as the undertaken research has
been descriptive, not prescriptive.

However, I as the author of this dissertation do deem it fitting to make several general
suggestions to architects as to what could fruitfully receive greater focus in their
acquisitive practice on the basis of my many interviews. Similar to Harrigan and Neel
(1996) and Sommer (1996), I believe architects do not always focus sufficiently on
understanding the clients perceptions of own needs, wishes, and priorities. If many of
the Danish architectural firms of my pilot and case studies had prioritized this type of
information more highly and sought methods of acquiring this information, it would
have been easier for them to make a credible promise (Lwendahl, 1997, see Section
2.4.) to clients and thus to acquire more projects. This is especially true with regard to
German private sector clients; many Danish architectural firms vastly under-prioritized
the collection of this type of information from these clients. This was perhaps due to a
290
false assumption that they as educated architects automatically were familiar with and
understood the clients best interests (see e.g. Appendix B: 464 as well as Harrigan
and Neel, 1996).

In connection with the above point, I would argue that Danish architectural firms need
to ensure that they are familiar with clients perceptions to an even greater extent when
operating on a large, anonymous foreign market such as the German market than is the
case when operating on their small domestic market. On the Danish market, the Danish
architectural firms may actually know something about the viewpoints and preferences
of most clients, as the market is relatively small and they have substantial knowledge
of the discourses of Danish construction industry from years of operating on the
market.

Familiarity with debate about improvements in the construction industry implies also
more than merely knowing that one receives projects through contacts or ones
network (see e.g. Appendix B: 413 and 474). Via e.g. knowledge of debates about
construction quality and economics (or the lack thereof), one also learns something
ones potential clients would like, but have not been offered yet. In connection with
this point, it is important for actors from firms in the professional sub-field to also be
aware of what is happening in the techno-economic sub-field, in spite of the fact that
they as members of the professional sub-field often shun their techno-economic sub-
field colleagues (see Albertsen, 1996 as described in Subsection 4.4.4.1.). On the long
term, there may be spill-over effects from the techno-economic sub-field to the
professional sub-field even though this is something that the members of the
professional sub-field often are loath to accept.

For example, the relationship to general contractors may need to be proactively
reconsidered, due to the fact that client are increasingly hiring general contractors and
thus building without independent architectural services (see Chapter 6 and Appendix
A). This development may be dealt with it proactively if architects (a) define their field
broadly, as a field of knowledge or expertise concerning construction (see e.g.
Ahlqvist, 1992, as described in Section 3.2.), instead of defending their territory by
refusing to accept new constellations of cooperation and (b) seek answers to
marketing-related questions such as Which types of solutions are potential clients
purchasing instead of the solutions I would propose?, What advantages and dis-
advantages do these solutions offer?, and Would it be advantageous to our firm to
offer different types of services based on these new trends, possibly in cooperation
with other firms?
291

Furthermore, profound knowledge of debates and discourses about previously unmet
needs may help an architectural firm in creating a proactive offering (see Cova and
Hoskins, 1997, as described in Subsection 3.3.2.), i.e. an offering that goes against the
existing rules and conventions of the industry yet meets clients needs. In an industry
now marked by over-capacity (see e.g. Lubanski, 1999) and the diminishing traditional
role of the architect as an independent consultant servicing her client (see Subsection
A.4.3.2. and Sections 6.2. and 6.4.), proactive strategies are desperately needed, as
many firms are struggling to survive. However, at the same time, the room for
proactive experimentation is small, as an individual architectural firm does not usually
have the size or power to change the rules of the industry (see e.g. Chapters 9 and 10).
Furthermore the firm risks its reputation, if an innovative idea fails badly (see ibid.).

Finally, construction industry offerings are not only influenced by customers percep-
tions, needs, and desires. The economically possible and real worlds of production
of construction industry-related goods and services (see e.g. Storper and Salais, 1997,
as described in Appendix A, Section A.2.) also constrain current and future offerings,
whether proactive or reactive. It is therefore imperative that architects and other
construction industry actors interested in developing a proactive strategy for future
project acquisition understand the fundamental economic rules that govern the world
of construction industry production. This enables them to assess the possible eco-
nomic and structural consequences of e.g. the increase in standardized construction
elements on the market (see e.g. Eurostat, 1995, as cited in Appendix A, Section A.5.)
or of other commonly cited future scenarios. This understanding, in turn, allows them
to e.g. assess their marketspace as well as find ways in which they could organize
their production to avoid excessive price pressure and/or pressure to produce solution
types that they would prefer not to produce. This is preferable to merely reacting to
unfavorable trends and tendencies when these trends actually appear, a practice
which all too many Danish construction industry firms seem to follow today.

To sum the points in this chapter up briefly, it is suggested that architectural and other
firms in the construction industry should not shun marketing and economic
information gathering per se. Although there are a number of very well-known models
that are less suitable for the marketing of architectural services, models can be found
that, when used, aid understanding the marketing and economic side of the business
as well as planning and assessing ones business operations both at home and abroad.
Furthermore, gathering information and making considerations pertaining to
knowledge management becomes very important, if ones firm is considering
292
beginning operations on a foreign market.

293
13. Summary.
13.1. Introduction to the Study and Its Research Questions.

At the beginning of the nineties, the Danish construction market and market for archi-
tectural services were in the midst of a severe slump (Eurostat, 1995). At the same
time, the German market was beginning to boom, due to the fall of the Berlin Wall and
the subsequent process to unify the two German states (European Construction Re-
search, 1995:8,12). Due to the poor home market circumstances, many Danish
construction industry actors, including individual Danish architects and Danish
architectural firms, decided to attempt to find work on the German market (Halskov,
1995). However, the aspirations of most of these actors were dashed. By 1996, many
of the largest Danish civil engineering and contracting firms had lost billions of Danish
kroner, and a great number of small firms, typically architectural firms or subcon-
tractors in the construction process, had experienced severe losses, some of which
had jeopardized the very existence of these firms (ibid.). This turn of events surprised
insiders in the Danish construction industry as it was generally believed that Denmark
has high construction standards and that the firms that had attempted operations in
Germany were technically competent and had sound domestic business policies
(ibid.).

On the basis of the above scenario, this doctoral dissertation research focuses on the
Germany-related internationalization activities of three Danish architectural services
firms that were exceptions, in that they achieved a degree of success on the German
market in the 1990s and are still present on this market today. The internationalization
that is focused upon in this dissertation is market-seeking internationalization:

Market-seekers lack experiential knowledge of foreign markets [...]. They
must also establish credibility with the buyers (Majkgrd and Sharma,
1998: 9-11)

In contrast, client-following internationalization (see ibid.) is only treated en passant,
when it appears as an empirical phenomenon.

As for the three firms that are studied, the first firm is internationally renowned, i.e. it
has been active on international markets for years and has won prizes in many coun-
294
tries. The second firm is nationally renowned in that it is one of Denmarks largest
and most well-established firms. It has won many Danish prizes in previous decades
and has built some of the largest, most prestigious projects in its home country.
Finally, the third firm is an innovative new firm because it has only existed on the
Danish market since 1986.

The dissertation study is an explorative-integrative (Maale, 1996) and abductive
(Andersen, 1988:139-140; Denzin, 1978:109; Dubois and Gadde, 1999) case study. In
it inductive and deductive methodologies are combined through the concurrent and se-
quential examination and comparison of existing theory as well as empirical obser-
vations concerning the three case firms. However, the research questions themselves
are descriptive. They have been chosen on the basis of a pilot study (see Appendix
A), which focused on the problems that less successful Danish architectural firms that
had attempted internationalization during this period had had on the German market in
the nineties. It showed that the Danish architectural firms generally had had difficulties
detecting needs and establishing relationships to potential clients and cooperation
partners in Germany as well as problems coping with the laws and conventions of the
German construction industry.

The first two research questions are of a general nature:

1. How did the German market for architectural services develop during the
nineties in terms of e.g. institutions, total market size and growth rates at the

2. Who were the major actors involved either directly or indirectly in the
Danish internationalization of architectural services to Germany in the 1990s
and to what extent and how did they cooperate with one another?

The purpose of these two questions is to provide a general overview of the situation
on the German market for architectural services in the nineties at the macro-economic,
macro-structural and key German-Danish actor levels as well as to lay a broad
contextual foundation upon which the experiences of the three case study firms can be
scrutinized in relation to relevant business administration literature.

The remaining three research questions concern the three case study firms; they are
worded as follows:

295
3. What sort of specific knowledge about the German market and specific pro-
jects on the German market did the case study firms use to receive archi-
tectural projects on the German market?

4. How were concrete architectural project jobs obtained by the case study
firms?

5. What role did previous project work play when the case study firms
obtained specific projects on the German market?

In order to better explain how these three case study questions have been analyzed,
many of the theoretical contributions scrutinized in this dissertation will be briefly
presented in the next section. Thereafter the abductive links between previous contri-
butions and the analysis of the empirical material will be presented in more detail in
Section 13.3. Finally, Section 13.4. contains the concluding remarks of this summary.

13.2. Introduction to the Theoretical Framework of the Study.
Although many of the theoretical contributions were scrutinized concurrently with the
gathering and assessment of the studys empirical material, for the sake of clarity, the
theoretical framework is presented separately in Chapters 2 4 of this dissertation.
Thereafter the links between existing scholarly contributions and the dissertations
descriptive research questions are presented in Chapter 5, before the five research
questions are addressed empirically in Chapters 6 10. The presentation of theories in
Chapters 2 4 resembles the genealogies more common to French- and German-
language articles and papers than to English-language business administration literature
(for an example of a genealogy, see Gemnden, 1990).

In Chapter 2, architectural services are defined in relation to this dissertation. This is
necessary due to huge national variations in architects offerings (see e.g. Stevens,
1998). Furthermore, relevant internationalization theories and contributions concerning
knowledge in organizations are presented; these will be introduced and discussed in
Subsections 13.3.2. and 13.3.3. Finally, drawing on literature concerning the
professional services (Albertsen, 1996; Alvesson, 1995; Freidson, 1983; Larson,
1977; Lwendahl, 1997; Sharma, 1991; Starbuck, 1992), construction projects (Day,
1994; Hellgren and Stjernberg, 1995; Oxley and Poskitt, 1996), and project marketing
(Backhaus, 1995; Holstius, 1989; Mattsson, 1973), a general model of Key
Characteristic of Construction Project-Related Architectural Services that are a Part of
Architectural Project Offerings (Figure 9) is created.

296
In Chapter 3, the very eclectic and spread existing body of project marketing contribu-
tions is assessed in a literature review, to enable the abductive analysis. The following
types of studies are included in the review:

1. Quantitative empirical studies
2. Case studies and other qualitative empirical studies
3. Conceptual studies
4. Practice-oriented contributions

The included studies have been selected according to an assessment of two factors:

The relevance of the study in question to the research project at hand
The standing of the study in question in the academic world (Studies
judged to be especially renowned and/or seminal have been included.)

The literature review furthermore categorizes the included studies as being either rela-
ted or non-related to the work of the International/Industrial Marketing Group (in the
following: IMP) and its affiliated subgroup, the International Network for Project
Marketing and Systems Selling (in the following: INPM). A total of 17 relevant non-
IMP/INPM contributions and 13 relevant IMP/ INPM contributions are reviewed. Of
these, many will be described briefly in Subsections 13.3.3.-13.3.5. of this summary,
in connection with the presentation of the analysis relating to research questions 3 5.

The coverage of IMP/INPM work on project marketing in the literature review is,
however, preceded by a description of the IMP Group, the main points of which will
be presented here, to lay the foundation for the justification of the inclusion of Bour-
dieus (1979, 1983, 1986) social and cultural capital theory in this dissertation.

The IMP approach emphasizes that relationships in dyads and networks play a
decisive role with regard to marketing practice. According to Easton (1992:106-110),
relationships are seen by IMP members as being comprised of four elements:

5. Mutual orientation, which implies that firms are prepared to interact with each
other and expect each other to do so (Mattsson, 1988).
6. Mutual dependence or perceived mutual dependence which in some sense may
be regarded as the price a firm may have to pay for the benefits that a relationship
bestows. Dependence is partly a matter of choice and partly a matter of circum-
stances. (Easton, 1992:107)
297
7. Bonds, i.e. a measure of tying albeit unspecified, between partner firms (ibid.).
Bonds may include e.g. economic, social, technical, logistical, administrative,
informational, legal and time based dimensions (ibid.:108).
8. Relationship investments or processes in which resources are committed in order
to create, build or acquire assets which can be used in the future (Johanson and
Mattsson, 1986).

In the IMP approach, an industry is viewed as a network of interconnected exchange
relationships (Easton, 1992:104) encompassing actor bonds, activity links, and
resource ties (Hkansson and Johanson, 1992). Within the network, at any given
point in time, member firms/organizations have positions (Easton, 1992: 114-115),
which vary on the following points:

5. Function [emphasis added] describes the function firms are held to perform, the
activities they are expected to undertake, for example, a limited line wholesaler.
6. The identity [emphasis added] of the net of firms that the focal firm has
relationships with []. If the net changes the expectations change and so does the
position.
7. [T]he relative importance [emphasis added] of the firm in its net, measured by
size or other correlates of power.
8. The level of analysis [emphasis added] in relation to the position, e.g. the micro- or
the macroposition.

With regard to the above-mentioned characteristics of positions, characteristics 1 and
2, i.e. function and identity, may be difficult to identify objectively, especially for ar-
chitectural firms who derive their identity both from the world of applied art and the
construction industry (see e.g. Albertsen, 1996).

Furthermore, concerning the presence of networks, many IMP Group members admit
that networks do not always play a major role in marketing and purchasing decisions
in industrial markets. In order to depict when networks are prevalent, Hkansson and
Johanson (1993), have developed a model of four possible ideal type structures of
industrial market governance (ibid.: 44-45, see Figure 11 of Subsection 3.3.1.). These
are determined by (a) two alternative types of actor-internal forces (own interests
versus general norms) and (b) two alternative types of actor-external exchange
relations (general relations, which are a consequence of the dominance of general inter-
play between all industry actors, versus specific relations, which imply the dominance
of specific long-term relationship-related interactions between individual actors).

298
In the Network, which is the first ideal type governance structure, activities are
governed by actors different individual interests which are channeled to each other via
relationships between specific actors. In the Hierarchy, interests have been replaced
by norms which individuals follow and which are enforced through specific relations
to other actors.

In the Market governance structure, actors also follow their own individual interests,
but, in contrast to the Network, do not predominantly interact with specific other
actors. This means that the actors are, on one hand, freer in relation to one another,
yet on the other hand, they cannot take advantage of specific productivity gains which
occur through specific joint activities with other actors in the Network governance
structure. Finally, in the Culture or Profession, actions are once again governed by
norms, yet the external forces that ensure that the norms are followed are based on
general relationships that involve all members of the governance structure.

Turning now to project marketing-related contributions of the INPM subgroup, there
are several issues specific to project marketing which mandate the selective use of the
IMP framework, as described above. These are encompassed by the so-called D-U-
C- framework (see Cova and Ghauri, 1996; Mandjk and Veres, 1998; Tikkanen 1998;
compare also to Ahmed, 1993:55-56). Tikkanen (1998:264) lists the three D-U-C
features of project marketing as follows (the italics are Tikkanens):

D. The discontinuity of demand for projects;
U. The uniqueness of each project in technical, financial and socio-political
terms;
C. The complexity of each individual project in terms of the number of actors
involved throughout the supply process.

The consequence of the above characteristics is that the world of project business
cannot be a priori placed in the network governance structure, as discontinuity and
uniqueness often do not allow for long-term relationships marked by mutual depen-
dence, bonds, and relationship investments (see Easton, 1992) or activity and resource
links (see Hkansson and Johanson, 1992). Thus Cova and Ghauri (1996) suggest that
project marketing governance structures are something between markets and
networks.

In Chapter 4, I deal with this problem by building on and modifying Hkansson and
Johansons (1993:45) model of possible structures of industrial market governance for
the specific case of professional service projects. In this type of project, the dis-
299
tinction between interests and norms is not clear-cut, as the projects are highly
complex (see the D-U-C model above), yet subject to many normative requirements
and often marked by potential difference in know-how between the buyer and the
seller (Backhaus, 1995).

However, this does not imply that the relationship between e.g. architects and their
customers is purely dependent on existing norms, as achieving project sales depends
on the selling of a credible promise, and, in the longer term, being able to deliver the
credible promise to the satisfaction of the buyer (Lwendahl, 1998: 42-3, presented in
Sections 2.4. and 4.2.), which also means taking the perceived interests of the buyer
into account. Thus one can conclude that both norms and interests govern the world
of professional services projects and that this world only has two possible governance
structures (see also Section 4.2. and Figure 18):

The Network is the governance structure that one finds in situations where specific
relationships marked by a complex interplay between norms and interests exist across
individual projects. On the other hand, the Socially Constructed Market functions in
situations where relationships between cooperation partners are mainly limited to the
concrete project in question due to e.g. the discontinuous nature of the project
demand and the uniqueness of each individual project.

Concepts used to describe the environment of project marketing, which are defined
broadly enough to be used both on network and socially constructed market gover-
nance structures, are also discussed in Chapters 3 and 4. One such concept is Cova,
Mazet, and Salles (1996a:654) milieu; it is a socio-spatial configuration that can be
characterized by four elements (ibid.):

a territory
a network of heterogeneous actors related to each other within this territory
a representation constructed and shared by these actors
a set of rules and norms (the law of the milieu) regulating the interactions
between these actors

Tikkanen (1998, see Subsection 3.3.2.) has challenged the inclusion of territoriality in
the definition of the milieu; he argues that many project marketing milieus could be e.g.
global. This challenge is dealt with empirically for the specific case of architectural
firms in Chapters 6-10 of this dissertation; it will thus be taken up again in the
concluding section 13.4.

300
Another similar concept is the field; the French sociologist Pierre Bourdieu (1979,
1986) as well as some institutional theorists (see DiMaggio and Powell, 1983; Melin,
1989; Scott, 1994) operate with it. On the basis of meta-theoretical and conceptual
analysis, it is shown in Chapter 4 that the field concept is almost identical to the
milieu concept. Thus a bridge can be built between contributions which use the two
concepts.

The concepts of cultural and social capital (Bourdieu, 1983) are then introduced in
Chapter 4. These concepts can also be used in both the network and socially
constructed market governance structures. Furthermore they enable the abductive ana-
lysis of the Danish architectural firms establishment of credibility and position (see
the previous remarks about position in this section) in their market-seeking activities in
the German construction industry milieu. This will be explained further in Subsections
13.3.4. and 13.3.5s treatment of research questions 4 and 5.

Finally Chapter 4 described the methods and methodologies of the empirical study.
The study is qualitative, encompassing in-depth case studies of three of the four
Danish architectural firms that established subsidiaries on the German market during
the nineties. The primary data collection method is the semistructured qualitative
interview (see Kvale, 1996) of key informants. Additionally the following types of
documents are analyzed:

Danish and German industrial statistics and studies of exports and inter-
nationalization
Articles in Danish, German, and Pan-European professional publications
Firm- and organization-specific documentary data such as annual reports,
brochures, minutes of meetings, strategy plans, and studies undertaken by Danish
and German architects organizations

301
13.3. Presentation of the Empirical Study.
13.3.1. Analysis pertaining to Research Question 1 (Chapter 6).
With regard to research question 1 concerning general developments on the German
market, the German construction market boomed at the beginning of the nineties. The
boom stopped in 1995, yet the total level of German construction industry volume was
still much higher at the end of the nineties than it had been in the previous decade and the
number of architects present on the German market continued to increase throughout the
decade. In comparison, the Danish market was severely depressed from 1990 - 1992; it
started to pick up after 1993, yet by no means reached a level of record highs in
subsequent years.

The largest European construction industry firms experienced a wave of mergers and ac-
quisitions as well as strategic alliances during the nineties; however, few architectural
firms were directly involved in this wave. Instead, architectural firms and smaller engi-
neering firms on the German market experienced increasing competitive pressure from
the General Contractor and Generalbernahme ways of coordinating construction pro-
cesses. Although German architects at the end of the nineties still more often manage
construction work than their Danish colleagues, private and public German clients have
been increasingly assigning this responsibility to other construction industry actors. Thus
architects operating in Germany have lost some of their traditional domain of work
during the nineties.

With regard to pressure on fees, the German Honorarordnung fr Architekten und In-
genieure has provided German architects with some protection against falling levels of
income; in Denmark, this protection has not been present. Additionally, due to the
smaller Danish market, Danish architectural firms are to a larger extent generalists than
German architectural firms. Danish architectural exports peaked in 1996; throughout the
nineties, Germany was one of the main receivers of Danish architectural exports.

The EU Public Service Directive (92/50/EEC), which establishes procedural rules for
the publication of calls for tender and the awarding of public procurement contracts,
was the largest single change in the institutional environment of architectural firms of
the nineties. In Denmark, the directive was implemented on July 1, 1993; the German
date of implementation was November 1, 1997 (Jochem, 1998:49); however, many
German public authorities were following the rules of the directive before its
implementation date.

For the case of architectural and civil engineering services, the directive mentions four
modes of tendering: design contests, open and restricted tendering procedures, and
302
tendering procedures involving negotiations with selected prequalified bidders.
Additionally, in Title V, the directive mentions two time schedules, the normal and the
accelerated procedure schedules, and states the minimum amount of time that must be
allotted for bidding firms for each of these schedules. According to Article 20, the
accelerated procedure may be used in cases where urgency renders impracticable the
time limits laid down in Article 19.

Germany implemented the directive through two ministerial orders, the Verordnung
ber die Vergabebestimmungen fr ffentliche Auftrge (VgV) and the Verding-
ungsordnung fr freiberufliche Leistungen (VOF), which is the main ministerial
order for the area of architectural and engineering consulting services. The main pro-
cedure specified by the VOF is the negotiated procedure because it is assumed that
the public authority in question needs to discuss the concrete project with the
professional service firms that could potentially do the work in order to insure the best
match between the public authority and the firm and thus the best project (Jochem,
1998:52; Prinz, 1999:602).

Furthermore, with regard to architectural competitions, a preexisting legal text, the
Grundstze und Richtlinien fr Wettbewerbe auf den Gebieten der Raumplanung,
des Stdtebaus und des Bauwesens (GRW), was changed in 1995 to accommodate
the requirements of the EU Public Service Directive (Neusss, 1996:174). The major
change in the GRW was the abolition of regional criteria for the participation in archi-
tectural competitions for competitions exceeding the EU Public Service Directives
threshold value (ibid.:178). Previously, German public authorities had been able to
specify that only architects situated in a certain German or European region had the
right to participate in a given architectural competition.

The immediate consequence of this change, combined with the downturn on the
German market after 1995, was a huge increase in the number of participants in
German architectural competitions; some competitions for relatively small project
types such as schools resulted in many hundreds of participants (interviews with 8
Danish and German respondents). The consequence of this development was that
many German public authorities subsequently reduced the number of architectural
competitions (ibid.), due to the cost of processing so many proposals from parti-
cipants.

In contrast to the German VOFs interpretation of the directive, which suggests the
use of the negotiated procedure for architectural and engineering services, the Danish
303
government believes that the correct interpretation of the directive is that the open or
restricted procedures of tendering are to be used by Danish public authorities, and
that the negotiated procedure may not to be used, except in exceptional cases where
the preconditions stated in the Directives (see Council of the European Communities,
1997) article 11, sections 2 and 3 are fulfilled. This major difference in interpretation
has resulted in major differences in national public tendering practices; whereas
German public sector architectural projects are tendered using the negotiated
procedure in approximately 75 % of the cases; the preferred method of public sector
tendering in Denmark is the restricted procedure, which is used approximately 65 % of
the time (see Table 15 in Section 6.5.). Furthermore, the German authorities use the
accelerated procedure in about 40 % of all public tendering processes, whereas the
Danish authorities only use this procedure about 5 % of the cases (see ibid.). Finally,
the number of architectural competitions in Denmark has, in contrast to Germany,
increased, not decreased, since the implementation of the Public Services Directive
and the increase in participants has been minor in comparison to the German situation.
Thus Danish architectural firms tendering for public sector projects in both Germany
and Denmark must adapt to two very different interpretations of the directive and two
very different resultant competitive situations.

Research question 2 deals with the actors involved in the Danish internationalization of
architectural services to Germany. Johanson and Mattsson (1988: 200, see Section
2.2.) have suggested that there are three ways in which a firm can internationalize:

4. through establishment of positions in relation to counterparts in national nets that
are new to the firm, i.e. international extension
5. by developing the positions and increasing resource commitments in those
nets abroad in which the firm already has positions, i.e. penetration
6. by increasing coordination between positions in different national nets, i.e.
international integration (The italics are Johanson and Mattssons.)

During the nineties, Danish architectural firms active in Germany had a relatively large
number of contacts to other Danish construction industry actors who also were active
on the German market. These actors included Danish engineering, contracting, and
developing firms as well as the construction industry attachs of the Danish Ministry
of Housing (in Danish: By- og Boligministeriet). However, these contacts were often
ad hoc and did not usually relate to joint project acquisition or cooperation with regard
to multiple projects over time. Thus the network of Danish construction industry firms
active on the German market was more of a social than an IMP-nature. There were
304
also few if any long-standing resource ties and activity links (see Hkansson and
Johanson, 1992, as previously described in Section 13.2.) and the levels of mutual
dependence and relationship investments were very low (see Easton, 1992, also
described in Section 13.2.).

Furthermore, Danish architectural firms, engineering firms, and contractors predo-
minantly went about the task of establishing themselves on the German market alone.
As a rule they accumulated their own separate knowledge bases and had their own
dealings with German actors concerning both possible subsidiary establishment and
the acquisition of projects on the German market. However, from time to time, they
did work together, if all the involved parties believed that such cooperation was advan-
tageous.

Thus the governance structure between the Danish construction industry actors
engaged in internationalization on the German market was the socially-constructed
market (see Section 13.2.). Moreover, in the terminology of Johanson and Mattsson
(1988), the Danish private sector actors were mainly involved in international exten-
sion, i.e. the establishment of positions in relation to counterparts in national nets that
are new to the firm.

The first case study research question, research question 3, deals with the knowledge
of the German market and specific projects on that market. In connection with this
question, the so-called Uppsala Internationalization Model (see e.g. Johanson and
Vahlne, 1977, as described in Section 2.2.) is drawn upon, as this model suggests that
(a) a process of experimentation and learning determines the internationalization path
of the firm and (b) this process takes place through interactions with actors on the for-
eign market (Petersen and Pedersen, 1996: 122-123).

Moreover, Axelsson and Johansons (1992: 221, 231-33, see Section 2.2.) mention of
internationalization- and knowledge-related factors often ignored by the textbook
view of internationalization (e.g. Root, 1994) is utilized. These include:

Knowledge of the specific actors in the network(s) of the foreign country in
question
Knowledge of the relative positions of the actors in the foreign countrys
network(s)
countrys network(s)
305
to the planned export activities
The ability of the export firms actors to orient themselves, i.e. obtain an
understanding of where different actors including the actor itself stand in
relation to each other (ibid.:231)
The ability of the export firms actors to position their firm in the network of
other firms
The ability of the firm to seize export market network opportunities that turn
up at irregular or totally unexpected intervals

Finally (a) types of knowledge and (b) potential locations of knowledge are discussed
on the basis of Section 2.4.s presentation of Alajoutsijrvi and Tikkanen (1998),
Nonaka and Takeuchi (1995), Polyani (1962), and Sanchez and Heene (1997). Here
the distinctions between tacit (i.e. subjective, analogous knowledge of experience
and practice) and explicit (i.e. objective, rational, and digital knowledge) is
emphasized.

The empirical material showed that Firm 1, the internationally renowned firm, had
much more initial knowledge than Firms 2 and 3, the nationally renowned and
innovative firms, respectively, due to its years of experience on the German market
and its many German-born employees. Key areas in which Firms 2 and 3 had initial
deficits were related to the broader knowledge of the German market (e.g. knowledge
of the DIN norm systems, construction law, typical German negotiation procedures
including the procedure used in public sector tendering) as well as knowledge of
German clients possible interpretations of traditions, values, and tastes. Actors from
Firms 2 and 3 were initially dependent upon the good-will of their German clients in
many respects due to this lack of knowledge; however, they worked actively to make
up for deficits in Germany-specific knowledge, often putting their newly acquired
knowledge of Germany to use almost immediately after it had been acquired in efforts
to fulfill the norms and practices of the German construction industry. The general
knowledge of design traditions, which all three case study firms possessed, was, on
the other hand, not put into direct use in connection with obtaining specific
architectural projects, as the German clients also had some knowledge of the design
tradition of the architectural firm in question.

Firm 3s acquisitive strategy was based on the personal, tacit knowledge of its found-
ing partner concerning creating and nurturing relationships; however, sometimes Firm
3 did not sufficiently understand the needs of its current or potential customers. Firm
2, in turn, had to initially realize that its position on the German market was markedly
306
different than its position on the Danish market due to the fact that its Danish
references meant little to potential German customers (see Subsection 13.3.5.). After
realizing this, Firm 2 had to then acquire further knowledge, to enable it to develop
practices and social capital (see Subsection 13.3.4.) for acquiring projects without a
wealth of references on the German market.

With regard to theory, context-specific knowledge of the German construction indus-
try milieu was a significant prerequisite for the German project acquisition activities of
the Danish case study architectural firms. This conclusion goes beyond the theoretical
insight of the so-called Uppsala Internationalization Model (see e.g. Johanson and
Vahlne, 1977, as described in Section 2.2.) concerning the importance of knowledge
in the internationalization process of the firm. The Uppsala model merely relates the
internationalization path of the firm to an experiential learning process (see ibid. and
Petersen and Pedersen, 1996); it does not specify the nature of knowledge as a
prerequisite for acquisitive activities.

The fact that context-specific knowledge is a prerequisite for project acquisition acti-
vities leads to a Catch-22 situation (see Section 5.4. and Subsection 8.3.5.), in
which the knowledge that is a necessary prerequisite for obtaining projects can only be
obtained through projects. However, the unique boom situation of the German market
at the beginning of the nineties as well as the resultant under-capacity problems helped
the two Danish case study firms (2 and 3) without previous German market-seeking
project experience overcome the Catch-22 dilemma. During this period, German
clients were more open to working with foreign firms that did not have the normal level
of contextual-knowledge about the German field. The theoretical implication of this is
the following proposition:

Entering foreign markets in boom situations enables a firm to better over-
come potential Catch-22 situations than entering foreign markets in other
circumstances.

Furthermore, contrary to the theory of Boisot et al. (1997, see Section 2.3. and Figure
5), the case study firms knowledge acquisition process did not follow a cycle of
codification/de-codification and inter-firm diffusion. It was not usually codified (see
ibid.), through e.g. reports, or formally taught to other organization members, but
slowly diffused within the case study firms through use. Thus much of the knowledge
seemed to remain in the from tacit knowledge to tacit knowledge socialization
quadrant of the Knowledge Conversion and Sharing Matrix of Nonaka and Takeuchi
(1995, see Figure 4 in Section 2.3.). Furthermore, in contrast to the theory of
307
Alajoutsijrvi and Tikkanen (1999, see Section 2.3. and Figure 6), knowledge that was
codified and generically applicable did not always have greater utility than relationship-
specific tacit knowledge. Thus this study identified two relevant questions that should
be addressed in further research:

3. What triggers and hinders the social learning cycle proposed by Boisot et al.
(1997)?
4. What is the relationship between the degree of codification of knowledge,
the level of applicability of knowledge (i.e. generic versus relationship-
specific), and the utility of the knowledge?

Moreover, with regard to the tacit knowledge, the responses of respondents showed
that they had difficulties in determining the boundary between the generic and the port-
folio levels of Alajoutsijrvi and Tikkanens (1999) levels of information structuring
(see Figure 6 in Section 2.3.). However, knowing the exact boundary was also shown
not to be managerially relevant. On this basis, a new model of Tacit Knowledge in the
Context of Relationships (see Figure 25 in Section 8.4.) was developed, which elimi-
nated the distinction between generic and portfolio-specific knowledge. Furthermore,
the developed model included a more precise classification of how knowledge may be
shared at the inter-organizational level (i.e. between two firms).

Finally, in relation to tacit knowledge, it was found that increases in the tacit and
experiential portfolio-specific knowledge lessened the amount of relationship-specific
knowledge the two new firms on the German market (2 and 3) needed to acquire in
specific situations. This leads to a second proposition:

For firms in the initial stages of internationalization, increases in the
amount of portfolio-specific knowledge held will result in decreases in level
of relationship-specific knowledge necessary to obtain.

Research question 4 concerns the process of architectural project acquisition (see
Chapter 1). It is based on a phase model of project marketing, the General Marketing
Configuration for Project-to-Order Supplier Firms (Cova et al., 1994, see Figure 1).
This model is especially powerful due to its ability to depict varying project situations,
including the situations where there are no immediate projects at hand and situations
where there is concurrent work on several projects. Furthermore, in comparison to
previous project marketing models (e.g. Holstius, 1987, see Subsection 3.3.2.), the
model provides a more detailed depiction of the pre-project phases. Mandjk and
308
Veres (1998:484) state the implication of this:

Once a future project starts to take shape either in the form of a tender or
contract, it is followed by the second stage of preparation, the adaptive
stage.

The purpose of research question 4 is not to validate or refute the model in its entirety,
but rather to use it as the point of departure for a rich description of the process of
obtaining project orders on the German market. Therefore three similar models which
depict the project marketing process in the private sector, the project marketing
process in the public sector, and the project marketing process in a relationship
situation (Figures 27-29) are developed and described in Chapter 9. They are the result
of the scrutiny of empirical data, the original Cova et al., 1994 model (see Figure 1 in
Chapter 1), and the previously mentioned architectural services project phase model
of Figure 9 (see Chapter 2).

The only major theoretical criticism of the original Cova et al. (1994) model (see
Figure 1) developed on the basis of the empirical material is as follows: Their model
depicts strategic analysis and priority setting as activities mainly completed before
investments in social networks and scanning in the environment are undertaken, which
is not in accordance with the case firms practice. Moreover the answer to research
question three has shown that some scanning and knowledge-acquisition must
necessarily proceed strategic analysis and determination of strategic priorities.
Furthermore, strategy formulation has a strong emergent (Mintzberg and Quinn, 1992)
element as well as an element of tacit socialization (see e.g. Nonaka and Takeuchi,
1995, as described in Section 2.4.). Thus, in relation to further refinement of the Cova
et al. (1994) framework, it would be relevant to test the following proposition:

Strategic analysis and priority setting in project marketing firms develops
organically and emergently (e.g. la Mintzberg and Quinn, 1992).

Paradoxically, initial empirical support for this proposition already exists in a pre-
vious work (Cova et al., 1993) by the very same authors of the General Marketing
Configuration for Project-to-Order Supplier Firms! Their work contains an assess-
309
ment of the project business strategy literature (e.g. Ahmad, 1990; Boughton, 1987;
Slatter, 1990; as described in Section 3.2.), which sought to develop e.g. Management
Information Systems (MIS) to monitor, gather, analyze, store, and evaluate a wide
range of market information [...] far beyond the collection of past competitive bid
histories. Information about the company, the customer, the competition, and the
environment must be obtained and processed to produce knowledge that can be used
directly in decision making (Boughton, 1987).

Cova et al. (1993 and 1994) examined (a) to what extent project marketing firms have
attempted to practice the normative suggestions of the project business strategy
literature (see Section 3.2.) and (b) the results of these attempts. Their findings were as
follows (ibid.: 1994:32):

4. concerning the screening of projects, companies found difficulties defining
stable priorities for a given period of time due to the importance of human
factors (intuition, motivation, personal involvement) in the selection of projects
[...] In addition, most firms claim their screening strategy is of the go/no go
type, but flexible enough to vary and balance the different efforts put into each
project. More than sophisticated choices concerning markets and
technologies, it is often the financial constraints of the yearly budget allocated
to tender preparation that determine the final selection of projects.
5. Concerning the scanning of project opportunities, companies have
progressively acknowledged the importance of interpersonal relationships
between individuals [...]
raised due to the heterogeneity and the rapid evolution of the projects and of
their environment

Based on these results, Cova et al. (ibid.) made the following statement concerning
the strategic marketing literature reviewed:

it does not grasp the complexity of the situation faced by project-to-order
implemented

My empirical material provides further support for the above statement. Furthermore it
provides support for Cova et al.s (1993) assertion of a fundamental anticipation-
flexibility dilemma in project business (see Section 3.3.2). In this connection, antici-
pation refers to the project supplier firms strategic need to use resources (a) to keep
itself informed about very specific technological, political, or financial developments in
310
the environment that might only be relevant in a few type of projects out of the total
pool of projects that the firm could potentially acquire and (b) to develop specific
policies and programs in relation to these specific developments. Flexibility, on the
other hand, refers to the need to use resources to maintain broad social networks to
ensure that that all of the firms project offerings that are considered to be top quality
by important parties in the broader milieu, and to ensure that all individual project
offerings can be adapted to e.g. specific cost and customization demands (Bansard et
al., 1993: 130-131).

Additionally, in relation to Cova et al.s (1994) configuration model, the results from
research question 3 indicates that architectural firms do not develop core offers to
be used in multiple architectural projects; instead they develop competencies (see e.g.
Alajoutsijrvi and Tikkanen, 1999, as described in Section 2.3.) to put to use in
multiple architectural projects. On the basis of this finding, a further proposition can
be put forth for use in future project marketing model refinement:

Firms that offer customized services in project marketing do not develop
core offers, but rather core competencies.

In relation to the above proposition, some general professional services management
theory already exists (see e.g. Lwendahl, 1997, mentioned in Sections 2.4. and 4.2.).
It should therefore be incorporated in a study of the above proposition.

The examination of research question 4, together with the previously mentioned results
of research question 2 (see Subsection 13.3.2.) concerning the Danish inter-
nationalization network and evidence related to research question 5, also indicates the
following: The German and Danish networks in which Danish actors active on the
German markets participated were more of a social nature than of the nature of
networks as typically defined by IMP researchers (see Subsection 3.3.2). This is once
again because activity links and resource ties (Hkansson and Johanson, 1992) were
not present, and mutual dependence and relationship investments (see Easton, 1992;
Johanson and Mattsson, 1986) were very low. Only in a very few instances were long-
term relationships between a client and an architectural firm found. These were, as
exceptions, characterized by relationship investments and some technical and eco-
nomic bonds related to the specific knowledge necessary to build optimally for the
particular client in question. Moreover, in these relationships, the process of reaching
agreement concerning an architectural project usually took less time, due to the
parties knowledge of each other.
311

One implication of the above results concerns the governance structure: It is that of a
socially constructed market (see Figure 18 in Section 4.2.). This finding may have
relevance beyond this particular study or the realm of architecture. It is probable that
the socially constructed market is a fairly common governance structure in project
marketing situations, due to the previously mentioned discontinuity and uniqueness
(see e.g. Ahmed, 1993; Cova and Ghauri, 1996; Tikkanen, 1998, as described in
Subsection 3.3.2.). Furthermore this governance structure may be key in the profes-
sional services, due to the previously mentioned role that socially constructed
factors such as judgment and credibility play in these services (see e.g. Lwendahl,
1997 and Section 2.4.).

Lastly, the socially constructed market governance structure may furthermore be the
dominating governance structure for smaller types of projects, i.e. projects often
offered by architectural and engineering service firms as well as by software solution
developing firms. Here, in addition to the discontinuity of offerings, there are many
potential offerers, thus making socially-constructed market conditions all the more
probable. This leads to the following theoretical proposition:

The socially constructed market governance structure prevails in situations
where there are many potential offerers of projects.

Finally, the analysis of research question 4 resulted in the following statement: In the
socially constructed market of the German construction industry, actors in the case
study firms generated social capital (Bourdieu, 1979, 1983, 1986, see Chapter 4),
which was used to establish credibility during the process of project acquisitions.
Bourdieu (1983:248-9) defines social capital as follows:

to credit, in the various senses of the word.

With regard to the operationalization of social capital, which is undertaken in Chapter
4 of this dissertation, the group is defined as being comprised of actors who have
similar viewpoints concerning architecture and the construction industry. Moreover,
the groups are small enough to allow the members to have heard of or know each
312
other and each others viewpoints on architecture and the construction industry. The
groups are furthermore a part of the milieu of the construction industry. The milieu, in
turn, encompasses architects and other construction industry actors as well as
persons working at schools of architecture or as critics of architecture and members
of society at large who show interest in architecture and urban planning.

Concerning the uses of social capital, it is regarded as a credential in this disser-
tation, in the sense that it entitles its bearers to be regarded as credible to other
members of the given group of the field of architecture (see Majkgrd and Sharma,
1998:11 and Lwendahl 1998:42-3). Credibility is, in turn, the actors perceived abil-
ity [i.e. perceived by the other members of the group] to perform something he claims
he can do on request (Blomqvist, 1997:279) and includes judgement of the architect
in questions knowledge of and ability to judge complex technical and economical
factors.

In relation to the process of architectural project acquisitions, social capital was
initially generated during contact episodes with actors from the case study firms
social networks, in situations in which the case study firm actors demonstrated (a)
their knowledge of the rules of the German construction industry milieu and/or (b)
their ability to converse credibly (see Lwendahl, 1997). Further social capital was
generated (a) during the project specific activities with clients and (b) through word-
of-mouth referrals from previous clients. With regard to project acquisition in the
public sector, the EU Public Services Directive reduced some, albeit not all of the
social capital effects. Especially in the German use of the negotiated procedure (see
Section 13.3.1.), social capital still played a role.

313
Research question 5 deals with the issue of how previous project work influences the
acquisition of new projects. In order to describe the analysis of this issue, it is neces-
sary to summarize the rest of the Bourdivan capital framework first presented in
Section 4.4. of this dissertation.

Bourdieus theory also encompasses cultural capital; it refers to value of the practices
and physical artifacts that are the result of individuals socialization within one of many
groups within society and this groups efforts to distinguish itself from other groups
(Bourdieu, 1983:243-8). Cultural capital manifests itself in three forms (ibid.: 243):

trace or realization of theories or critiques of these theories, problematics,
etc.; and in the institutionalized state, [ e.g. in the form of ] educational
qualifications.

In my operationalization of cultural capital, the embodied state (e.g. the dispositions of
the mind and body) is excluded, as it is included in operationalization of social capital.
The objectified and institutionalized states are, on the other hand, included: The
objectified cultural goods that the architect produces are buildings, parks, etc.
Furthermore as a professional, the architect has most often received (a) formal training
and titles which provide him with the opportunity to claim the right to practice his
profession and thus provide cultural capital, i.e. institutionalized legitimacy. Further-
more, (b) membership in architects organizations as well as (c) reference lists which
include (i) projects either in progress or completed as well as (ii) prizes or honorable
mentions awarded in architectural competitions or public tendering procedures
provide institutionalized cultural capital.

The generation of credibility in field of architecture is, however, complex; the
architects (and, consequently, his firms) ability to acquire architectural projects de-
pends upon (a) his credibility in relation to other architects as well as architectural cri-
tics, (b) other construction industry actors judgment of his credibility, and (c) com-
plex interaction effects that occur when these two groups voice their opinions about
his credibility (Albertsen, 1996:2). On the basis of the above, Albertsen (ibid.) has
identified three possible sub-fields of the milieu of architecture:

314
The artistic sub-field: Members of this sub-field orients themselves predominantly
towards architectural and art critics and show little outward concern about market
mechanisms, marketing, or profit.
The professional sub-field: Members of this sub-field show interest in design-
related ideas and aim to produce architecture that is considered good design, yet
they are also concerned with e.g. productivity, marketing, technological, and
environmental issues.
The technical-economic sub-field: In this sub-field efficiency and productivity are
valued most highly. The architectural firms of this sub-field attempt to obtain cust-
omers previously served by the professional sub-field; however, architects from
the other two sub-fields scorn the work done by the architects of this sub-field due
to their neglect of the artistic aspect of architecture.

Albertsens three sub-fields are depicted in Figure 21, to enable positioning. Further-
more, concerning capital levels, the architects of the artistic sub-field (and their firms)
have a generally low levels of total social and economic capital, yet may have high
levels of cultural capital due to the fact that they may have received acclaim from other
architects and art critics. The architects (and firms) of the professional sub-field have
high levels of both social and cultural capitals due to their success in achieving critical
acclaim as well as their contacts to both other architects, art critics, and other parties
in the construction industry. The high levels of both types of capitals generally also
translate into a high level of economic capital (Albertsen, 1996:6-7). Finally, the
architects of the technical-economic sub-field have a relatively high-level of social
capital in their dealings with other actors in this sub-field, in comparison with their
level of cultural capital. They are generally not successful at winning architectural com-
petitions and thus accumulating cultural capital. The relation between the level of the
sub-field and the levels of the groups and networks is as follows: Groups are always a
part of a specific sub-field. Networks are also most often mainly part of one sub-field.

My empirical material results provide initial support for the use of the framework with
regard to the marketing of architectural projects. The case study firms all belonged to
the professional sub-field on the Danish market and also aimed at (Firms 2 and 3) or
were already part of this sub-field (Firm 1) on the German market. They put their
cultural capital to use in their reference lists and other promotional material as well as
took contacts to the press to inform them of projects they had won as an indirect way
of promoting themselves on the basis of previous or current project work. On the
other hand, direct promotional efforts related to previous project work, such as asking
former client to promote the architectural firm in question in brochures or advertising,
were not used. Similarly clients were not directly asked by the case study firms to use
315
social capital-related mechanisms such as word-of-mouth; this happened at client
initiative only.

Additionally, it was shown that the accumulation of both cultural and social capital
was to a large extent specific to the country of origin, i.e. Germany or Denmark, as
German clients usually had no contact to construction industry actors in Denmark and
did not hold most types of Danish references in high regard. Thus, the case study
firms had to accumulate social and cultural capital separately for each market, some
that, as previously mentioned in Subsection 13.3.2., came as a surprise for Firm 2.

Finally, with regard to the public sector, the final selection process in rounds of public
tendering is furthermore ideally supposed to be immune from cultural capital effects,
as the EU Public Service Directive (92/50/EEC) specifies that judgment is to be made
on the basis of the concrete proposal alone. However, similar to the case of social
capital (see the end of Subsection 13.3.4.), the effect of cultural capital was also not
be eliminated completely in the final selection round.

On the basis of the above paragraphs, it can be said that previous project work could
provide the three case study firms with social or cultural capital or both. Throughout
the nineties the three case study firms accumulated cultural capital on the German
market. Firm 2 and 3 also accumulated substantial amounts of social capital, whereas
Firm 1 already had a large stock of social capital which it did not concentrate upon
increasing. Firm 1 strengthened its position in the German professional sub-field,
whereas Firms 2 and 3 made efforts to establish themselves in this sub-field and came
closer to this goal during the nineties. These developments are depicted in Figures 32
and 33 of Chapter 10.

The reference theoretical framework of Salminen (1997, see Holstius, 1987 and
Subsection 3.3.2.) is also scrutinized and used as a supplement to the Bourdivan
capital framework in Chapter 10, in cases where the empirical material supports this
use. On the basis of e.g. Holstius (1987), Salminen (1997:50) defines a reference as
follows:

[A] reference is a deal containing one or several deliveries of products/
services, or a part of that deal that either already has been, or will be deli-
vered to a subsequently recognized customer.

316
Furthermore, Salminen (1997:57) lists a number of factors that influence the value of a
specific reference, categorized by the degree of their specificity in relation to the
delivery at hand, the most general factors being listed first:

5. Environmental factors. These relate to e.g. the effect of the home country of the
reference customer firm or the degree of competition in the given industry.
6. Party-specific factors. These relate to e.g. salespersons of the potential selling
firm, representatives of the purchasing firm and the reference customer firm and
their ability to communicate with each other.
7. The equipment or buildings that the reference customer has purchased (i.e. both
the equipment and buildings supplied by the potential selling firm and the
equipment and buildings supplied by other firms).
8. The three usability factors of the specific reference in question, Openness,
experience, and satisfaction:

depends on the age experience of the use of a reference. A deal (reference)
can be utilized in reference lists immediately after the deal with a customer
has been closed, although its reference value is not very high at that time
(it is not yet very convincing). After the installation of the equipment has
been completed, the value of the reference increases, and after the
equipment has been used for one year, the reference can really be utilized.
[]


someone has to express that satisfaction. (ibid.:50-1; Salminens
underlining and boldface type.)

In terms of Bourdieu (1984), Salminens (1997) reference value corresponds to the
accumulation of project specific institutionalized (i.e. prizes) and objectified (i.e.
buildings) cultural capital as well as, with specific regard to dimensions 1 and 3,
experience and satisfaction, social capital (through e.g. positive word-of-mouth).
General support is found for Salminens reference theory with two exceptions:

3. Contrary to Salminens suggestion, evidence is found that some projects not yet
317
completed already have a reference value and that the reference value does not
necessarily further increase as the potentially referring client gains experience with
the facilities provided by the project.
4. Verbal communication between the potential project purchaser and the potentially
referring client is the exception, not the rule, as conversations with former clients
often do not provide further relevant information for potential project purchasers
that could not be acquired through other, better means.

Finally, in connection with research question 5, two further concepts from the
literature review of Chapter 3 were scrutinized: the sleeping relationship (Hajikhani,
1996) and the social construction of demand (Cova and Hoskins, 1997). In his 1996
article, Hadjikhani examines the nature of the buyer-seller relationships in the period of
discontinuity, i.e. the period after project completion in which project buyer and
seller are not concerned with resource exchange or negotiation and the buyers
mobility is high. Hadjikhanis (ibid.:332-333) sleeping relationship refers to cases
of continued buyer-seller dependence after completion of the project itself (due to i.e.
the possible future need for improvements or replacement parts with regard to the pro-
ject):

that it affect influenced buyer behavior with regard to ordering new projects.
In the sample of case study firms studies, in cases where the level of buyer
trust of the sleeping relationship was high, there were incidents where buyer
chose the seller to produce new projects.

Relating the above definition to the empirical material, it was found that it is extremely
difficult for architectural firms as relatively small firms with many potential competitors
to create dependence in relations, which would otherwise result in relationships or
even the previously mentioned network governance structure, as they neither can offer
unique replacement parts nor achieve a monopoly on future improvements. Thus trust,
which is directly related to social and cultural capital, plays an extremely important role
in the management of often very discontinuous sleeping relationships.

With regard to the social construction of demand issue, Cova and Hoskins,
1997:546-7) state that project marketing firms can follow two courses of action in
relation to the rules and norms of the milieu:

318
1. The deterministic approach, i.e. anticipating the competitive arena and the rules of
the game
2. The constructivist approach, i.e. becoming actively involved in shaping the
competitive arena and the rules of the game

The empirical data indicates that the case study firms have mainly followed the
determinist approach. This is probably because they did not have the size and power
to actively shape the competitive arena and the rules of the milieu. The statements lead
to the final two theoretical propositions to be presented in this summary:

In relation to the sleeping relationship concept, small project selling firms
rely on trust creation more than creating dependency.
With regard to the social construction of demand issue, small project
selling firms mainly follow the deterministic approach.

13.4. Conclusions concerning the Contribution of this Study.
The presentation of the theoretical research results in the previous section may have
seemed rather spread and eclectic. This was, however, partially due to the similar
nature of the previous project marketing literature (see Section 13.2.). Furthermore, it
was also the result of the studys design. As previously mentioned in Section 13.1.,
this study was undertaken using an abductive (Andersen, 1988; Denzin, 1978; Dubois
and Gadde, 1999) and explorative-integrative (Maale, 1996) methodology, which
entails a complex combination of inductive and deductive analysis. There are four
ways in which such a study can contribute to scientific progress (see e.g. Andersen,
1988 and Flick et al., 1995):

5. By providing further empirical evidence supporting previous scientific results and
the corresponding theories
6. By providing evidence that existing theories and conceptual frameworks may need
to be modified
7. By providing the basis for theoretical and conceptual syntheses
8. By contributing with totally new theories, models, and conceptual definitions

With regard to points 1 and 2, providing further or contradicting evidence is always
positive in relation to both quantitative and qualitative research. However, due to the
inherently larger problems of external validity (see Subsection 4.3.3.), these points are
especially relevant when applied to previous contributions based on qualitative
analysis. This study scrutinizes a number of qualitatively developed concepts and
models, including Alajoutsijrvi and Tikkanens (1999) Competencies in the Context
of Relationships model (see Section 2.3.) as well as the following concepts from
319
Chapter 1 and Subsection 3.3.2.: Cova et al.s (1996a) milieu, their General Config-
uration for Project-to-Order Firms (Figure 1, which is from Cova et al., 1994) and
Anticipation-Flexibility framework (Figure 13 from Cova et al., 1993), concepts
from Salminens (1997) dissertation on references (see e.g. Figures 14 and 15), the
sleeping relationship of Hadjikhani (1996), and the social construction of demand
issue (see e.g. Cova and Hoskins, 1997), with additional empirical data.

For example, with regard to the territoriality issue of the concept of the milieu (see
Tikkanens 1998 remarks in Subsection 3.3.2. as well as the remarks at the end of
Subsection 4.4.2.), the empirical treatment of all five research questions provides
support for the original geographical delimitation of this concept (see Cova et al.,
1996, as described in Subsection 3.3.2.) with regard to the architectural projects as
well as other construction industry projects. This result should therefore, as suggested
at the end of Section 4.4.2, be included in any future research about when it is
acceptable to define the boundaries of the milieu (or the field, see Section 4.4.) in
geographical terms.

Concerning point 3, the model depicted in Figure 9 of Chapter 2 shows key charac-
teristics of architectural project offerings. As previously mentioned in Section 13.2., it
was developed on the basis of the professional services literature, project marketing
literature, and literature concerning construction projects in particular. Furthermore,
the commensurability of the project marketing milieu-concept (Cova et al. 1996a) and
Bourdieus (1983, 1990, 1996) and the institutional theoretical (see e.g. DiMaggio and
Powell, 1983; Melin, 1989, Scott, 1994) concept of the field was demonstrated in
Section 4.4. on the basis of conceptual and meta-theoretical analysis. This, in
combination with the identification of two possible governance structures for project-
based services industries (see Section 13.2.), enables this study to draw on and
combine insights from both INPM-contributions and Bourdivan social and cultural
capital theory in a project marketing capital accumulation frame (see Chapter 10 and
Figures 32 and 33). The application of Bourdieus capital framework to the context of
project marketing was a novelty. In contrast, this study did not develop any truly new
models (point 4) above.

Additionally there is one final critical issue which must be elaborated upon in connec-
tion with the scientific contribution of this study, namely the issue of generalizability.
As a qualitative research contribution, this study is somewhat problematic with regard
to external validity (see Subsection 4.3.3.). Furthermore, this study draws on a large
number of other qualitative contributions which share this same weakness (see Section
320
13.2. as well as Chapter 3 and Section 5.7.). Therefore the ambition of this study has
neither been to present universally valid results nor to develop grand theory (see
Chapter 1). Instead the aim has been to develop a local conceptual framework based
on synthesis and to provide further empirical evidence concerning a multitude of
existing frameworks.

One may of course discuss the usefulness of this endeavor. However, in connection
with this issue, the question of usefulness for whom is highly relevant to ask. From
e.g. a practitioners and societal perspective, it can be argued that such an in-depth
study, although not universally generalizable, is especially useful for practice in the
country which has financed the research, namely Denmark.

Furthermore, from a scientific viewpoint, it is often not possible to do quantitative
research about internationalization and export trends, if one limits ones research to
firms from specific small countries, as the sample size in many industries will be too
small. Including firms from several different countries is admittedly an option, but this
option is only feasible if the firms are comparable across countries. For the case of
architecture, sources such as Stevens (1998:29, see Section 13.2., as well as Section
2.1.) as well as Button and Fleming, 1992; Drbye, 1999; and Oliver-Taylor, 1993
(see Appendix A) indicate that this is not the case. Thus, in this case, a researcher with
a specific interest in the situation in a small country only has two options:

1. Doing a qualitative study
2. Doing no study whatsoever

On the basis of the above, I justify and defend my qualitative study design. Through
this study, I have taken the initial steps to develop the concepts of social and cultural
capital, which may also prove to be powerful descriptive tools in other socially
constructed market situations, e.g. in other project marketing and professional services
settings. However, as I have not been able to create more than local theories, in each
specific case, the rules of the generation of social and cultural capital as well as the
laws of the milieu (cf. Cova et al., 1996) must be assessed anew. This is because no
researcher has enough knowledge to make general, a priori statements about rules of
social and cultural capital generation that apply to all milieus (see e.g. Araujo and
Easton, 1999; Bourdieu, 1996). However, it is my hope that yet other researchers will
undertake similar abductive studies, which the aim of contribution to a cumulative base
of knowledge about the operationalization of these concepts in varying business
situations as well as the further refinement of these concepts on a more general level
for middle-range business-to-business marketing theories. In contrast, the theoretical
321
propositions that I have presented in this chapter are well-suited for quantitative theory
testing.

With regard to managerial implications (Chapter 12), this studys proposed application
of social and cultural capital theory to architectural project marketing is meant as
food for thought in managers evaluation and discussion of their acquisitive
practice, as these persons most often have not received much formal management
education (see e.g. Sommer, 1996; Stevens, 1998; stns, 1984; stns and
Svensson, 1986) and there are few books and articles about marketing architectural
services. For this audience, the presentation of such a description is managerially
relevant in that it provokes discussion at a higher level than otherwise, as a new
vocabulary for the description of the marketing process has been created. In contrast,
it is not a ready-made model of how-to-market architectural services, as the
undertaken research has been descriptive, not prescriptive.

However, I as the author of this dissertation do also deem it fitting to make several
general suggestions to architects as to what could fruitfully receive greater focus in
their acquisitive practice on the basis of my many interviews. Similar to Harrigan and
Neel (1996) and Sommer (1996), on the basis of my empirical material, I argue in
Chapter 12 that architects do not always focus sufficiently on understanding their
clients perceptions of own needs, wishes, and priorities. Furthermore I would
suggested that architectural and other firms in the construction industry should not
shun marketing and economic information gathering per se. Although there are a
number of very well-known models that are less suitable for the marketing of
architectural services, models can be found that, when used, aid understanding the
marketing and economic side of the business as well as planning and assessing ones
business operations both at home and abroad. Furthermore, gathering information and
making considerations pertaining to knowledge management becomes especially
important, if ones firm begins to consider operations on a foreign market.

It is thus my hope that this dissertation will contribute to both managers and
scientists enlightened discussion of the commercial factors that influence the project
marketing of architectural firms.
322
14. Afhandlingsresum pdansk. (Summary in Danish)
14.1. Introduktion til studiet og dets forskningssprgsml.
I begyndelsen af 90erne befandt den danske byggeindustri, inklusiv markedet for
arkitektydelser, sig i midten af en konomisk lavkonjunktur (Eurostat, 1995). Samtidigt
var det tyske marked som flge af Berlin-murens fald og genforeningsprocessen
begyndt at boome (European Construction Research, 1995:8, 12). P grund af den
drlige hjemmemarkedssituation besluttede mange danske byggeaktrer sig for at
prve at finde arbejde p det tyske marked (Halskov, 1995). Dog blev de fleste
enkeltpersoner og firmaer efterflgende skuffede. I begyndelsen af 1996 var billedet
nemlig det, at mange af de strste danske ingenir- og entreprenrfirmaer havde tabt
milliarder af danske kroner p det tyske marked. Ogs de fleste mindre virksomheder
dvs. typisk arkitekttegnestuer eller underleverandrer havde prvet at tabe mange
penge p det tyske marked, noget som ofte havde truet disse virksomheders
overlevelsesmuligheder (ibid.). Denne udvikling overraskede de fleste danske
byggekyndige, som mente, at Danmark havde en hj byggestandard og at de fleste
danske firmaer, der havde forsgt sig p det tyske marked, var teknisk kompetente og
gode til at drive forretning i Danmark (ibid.).

P grundlag af det ovenfor prsenterede scenario beskftiger denne afhandling sig
med internationaliseringen af tre danske arkitektfirmaer p det tyske marked. De tre
valgte firmaer er undtagelser, idet de alle opnede en vis succes p det tyske marked i
1990erne. Den form for internationalisering, som afhandlingen beskftiger sig med, er
den markedssgende internationalisering:

Market-seekers lack experiential knowledge of foreign markets []. They
must also establish credibility with the buyers (Majkgrd and Sharma,
1998:9-11)

Derimod bliver klientefterflgende internationalisering (se ibid.) kun behandlet i
forbigende, nr det optrder som empirisk fnomen.

Med hensyn til de valgte firmaer, er det frste firma internationalt anerkendt, dvs. det
har vret aktivt p udenlandske markeder i mange r, og har vundet priser i mange
lande. Det andet firma er derimod nationalt anerkendt, idet det er et af Danmarks
strste og mest veletablerede firmaer. Firmaet har vundet mange danske priser i de
foregende rtier, og har bygget nogle af de strste og mest prestigefulde projekter p
323
det danske marked. Endeligt er det tredje firma en innovativ ny virksomhed, som frst
blev grundlagt i 1986.

Afhandlingsstudiet er et eksplorativt-integrativt (Maale, 1996) og abduktivt (Ander-
sen, 1998:139-140; Denzin, 1978:109; Dubois og Gadde, 1999) case-studium. I studiet
bliver induktiv og deduktiv metodologi kombineret i den samtidige og sekventielle
behandling og sammenligning af teorier og empiriske observationer vedrrende de tre
case-virksomheder. Imidlertid er selve forskningssprgsmlene beskrivende. De blev
valgt p grundlag af et pilotstudium (se Appendix A), som fokuserede p de
problemer, som de mindre succesrige danske arkitekttegnestuer var stdt ind i, nr de
havde forsgt at internationalisere p 90ernes tyske marked. Pilotstudiet viste, at disse
firmaer generelt havde problemer med at forst de tyske kunders behov, med at knytte
forbindelser til potentielle tyske klienter og samarbejdspartnere, og med at handle i
forhold til de love og konventioner, som den tyske byggeindustri opererer med.

De to frste forskningssprgsml beskftiger sig med generelle industriforhold:

1. Hvordan var udviklingen p det tyske marked for arkitektydelser i
1990erne mht. institutioner, samlet markedsstrrelse og vkstrater bde
nationalt og pdelstatsniveau?

2. Hvem var de danske hovedaktrer, som enten direkte eller indirekte var
involverede i internationaliseringen af danske arkitektydelser i halvfem-
sernes Tyskland, og i hvilken grad og hvordan samarbejdede disse hoved-
aktrer med hinanden?

Formlene med disse to sprgsml er dels at give et overblik over situationen p
90ernes tyske marked for arkitektydelser p et makrokonomisk og makrostrukturel
niveau, dels at danne et fundament for analysen af de tre case-virksomheders inter-
nationalisering i 90erne i relation til relevant erhvervskonomisk litteratur.

De sidste tre forskningssprgsml vedrrer de tre case-virksomheder; de lyder som
flger:

3. Hvilke former for viden om det tyske marked og om specifikke
arkitektprojekter pdet tyske marked blev anvendt af case -virksomheder til
at opnprojektordrer pdet tyske marked?

4. Hvordan opnede case -virksomhederne projektordrer pdet tyske marked?
324

5. Hvilken rolle spillede tidligere projekter og projektarbejde, nr case -
virksomhederne opnede specifikke projektordrer pdet tyske marked?

For bedre at kunne forklare hvordan de tre forskningssprgsml blev analyseret bliver
mange af de teoretiske bidrag, som inddrages i denne afhandling, kort prsenteret i
det nste underafsnit. Derefter prsenteres de abduktive sammenkdninger af
eksisterende teoretiske bidrag med analysen af empirien mere detaljeret i underafsnit
14.3. Endeligt indeholder underafsnit 14.4. dette resums afsluttende bemrkninger.

14.2. Introduktion til studiets teoretiske ramme.
Selvom mange af de teoretiske bidrag granskes samtidigt med indsamlingen og
vurderingen af studiets empiriske materiale, bliver den teoretiske ramme for klarhedens
skyld prsenteret srskilt i afhandlingens afsnit 2 4. Derefter identificeres
sammenhngene mellem de teoretiske bidrag og studiets forskningssprgsml i afsnit
5, hvorefter de fem forskningssprgsml behandles empirisk i afsnittene 6 10.
Prsentationen af teorierne i afsnit 2 4 kan sammenlignes med de genealogier, som
oftere findes i fransk- og tysksprogede artikler og bger end i den engelsksprogede
erhvervskonomiske faglitteratur (for et eksempel p en genealogi, se Gemnden,
1990).

I afsnit 2 bliver arkitektydelser defineret i forhold til afhandlingen. Dette er ndvendigt
p grund af store nationale forskelle i arkitekternes arbejdsomrde (se f.eks. Stevens,
1998). Derudover bliver relevante internationaliseringsteorier samt bidrag om viden i
organisationer prsenteret. Disse vil frst introduceres og diskuteres i underafsnit
14.3.2. og 14.3.3. Endeligt skabes der i afsnit 2 en model af Nglekarakteriska for
byggeprojektrelaterede arkitektydelser (figur 9) p grundlag af relevant litteratur om
professionelle serviceydelser (Albertsen, 1996; Alvesson, 1995; Freidson, 1983;
Larson, 1977; Lwendahl, 1997; Sharma, 1991; Starbuck, 1992), byggeprojekter
(Day, 1994; Hellgren og Stjernberg, 1995; Oxley og Poskitt, 1996) og
projektmarkedsfring (Backhaus, 1995; Holstius, 1989; Mattsson, 1973).

I afsnit 3 bliver den meget eklektiske og spredte bestand af projektmarkedsfrings-
bidrag vurderet i et systematisk litteraturstudium for at muliggre den abduktive
analyse. Flgende typer bidrag inddrages i litteraturstudiet:

325
1. Kvantitative empiriske studier
2. Case-studier og andre kvalitative empiriske studier
3. Konceptuelle studier
4. Praktiker-orienterede bidrag

De inkluderede studier blev udvalgt p grundlag af en vurdering af to faktorer:

Studiets relevans i forhold til mit ph.d. forskningsprojekt
Modtagelsen af studiet i den akademiske verden (Studier, som anses for at vre
srdeles renommerede eller nyskabende, blev medtaget.)

Endvidere kategoriserer litteraturstudiet de studier, som blev medtaget, som enten
vrende relaterede eller ikke-relaterede til the International/Industrial Marketing
Group (herefter betegnet IMP) og dens undergruppe, the International Network for
Project Marketing and Systems Selling (herefter betegnet INPM). Samlet set blev 17
relevante ikke-INPM bidrag og 13 relevante INPM bidrag vurderet i litteraturstudiet.
Mange af disse bidrag vil behandles i underafsnittene 14.3.3.-13.3.5., i forbindelse med
analysen af forskningssprgsml 3 5.

Fr beskrivelsen af INPM-projektmarkedsfringsbidragene i litteraturstudiet bliver
IMP-gruppens tilgang beskrevet generelt. Hovedpunkterne i denne beskrivelse vil
gentages her, for at bygge et fundament for at begrunde inddragelsen af Bourdieus
(1979, 1983, 1986) teori om social og kulturel kapital i denne afhandling.

IMP-tilgangen fokuserer p relationelle dyaders og netvrks afgrende rolle mht.
markedsfringen p erhvervsmarkeder. Iflge Easton (1992:106-110) betragtes rela-
tionelle forbindelser (p engelsk: relationships) af IMP-forskere som bestende af
fire elementer:

1. Gensidig orientering, dvs. at firmaerne er parate til at have forretningsmssigt
samkvem med hinanden og forventer dette af deres modpart (Mattsson, 1988).
2. Gensidig afhngighed, der tilnrmelsesvis kan betragtes som den pris, som et
firma m betale for de fordele, som det opnr via de relationelle forbindelser.
Afhngigheden er dels et sprgsml om valg og dels noget, som determineres af
omstndighederne (Easton, 1992:107).
3. Bindinger, som er et ml for, hvor tt de to firmaer er forbundet med hinanden.
Bindingerne kan omfatte konomiske, sociale, tekniske, logistiske, forvaltnings-
mssige, informationsmssige, juridiske og tidsmssige aspekter (ibid.:108).
4. Relationelle investeringer, dvs. de processer, hvor ressourcer bindes for at kunne
skabe, opbygge eller f aktiver, som kan bruges engang i fremtiden (Johanson og
Mattsson, 1986).
326

I IMP-tilgangen bliver en industri betragtet som et netvrk af relationelle forbindelser
(Easton, 1992:104), som iflge Hkansson og Johanson (1992) omfatter bindinger
mellem aktrer (actor bonds), sammenhngende aktiviteter (activity links) og
ressourcemssige forbindelser (resource ties). Virksomheder har derudover
positioner i et bestemt netvrk p et bestemt tidspunkt, som kan variere p flgende
punkter (Easton, 1992:114-115):

1. Funktionen, dvs. den funktion i netvrket, som et bestemt firma varetager.
Funktionen omfatter f.eks. firmaets produktions eller forskningsaktiviteter.
2. Identitet af det net af firmaer, som et givet firma har direkte relationelle forbindelser
med. Hvis nettets forventninger ndres, ndres ogs firmaets position.
3. Den relative betydning af firmaet i dets net, mlt efter f.eks. strrelse eller relativ
magt.
4. Analyseniveau i forhold til positionsbegrebet man kan tale om mikro- eller
makropositioner.

Med hensyn til de ovennvnte positionsegenskaber er det generelt svrt at komme
med objektive betragtninger om karakteristika 1 og 2 (funktion og identitet), efter som
enhver aktr i et netvrk har sin egen opfattelse af disse ting. Dette problem er
srdeles stort for arkitektfirmaer, efter som en tegnestues identitet og funktion er
relateret bde til byggeindustriens organisation og til diskursen om arkitekturens
kunstneriske kvaliteter (se Albertsen, 1996).

Mht. udbredelsen af netvrk indrmmer flere IMP-forskere desuden, at netvrk ikke
altid spiller en stor rolle p erhvervsmarkederne. For at illustrere, hvornr netvrk
spiller en stor rolle, har Hkansson og Johanson (1993: 44-45) udviklet en model af
fire forskellige governance structure idealtyper, som bestemmes af (a) to alternative
typer af aktrinterne beslutningskriterier (egne interesser kontra almene normer) og (b)
to typer af interaktionsformer (anonyme markedsrelationer kontra specifikke relationer
baseret p langsigtede relationelle forbindelser mellem aktrerne p markedet).

I netvrket, som er den frste governance structure idealtype, bliver aktiviteterne
bestemt af aktrernes individuelle interesserer, som kommunikeres i de relationelle
forbindelser mellem aktrerne. I hierarkiet er interesserne udskiftet med normerne,
som individerne er underlagt og som bliver opretholdt igennem relationerne med andre
aktrer.

327
I markedet som governance structure flger aktrerne igen deres egne individuelle
interesser. Men i modstning til netvrket plejer aktrerne ikke relationelle forbind-
elser. Dette betyder, at aktrerne p den ene side str friere i relation til hinanden, men
p den anden side ikke kan hste fordel af de specifikke produktivitetsforgelser, der
sker via flles aktiviteter med andre aktrer i et netvrk. Endeligt i kulturen eller
professionen styres aktiviteterne igen af normer, dog er de eksterne sanktionssystemer,
som sikrer, at normerne overholdes, baserede p generelle relationer, der involverer
alle personer underlagt den pgldende governance structure.

Hvad angr de projektmarkedsfringsrelaterede bidrag af INPM-undergruppen er der
mht. markedsfringen af projekter flere srforhold, som gr, at man kun selektivt kan
bruge den ovenfor beskrevne IMP-teoriramme. Disse srforhold er sammenfattet i
den skaldte D-U-C model (se Cova og Ghauri, 1996; Mandjk og Veres, 1998; Tik-
kanen, 1998; sammenlign ogs med Ahmed, 1993:55-56). Tikkanen (1998:264) har
opremset de tre D-U-C karakteristika af projektmarkedsfring som flger:

D. Discontinuity of demand, dvs. diskontinuerlig eftersprgsel efter projekter
U. Uniqueness, dvs. ethvert projekt er unikt mht. dets tekniske, finansielle og socio-
politiske egenskaber
C. Complexity, dvs. ethvert projekt er komplekst mht. f.eks. lsningens
sammenstning samt de aktrkonstellationer, der er involveret i at udarbejde og
levere projektet

n flge af de ovennvnte karakteristika er, at projektforretninger ikke uden videre kan
betragtes som underlagt netvrket som governance structure, eftersom dis-
kontinuerlig eftersprgsel og unikke projekter hverken er gunstige for langsigtede
relationelle forbindelser prget af gensidig afhngighed eller relationelle bindinger og
investeringer (se Easton, 1992), og heller ikke har nogen positiv virkning p
sammenhngende aktiviteter og ressourcemssige forbindelser (se Hkansson og
Johanson, 1992). P grund af disse forhold foreslr Cova og Ghauri (1996), at
projekters governance structures oftest ligger et sted mellem markeder og netvrk.

I afsnit 4 beskftiger jeg mig med dette problem ved at udbygge og tilpasse Hkans-
son og Johansons (1993:45) model af mulige industrielle governance structures til de
srforhold, som glder projekter, som bestr af professionelle serviceydelser. I
denne projekttype er adskillelsen mellem interesser og normer nemlig ikke skarp,
eftersom projekter er meget komplekse (se D-U-C modellen ovenfor), underlagt
mange normative begrnsninger, og ofte karakteriseret ved kundens manglende
fagviden (se Backhaus, 1995).
328

Imidlertid bevirker disse ting ikke, at forholdet mellem f.eks. arkitekter og deres
klienter bestemmes hovedsageligt af normer, eftersom man for at kunne opn projekt-
ordrer er ndt til at slge et trovrdigt lfte og, p lngere sigt, opfylde det tro-
vrdige lfte til kundens fulde tilfredshed (Lwendahl, 1998: 42-3, se underafsnittene
2.4. og 4.2.), hvilket ogs indebrer at mtte tage hjde for kundens interesser.
Sledes kan det konkluderes, at bde normer og interesser er bestemmende i projekter,
der bestr af tjenesteydelser, og at der som flge heraf her kun er to mulige
governance structures (se ogs underafsnit 4.2. og figur 18):

Netvrket er den governance structure, som findes i situationer, hvor relationelle
forbindelser, der kendetegnes ved et komplekst samspil mellem normer og
interesserer, eksisterer over et forlb p flere projekter. P den anden side fungerer det
socialt konstruerede marked i situationer, hvor de relationelle forbindelser kun
opretholdes under t konkret projekt pga. f.eks. den diskontinuerlige eftersprgsel
efter projekter og hvert projekts unikke egenskaber.

Omverdensbegreber, som er rummelige nok til at omfatte bde mulige generelle og
mulige specifikke relationer i projektmarkedsfringen, bliver ogs behandlet i afsnit 3
og 4. En af disse er Cova m.fl.s (1996a:654) projektmarkedsfringsmilj (p engelsk
og fransk: milieu), der kendetegnes af flgende fire karakteristika (Cova m.fl.: ibid.):

et territorium
et netvrk af heterogene aktrer, som har relationer til hinanden inden for territoriet
en flles kognitiv forstelsesramme, som skabes og deles af disse aktrer
et st regler og normer (the law of the milieu), som regulerer aktrernes
interaktion

Tikkanen (1998, se underafsnit 3.3.2.) har imidlertid stillet sprgsmlstegn ved den
territoriale afgrnsningen af projektmarkedsfringsmiljer. Han argumenterer for, at
mange miljer f.eks. kunne vre globale. Dette sprgsml bliver behandlet empirisk i
beskrivelsen af arkitekternes verden i afsnittene 6-10, og vil derfor blive besvaret i
dette resums konkluderende underafsnit 14.4.

Et andet, lignende begreb er feltet, som bruges af den franske sociolog Bourdieu
(1979, 1986) og institutionsteoretikere (se DiMaggio og Powell, 1983; Melin, 1989;
Scott, 1994). Gennem en metateoretisk og konceptuel analyse vises det i afsnit 4, at
feltet er nsten identisk med projektmarkedsfringsmiljet. Dette muliggr, at der kan
bygges bro mellem bidrag, der opererer med de to begreber.
329

Derefter bliver begreberne kulturel og social kapital (Bourdieu, 1983) introduceret i
afsnit 4. Disse begreber kan ligeledes bruges i begge governance structures: netvrket
og det socialt konstruerede marked. Derudover muliggr de den abduktive analyse af
de danske case-arkitektfirmaers skabelse af trovrdighed og position (se de tidligere
bemrkninger om position i dette underafsnit) i deres markedssgende aktiviteter i den
tyske byggeindustris projektmarkedsfringsmilj. Dette vil blive forklaret nrmere i
underafsnit 13.3.4. og 13.3.5 under behandlingen af forskningssprgsmlene 4 og 5.

Endeligt beskriver afsnit 4 de metoder, som anvendes i det empiriske studium. Studiet
er kvalitativt og omfatter case-studier af 3 af de 4 danske arkitekttegnestuer, som
etablerede datterselskaber p det tyske marked i 90erne. Hoveddataindsamlings-
metoden er det semistrukturerede interview (se Kvale, 1996) af ngleinformanter.
Derudover analyseres flgende typer af skriftligt materiale:

Danske og tyske industristatistikker og studier af eksport/internationalisering
Artikler i danske, tyske og europiske fagtidsskrifter
Firma- og organisationsspecifikke data ssom rsregnskaber, brochurer,
mdereferater, strategiplaner, samt studier foretaget af danske og tyske arkitekt-
organisationer

14.3. Sammenfatning af det empiriske studium.
14.3.1. Analysen af forskningssprgsml 1 (Afsnit 6).
Mht. det frste forskningssprgsml om den tyske byggeindustris generelle udvikling
boomede industrien i begyndelsen af 90erne. Hjkonjunkturen fik imidlertid ende i
1995, men den samlede byggevolumen forblev meget strre i slutningen af 90erne end
den havde vret i det forrige rti. Endvidere steg antallet af arkitekter i Tyskland i hele
rtiet. Til sammenligning var det danske marked kriseramt i rene 1990-1992.
Udviklingen vendte efter 1993, men markedet nede aldrig den tidligere byggevolumen.

De strste firmaer i den europiske byggeindustri var i 1990erne prget af mange
virksomhedssammenslutninger og opkb samt nydannede strategiske alliancer
(Lubanski, 1999). Imidlertid var f arkitekttegnestuer involverede i denne udvikling. I
stedet blev arkitekttegnestuer og mindre ingenirfirmaer p det tyske marked pressede
af den stigende brug af totalentrepriselsninger og den skaldte Generalbernahme-
mde at organisere byggeprocessen p. Selv om de tyske arkitekter i slutningen af
1990erne stadigvk str for byggeledelsen oftere end deres kollegaer i Danmark, er
svel private som offentlige tyske klienter i stigende grad get over til at uddelegere
330
byggeledelsesopgaven til andre aktrer. Sledes har den tyske arkitekt tabt noget af sit
traditionelle arbejdsomrde i lbet af 1990erne.

Mht. honorar har den tyske Honorarordnung fr Architekten und Ingenieure i nogen
grad beskyttet tyske arkitekter mod faldende indtgter for det samme stykke arbejde. I
Danmark, derimod, eksisterer der ingen beskyttelse. Derudover er danske arkitekt-
tegnestuer pga. det mindre danske hjemmemarked oftere generalistfirmaer end tyske
tegnestuer. Dansk arkitektureksport nede sin forelbig hjde i 1996, og Tyskland var
et af de vigtigste eksportmarkeder i hele rtiet.

Indfrelsen af EUs tjenesteydelsesdirektiv (92/50/EF) udgjorde den strste enkelt-
forandring i de europiske arkitekters institutionelle omverden. Direktivet etablerer
processuelle regler mht. offentligt udbud af opgaver og udvlgelse af leverandrer til
projekter, som bygges for offentlige midler. I Danmark blev direktivet indfrt ved lov
den 1. juli 1993. I Tyskland blev direktivet implementeret den 1. november 1997
(Jochem, 1998:49). Imidlertid var der mange tyske offentlige myndigheder, som fulgte
direktivets regler fr den officielle omsttelse i tysk lovgivning.

Mht. arkitektarbejde samt bygge- og anlgsrelateret ingenirarbejde nvner direktivet
fire udbudsformer: arkitektkonkurrencer, bent og begrnset udbud samt udbud efter
forhandling. Derudover nvner direktivet to tidsskemaer i Afsnit 5, den normale og
hastighedsproceduren, samt faststter det mindste tilladelige tidsrum for firmaer at
udarbejde deres tilbud i, for hver af de to procedurer. Iflge direktivets artikel 20 m
hastighedsproceduren kun bruges [i] hastende tilflde, hvor det ikke er muligt at
overholde de i artikel 19 omhandlede tidsfrister.

Tyskland implementerede direktivet gennem to ministerielle bekendtgrelser, Verord-
nung ber die Vergabebestimmung fr offentliche Auftrge (VgV) og Verding-
ungsverordnung fr freiberufliche Leistungen (VOF). Den sidstnvnte er hovedbe-
kendtgrelsen, hvad angr arkitekt- og rdgivende ingenirydelser. VOF angiver, at
udbud efter forhandling br bruges p de fleste arkitekt- og rdgivende ingenir-
projekter, fordi det antages, at de offentlige myndigheder vil have behov for at
diskutere det konkrete projekt med de potentielle udbydere for at sikre den bedste
match mellem den pgldende offentlige myndighed og det endeligt udvalgte
udbyderfirma (Jochem 1998:52; Prinz 1999: 602).

Endvidere mht. arkitektkonkurrencer blev en eksisterende lovtekst, Grundstze und
Richtlinien fr Wettbewerbe auf den Gebieten der Raumplanung, des Stdtebaus
331
und des Bauwesens (GRW) tilpasset kravene i EUs tjenesteydelsesdirektiv i 1995
(Neusss, 1996:174). Den strste ndring var fjernelsen af muligheden for at lave
regionale begrnsninger mht. hvilke arkitekter der mtte deltage i en arkitekt-
konkurrence. Tidligere havde de tyske myndigheder kunnet foreskrive, at kun
arkitekter, hvis firma l i en bestemt tysk eller europisk region, kunne deltage i en
bestemt arkitektkonkurrence.

Flgen af den ovennvnte ndring, sammen med afdmpningen af det tyske marked
efter 1995 var en kmpeforgelse af deltagerantallet i de fleste tyske arkitektkon-
kurrencer. Til mindre opgaver, s som lokale grundskoler, kunne der f.eks. vre flere
hundrede deltagende firmaer (interview med otte danske og tyske respondenter). En af
flgerne af denne udvikling blev, at mange tyske myndigheder reducerede antallet af
arkitektkonkurrencer (ibid.), fordi deres omkostninger ved vurdering af s mange
forslag var meget hje.

I modstning til den tyske VOFs fortolkning af tjenesteydelsesdirektivet, som jo fore-
slr anvendelsen af udbud efter forhandling som hovedudbudsform mht.
arkitektprojekter, er den officielle danske fortolkning af direktivet den, at det bne eller
begrnsede udbud skal anvendes af danske myndigheder, nr der er tale om arkitekt-
eller ingenirydelser. De danske ministerier forstr direktivet sdan, at udbud efter
forhandling ikke kan bruges med mindre der er tale om de srlige omstndigheder,
der direkte omtales i direktivets artikel 11, sektioner 2 og 3 (se Council of the Euro-
pean Communities, 1997). Denne store forskel i direktivets fortolkning landene imellem
har resulteret i meget forskelligartet udbudspraksis. I Tyskland bliver ca. 75% af alle
offentlige arkitektprojekter udbudt efter forhandling, hvor den danske offentlige sektor
anvender den begrnsede udbudsform i ca. 65% af tilfldene (se Tabel 15 i
underafsnit 6.5). Derudover bruger de tyske myndigheder hastighedsproceduren i ca.
40% af projekterne, mens de danske myndigheder kun anvender hastighedsproceduren
i ca. 5% af tilfldene. Endelig er antallet af arkitektkonkurrencer i Danmark i
modstning til den tyske situation steget, ikke mindsket, siden implementeringen af
tjenesteydelsesdirektivet, selv om stigningen m betragtes som vrende beskeden.
Derfor m danske arkitektfirmaer, som byder p projekter i bde Danmark og
Tyskland, kunne indstille sig efter to vidt forskellige fortolkninger af direktivet og, som
flge heraf, to vidt forskellige konkurrencesituationer.

332
Forskningssprgsml 2 omhandler de danske hovedaktrer med hensyn til internation-
alisering af arkitektydelser p det tyske marked. Johanson og Mattsson (1988:200)
foreslr, at der er tre mder, hvorp et firma kan internationalisere:

1. International extension, dvs. etablering i udenlandske netvrk i lande, hvor firmaet
ikke tidligere har vret aktivt
2. Penetration, dvs. en videreudvikling af positionen i de lande, hvor man allerede har
aktiviteter
3. International integration, dvs. bestrbelser p at forge samarbejdet mellem
parterne i forskellige nationale samarbejdsnetvrk

I halvfemserne havde danske arkitektfirmaer p det tyske marked et relativt stort antal
kontakter til andre danske byggeindustriaktrer, som ogs var aktive p det tyske
marked. Disse andre aktrer omfatter danske ingenirfirmaer, entreprenrer,
hndvrkere og developers samt Boligministeriets byggeattacher. Imidlertid var
kontakterne relativt sporadiske, idet de for det meste hverken indebar flles akkvisitive
aktiviteter eller samarbejde over flere, p hinanden flgende projekter. Sledes m
netvrket bestende af de danske byggeindustriaktrer betragtes som vrende af en
social i modstning til en IMP natur. Der var f eller ingen sammenhngende
aktiviteter og ressourcemssige forbindelser (se Hkansson og Johanson, 1992,
tidligere beskrevet i underafsnit 14.2.), og den gensidige afhngighed samt invester-
ingerne i relationelle forbindelser (se Easton, 1992, ligeledes beskrevet i underafsnit
14.2.) l p et meget lavt niveau.

Endvidere etablerede de danske arkitekttegnestuer, ingenirfirmaer og entreprenrer
sig som hovedregel alene p det tyske marked. Deraf flger, at disse firmaer hver for
sig udviklede deres videnbase om det tyske marked, og frte deres egne forhandlinger
og samtaler med tyske aktrer om emner som etablering af datterselskab og
projekterhvervelse. Imidlertid var der eksempler p kortvarigt projektrelateret
samarbejde, som opstod, nr samtlige parter s en fordel deri.

Sledes m det governance structure-mssige samarbejdsmnster mellem de danske
byggeindustriaktrer, som var tilstede p det tyske marked i 1990erne, betragtes som
et socialt konstrueret marked (se underafsnit 14.2.). Derudover, i Johanson og
Mattssons (1988) terminologi, var disse danske byggeindustriaktrer hovedsagelig
beskftiget med internationalisering af typen international extension, dvs. etablering i
et udenlandsk netvrk i et land, hvor deres firmaer ikke tidligere havde vret aktive.

333
Det frste case-forskningssprgsml - sprgsml 3 - omhandler viden om det tyske
marked og om specifikke projekter p dette marked. I forbindelse med besvarelsen af
sprgsmlet anvendes den skaldte Uppsala internationaliseringsmodel (se f.eks.
Johanson og Vahlne, 1997). Modellen foreslr, at (a) en eksperimentel lreproces
bestemmer firmaets internationaliseringsproces og (b) den eksperimentelle lring
foregr i interaktion med specifikke aktrer p det udenlandske marked (Petersen og
Pedersen, 1996:122-123).

Endvidere inddrages Axelsson og Johansons (1992:221,231-33) opremsning af
internationaliserings- og vidensrelaterede faktorer, som der ofte ikke bliver taget hjde
for i lrebger om virksomheders internationalisering (f.eks. Root, 1994):

Viden om specifikke aktrer i det relevante udenlandske markeds netvrk
Viden om de relative positioner af aktrerne i det udenlandske markeds netvrk
Viden om direkte og indirekte relationer mellem aktrer i det udenlandske markeds
netvrk
Viden om, hvordan visse af disse aktrers sttte kunne opns i relation til det
internationaliserende firmas planlagte aktiviteter i udlandet
De ansatte i det internationaliserende firmas evne til at obtain an understanding of
where different actors including the actor itself stand in relation to each other
(ibid.:231)
Det internationaliserende firmas ansattes evne til at positionere firmaet i det uden-
landske netvrk
De ansatte i det internationaliserende firmas evne til at udnytte muligheder p det
udenlandske marked, som opstr pludseligt og/eller helt uventet

Endeligt bliver (a) videnstyper og (b) mulig vidensplacering behandlet p grundlag af
underafsnit 2.4.s prsentation af Alajoutsijrvi og Tikkanen (1998), Nonaka og
Takeuchi (1995), Polyani (1962), og Sanchez og Heene (1997). Her understreges
skelnen mellem tavs viden (dvs. subjektiv, analog erfarings- og praktisk viden) og
eksplicit viden (dvs. objektiv, argumentationsbaseret og digital viden).

Studiets empiriske materiale viser, at firma 1 (det internationalt anerkendte firma)
havde meget mere forhndsviden end firmaer 2 (det nationalt anerkendte firma) og 3
(den nye, innovative virksomhed) pga. dettes mangerige erfaring p det tyske marked
og store antal tyskfdte ansatte. Nogle vigtige omrder, hvor firmaerne 2 og 3 i starten
manglede viden, relaterede sig bl.a. til den bredere viden om det tyske marked (f.eks.
viden om DIN-normer og normsystemet, om byggelovgivningen, og om forlbet i det
tyske udbud efter forhandling i den offentlige sektor) og til den potentielle tyske klients
334
forstelse af byggetraditioner og byggemssige prferencer og arkitektursmag.
Aktrerne i firmaerne 2 og 3 var i starten noget afhngige af deres tyske klienters
velvilje p grund af denne manglende viden. Dog arbejdede de aktivt for at indhente
den manglende tysklandsrelaterede viden. Ofte anvendte de deres nyerhvervede viden
om Tyskland lige efter de havde fet den, i deres bestrbelser p at opfylde normerne
og efterleve den tyske byggeindustris skik, og skrevne og uskrevne regler. De tre
firmaers generelle viden om designhistorie og traditioner blev derimod sjlden brugt i
konkrete akkvisitive projekter, eftersom de tyske klienter ogs vidste noget om den
pgldende arkitekttegnestues designtradition.

Firma 3s akkvisitionsstrategi var baseret p dets grundlggers personlige og tavse
viden, og evne til at skabe og vedligeholde relationelle forbindelser. Imidlertid var der
tilflde, hvor Firma 3 ikke forstod sine vrende eller potentielle tyske kunders behov
tilstrkkeligt. Firma 2 mtte p sin side frst indse, at firmaets stilling p det tyske
marked var markant forskellig fra dets situation p det danske marked pga. det faktum,
at de tyske kunder ikke fandt de fleste af firma 2s danske referencer meningsgivende
(se ogs underafsnit 14.3.5.). Efter firma 2 havde indset dette, mtte det samle anden
viden for at muliggre skabelsen af de rutiner samt den sociale kapital (se underafsnit
14.3.4.), som var ndvendig p det tyske marked for at kunne vinde projekter uden at
have mange anerkendte referencer.

Med hensyn til teori var den kontekst-specifikke viden om den tyske byggeindustri en
vsentlig forudstning for de danske case-virksomheders projekterhvervende
aktiviteter p det tyske marked. Dette udsagn gr videre end den skaldte Uppsala
internationaliseringsmodels (se f.eks. Johanson og Vahlne, 1997, som beskrevet i
underafsnit 2.2.) teoretiske bidrag mht. betydning af viden i virksomheders inter-
nationaliseringsproces. Uppsala-modellen fastlgger blot, at et firmas internationa-
liseringsforlb bestemmes af en eksperimentel lreproces (se ibid. og Petersen og
Pedersen, 1996). Derimod fastlgger modellen ikke specifikt, at viden ogs kan vre
en forudstning for udenlandske akkvisitive aktiviteter.

Det faktum, at kontekst-specifik viden i nogle situationer er en forudstning for
projektakkvisitive aktiviteter frer i nogle situationer til en vidensflde (p engelsk:
Catch-22 situation, se underafsnit 5.4. og 8.3.5.), idet den viden, som er en forud-
stning for at kunne opn projektordrer kun kan fs gennem projektarbejde. Imidlertid
hjalp Tysklands unikke hjkonjunkturelle situation i begyndelsen af halvfemserne samt
de deraf flgende tyske underkapacitetsproblemer de to case-virksomheder (2 og 3)
uden tidligere markedssgende erfaringer p det tyske marked til at undg
335
vidensflden. Under hjkonjunkturen var de potentielle tyske klienter nemlig mere
bne over for at arbejde med udenlandske virksomheder, som ikke var i besiddelse af
det sdvanlige niveau af viden om det tyske marked. Den teoretiske flge af dette er
den flgende hypotese:

At starte med at gre forretning pet udenlandsk marked under hjkon -
junktur giver et firma bedre muligheder for at undg vidensflden end
tilfldet er, hvis man pbegynder sine forretningsmssige aktiviteter under
andre omstndig heder.

Endvidere: i modstning til Boisot m.fl.s (1997, se underafsnit 2.3. og figur 5) teori
fulgte case-virksomhedernes videnserhvervelsesproces ingen kodificering/dekodifi-
cerings- og diffusionsproces. Megen viden blev hverken kodificeret (se ibid.) gen-
nem f.eks. rapporter eller formelt videregivet til andre organisationsmedlemmer. I
stedet blev viden kun langsomt spredt gennem brug. Sledes forblev megen viden i
socialisationsfeltet from tacit knowledge to tacit knowledge i Nonaka og Takeuchis
(1995, se figur 4 i underafsnit 2.3.) Knowledge Conversion and Sharing Matrix. I
modstning til Alajoutsijrvi og Tikkanens (1999, se underafsnit 2.3. og figur 6) teori
havde viden, som var kodificeret og generelt anvendelig, desuden ikke altid strre
nyttevrdi end f.eks. relationsspecifik, tavs viden. Sledes identificerede dette
studium to uopklarede teoretiske sprgsml, som kunne gres til genstand for
fremtidig forskning:

1. Hvad udlser og hindrer virksomheders sociale lreproces (som defineret af
Boisot m.fl., 1997)?
2. Hvad er forholdet mellem videnskodificeringsgrad, vidensanvendelighedsgrad
(dvs. generisk kontra relationsspecifik) og den pgldende videns nyttevrdi?

Derudover, i forhold til den tavse viden, viste respondenternes svar, at de i forhold til
Alajoutsijrvi og Tikkanens (1999) informationsstruktureringsniveauer havde svrt
ved at skelne, hvor grnsen mellem det generiske og det portefljespecifikke niveau
l. Imidlertid blev det ogs demonstreret, at det ikke er ndvendigt for
virksomhedsmedarbejdere at kende den eksakte grnse. P dette grundlag blev en ny
model for tavs viden i relationelle kontekster (se figur 25 i underafsnit 8.4.) udviklet.
Modellen ophver grnsen mellem det generiske og det portefljespecifikke niveau.
Endvidere inkluderer den udviklede model en mere prcis klassificering af, hvordan
viden kan vre spredt p det interorganisatoriske niveau (dvs. mellem to firmaer).

336
Endeligt, i forhold til den tavse viden, viste det empiriske materiale flgende:
Forgelser i de to nye firmaer p det tyske markeds (case-firmaer 2 og 3) tavse og
eksperimentelle portefljespecifikke viden resulterede i et formindsket behov for at
indsamle relationsspecifik viden i specifikke forretningssituationer. Dette resultat frer
til en anden hypotese:

For firmaer, som er ved at indlede deres internationalisering, vil en
forgelse i mngden af portefljespecifik viden f re til et formindsket behov
for at indsamle relationsspecifik viden.

Forskningssprgsml 4 beskftiger sig med arkitektfirmaers projektakkvisitionsproces
(se afsnit 1). Sprgsmlet er dannet p grundlag af en model af den akkvisitive proces,
the General Marketing Configuration for Project-to-Order Supplier Firms (Cova
m.fl., 1994, se figur 1). Modellen er et srdeles anvendeligt deskriptivt redskab pga.
dens evne til at beskrive varierende projektsituationer s som situationen, hvor der
ingen forestende projektordrer er, og situationen, hvor firmaet arbejder med mange
projekter p samme tid. I forhold til tidligere modeller af projektakkvisitionsprocessen
(f.eks. Holstius, 1987, se underafsnit 3.3.2.) giver modellen endvidere en mere
indgende beskrivelse af de faser, der indtrffer, fr en projektordre opns. Mandjk
og Veres (1998:484) formulerer betydningen af dette p flgende mde:

Once a future project starts to take shape either in the form of a tender or
contract, it is followed by the second stage of preparation, the adaptive
stage.

Formlet med forskningssprgsml 4 er ikke at verificere eller falsificere modellen i sin
helhed, men i stedet at bruge modellen som et grundlag for en dybtgende beskrivelse
af projektordreopnelsesprocessen p det tyske marked. Derfor bliver tre lignende
modeller udviklet i afsnit 9 (se figurerne 27-29). De afbilder processen i den private og
offentlige sektor samt i den private sektor i en relationel situation, og er et resultat af
granskningen af det empiriske materiale, den oprindelige Cova m.fl., 1994 model (se
figur 1 i afsnit 1) og de tidligere nvnte Nglekarakteritiska af byggeprojektrelaterede
arkitektydelser, som afbildes i figur 9 (se afsnit 2).
337

Den eneste strre teoretiske kritik af den oprindelige Cova m.fl. (1994) model (se figur
1), der rejses p grundlag af det empiriske materiale, er som flger: Deres model
afbilder den strategiske analyse og prioritetsvgtning som aktiviteter, der
hovedsageligt bliver frdiggjort, fr investeringerne i de sociale netvrk og indsam-
lingen af information om tendenser i projektmarkedsfringsmiljet foretages. Dette er
ikke i overensstemmelse med de tre case-virksomheders praksis. Derudover har
analysen af forskningssprgsml 3 vist (se underafsnit 14.3.3.), at nogle infor-
mationsindsamlingsaktiviteter ndvendigvis m g forud for en strategisk analyse og
prioritetsvgtning af aktiviteter. Endvidere er formuleringen af strategi noget, der sker,
mens ndringer i omverdenen samtidigt foregr (se Mintzberg og Quinns, 1992,
beskrivelse af emergent strategies), og den indeholder et strkt islt af tavs
socialisering (se f.eks. Nonaka og Takeuchi, 1995, som beskrevet i underafsnit 2.4.).
Derfor ville det i forbindelse med en forbedring af Cova m.fl.s (1994) model vre
relevant at teste flgende hypotese:

Strategisk analyse og prioritetsfastlggelse i firmaer, som markedsfrer
projekter, sker p en organisk mde, samtidigt med at ndringer i
omverdenen foregr.

Paradoksalt eksisterer der allerede empirisk materiale til sttte for denne hypotese i
en tidligere artikel (Cova m.fl., 1993) skrevet af de samme forfattere, som udviklede
the General Marketing Configuration for Project-to-Order Supplier Firms! Deres
1993-bidrag indeholder en vurdering af litteraturen om strategisk ledelse i projekt-
markedsfring (f.eks. Ahmad, 1990; Boughton, 1987; Slatter, 1990, som beskrevet i
underafsnit 3.2.), som sgte bl.a. at udvikle ledelsesinformationssystemer (Manage-
ment Information Systems eller MIS) to monitor, gather, analyze, store, and evaluate
a wide range of market information [] far beyond the collection of past competitive
bid histories. Information about the company, the customer, the competition, and the
environment must be obtained and processed to produce knowledge that can be used
directly in decision making (Boughton, 1987).

Cova m.fl. (1993 og 1994) undersgte (a) i hvilken grad de projektslgende firmaer
forsgte at implementere de normative modeller fra litteraturen om strategisk ledelse i
projektmarkedsfring (se underafsnit 3.2.) og (b) hvilke resultater disse forsg frte til.
Deres empiriske materiale viste flgende (ibid.:1994:32):

1. concerning the screening of projects, companies found difficulties defining stable
priorities for a given period of time due to the importance of human factors
338
(intuition, motivation, personal involvement) in the selection of projects [] In
addition, most firms claim their screening strategy is of the go/no go type, but
flexible enough to vary and balance the different efforts put into each project. More
than sophisticated choices concerning markets and technologies, it is often the
financial constrains of the yearly budget allocated to tender preparation that
determine the final selection of projects.
2. Concerning the scanning of project opportunities, companies have progressively
acknowledged the importance of interpersonal relationships between individuals
[]
raised due to the heterogeneity and the rapid evolution of the projects and of their
environment.

P grundlag af disse resultater nede Cova m.fl. (ibid.) frem til flgende konklusion
om den strategiske ledelseslitteratur, som de havde studeret:

it does not grasp the complexity of the situation faced by project-to-order
implemented

Mit empiriske materiale bidrager med yderligere sttte for ovennvnte udsagn.
Endvidere understtter det Cova m.fl.s (1993) pstand om, at der er et fundamentalt
dilemma mht. forudsigelse og fleksibilitet i projektmarkedsfring (se underafsnit
3.3.2.). I den forbindelse refererer forudsigelse til en projektudbyders strategiske
behov for (a) at holde sig informeret om meget specifikke teknologiske, politiske og
finansielle udviklinger, som muligvis kun ville vre relevant for f af de mange typer
projekter, firmaet potentielt kunne udfre, og (b) at udvikle specifikke politikker og
programmer i henhold til disse udviklinger. P den anden side refererer fleksibilitet til
behovet for (a) at bruge ressourcer til at opretholde brede sociale netvrk for at sikre,
at alle firmaets mulige projekttilbud betragtes som vrende af den hjeste kvalitet af
vigtige potentielle modparter i projektmarkedsfringsmiljet, og for (b) at sikre, at
samtlige mulige projekttilbud kan tilpasses specifikke omkostnings- og tilpasningskrav
(Bansard m.fl., 1993:130-131).

Derudover, i henhold til Cova m.fl.s (1994) model af projekterhvervelsesprocessen,
viser svarerne p forskningssprgsml 3, at arkitekttegnestuer ikke udvikler et
kernetilbud, som genbruges i flere forskellige arkitektprojekter. I stedet udvikler de
vidensrelaterede kernekompetencer (se f.eks. Alajoutsijrvi og Tikkanen, 1999, i
underafsnit 2.3.), som de bruger i flere arkitektoniske projekter. P grundlag af dette
339
resultat kan endnu en hypotese prsenteres til brug for forbedring af de eksisterende
projektmarkedsfringsprocesmodeller:

Firmaer, som tilbyder kunder projekter, der indeholder hovedsageligt
kundetilpassede tjenesteydelser, udvikler ikke kernetilbud, men derimod
kerne-kompetencer.

Med hensyn til ovenstende hypotese findes der allerede nogle generelle teorier om
ledelse af firmaer, som tilbyder professionelle tjenesteydelser (se f.eks. Lwendahl,
1997, som nvnes i underafsnit 2.4. og 4.2.). Denne eksisterende litteratur burde ogs
behandles i et studium af ovennvnte hypotese.

Analysen af forskningssprgsml 4 viser, sammen med den tidligere nvnte analyse af
forskningssprgsml 2 (se underafsnit 14.3.2.) om det danske internationaliserings-
netvk, samt resultaterne fra forskningssprgsml 5 (se det nste underafsnit),
flgende: De danske og tyske netvrk, som de danske case-firmaer har deltaget i, m
betragtes som vrende af en social i modstning til en IMP natur (se underafsnit
3.3.2.). Der var f sammenhngende aktiviteter og ressourcemssige forbindelser (se
Hkansson og Johanson, 1992) mellem aktrerne, og den gensidige afhngighed samt
investeringerne i relationelle forbindelser (se Easton, 1992, Johanson og Mattsson,
1986) l p et meget lavt niveau. Kun i meget f tilflde kunne man finde langsigtede
relationer mellem klient og arkitektvirksomhed. Disse undtagelser var imidlertid
prgede af investeringer i de relationelle forbindelser samt nogle tekniske og
konomiske forbindelser med hensyn til den viden, der krves for at kunne bygge
optimalt for den pgldende klient. Derudover tog det som regel mindre tid for
partnerne i undtagelsessituationen at n til enighed om arkitektprojekter, eftersom
partnerne kendte hinanden.

En flge af ovenstende vedrrer governance structure-problematikken: P
arkitekturmarkederne finder vi det socialt konstruerede marked (se figur 18 i under-
afsnit 4.2.). Dette resultat kunne imidlertid vre relevant for mere end blot dette
studium eller arkitekturens verden. Det er nemlig sandsynligt, at det socialt konstru-
erede marked er en ret udbredt governance structure i projektmarkedsfring, pga. den
tidligere nvnte diskontinuerlige eftersprgsel og de unikke projektegenskaber (se
f.eks. Ahmed, 1993; Cova og Ghauri, 1996; Tikkanen, 1998; som beskrevet i
underafsnit 3.3.2.). Endvidere kunne denne governance structure vre srdeles vigtig
mht. tjenesteydelser, som udfres af professionelle, pga. den tidligere nvnte rolle
som socialt konstruerede faktorer, ssom omdmme og trovrdighed, spiller i disse
tjenesteydelser (se f.eks. Lwendahl og underafsnit 2.4.).
340

Derudover er det tnkeligt, at det socialt konstruerede marked er den fremtrdende
governance structure mht. mindre projekter, f.eks. de fleste projekter udfrt af arki-
tekt- og ingenirvirksomheder, men ogs projekter, som udfres af software-
udviklerfirmaer. Her er der, ud over den diskontinuerlige eftersprgsel, mange
udbydere, hvilket gr det socialt konstruerede marked endnu mere sandsynligt. Disse
overvejelser frer til flgende hypotese:

Det socialt konstruerede marked som governance structure findes i
situationer, hvor der er mange potentielle projektudbydere.

Endeligt resulterede analysen af forskningssprgsml 4 i flgende udsagn: P den
tyske byggeindustris socialt konstruerede marked akkumulerede aktrerne fra case-
virksomhederne social kapital (Bourdieu, 1979, 1983, 1986, se afsnit 4), som blev
brugt til at skabe trovrdighed i projektakkvisitionsprocessen. Bourdieu (1983:248-9)
definerer social kapital som flger:

to credit, in the various senses of the word.

Mht. operationaliseringen af social kapital-begrebet, som foretages i denne
afhandlingens kapitel 4, defineres gruppen som bestende af aktrer, hvis holdninger
til arkitektur og byggeindustrien ligner hinanden. Derudover er grupperne sm nok til at
deres medlemmer vil kende eller have hrt om hinanden og hinandens syn p arkitektur
og byggeindustri. Grupperne er ogs en del af byggeindustriens projektmarked-
sfringsmilj, som omfatter arkitekter og andre byggeindustriaktrer, personer, som
arbejder p arkitektskoler og som arkitekturkritikere, samt borgere, der viser interesse
for arkitektur og byplanlgning.

Med hensyn til brugen, bliver den sociale kapital betragtet som trovrdigheds-
skabende i denne afhandling, idet akkumulation af den sociale kapital giver dens
brere trovrdighed hos andre medlemmer af gruppen (se ogs Majkgrd og Sharma,
1998:11 og Lwendahl, 1998:42-3). Trovrdighed defineres her som the actors per-
ceived ability [dvs. opfattede af andre gruppemedlemmer] to perform something he
claims he can do on request (Blomqvist, 1997:279) og omfatter f.eks. bedmmelsen
341
af den pgldende arkitekts viden, og hans/hendes evne til at vurdere komplekse
tekniske og konomiske faktorer.

I forhold til projektakkvisitionsprocessen blev den sociale kapital indledningsvis
genereret i kontaktepisoder mellem aktrerne fra case-virksomheder og andre aktrer i
det sociale netvrk, i situationer hvor case-virksomhedernes aktrer fik lejlighed til at
vise (a) deres viden og kunnen mht. reglerne og normerne i det tyske bygge-
projektmilj og (b) deres evne til at fre en tillidsskabende samtale (se Lwendahl,
1997). Endvidere blev social kapital genereret (a) under de projektspecifikke
klientorienterede aktiviteter, nr virksomhederne havde fet en projektordre, og (b)
gennem word-of-mouth, dvs. udsagn fra nuvrende og tidligere klienter. Mht.
projektakkvisition i den offentlige sektor, reducerede EUs tjenesteydelsesdirektiv
nogle, men dog ikke alle effekter relaterede til social kapital. Isr i den tyske brug af
udbud efter forhandling (se underafsnit 14.3.1.) spillede den sociale kapital stadig en
vis rolle.

342
Forskningssprgsml 5s tema er den rolle, som tidligere arkitektprojekter spiller i det
nutidige akkvisitionsarbejde. For at kunne beskrive denne analyse er det ndvendigt at
sammenfatte resten af Bourdieus kapitalteoriramme, som frst prsenteredes i denne
afhandlings underafsnit 4.4.

Bourdieus teori omfatter ogs begrebet kulturel kapital", der refererer til vrdien af
den praksis og de artefakter, som er resultatet af individers socialisering indenfor en af
mange hierarkisk ordnede grupper i et felt (Bourdieu, 1983:243-8). Den kulturelle
kapital manifesterer sig p tre mder (ibid.:243):

trace of realization of theories or critiques of these theories, problematics,
etc. and in the institutionalized state, [ e.g. in the form of] educational
qualifications.

I denne afhandlings operationalisering af begrebet kulturel kapital udelades den
kropsliggjorte/indlejrede kapital, eftersom denne form for kapital er omfattet af den
sociale kapital. Den objektiverede og institutionaliserede kapital medtages derimod.
De objektiverede kulturelle kapitalgoder, som en arkitekt fremstiller, er bl.a. bygninger
og parker. Derudover har arkitekten i reglen fet (a) formel uddannelse og akademiske
grader, som svarer til institutionaliseret kapital og giver ham mulighed for at pberbe
sig ret til at udve sit hverv. Endvidere giver (b) medlemskab i arkitektorganisationer
og (c) referencelister, som omfatter (i) projekter, der enten er frdige eller under
konstruktion, svel som (ii) priser og prmier fra arkitektkonkurrencer samt fra
offentligt udbud, arkitekten yderligere institutionaliseret kulturel kapital.

Genereringen af trovrdighed er dog kompleks i det arkitektoniske felt, eftersom
arkitektens (og sledes hans firmas) evne til at opn projektordrer afhnger af (a)
andre arkitekters samt arkitekturkritikeres bedmmelse af arkitektens kunstneriske
evner, (b) andre byggeindustrirelaterede aktrers bedmmelse af hans trovrdighed,
samt (c) de komplekse samspil mellem (a) og (b), eftersom begge grupper lbende er i
dialog med hinanden (Albertsen, 1996:2). P dette grundlag har Albertsen (ibid.)
identificeret tre delfelter i det arkitektoniske felt:

Det kunstneriske delfelt: Dets medlemmer orienterer sig primrt mod andre
arkitekters og kritikeres bedmmelse af deres kunstneriske bidrag til arkitekturen.
343
Derimod interesserer medlemmer af dette delfelt sig meget lidt for markedsfring
og profit.
Det professionelle delfelt: Medlemmer af dette felt viser stor interesse for den
kunstneriske og formgivningsmssige side af arkitekturen, men er ligeledes
interesseret i energi- og miljmssige, teknologiske, byggeproduktivitets- og
overskudsrelaterede problematikker.
Det teknologisk-konomiske delfelt: I dette felt vgtes efficiens og produktivitet
tungest. Arkitektfirmaer i dette delfelt sigter mod klienter, som tidligere blev betjent
af det professionelle delfelt. Imidlertid ringeagter arkitekter fra de kunstneriske og
professionelle delfelter aktrerne fra den teknologisk-konomiske delfelt, pga.
disses manglende vgt p arkitekturens kunstneriske side.

Albertsens tre delfelter er afbildet i figur 21 for at muliggre positionering. Med hensyn
til kapitalmngder har arkitekter i det kunstneriske delfelt (og deres firmaer) generelt
sm mngder af social og konomisk kapital. Dog har de megen kulturel kapital, hvis
de har opnet anerkendelse fra andre arkitekter og arkitekturkritikere. Veletablerede
arkitekter og deres firmaer i det professionelle delfelt har generelt store mngder af
bde social og kulturel kapital, eftersom den kulturelle kapital er forbundet med deres
kunstneriske omdmme og den sociale kapital med deres relationer til samtlige aktrer
i byggeindustrien. Endeligt har arkitekter i det teknologisk-konomiske delfelt kun en
relativt stor mngde af social kapital fra deres forretninger med andre aktrer i samme
delfelt set i forhold til deres mngde af kulturel kapital. Disse arkitekter er generelt ikke
srlig gode til at vinde arkitektkonkurrencer og derved akkumulere den kulturelle
kapital. Forholdet mellem delfelterne og grupperne er som flger: Grupperne er altid
del af et af delfelterne. Ligeledes er sociale netvrk oftest hovedsageligt omfattet af et
delfelt.

Mit empiriske materiale er den frste empiri til sttte for brugen af Bourdieus
kapitalteori mht. markedsfringen af arkitektoniske projekter. Samtlige case-virksom-
heder tilhrte det professionelle delfelt p det danske marked, og ligeledes bestrbte
firma 2 og 3 sig p at blive medlem af dette delfelt p det tyske marked, mens firma 1
allerede var det. Alle tre firmaer brugte deres kulturel kapital i deres referencelister og
andet pr-materiale. De tog kontakt til pressen for at informere om projekter, som de
havde vundet. Dette var en indirekte mde at markedsfre sig selv p, p grundlag af
tidligere eller nuvrende projektarbejde. P den anden side blev mere direkte
markedsfring ssom reklamer, eller at bede tidligere klienter om at markedsfre
firmaet i deres egne brochurer, ikke brugt. Ligeledes blev klienterne heller ikke bedt om
at anvende positive social kapital-relaterede mekanismer ssom word-of-mouth. Dette
skete kun, nr klienten tog initiativet egenhndigt.

344
Derudover viste empirien, at opsamlingen af bde den sociale og den kulturelle kapital
var begrnset til oprindelseslandet, dvs. Tyskland eller Danmark, eftersom tyske
klienter i reglen ingen kontakter havde til byggeindustriaktrer i Danmark, og derfor
heller ikke havde noget forhold til referencer fra Danmark. Sledes mtte de tre case-
virksomheder opsamle den sociale og kulturelle kapital separat p hvert marked. Som
tidligere nvnt i underafsnit 14.3.2. kom dette som en overraskelse for virksomhed 2.

Endeligt, med hensyn til den offentlige sektor, br den endelige udvlgelsesrunde i en
udbudsprocedure vre renset for effekten af kulturel kapital, eftersom EUs tjeneste-
ydelsesdirektiv (92/50/EF) foreskriver, at udvlgelsen skal ske p grundlag af
projektforslaget alene. Imidlertid blev effekten af den kulturelle kapital ikke altid
fuldstndigt elimineret i den sidste udvlgelsesrunde, i lighed med situationen mht.
den sociale kapital (se slutningen af delafsnit 14.3.4.).

P grundlag af informationerne i de ovennvnte afsnit kan det siges, at tidligere pro-
jektarbejde kunne give de tre case-virksomheder social eller kulturel kapital eller begge
dele. I 90erne samlede de tre case-virksomheder kulturel kapital p det tyske marked.
Case-virksomhederne 2 og 3 samlede store mngder social kapital, mens case-
virksomhed 1 allerede havde en stor mngde social kapital, som gjorde, at
virksomheden ikke beskftigede sig srlig meget med tiltag for at forge mngden
yderligere. Dog styrkede case-virksomhed 1 sin position i det tyske professionelle
delfelt samlet set i 1990erne, mens firmaerne 2 og 3 strbte mod at etablere sig med
en god position i dette felt i samme rti. Udviklingen er afbildet grafisk i figurerne 32
og 33 i afsnit 10.

Salminens (1997, se ogs Holstius, 1987 og underafsnit 3.3.2.) referenceteoretiske
ramme blev ogs gransket og brugt som et supplement til Bourdieus kapitalteori i
afsnit 10, i tilflde hvor det empiriske materiale tillod dette. P grundlag af f.eks.
Holstius (1987) definerer Salminen (1997:50) en reference p flgende mde:

[A] reference is a deal containing one or several deliveries of
products/services, or a part of that deal that either already has been, or will
be delivered to a subsequently recognised customer.

Salminen (1997:57) opremser derudover delvist overlappende faktorer, som ver
indflydelse p, hvor let og hvor gavnligt det er at henvise til en reference. I det
nedenstende opremses de mere generelle faktorer frst:

345
1. Omverdensrelaterede faktorer: Disse refererer til f.eks. betydning af oprindel-
sesland eller konkurrence- eller globaliseringsgraden i den pgldende industri
2. Aktrspecifikke faktorer: Disse relaterer til f.eks. hvor gode og villige
reprsentanterne fra kbsfirmaet er til at forklare projektet til fremmede
3. Anlgsspecifikke faktorer : Disse omfatter f.eks. almindeligheden af det problem,
som sgtes lst ved at bygge anlgget og/eller almindeligheden og forsteligheden
af den valgte lsning
4. De tre anvendelighedsfaktorer: benhed, erfaring og kundetilfredshed. Disse
forklares i dybden i det flgende citat:

depends on the age of experience of the use of a reference. A deal
(reference) can be utilized in reference lists immediately after the deal with a
customer has been closed, although its reference value is not very high at
that time (it is not yet very convincing). After the installation of the
equipment has been completed, the value of the reference increases, and
after the equipment has been used for one year, the reference can really be
utilized. []


someone has to express that satisfaction. (ibid.:50-1; Salminens egen
understregning)

Ved at inddrage Bourdieus (1984) terminologi kan man sige flgende: Salminens
(1997) referencevrdi relaterer til projektspecifik institutionel (f.eks. priser i konkur-
rencer) og objektiviseret (f.eks. bygninger) kulturel kapital og, med srligt henblik p
dimensionerne 1 og 3, erfaring og tilfredshed (gennem f.eks. positiv mundtlig omtale),
til den tidligere nvnte sociale kapital. Det empiriske materiale understttede
Salminens referenceteori med to undtagelser:

1. I modstning til Salminens teori viste nogle af dataene, at arkitektprojekter, som
endnu ikke er frdige, ogs kan have en referencevrdi, og at denne reference-
vrdi ikke ndvendigvis forges yderligere, nr klienten fr brugserfaring.
2. Mundtlig kommunikation mellem den potentielle kber og en tidligere klient finder
kun undtagelsesvis sted. Mht. arkitektprojekter giver samtaler med tidligere klienter
346
de potentielle kbere f relevante informationer, som de ikke kunne have fet ad
andre veje.

Endeligt, i forbindelse med forskningssprgsml 5, blev yderligere to begreber fra
afsnit 3s litteraturstudium inddraget og gransket: det hvilende forhold (Hadjikhani,
1996) og den sociale konstruktion af eftersprgsel (Cova og Hoskins, 1997). I sin
1996 artikel fokuserer Hadjikhani p de relationelle forbindelse mellem kber og slger
i den diskontinuerlige hvileperiode, dvs. the period after project completion in which
project buyer and seller are not concerned with resource exchange or negotiation and
the buyers mobility is high. Hadjikhanis (ibid.:332-333) hvilende forhold refererer
til fortsat afhngighed mellem partnerne efter projektets udfrelse (pga. f.eks. behovet
for fremtidige forbedringer eller reservedele):

that it affected and influenced buyer behaviour with regard to ordering new
projects. In the sample of case study firms studied, in cases where the level
of buyer trust of the sleeping relationship was high, there were incidents
where the buyer chose the seller to produce new projects.

Nr definitionen ovenfor sammenlignes med mit empiriske materiale ses, at det var
utroligt svrt for arkitektfirmaer som relativt sm firmaer med mange konkurrenter at
skabe den klientafhngighed, som ellers ville fre til relationelle forbindelser eller sgar
den tidligere nvnte netvrk-governance structure, eftersom arkitektfirmaerne
hverken kan tilbyde unikke reservedele eller opn et monopol p fremtidige
forbedringer. Sledes spiller trovrdighed, som er direkte forbundet med den sociale
og den kulturelle kapital, den vigtigste rolle i hndteringen af de hvilende forhold.

Mht. den sociale konstruktion af eftersprgsel specificerer Cova og Hoskins (1997:
546-7), at projektmarkedsfrende firmaer kan handle p to mder i forhold til
projektmarkedsfringsmiljets regler og normer:

1. Den deterministiske handlemde, dvs. at man lrer spillets regler og p grundlag
deraf spiller spillet samt forsger at forudse de fremtidige regler
2. Den konstruktivistiske handlemde, dvs. at man handler for at ndre samt kunne
bestemme spillets regler og konkurrencesituationen

Det empiriske materiale viser, at case-virksomhederne hovedsageligt brugte den
deterministiske handlemde. Dette er sandsynligvis, fordi de hverken havde strrelsen
347
eller magten til aktivt at forme konkurrencesituationen og spillereglerne. Denne
argumentation frer til de sidste to hypoteser, som prsenteres i dette resum:

I forhold til begrebet det hvilende forhold sttter smprojektudbydere sig
mere til skabelse af klientens tillid end til skabelse af klientafhngighed.
I forhold til den sociale konstruktion af eftersprgsel handler sm
projektudbydere i hovedreglen pden deterministiske mde.

14.4. Slutbemrkninger om studiets bidrag.
Prsentationen af den empiriske forskning i de forrige underafsnit kan have syntes
noget spredt og eklektisk. Imidlertid skyldes dette til dels, at de hidtidige projekt-
markedsfringsbidrag ogs brer prg af eklekticisme (se delafsnit 14.2.). Dog kan
dette ogs henfres til studiets design. Som tidligere nvnt i underafsnit 14.1. blev
studiet foretaget med et abduktivt (Andersen, 1998; Denzin, 1978; Dubois og Gadde,
1999) design og en eksplorativ-integrativ (Maale, 1996) metodologi, hvilket
indebrer en kompleks sammenstning af induktiv og deduktiv analyse. Der er fire
mder, hvorp et sdant studium kan bidrage til videnskaben (se f.eks. Andersen,
1988 og Flick m.fl., 1995):

1. Ved at supplere med yderligere empiri til sttte for tidligere videnskabelige
resultater og deres underliggende teorier
2. Ved at prsentere empiri, som viser, at tidligere teorier og konceptuelle rammer
muligvis vil skulle modificeres
3. Ved at skabe et grundlag for teoretisk og konceptuel syntese
4. Ved at bidrage med helt nye teorier, modeller og koncepter

Punkter 1 og 2, at komme med nyt empirisk materiale, er altid positivt i forhold til
tidligere kvantitative og kvalitative bidrag. Pga. den kvalitative forsknings iboende
strre problemer med ekstern validitet (se underafsnit 4.3.3.) er disse punkter
imidlertid srligt relevante med hensyn til eksisterende kvalitative bidrag. Dette
studium gransker et antal kvalitativt udviklede begreber og modeller ved hjlp af
yderligere empirisk materiale, herunder Alajoutsijrvi og Tikkanens (1999)
Competencies in the Context of Relationships (se underafsnit 2.3.) og flgende kon-
cepter fra afsnit 1 og underafsnit 3.3.2: Cova m.fl.s (1996a) projektmarkedsfrings-
milj, samme forfatteres General Configuration for Project-to-Order Firms (figur 1
fra Cova m.fl., 1994) og forudsigelighed-fleksibilitet dilemma (figur 13 fra Cova
m.fl., 1993), begreber fra Salminens (1997) afhandling om referencer (se e.g. figurerne
348
14 og 15), Hadjikhanis (1996) sovende forhold og den sociale konstruktion af
eftersprgsel (se f.eks. Cova og Hoskins, 1997).

For eksempel, med hensyn til sprgsmlet om den territoriale afgrnsning af projekt-
markedsfringsmilj-begrebet (se Tikkanen 1998 og afsnit 14.2.), understtter
empirien fra behandlingen af samtlige fem forskningssprgsml ophavsmndenes (se
Cova m.fl., 1996) pstand om, at man kan lave en territorial afgrnsning i hvert
tilflde mht. arkitekturprojekter og byggeindustrien. Dette resultat br medtages i
fremtidig forskning om, hvornr det er acceptabelt at definere et projekt-
markedsfringsmilj (eller felt, se underafsnit 14.2. og 4.4.) geografisk.

Mht. pkt. 3 viser modellen afbildet i kapital 2s figur 9 nglekarakteristika for
arkitekturprojekter. Som tidligere nvnt i underafsnit 14.2. blev modellen sammensat
p grundlag af litteratur om professionelle tjenesteydelser, projektmarkedsfring samt
byggeindustrien. Endvidere blev sammenligneligheden af begreberne projektmarkeds-
fringsmilj (Cova et al., 1996a) og Bourdieus (1983, 1990, 1996) og de institutionelle
teoretikeres (se f.eks. DiMaggio og Powell, 1983; Melin, 1989; Scott, 1994) felt-
begreb demonstreret p grundlag af en konceptuel og metateoretisk analyse i
underafsnit 4.4. Dette kombineret med faststtelsen af de to mulige governance
structures for projektbaserede tjenesteydelsesindustrier (se afsnit 13.2.) gjorde det
muligt for dette studium at inddrage og kombinere indsigter fra bde INPM-bidrag og
Bourdieus teori om social og kulturel kapital i en projektakkvisitiv teoriramme (se
kapitel 10 og figurerne 32 og 33). Anvendelsen af Bourdieus kapitalteori i
projektmarkedsfringen var en nyskabelse. I modstning hertil udviklede dette
studium dog ingen helt nye modeller (punkt 4).

Der er imidlertid et sidste tema, som m behandles kritisk i forbindelse med de afslut-
tende bemrkninger om dette studiums videnskabelige bidrag: sprgsmlet om
generaliseringen. Som et kvalitativt bidrag er dette studium noget problematisk mht.
den eksterne validitet (se underafsnit 4.3.3.). Endvidere trkker dette studium p
mange andre kvalitative bidrag, som deler denne svaghed (se underafsnit 14.2. samt
afsnit 3 og underafsnit 5.7.). Derfor har dette studiums sigte hverken vret at
prsentere eller udvikle universelt gyldige teorier (se afsnit 1). I stedet har sigtet vret
at udvikle en lokalteori og begrebsramme baseret p syntese, og at granske eksis-
terende bidrag ved hjlp af yderligere empiri.

Man kan selvflgelig diskutere nytten af dette. Imidlertid er det i forbindelse med
denne diskussion relevant at sprge nytte for hvem? Fra f.eks. en praktikers eller et
349
samfundsmssigt perspektiv kan der argumenteres for, at et dybtgende studium som
dette er srdeles anvendeligt for praksis i det land, som har finansieret forskningen,
nemlig Danmark p trods af, at studiets resultater ikke har frt til nogle meget
generelle udsagn.

Fra et videnskabeligt perspektiv m det endvidere bemrkes, at det ikke altid er muligt
at lave kvantitativ forskning om internationalisering og eksporttendenser, hvis man
begrnser forskningen til firmaer fra sm lande, eftersom populationsstrrelsen af
egnede firmaer i et mindre land vil vre for lille. At inkludere firmaer fra flere
forskellige lande er en mulighed, men kun hvis firmaerne i de forskellige lande virkelig
er sammenlignelige. I tilfldet arkitektur er denne betingelse ikke opfyldt, eftersom
kilder som Stevens (1998:29, se underafsnit 14.2.) og Button og Fleming, 1992;
Drbye, 1999; og Oliver-Taylor, 1993 (se Appendix A) angiver, at dette ikke er
tilfldet. Sledes har man som forsker i dette tilflde kun to muligheder:

1. At gennemfre et kvalitativt studium
2. Ikke at gennemfre noget studium overhovedet

P grundlag af ovenstende begrunder og forsvarer jeg mit valgte studium og dets
design. Igennem studiet har jeg taget de frste skridt mod at udvikle begreberne social
og kulturel kapital for projektmarkedsfringen. Disse vil muligvis vise sig at vre
strkt, beskrivende redskaber p andre socialt konstruerede markeder, f.eks. i andre
projektmarkedsfrings- og professionelle tjenesteydelsessituationer. Efter som jeg ikke
har vret i stand til mere end at skabe lokale teorier, br reglerne for opnelse af social
og kulturel kapital, samt reglerne i projektmarkedsfringsmiljet imidlertid i frste
omgang fastlgges p ny i hvert enkelt tilflde. Dette er fordi ingen forsker idag
besidder viden nok til at lave generelle, a priori udsagn om regler vedr. social og kul-
turel kapital p alle felter (se f.eks. Araujo og Easton, 1999; Bourdieu, 1996). Imid-
lertid er det mit hb, at andre forskere vil gennemfre lignende, abduktive studier med
henblik p at bidrage til den samlede vidensbase om operationaliseringen af disse
begreber i forskellige kommercielle situationer, samt til den videre forbedring af
begreberne p et mere generelt niveau, til brug for erhvervskonomiske middle-range
teorier. I modstning hertil str de hypoteser, som jeg har prsenteret i dette
sammenfattende afsnit. Disse er velegnede til kvantitative teoritests.

Med hensyn til studiets relevans for forretningsfolk (afsnit 12) er den foreslede
anvendelse af teorien om social og kulturel kapital p omrdet projektmarkedsfring
ment som tankegods for de arkitektuddannede beslutningstageres evaluering og
diskussion af deres akkvisitionspraksis. Ofte har disse beslutningstagere ikke fet
350
megen uddannelse i virksomhedsledelse (se f.eks. Sommer, 1996; Stevens, 1998;
stns, 1984; stns og Svensson, 1986), og der er f bger og artikler om
markedsfring af arkitektydelser. Derfor er prsentationen af en sdan beskrivelse
ledelsesmssigt relevant for denne mlgruppe, eftersom det nyskabte begrebsapparat
for markedsfringsmssige sprgsml kan bidrage til at hve diskussionen til et
hjere niveau end ellers. Derimod er der ingen frdigsyede, hvordan-man-gr
modeller at hente i min afhandling, eftersom forskningen havde et deskriptivt, ikke
prskriptivt, sigte.

Som denne afhandlings forfatter vurderer jeg det imidlertid som passende at komme
med et par generelle forslag til arkitekter mht. hvad der burde f strre
opmrksomhed i deres akkvisitive arbejde. P grundlag af mine mange dybde-
interviews argumenterer jeg i afsnit 12 for, at arkitekter ikke altid fokuserer nok p at
forst deres kunders opfattelser af egne behov, nsker og prioriteter (en lignende
argumentation findes i Harrigan og Neel, 1996, og Sommer, 1996). Endvidere hvder
jeg, at det er en misforstelse, nr mange arkitekter og ingenirer pstr, at
markedsfring og konomisk informationsindsamling slet ikke kan bruges i deres
arbejde. P trods af, at de mest kendte markedsfringsmodeller nok ikke er srligt
anvendelige mht. salg af arkitektydelser, findes der andre modeller, som hvis de
bruges kan bidrage vsentligt til svel forstelsen af de markedsfringsmssige og
konomiske sider af arkitekthvervet som planlgningen og vurderingen af firmaets
forretninger bde p hjemmemarkedet og i udlandet. Denne informationsindsamling,
samt tiltag vedrrende vidensledelse, bliver srdeles vigtige, nr et firma begynder at
overveje at starte op p et nyt og fremmed marked.

Det er sledes mit hb, at denne afhandling vil bidrage til svel arkitekters som
videnskabsmnds oplyste samtaler om de kommercielle faktorer, der ver indflydelse
p arkitektfirmaernes projektakkvisition.

351
15. Bibliography.

Adams, J. Stacy (1976): The Structure and Dynamics of Behavior in Organizational Boundary Roles, in
Dunnette, Marvin D., Ed. (1983): Handbook of Industrial and Organizational Psychology. New York:
Wiley.

Ahlqvist, Bengt (1992): Architecture - Field of Activity or Knowledge, in Kazemian, Ed. (1992):
Conference Proceedings. International Conference on Theories and Methods of Design, Chalmers,
Sweden: Royal Institute of Technology/Chalmers University of Technology, May 13-15, 1992, pp. 81-86.

Ahmad, Irtishad (1990): Decision-Support System for Modeling Bid/No-Bid Decision Problem, in
Journal of Construction Engineering and Management, Vol. 116, No. 4, pp. 595-608.

Ahmed, M.M. (1993): International Marketing and Purchasing of Projects: Interactions and
Paradoxes. A Study of Finnish Project Exports to the Arab Countries. Ph.D. Thesis. Helsinki:
Publications of the Swedish School of Economics and Business Administration.

Alajoutsijrvi, Kimmo (1996): Rautainen pari. Kymmenen ja Valmetin suhde, lhiverkosto ja
makrovoimat 1948-1990. Ph.D. dissertation, University of Jyvskyla, Finland.

Alajoutsijrvi, Kimmo and Henrikki Tikkanen (1999): Research on Competence-Based Business
Processes within Industrial Networks, in Woodside, Arch, Ed. (forthcoming): Advances in Business
Marketing.

Alasuutari, Pertti (1995): Researching Culture. Qualitative Method and Cultural Studies. London:
Sage.

Albertsen, Niels (1999): Arkitekturvrkets Netvrk. Working Paper, Aarhus School of Architecture
(Denmark), June 1999.

Albertsen, Niels (1997a): Monographie Danemark. 3
rd
Version. Unpublished Working Paper.
November 1997.

Albertsen, Niels (1997b): Transversal Answers for the Case of Denmark. Unpublished Working Paper.
June 1997.

Albertsen, Niels (1996): Architectural Practice. Habitus, field and cultural capital. Paper presented at
the conference "Occupations and Professions: Changing Patterns, Definitions, Classifications. University
of Nottingham UK, 11-13 September 1996.

Aldag, R. M. and T. M. Stearns (1988): Issues in Research Methodology, in Journal of Management,
Vol 14, No. 2, pp. 253-276.

Alderson, Wroe (1965): Dynamic Marketing Behavior. A Functionalist Theory of Marketing.
Homewood, Illinois USA: Richard D. Irwin.

352
Alderson, Wroe (1957): Marketing Behavior and Executive Action. A Functionalist Approach to
Marketing Theory. Homewood, Illinois USA: Richard D. Irwin.

Aldrich, Howard and Diane Herker (1977): Boundary Spanning Roles and Organization Structure, in
Academy of Management Review, Vol. 2, No. 2, pp. 217-230.

Altheide, D.L. and Johnson, J.M. (1994): Criteria for assessing interpretive validity in qualitative
research, in N.K. Denzin and Y.S. Lincoln, Eds. (1994): Handbook of Qualitative Research, Thousand
Oaks CA USA: Sage, pp. 485-499.

Alvesson, Mats (1995): Management of Knowledge-Intensive Companies. Berlin and New York:
Walter de Gruyter.

Alvesson, Mats and Stanley Deetz (1996): Critical Theory and Postmodernism Approaches to
Organizational Studies, in Clegg, Stewart R., Cynthia Hardy, and Walter R. Nord (1996): Handbook of
Organization Studies. Thousand Oaks USA: Sage, pp. 191-217.

American Heritage Dictionary (1982): American Heritage Dictionary. Second College Edition. Boston
USA: Houghton Mifflin Company.

Andersen, Heine (1988): Videnskabsteori & metodelre for erhvervskonomer, 2. udg. Copenhagen:
Samfundslitteratur.

Andersen, Heine and Lars Bo Kaspersen, Eds. (1996): Klassisk og moderne samfundsteori.
Copenhagen: Hans Reitzels Forlag.

Andersen, Ib, Ed. (1990): Valg af organisationssociologiske metoder et kombinationsperspektiv.
Frederiksberg, Denmark: Samfundslitteratur.

Andersen, Ib, Finn Borum, Peer Hull Kristensen, Peter Karne (1992): Om kunsten at bedrive
feltstudier - en erfaringsbaseret forskningsmetodik. Frederiksberg, Denmark: Samfundslitteratur.

Andersen, Poul Houman (1999): A Foot in the Door: Relationship Marketing towards Transaction-
Oriented Customers. Paper presented at the 9
th
Nordic Workshop on Internationalization Research at the
University of Wasa, Finland. rhus, Denmark: The rhus School of Business, Department of International
Business.

Andersen, Poul Houman (1995): Collaborative Internationalization of Small and Medium-Sized
Enterprises. Copenhagen: DJF Publishing.

Andersen, Poul Houman, Per Blenker, Poul Rind Christensen (1997): Generic Routes to Subcontractors
Internationalisation, in Bjrkman, Ingmar and Mats Forsgren (1997): The Nature of the International
Firm, Copenhagen: Copenhagen Business School Press, pp. 231-255.

Anderson, James C., Hkan Hkansson, and Jan Johanson (1994): Dyadic business Relationships Within
a Business Network Context, in Journal of Marketing, Vol. 58 (October 1994), pp. 1-15.

353
Araujo, Luis and Geoff Easton (1999): A Relational Resource Perspective on Social Capital, in
Leenders, Roger Th. A. J. and Shaul Gabbay, Ed. (1999): Corporate Social Capital and Liability.
Norwell MA, USA: Kluwer, pp. 68-87.

Araujo, Luis and Geoffrey Easton (1996): Networks in Socioeconomic Systems: A Critical Review, in
Iacobucci, Dawn, Ed. (1996): Networks in Marketing. Newbury Park USA: Sage, pp. 63-107.

Architects Council of Europe (1995): Europe and Architecture Tomorrow. Brussels: Architects
Council of Europe.

Arkitekt- og byggebladet. Journal published by Dansk Praktiserende Arkitekter until February 1993,
thereafter by the Society of Associated Danish Architects (ADA).

Arkitekten. Journal published by the Danish Association of Academically Educated Architects (DAL).

Arkitektfirmaet C.F. Mllers Tegnestue (1998): Erhverv og menneske. Arkitektfirmaet C.F. Mllers
Tegnestue. rhus, Denmark: C.F. Mllers Tegnestue.

Atkin International (1993): SECTUER, Strategic Study on the Construction Sector (Commonly known
as the Atkin Study). Brussels: Commission of the European Communities, Directorate General for Industry.

Axelsson, B. and J. Johanson (1992): Foreign Market Entry- The Textbook vs. the Network View, in
Axelsson, Bjrn and Geoffrey Easton (1992): Industrial Networks - A New View of Reality, London:
Routledge, pp. 218-236.

Azimont, Frank, B. Cova, R. Salle (1998): Solutions Selling and Project Marketing: A Convergence
Towards Customer Intimacy for a Joint Construction of Offer and Demand, in Halinen, K., N. Nummela,
Eds. (1998): 14
th
IMP Annual Conference Proceedings, Interaction, Relationships and Networks:
Visions for the Future, Vol. 1: Competitive Papers, Turku, Finland: Turku School of Economics and
Business Administration, pp. 113-132.

Backhaus, K. (1995): Investitionsgtermarketing. 4
th
Edition. Munich: Verlag Vahlen.

Backhaus, Klaus and Joachim Bschken (1997): What do we know about Business-to-Business
Interactions? - A Synopsis of Empirical Research on Buyer-Seller Interactions, in Gemnden, H., T.
Ritter, A. Walter, Eds. (1997): Relationships and Networks in International Markets, Oxford:
Pergamon, pp. 13-36.

Backhaus, K., Aufderheide, D. Spth, G.-M., Eds. (1995): Marketing fr Systemtechnologien:
Entwicklung eines theoretisch-konomisch begrndeten Geschftstypenansatzes. Stuttgart: Schffer-
Poeschel.

Backhaus, K., R. Weiber (1987): Systemtechonologien - Herausforderung des
Investitionsgtermarketing in Harvard Manager, No. 4, pp. 70-80.

Backhaus, K. and Gnter, B. (1976): A Phase-Differentiated Interaction Approach to Industrial
Marketing Decisions, in Industrial Marketing Management, Vol. 5, pp. 255-270.

354
Bansard, D., B. Cova, R. Salle (1993): Project Marketing. Beyond Competitive Bidding Strategies,
International Business Review, Vol. 2, No. 2, pp. 125-141.

Barney, Jay B., William G. Ouchi, Eds. (1986): Organizational Economics: Towards a New Paradigm
for Understanding and Studying Organizations. San Francisco CA USA: Jossey-Bass.

Barth, Steffen (1997): Der Architekt als Unternehmer: Ein Leitfaden fr Studium und Praxis.
Stuttgart: Verlag W. Kohlhamer.

Beck, Thomas (1996): Die Projektorganisation und ihre Gestaltung. Berlin: Duncker und Humboldt.

Blau, Judith R. (1988): Study of the Arts: A Reappraisal, in Annual Review of Sociology, Vol. 14
(1988): pp. 269-292.

Blau, Judith R. (1984): Architects and Firms. A Sociological Perspective on Architectural Practice.
Cambridge USA: MIT Press.

Blomqvist, Kirsimarja (1997): The Many Faces of Trust, in Scandinavian Journal of Management,
Vol. 13 (1997), No. 3, pp. 271-286.

Blum, Jacques (1986): Splinten i jet. Om danskernes forhold til de fremmede. Odense, Denmark:
Odense University Press.

Boisot, Max, Dorothy Griffiths, Veronica Moles (1997): The Dilemma of Competence: Differentiation
versus Integration in the Pursuit of Learning, in in Sanchez, Ron and Aim Heene, Eds. (1997): Strategic
Learning and Knowledge Management. New York: John Wiley, pp. 65-83.

Bonnacorsi, A., F. Pammoli, S. Tani (1996): The Changing Boundaries of System Companies, in

355
Bostrup, Jens, Steen Larsen and Michael Rothenborg (April 24, 1996): Konkurrencen foregr hjemme,
in the Danish daily newspaper, Politiken.

Boswoth, M.T. (1995): Solution Selling, Creating Buyers in Difficult Sellings Markets. New York:
McGraw-Hill.

Boughton, P. (1987): The Competitive Bidding Process: Beyond Probability Models, in Industrial
Marketing Management, Vol. 16.

Bourdieu, Pierre (1996): The Rules of Art - Genesis and Structure of the Literary Field. Cambridge
UK: Polity Press.

Bourdieu, Pierre (1994): In Other Words. Cambridge UK: Polity Press.

Bourdieu, Pierre (1990): The Logic of Practice. Stanford CA USA: Stanford University Press.

Bourdieu, Pierre (1986): Distinction - A Social Critique of the Judgement of Taste. London: Routledge
(English Translation of Bourdieu, 1979).

Bourdieu, Pierre (1983): The Forms of Capital, in Richardson, John G., Ed. (1986): Handbook of
Theory and Research for the Sociology of Education. New York: Greenwood Press, pp. 241-258.

Bourdieu, Pierre (1979): La distinction. Critique sociale du jugement. Paris: Les Editions de Minuit.

Bourqui, Michel (1990): Relations interorganisationnelles et relations interpersonnelles: limpact des
rseaux sur lapproche concurrentielle des projets, in Revue Franaise du Marketing, No. 127/128,
pp. 51-61.

Brooks, Douglas G. (1978): Bidding for the Sake of Follow-On Contracts, in Journal of Marketing,
January 1978, pp. 35-38.

Bund Deutscher Architekten, German Federation of Architects (1999): 5 gute Grnde fr den
Architektenwettbewerb, Berlin: Press Release from the BDA National Secretariat.

Bund Deutscher Architekten, German Federation of Architects (1995, 1997, 1998): BDA Handbuch
1995, 1997, 1998-9. Eutin, Germany: Architektur Verlag Nord GmbH.

Bundesarchitektenkammer, German Federal Chamber of Architects (1990-1997):
Bundeskammerstatistik 1990-1998.

Burrell, Gibson (1996): Normal Science, Paradigms, Metaphors, Discourses and Genealogies of
Analysis, in Clegg, Stewart R., Cynthia Hardy, and Walter R. Nord (1996): Handbook of Organization
Studies. Thousand Oaks USA: Sage, pp. 642-658.

Burrell, G. and Morgan, G. (1979): Sociological Paradigms and Organizational Analysis. London:
Heinemann.

356
Button, Kenneth, Michael Fleming (1992): The Professions in the Single European Market: A Case Study
of Architects in the UK, in Journal of Common Market Studies, Vol. xxx, No. 4, December 1992, pp.
403-418.

Bygge- og Boligstyrelsen (May 1996): Vejledning om tjenesteydelsesdirektivets anvendelse i de
almennyttige boligselskaber. Copenhagen: Statens Information.

Bygge- og Boligstyrelsen, KonkurrenceSekretariatet (July 1993): Vejledning om
tjenesteydelsesdirektivets anvendelse i Bygge- og Anlgssektoren. Copenhagen: Statens Information.

Byrne, John A. (1993): The Virtual Corporation, in Business Week, February 8, 1993, pp. 98-102.

Brsen, Danish business daily newspaper published in Copenhagen.

Chetty, Sylvie and Kent Eriksson (1999): Market Experience and How It Influences Learning in
International Expansion, in McLoughlin, Damien and C. Horan, Eds. (1999): Proceedings of the 15
th

Annual IMP Conference. Dublin: University College Dublin.

Christensen, Poul Rind and Jesper Strandskov (1993): Konkurrence- og samarbejdsstrategier i samspil,
in Hildebrandt, Steen, Ed. (1993): Strategi og Ledelse. Veje og Visioner mod r 2000. Herning,
Denmark: Systime, pp. 287-307.

Clemensen, Jens (November 28, 1995): Arkitektens onde stedmoder, in the Danish daily newspaper,
Politiken.

Coleman, James S. (1988): Social Capital in the Creation of Human Capital, in American Journal of
Sociology, Volume 94, Supplement, pp. S95-S120.

Cooper, Harris M. (1989): Integrating Research. A Guide for Literature Reviews, Second Edition.
Newbury Park USA: Sage, Applied Social Research Methods Series, Vol. 2.

Council of the European Communities (October 13, 1997): Council Directive 92/50/EEC of 18 June 1992
relation to the coordination of procedures for the award of public service contracts as amended by
European Parliament and Council Directive 97/52/EC of 13 October 1997.

Cova, Bernard (1998): Holstius Project Marketing Cycle: A Basis for Theory Building in Project
Marketing, in Tikkanen, H., Ed. (1998): Marketing and International Business. Essays in Honour of
Professor Karin Holstius on her 65
th
Birthday, Turku, Finland: Turku School of Economics and
Business Administration, pp. 63-84.

Cova, B. (1990a): Appel doffres: du mieux disant au mieux cooprant, in Revue Franaise de
Gestion, March-April-May 1990, pp. 61-72.

Cova, B. (1990b): Marketing international de projets: un panorama des concepts et des techniques, in
Revue Franaise du Marketing, No. 127/128, pp. 9-37.

357
Cova, B., Salle, R., and Ren Vincent (1999): Project Marketing: The Catalu Shipyard Case of De/Re-
Construction of a Project, in McLoughlin, Damien and C. Horan, Eds. (1999): Proceedings of the 15
th

Annual IMP Conference. Dublin: University College.

Cova, B., S. Hoskins (1997): A Twin-Track Networking Approach to Project Marketing, in European
Management Journal, Vol. 15, October.

Cova, B., Salle, R. (1997): Management of the Atmosphere of the Extrabusiness Relationship: An
Approach Through Rituals, in Proceeding from the 13
th
IMP Conference: Interaction, Relationships
and Networks in Business Markets, Lyon France, 4 6 September 1997, Competitive Papers, Volume
3, pp. 111-137.

Cova, B., F. Mazet (1997): Joint Construction of Demand: The Dynamic of Supplier-Client Interaction in
Project Business, in Gemnden, H., T. Ritter, A. Walter, Eds. (1997): Relationships and Networks in
International Markets, Oxford: Pergamon, pp. 343-359.

Cova, B. and P. Ghauri (1996): Project Marketing. Between Mass Marketing and Networks. Working
Paper, the European Seminar on Project Marketing and System Selling.

Cova, B., F. Mazet, R. Salle (1996a): Milieu as the Pertinent Unit of Analysis in Project Marketing, in

Cova, B., F. Mazet, R. Salle (1996b): Project Negotiations: An Episode in the Relationship, in Ghauri,
P., J.-C. Usunier, Eds. (1996): International Business Negotiations, Oxford: Pergamon Press, pp. 253-
271.

Cova, B., F. Mazet, R. Salle (1994): From Competitive Tendering to Strategic Marketing: An Inductive
Approach to Theory-Building, in Journal of Strategic Marketing, Vol. 2, pp- 1-19.

Cova, B., K. Holstius (1993): How to Create Competitive Advantage in Project Business, in Journal of
Marketing Management, Vol. 9, No. 2, pp. 105-121.

Cova, B., F. Mazet, R. Salle (1993): Towards Flexible Anticipation: The Challenge of Project
Marketing, in Baker, M.J. (1993): Perspectives on Marketing Management, Vol. 3, John Wiley &
Sons Ltd.

Cova, B., D. Bansard, J.-P. Flipo (1992): Le marketing de projets: de la raction lanticipation, in
Recherche et Application en Marketing, Vol 7, No. 4, pp. 83-104.

Cova, B., P. Cova (1990): European Public Procurement Directives: Breaking Free from the Competitive
Paradigm, in European Management Journal, Autumn 1990, pp. 333-336.

Cova, B. and Timothy Allen (1989): New Vistas in Competitive Bidding Strategies, in European
Management Journal, Vol. 7, No. 4 (1989); pp. 451-456.

DAL, Danish Union of Architects (1997): Arkitektkonkurrencer. Copenhagen: DAL.

DAL (1996): Arkitekturpolitik. Copenhagen: DAL.
358

Danish Association of Consulting Engineers, F.R.I. (March 1996- March 1999, published annually): F.R.I.
Survey of Architectural and Consulting Engineering Services 1995-98: Statistical Analysis related
to the EU Services Directive.

Danish Association of Consulting Engineers, F.R.I. (February 3, 1998): Letter to Bureau Head Ms.
Merete Rasmussen, the Competition Council of the Ministry of Commerce on Barrierer for danske
virksomheders deltagelse i EU-udbud

Danish Association of Consulting Engineers, F.R.I. (9/1996): Rdgivere har det svrt med EUs
grnser, on Ingeniren NET, http://www.ing.dk/resumeer/1996/ uge09/ eulimit.html.

Danish Ministry of Commerce and Industry (June 22, 1993): Bekendtgrelse om samordning af
fremgangsmderne ved indgelse af kontrakter om offentlige indkb af tjenesteydelser i De
Europiske Fllesskaber.

Danish Ministry of Foreign Affairs (1995): Marketsorientering Tyskland. Copenhagen: TeleDanmark
Forlag.

Danish Ministry of Housing (1990 1999): Selected Press Releases concerning cooperation with
Germany or German federal states.

Danish Ministry of Housing (1997): Dokumentation. Hessisch-dnischer Holzbaukongress/ Hessisk-
dansk kongres om byggeri i Tr, March 12 13, 1997 in Wiesbaden.

Danish Ministry of Housing (1996): Kosten- und flchensparendes Bauen im Knigreich Dnemark
und in der Bundesrepublik Deutschland. Udgivet i samarbejde med Bundesministerium fr
Raumordnung Bauwesen und Stdtebau der Bundesrepublik Deutschland.

Danish Ministry of Housing (May 15, 1996): Kommuniqu ber die Zusammenarbeit zwischen dem
Ministerium fr Wohnungsbau und Bauwesen des Knigreichs Dnemark und dem Ministerium fr
Bauen und Wohnen des Landes Nordrhein-Westfalen auf dem Gebiet des Bauwesens und
Wohnungswesens.

Danish Ministry of Housing (May 16, 1995): Aftale mellem Boligministeriet i Kongeriget Danmark og
Bundesministerium fr Raumordnung, Bauwesen und Stdtebau i Forbundsrepublikken Tyskland
om programmet EUREXPER.

Danish Ministry of Housing (March 23, 1995): Kooperationsprotokoll im Bau- und
Wohnungsbaubereich zwischen dem Ministerium fr Landesentwicklung, Wohnen, Landwirtschaft,
Forsten und Naturschuz des Landes Hessen und dem dnischen Wohnungsbauministerium.

Danish Ministry of Housing (April 11, 1994): Protokoll des Gesprchs zwischen dem Dnischen
Wohnungsbauminister und dem Schsischen Staatsminister des Innern.

Danish Ministry of Housing (November 18, 1992): Kooperationsprotokoll zwischen dem Ministerium
fr Stadtentwicklung, Wohnen und Verkehr, Land Brandenburg und dem Dnischen
Wohnungsbauministerium im Bau- und Wohnungsbaubereich.
359

Danish Ministry of Housing (April 6, 1992): Kooperationsprotokoll zwischen dem Ministerium fr
Raumordnung, Stdtebau und Wohnungswesen des Landes Sachsen-Anhalt und dem Dnischen
Wohnungsbauministerium im Bau- und Wohnungsbaubereich.

Danmarks Statistik (1992-1999): Bygge- og Anlgsvirksomhed. Statistiske Efterretninger.
Copenhagen: Danmarks Statistik.

Danmarks Statistik (1992-1999): Generel Erhvervsstatistik og Handel. Statistiske Efterretninger.
Copenhagen: Danmarks Statistik.

Danmarks Statistik (1991-1996): Statistisk rbog. Copenhagen: Danmarks Statistik.

Day, David W. J. (1994): Project Management and Control. London: MacMillan.

Denzin, N.K. (1978): The Research Act.

Der Architekt. Journal published by the German Federation of Architects (BDA).

Dessinges, J. (1990): Stratgies doffres cratrices de projets, in Revue Franaise du Marketing, No.
127/128, pp. 83-89.

Deutsche Bauzeitung. Monthly German periodical for the German construction industry. Affiliated with the
German organization BDB.

Deutsches Institut fr Wirtschaftsforschung (DIW), the German Institute of Economic Research.
Statistics found at the following Internet address: http://statfinder.diw-
berlin.de/widab_html/bam_diw_bauvolumen.html.

DiMaggio, Paul J. and Walter W. Powell (1983): The Iron Cage Revisited: Institutional Isomorphism and
Collective Rationality in Organizational Fields, in American Sociological Review, Vol. 48, pp. 147-160.

Drbye, Tage (1998): Forundersgelse: Byggevirksomheders succes og fiasko p det tyske marked.
Copenhagen: Danish Ministry of Commerce (Erhversministeriet)/the Danish Agency for Trade and
Industry (Erhvervsfremmestyrelsen).

Dubois, Anna and Lars-Eriks Gadde (1999): Case Studies in Business Market Research: An Abductive
Approach, in McLoughlin, Damien and C. Horan, Eds. (1999): Proceedings of the 15
th
Annual IMP
Conference. Dublin: University College.

Dunn, D.T., C.A. Thomas (1986): Strategy for Systems Sellers: A Grid Approach, in Journal of
Personal Selling & Sales Management, Vol. 6, August, pp. 1-10.

Easton, Geoff (1995a): Methodology and Industrial Networks, in Mller, K.E. and D. Wilson (1995):
Business Marketing: An Interaction and Network Perspective. Boston: Kluwer, pp. 411-492.

Easton, Geoff (1995b): Case Research as a Methodology for Industrial Network; A Realist Apologia, in
the Proceedings of the 11
th
Annual IMP Conference, Vol. 1, pp. 368-391.
360

Easton, Geoff (1992): Industrial Networks: A Review, reprinted in Ford, David, Ed. (1997):
Understanding Business Markets, 2nd Edition. London: The Dryden Press, pp. 102-126.

Eden, Colin and J.-C. Spender (1998): Managerial and Organizational Cognition. London: Sage.

Ekstedt, Eskil, Rolf Lundin, Hans Wirdenius (1992): Conceptions and Renewal in Swedish Construction
Companies, in European Management Journal, Vol. 10, No. 2, June 1992, pp. 202-208.

Entreprenrforeningen, i.e. the Danish Association of Contractors (1996): Danske Entreprenrer i
Tyskland. Copenhagen: June 1996.

ErhvervsfremmeStyrelsen (1993): Resourceomrdet bygge/bolig - en erhvervskonomisk analyse.
Copenhagen: ErhvervsfremmeStyrelsen.

Ernst & Young (1992): Et rsregnskab skal vre retsvisende. Copenhagen: Ernst & Young.

Eurobuild (1996): Kun 1- 2 procent af byggeriet i Skandinavien gr til udenlandske entreprenrer, in
Eurobuild, No. 122, Copenhagen: European Construction Research.

European Commission (1997): Communication from the Commission to the European Parliament,
the Council, the Economic and Social Committee and the Committee of Regions on: The
Competitiveness of the Construction Industry, Version 3.3. Luxembourg: Office for Official
Publications of the European Communities.

European Commission (1994): Strategies for the European Construction Sector. A Programme for
Change. Luxembourg: Office for Official Publications of the European Communities.

European Construction Research (1995): Bygge- og Ejendomsmarkedet i Vesttyskland. Glostrup,
Denmark: European Construction Research.

Eurostat (1996): International Trade in Services 1985-1994. Luxembourg: Office for Official
Publications of the European Commuities.

Eurostat (1995): Architects, in Eurostat (1995): Panorama of EU Industry 95/96. Luxembourg: Office
for Official Publications of the European Communities, pp. 24-38 - 24-40.

Fletcher, Keith and Colin Wheeler (1989): Market Intelligence for International Markets, in Marketing
Intelligence & Planning, Vol. 7 (1989); Iss. 5,6, pp. 30-34.

Flick, Uwe, Ernst v. Kardorff, Heiner Keupp, Lutz v. Rosenstiel, Stephan Wolff (1995): Handbuch
Qualitative Sozialforschung: Grundlagen, Konzepte, Methoden und Anwendungen, 2. Auflage.
Weinheim, Germany: Beltz, Psychologie-Verl.-Union.

Fonfara, Krzysztof (1989): Relationships in the Complex Construction Venture Market, in Cavusgil, Ed.
(1989): Advances in International Marketing, Vol. 3, Greenwich: JAI Press, pp. 235-249.

Forchhammer, Ib (July 26, 1995): Mimi Jakobsen til EU-kommissionen, in the Danish business daily
361
newspaper, Brsen.

Ford, David, Ed. (1997): Understanding Business Markets, Second Edition. London: The Dryden
Press.

Ford, David (1980): The Development of Buyer-Seller Relationships in Industrial Markets, in Ford,
David, Ed. (1997): Understanding Business Markets, Second Edition. London: The Dryden Press, pp.
39 - 54.

Fowler, Bridget (1997): Pierre Bourdieu and Cultural Theory. London: Sage Publications.

Freidson, Eric (1983): The Theory of the Professions: State of the Art, in R. Dingwall and P. Lewis,
Eds. (1983): The Sociology of the Professions, London: Macmillan, pp. 19-37.

Friedman, L. (1956): A Competitive Bidding Strategy, in Operations Research, Vol. 4, pp. 104.112.

Frisch-Jensen, Michael (Februar 3, 1999): Formandens udkast til konklusioner og anbefalinger.
Materialet til temaseminar om internationale projekter, onsdag den 3, marts 1999 i Gammel Dok. Danish
Ministry of Housing: Projekt Renovering.

Galkowski, Bartosz Michael, Sandra Gleesborg, Henriette Khrsen, Timo Larsen (1997): Berlin -
Europas strste byggeplads. Copenhagen Business School: 2
nd
year seminar paper, SPRK course of
study.

Gemnden, Hans Georg, Thomas Ritter and Peter Heydebreck (1996): Network Configuration and
Innovation Success: An Empirical Analysis in German High-Tech Industries, in International Journal of
Research in Marketing, Vo. 13, No. 5, Dec. 1996, pp. 449-462.

Gemnden, Hans Georg, Achim Walter (1995a): Der Beziehungspromotor. Schlsselperson fr inter-
organisationale Innovationsprozesse (Innovationsfhigkeit), in Zeitschrift-fr-Betriebswirtschaft, Vol.
65:9, September 1995, pp. 971-986.

Gemnden, Hans Georg, Achim Walter (1995b): Der Beziehungspromotor. Schlsselperson fr inter-
organisationale Innovationsprozesse. Karlsruhe, Germany: IABU, Institut fr Angewandte
Betriebswirtschaftslehre und Undernehmensfhrung.

Gemnden, Hans Georg, Thomas Ritter and Peter Heydebreck (1995): The Influence of Business
Strategies on Techonological Network Activities, in Research Policy, Vol. 24, Iss. 6, November 1995,
pp. 831-849.

Gemnden, Hans Georg and Peter Heydebreck (1994): Geschftsbeziehungen in Netzwerken.
Instrumente der Stabilittssicherung und Innovation. in Kleinaltenkamp, Michael and Klaus Schubert
(1994): Netzwerkanstze im Business-to-Business Marketing: Beschaffung, Absatz und
Implementierung Neuer Technologien. Wiesbaden: Gabler, pp. 251-284.

Gemnden, Hans Georg and Walter, Achim (1994): The Relationship Promoter - Key Person for Inter-
Organizational Innovation Processes, in Sheth, Jagdish N. and Parvatiyar, Atul (1994): Relationship
362
Marketing: Theory, Methods and Applications, Proceedings of the Second Research Conference on
Relationship Marketing. Atlanta USA: Center for Relationship Marketing, Goizueta Business School.

Gemnden, Hans Georg (1990): Innovationen in Gechftsbeziehungen und Netzwerken, Karlsruhe,
Germany: IABU, Institut fr Angewandte Betriebswirtschaftslehre und Unternehmensfhrung.

Gemnden, Hans Georg (1986): Promotors - Key Persons for the Development and Marketing of
Innovative Industrial Products, in Backhaus, Klaus and David T. Wilson, Eds. (1986): Industrial
Marketing: A German-American Perspective. Berlin, New York and Tokyo: Springer Verlag, pp. 134-
166. This article was also reprinted in Gronhaug, Kjell and Geir Kaufmann, Eds. (1998): Innovation: A
Cross-Disciplinary Perspective. Oslo: Norwegian University Press, pp. 347-74.

Gerkan, Meinhard von (1995): Architektur im Dialog: Texte zur Architekturpraxis. Berlin: Ernst &
Sohn.

Ghauri, P.N. (1998): Negotiating Projects with China (PRC), in Tikkanen, H., Ed. (1998): Marketing
and International Business. Essays in Honour of Professor Karin Holstius on her 65
th
Birthday,
Turku, Finland: Turku School of Economics and Business Administration, pp. 85-102.

Ghauri, P.N. (1983): Negotiating International Package Deals - Swedish Firms and Developing
Countries. Ph.D. Thesis, Uppsala: Department of Business Studies, University of Uppsala.

Giddens, Anthony (1993): New Rules of Sociological Method: A Positive Critique of Interpretive
Sociologies. 2
nd
Edition. Cambridge UK: Polity Press.

Glaser, Gerhard (1993): Grenzen der Harmonisierung oder Kultur als Barriere, in Wirtschaftsjournal,
No. 8, February 1993.

Glaser, Hermann (1991): Kleine Kulturgeschichte der Bundesrepublik Deutschland 1945 1989. 2.,
durchgesehene Auflage. Munich: Carl Hanser Verlag.

Greenwood, R., C.R. Hinings, J. Brown (1990): P2-Form Strategic Management: Corporate Practices in
Professional Partnerships, in Academy of Management Journal, Vol. 33, pp. 725-755.

Guba, Egon G. (1990): The Alternative Paradigm Dialog, in Guba, Egon G., Ed. (1990): The Paradigm
Dialog. Newbury Park USA: Sage, pp. 17-30.

Gummeson, Evert (1987): The New Marketing - Developing Long-Term Interactive Relationships, in
Long Range Planning, Vol. 20, No. 4, pp. 10-20.

Gnter, B. (1988): Systemdenken und Systemgeschft in Marketing, in Marktforschung &
Management, No. 4/88, pp. 106-110.

Gnter, B., A. Bonaccorsi (1996): Project Marketing and Systems Selling: In Search of Frameworks and
Insights, in International Business Review, Vol. 5, No. 6, pp. 531-537.

Haagensen, Hans (1990): Schchternheit oder Selbstgengsamkeit, in Der Architekt, May 1990, pp.
240 242.
363

Hadjikhani, A. (1996): Project Marketing and the Management of Discontinuity, in International
Business Review, Vol. 5, No. 3, pp. 319-336.

Hadjikani, A. (1992): Managing Internaitonal Package Deal Projects, in Forsgren, M. and J. Johanson,
Eds. (1992): Managing Networks in International Business, Philadelphia: Gordon and Breach, pp. 138-
150.

Hadjikhani, A. (1984): Organization of Manpower Training in International Package Deal Projects.
Temporary Organizations for the Transfer of Technology. Ph.D. Thesis, Uppsala: Department of
Business Studies, University of Uppsala.

Hgg, I. and Jan Johansson, Eds. (1982): Fretag i ntverk - en ny syn p konkurrenskraft.
Stockholm: SNS.

Halinen, Aino and Jan-ke Trnroos (1998): The Role of Embeddedness in the Evolution of Business
Networks, in Scandinavian Journal of Management, Vol. 14, No. 3, pp. 187-205.

Hall, Richard (1997): Complex Systems, Complex Learning, and Competence Building, in in Sanchez,
Ron and Aim Heene, Eds. (1997): Strategic Learning and Knowledge Management. New York: John
Wiley, pp. 39-64.

Halln, Lars (1992): Infrastructural Networks in International Business, in Ford, David, Ed. (1997):
Understanding Business Markets, Second Edition. London: The Dryden Press, pp. 214-226.

Halln, Lars and Jan Johanson (1985): Industrial Marketing Strategies and Different National
Environments, in Ford, David, Ed. (1997): Understanding Business Markets, Second Edition. London:
The Dryden Press, pp. 326-340.

Halskov, Lars (1995): Tysk eksporteventyr med store skrammer, in the Danish newspaper Berlingske
Tidende, Wednesday, October 18, 1995.

Hannaford, William J. (1976): Systems Selling: Problems and Benefits for Buyers and Sellers, in
Industrial Marketing Managment, Vol. 5 (1976), pp. 139-145.

Hansen, Gyde (1995): Einfhrung in das bersetzen. Copenhagen: Copenhagen Business School Press.

Hansen, Jan W., Gsta Knudsen, Nils-Ole Lund, Erik Nygaard, Marius Lyhne-Knudsen (1994): Dansk
arkitektur. Vilkr, muligheder og udfordringer. rhus: Forlaget Klim.

Hardy, L.W. and E. Davies (1983): The Marketing of Services in the UK Construction Industry, in
European Journal of Marketing, Vol. 17 (1983), No. 4, pp. 5-17.

Harrigan, John E. and Paul R. Neel (1996): The Executive Architect. New York: John Wiley.

Hartmann, Michael C. (1997): TYD - hvad nu?, in Byggeindustrien, a Danish construction industry
periodical, Vol. 48, No. 4 (1997), pp. 10-13.

364
Hartmann, Michael and Adam Trier Jacobsen (1994): EU, Atkins Rapporten og Byggeriets Udvikling,
in Byggeindustrien, No. 6 (1994), pp. 30-31.

Hartung, Annette (1997): Vi nyder godt af det tyske husbehov, in Ingeniren, No. 15, 11/4-1997, p.
3.

Havila, Virpi, Hkansson, Hkan, Pedersen, Ann-Charlott (1998): Requirements for Inter-Organisational
Learning: A Study of a Swedish Construction Project, in Halinen, K., N. Nummela, Eds. (1998): 14
th

IMP Annual Conference Proceedings, Interaction, Relationships and Networks: Visions for the
Future, Vol. 2: Work-in-Progress Papers, Turku, Finland: Turku School of Economics and Business
Administration, pp. 463-480.

Hayek, Friedrich A. (1945): The Use of Knowledge in Society, in American Economic Review, Vol.
35, pp. 519-530.

Hayek, Friedrich A. (1937): Economics and Knowledge.

Hedaa, Laurids (1996): Customer Acquisition in Sticky Business Markets, in International Business
Review, Vol. 5 (1996), No. 5, pp. 509-530.

Hedaa, Laurids (1995): Understanding Portfolios of Customer Relations, Copenhagen Business
School: Management Research Institute: Working Paper 21.

Hedaa, Laurids (1994): Black Holes in Networks - An Essay, Copenhagen Business School:
Management Research Institute: Working Paper 14.

Hedaa, Laurids (1992a): Under Norms of Long Lasting Supplier Customer Relationships - How Are
New Relationships Established?, Copenhagen Business School: Management Research Institute:
Working Paper 4.

Hedaa, Laurids (1992b): Et essay om strategiske netvrk, in Ledelse og Erhvervskonomi, 1992,
Jan. Vol. 56:1, pp. 5-10.

Hedaa, Laurids and Jan-ke Trnroos (1997): Understanding Event-Based Business Networks.
Copenhagen Business School: Department of Management, Politics and Philosophy: Working Paper 10-
1997.

Heide, Jan B. and George John (1995): Measurement Issues in Research on Inter-Firm Relationships,
in Mller, Kristian and David Wilson (1995): Business Marketing: An Interaction and Network
Perspective. Norwell MA USA: Kluwer Academic Publishers, pp. 531-554.

Heide, Jan B. and George John (1990): Alliances in Industrial Purchasing: The Determinants of Joint
Action in Buyer-Supplier Relationships, in Journal of Marketing Research, Vol. XXVII (February
1990), pp. 24-36.

Hellgren, Bo and Torbjrn Stjernberg (1995): Design and Implementation in Major Investments - A
Project Network Approach, in Scandinavian Journal of Management, Vol. 11, No. 4, pp. 377-394.

365
Hellgren, Bo, Leif Melin and Anders Pettersson (1993): Structure and Change: The Industrial Field
Approach, in Cavusgil, S. Tamer, Ed. (1993): Advances in International Marketing, Vol. 5, Industrial
Networks, pp. 87-106. JAI Press.

Helmericks, Steven G., Randal L. Nelsen, N. Prabha Unnithan (1991): The Researcher, the Topic, and
the Literature: A Procedure for Systematizing Literature Searches, in Journal of Applied Behavioral
Science, Vol. 27 (1991), No. 3 (Sept.), pp. 285-294.

Hillmann, Karl-Heinz (1994): Wrterbuch der Soziologie. 4., berarbeitete und ergnzte Auflage.
Stuttgart, Germany: Krner Verlag.

Hofstede, Geert (1983): The Cultural Relativity of Organizational Practices and Theories, in Journal of
International Business Studies, Fall 1983, pp. 75-89.

Holm, Dsire Blankenburg and Jan Johanson (1997): Business Network Connections and the
Atmosphere of International Business Relationships, in Bjrkman, Ingmar and Mats Forsgren (1997):
The Nature of the International Firm, Copenhagen: Copenhagen Business School Press, pp. 411-432.

Holmen, Elsebeth, Ann-Charlott Pedersen, Tim Torvatn (1999): Is it Possible to Conceptualize the
Interplay between Structure and Process in the Industrial Network Approach?, in McLoughlin, Damien
and C. Horan, Eds. (1999): Proceedings of the 15
th
Annual IMP Conference. Dublin: University
College.

Holmlund, Maria and Jan-ke Trnroos (1997): What are relationships in business networks?, in
Management Decision, Vol. 35 (1997), No. 4, pp. 304-9.

Holstius, Karin (1993): Managing Technology Transfer. A New Success Factor in International
Business Operations. Turku: Finland: Turku School of Economics and Business Administration.

Holstius, Karin (1989): Project Business as a Strategic Choice. A Theoretical and Empirical Study of
Project Marketing. Research Report 12/1989, Lappeenranta University of Technology, Finland.

Holstius, Karin (1987): Project Export. Research Report 1: 1987. Lappeenranta University of
Technology, Finland.

Holstius, Karin and Bernard Cova (1990a): A Model for Creating Competitive Advantage in Project
Business, Research Report 28, Lappeenranta University of Technology, Finland.

Holstius, Karin and Bernard Cova (1990b): Le cycle marketing du projet: Fondement pour un marketing
de projet, in Revue Franaise du Marketing, 1990/2-3, No. 127-128, pp. 91-106.

Huovinen, Pekka and Juhani Kiiras (1998): Procurement Methods as Determinant for Interactions and
Networking within the EU Building Industry, in Halinen, K., N. Nummela, Eds. (1998): 14
th
IMP
Annual Conference Proceedings, Interaction, Relationships and Networks: Visions for the Future,
Vol. 2: Work-in-progress Papers, Turku, Finland: Turku School of Economics and Business

366
Hkansson, Hkan, Ed. (1992): Evolution processes in industrial networks, in Axelsson, Bjrn and
Geoffrey Easton, Eds. (1992): Industrial Networks. A New View of Reality. London: Routledge, pp.
129-143.

Hkansson, Hkan, Ed. (1987) Industrial Technological Development: A Network Approach.
London: Croom Helm.

Hkansson, Hkan, Ed. (1982): International Marketing and Purchasing of Industrial Goods - An
Interaction Approach. Chichester UK: Wiley.

Hkansson, Hkan and Ivan Snehota (1995): Developing Relationships in Business Networks. London:
Routledge.

Hkansson, Hkan and Jan Johanson (1993): The Network as a Governance Structure: Interfirm
Cooperation beyond Markets and Hierarchies, in Grabher, Gerhard (1993): The Embedded Firm.
London: Routledge, pp. 35-49.

Hkansson, Hkan and Jan Johanson (1992): A Model of Industrial Networks, in Ford, David, Ed.
(1997): Understanding Business Markets, 2
nd
Edition, London: The Dryden Press, pp. 129-135.

Hkansson, Hkan and Ivan Snehota (1992): No Business is an Island: The Network Concept of
Business Strategy, in Ford, David, Ed. (1997): Understanding Business Markets, 2
nd
Edition, London:

Hkansson, Hkan and Jan Johanson (1984): Heterogeneity in Industrial Markets and its Implications for
Marketing, in Hgg, Ingemund and Finn Wiedersheim-Paul, Eds. (1984): Between Market and
Hierarchy. Uppsala: Uppsala University.

Hndvrksrdet (1994): De gule plader - en undersgelse af den danske byggeeksport til Tyskland.
Copenhagen: Hndvrksrdet.

Hndvrksrdet (1992): Byggeeksport til Tyskland. Odense, Denmark: Alo Tryk.

Institution of Civil Engineers (1985): Management of International Construction Projects. London:
Thomas Telford, Proceedings of a Conference organized by The Institution of Civil Engineers, November
14-15, 1984.

Jarlner, Michael (1994): Store arkitektfirmaer i konomisk klemme, in the Danish newspaper Politiken,
January 21, 1994.

Jansson, H. (1989): Marketing of Projects in South-East Asia, in Cavusgil, Ed. (1989): Advances in
International Marketing, Vol. 3, Greenwich: JAI Press, pp. 259-276.

Jansson, H., Mohd. Saqib, and Deo Sharma (1990): A Methodology for the Study of Trans-
Organizational Networks. Working Paper Series 1990/7, Institutet fr Ekonomisk Forskning, University
of Lund, Sweden.

367
JB Business Information (1997): Arkitekter & Tegnestuer. April 1997, 7. udgave. Vol 1-2.
Copenhagen: JB Business Information.

Jensen, Trine Kaare (June 1, 1995): Arkitekter vinder konkurrence i Tyskland in Brsen, a Danish
business daily newspaper.

Jochem, Rudolf (1998): Verdingungsordnung fr freiberufliche Leistungen VOF, in Deutsches
Architektenblatt DAB, 1. Januar 1998/30. Jahrgang, pp. 49-54.

Johanson, Jan and Lars-Gunnar Mattsson (1988a): Internationalisation in Industrial Systems - a Network
Approach, in Ford, David, Ed. (1997): Understanding Business Markets, Second Edition. London:

Johanson, Jan and Lars-Gunnar Mattsson (1988b): Network Positions and Strategic Action - An
Analytical Framework in Ford, David, Ed. (1997): Understanding Business Markets, 2
nd
Edition,
London: The Dryden Press, pp. 205-214.

Johanson, Jan and Lars-Gunnar Mattsson (1987): Interorganisational Relations in Industrial Systems: A
Network Approach Compared with a Transaction Cost Approach, in International Studies of
Management Organisation, Vol. 17, No. 1, p. 34-48.

Johanson, Jan and Lars-Gunar Mattsson (1986): Interorganisation Relations in Industrial Systems: A
Network Approach Compared with a Transaction Cost Approach, Working Paper. University of
Uppsala, Sweden.

Johanson, Jan and Jens-Erik Vahlne (1977): The Internationalisation Process of the Firm - A Model of
Knowledge Development and Increasing Market Commitment, in Journal of International Business
Studies, Vol. 8 (1977), No. 2, pp. 23 - 32.

Jrgensen, Per Schultz (1989): Om kvalitative analyser - og deres gyldighed, in Nordisk Psykologi,
1989, Vol. 41, No. 1, pp. 112-128.

Kadefors, A. (1995): Institutions in Building Projects: Implications for Flexibility and Change, in
Scandinavian Journal of Management, Vol. 11, No. 4, pp. 395-408.

Kallinikos, J. (1986): Networks as webs of signification. Working Paper, Uppsala University, Sweden.

Klagenvnet for Udbud (the Danish Competition Authoritys Complaints Council): Kendelse fra
Klagenvnet for Udbud, http://www.ks.dk/udbud/kendelser.html.

Kleckers, Dorthe, Helle Kofod, Jette Kristensen, Charlotte Koch (1989): A5 Tegnestuen p vej mod det
spanske market. Holder kursen? Copenhagen Business School: 3 year seminar paper, SPRK course
of study.

Korst, Mogens (1997): Tyskland ved en skillevej, in Ingeniren, No. 11, 14/3-1997, p. 18.

Kosonen, H. M. (1991): The Internationalization of Industrial System Suppliers. A Case Study of the
Internationalization Process of Industrial Systems Suppliers with Special Emphasis on Strategy and
368
Organization. Ph.D. Thesis, Publications of the Helsinki School of Economics and Business
Administration.

Kosonen, H. M. (1990): Systems Sales as an International Business Strategy for Industrial
Companies - A Theoretical Approach. Publications of the Helsinki School of Economics and Business
Administration.

Kragballe, Sren (1996): Entreprenrerne trygnet i Tyskland, in the Danish newspaper Brsen, April 5,
1996.

Kristensen, Helen (1997a): Erfaringer med anvendelse af EUs tjenesteydelsesdirektiv, in
Byggeindustrien, a Danish construction industry periodical, Vol. 48, No. 1 (1997), pp. 26-28.

Kristensen, Helen (1997b): Udbud efter EUs udbudsdirektiver, in Stads- og Havneingeniren, the
Danish journal for publically employed civil engineers, Vol. 88, No. 4 (1997), pp. 34, 36-39.

Kvale, Steinar (1996): InterViews. An Introduction to Qualitative Research Interviewing. London:
Sage.

Larson, Magali Sarfatti (1977): The Rise of Professionalism: A Sociological Analysis. Berkeley USA:
University of California Press.

Lehrskov, Carsten (1996): Analyse af renoveringsmarkedet i Tyskland. Copenhagen: European
Construction Research in cooperation with Projekt Renovering (Project Renovation).

Lehrskov, Carsten and Niels Jrgensen (1995): Europas strste Byggefirmaer. Copenhagen: European
Construction Research.

Leibert, James G. (1996): Research Integration in Social Science - Using Meta-Analysis, in Great
Plains Sociologist, Vol. 9, No. 1, pp. 46-56.

Lemert, Charles C. (1981): French Sociology. Rupture and Renewal since 1968. New York: Columbia
University Press.

Lethan, Flemming (1995): De frste r med tjenesteydelsesdirektivet, in Byggeindustrien, a Danish
construction industry periodical, Vol. 46, No. 4, pp. 33-35.

Lubanski, Nikolaj (1999): Europisering af Arbejdsmarkedet. Bygge- og Anlgssektoren i Tyskland,
Danmark og Sverige. Copenhagen: Jurist- og konomforbundets Forlag. A Ph.D. Dissertation submitted
to the Department of Sociology, Copenhagen University with an English Summary.

Lund, Nils-Ole (1998): Bygmesteren C.F. Mller. rhus, Denmark: Aarhus Universitetsforlag.

Lundgren, A. (1992): Coordination and mobilisation processes in industrial networks, in Axelsson,
Bjrn and Geoffrey Easton (1992): Industrial Networks - A New View of Reality, London: Routledge,
pp. 144-165.

369
Luostarinen, Reijo and Lawrence Welch (1990): International Business Operations. Helsinki: KY Book
Store, Helsinki School of Economics.

Lwendahl, Bente R. (1997): Strategic Management of Professional Service Firms. Copenhagen:
Copenhagen Business School Press.

Maale, Erik (1996): Case-studier af og om mennesker i organisationer. Copenhagen: Akademisk
Forlag A/S.

Madsen, Ole Hier (1991): Netvrkssamarbejde i rdgivningsbranchen indenfor byggesektoren.
Copenhagen: Thesis, Course of study: HD in Organizational Studies.

Magalhes, Rodrigo (1998): Organizational Knowledge and Learning, in von Krogh, Georg, Johan
Roos, and Dirk Kleine (1998): Knowing in Firms. London: Sage, pp. 87 - 122.

Majkgrd, Anders and D. Deo Sharma (1998): Client-Following and Market-Seeking Strategies in the
Internationalization of Service Firms, in Journal of Business-to-Business Marketing, Vol. 4 (3) 1998,
pp 1-41.

Mandjk, T., Z. Veres (1998): The D-U-C Model and the Stages of Project Marketing Process, in
Halinen, K., N. Nummela, Eds. (1998): 14
th
IMP Annual Conference Proceedings, Interaction,
Relationships and Networks: Visions for the Future, Vol. 1: Competitive Papers, Turku, Finland:
Turku School of Economics and Business Administration, pp. 471-490.

Marquart, Christian (1997): Marketing und ffentlichkeitsarbeit fr Architekten und Planer. Stuttgart:
av-Edition.

Marshall, C. and G. Rossman (1989): Designing Qualitative Research. Newbury Park CA USA: Sage.

Mattsson, L.G. (1988): Interaction Strategies: A Network Approach, Paper presented at the AMA
Marketing Educators Conference, Summer, San Francisco, California USA,

Mattsson, L.G. (1986): Indirect Relationships in Industrial Networks: A Conceptual Analysis of their
Significance, Paper presented at the 3
rd
IMP International Seminar at IRE, Lyon, France.

Mattsson, L.G. (1984): An Application of a Network Approach to Marketing: Depending and Changing
Market Positions, in N. Dholakia and J. Arndt, Eds. (1984): Changing the Course of Marketing.
Alternative Paradigms for Widening Marketing Theory. Greenich, Conn. USA: JAI Press.

Mattsson, L.G. (1973): System Selling as a Strategy on Industrial Markets, in Industrial Marketing
Management, Vol. 3 (1973), pp. 107-119.

Mazet, F., B. Cova (1992): Project Marketing Strategies: Pell-Mell or Planned?, in Proceedings of the
8
th
IMP Conference Business Networks in an International Context, Lyon, Septeber 3- 5, 1992,
pp. 229-249.

McCracken, Grant (1988): The Long Interview. London: Sage.

370
Melin, Leif (1989): The Field-of-Force Metaphor, in Cavusgil, s. Tamer, Ed. (1989): Advances in
International Marketing. JAI Press, pp. 161-179.

Messner, John I. (1994): An Information Framework for Evaluating International Construction
Projects. The Pennsylvania State University Graduate School USA: Ph.D. Dissertation.

Meyer, Katrina A. (1988): How Well Do Grantsmanship Guides Address the Literature Review?, in
Journal of the Society of Research Administrators, Vol. 20, Issue 33, Winter 1988, pp. 29-33.

Milgrom, Paul and John Roberts (1992): Economics, Organization, and Management. Englewood Cliffs
NJ USA: Prentice Hall.

Mintzberg, H., S. Otis, J. Shamisie, J.A. Waters (1988): Strategy og Design: A Study of Architects in
Co-Partnership, in Grant, J.H., Ed. (1988): Strategic Management Frontiers, Greenwich, Conn.
USA: JAI Press, pp. 311-360.

Molander, Bengt (1992): The Practical Intellect - Design and Use of Knowledge, in Kazemian, Ed.
(1992): Conference Proceedings. Internationial Conference on Theories and Methods of Design,
Chalmers, Sweden: Royal Institute of Technology/Chalmers University of Technology, May 13-15, 1992,
pp. 101-119.

Morgan, Robert E., Susan K. Foreman, Tony C.C. Poh (1994): Assessing the Status of Marketing in
Architectural Service Firms, in Management Decision, Vol. 32, No. 4, 1994, pp. 36-42.

Mose, Peter (May 6, 1997): Ministerium erkender brud p EU-regler, in the Danish daily newspaper,
Politiken.

Mose, Peter (May 6, 1997): Vi er blandt de vrste syndere i EU, in the Danish daily newspaper,
Politiken.

Mose, Peter (May 5, 1997): Udenrigsministeriet bygger ulovligt i Berlin, in the Danish daily newspaper,
Politiken.

Mller, K.E. Kristian (1993): Interorganizational Marketing Exchange: Metatheoretical Analysis of
Current Research Approaches, in Laurent, Gilles, Gary L. Lilien, Bernard Pras, Ed. (1993): Research
Traditions in Marketing. Boston: Kluwer Academic Publishers, pp. 347-382.

Mller, K.E. Kristian (1991): Marketing and Strategy Interface, in Nsi, Juha, Ed. (1991): Arenas of
Strategic Thinking. Helsinki: Foundation for Economic Education of Finland.

Mller, K.E. Kristian, David T. Wilson (1995): Business Marketing: An Interaction and Network
Perspective. Bosten: Kluwer Academic Publishers.

Mller, K.E. Kristian, David T. Wilson (1989): Interaction Perspective in Business Marketing. Helsinki:
Helsinki School of Economics, Working Paper F-234.

Mller, C.F. (1978): Aarhus Universitets Byginger. rhus, Denmark: Universitetsforlaget i Aarhus.

371
Mller, Henrik Steen (February 21, 1995): Kun sm lande bruger direktiv, in the Danish daily
newspaper, Politiken.

Mller, Henrik Steen (January 26, 1995): Direktiv afvises af andre lande, in the Danish daily newspaper,
Politiken.

Neusss, Wolfgang (1996): GRW 1995: Was ndert sich im Wettbewerbswesen? Teil 1, in
Bundesbaublatt, Heft 3/96, pp. 174-178.

Nonaka, Ikujiro and Hirotaka Takeuchi (1995): The Knowledge-Creating Company. How Japanese
Companies Create the Dynamics of Innovation. New York: Oxford University Press.

OECD (1996): International Trade in Professional Services. Assessing Barriers and Encouraging
Reform. Paris: OECD.

Oliver-Taylor, E.S. (1993): The Construction Industry of the European Community. Beckenham,
Kent, United Kingdom: STEM SYSTEMS Ltd.

Ortving, Hans Henrik (March 23, 1995): Direktiv med mange forhindringer, in the Danish business daily
newspaper, Brsen.

Oxley, R. and J. Poskitt (1996): Management Techniques applied to the Construction Industry, 5
th

Edition. Oxford: Blackwood Science.

Owusu, R.A. (1997): The Nature and Development of Relationships in International Project Business: A
Network Approach, in Mazet, F., R. Salle, J. Valla, Eds. (1997): 13
th
IMP Conference: Interaction,
Relationships and Networks in Business Markets, Proceedings. Competitive Papers, Lyon, pp. 483-
505.

Page, Albert L., M. Siemplenski (1983): Product Systems Marketing, in Industrial Marketing
Management, Vol 12 (1983), pp. 89-99.

Paliwoda, S.J., P. Thomson (1987): Systems Selling in the French Packaging Industry, in Journal of
Marketing Management, Vol. 12 (1983), pp. 89-99.

Panduro, Arne (March 7, 1997): Ministerium indklages for at overtrde EU-direktiv, in the Danish daily
newspaper, Morgenavisen Jyllands-Posten..

Parish, A.R. (1996): The Changing Role of Consultants, in Institution of Civil Engineers (1985):
Management of International Construction Projects. London: Thomas Telford, Proceedings of a
Conference, pp. 115-124.

Petersen, Bent and Torben Pedersen (1996): Twenty Years After - Support and Criticque of the Uppsala
Internationalisation Model, in Bjrkman, Ingmar and Mats Forsgren (1996): The Nature of the
International Firm. Copenhagen: Copenhagen Business School Press, pp. 117-134.

Petersen, Lars Holten (8/1997): Valg af rdgiver i konkurrence: tjenestydelsesdirektivet dur ikke for
rdgivende ingenirydelser, in the Danish Society of Engineers periodical, Ingeniren, pp. 10-11.
372

Politiken, Danish daily newspaper published in Copenhagen.

Polyani, M. (1962): Personal Knowledge. Chicago: University of Chicago Press.

Porter, Michael (1985): Competitive Advantage: Creating and Sustaining Superior Performance.
New York: The Free Press.

Porter, Michael (1980): Competitive Strategy: Techniques for Analyzing Industries and Competitors.
New York: The Free Press.

Praktiserende Arkitekternes Rd (PAR), the Danish Council of Practicing Architects (1992): PARs
Eksportundersgelse 1991. Copenhagen: PAR.

Praktiserende Arkitekternes Rd (1998): Eksportomstning PAR 1990 1998. Copenhagen: PAR,
statistics provided by Paul Jeppesen, PARs Secretary for International Affairs.

Preuss, Steffan (December 8, 1995): Arkitekterne blev ramt af byggekristen, in Dagbladet
Licitationen, s. 7.

Priem, Richard L., Abdul M.A. Rasheed, Shahrzad Amirani (1997): Aldersons transvection and
Porters value system: a comparison of two independently-developed theories, in Journal of
Management History, Vol. 3, No. 2, 1997, pp. 145-165.

Prinz, Tillman (1998): Gerechtfertigte Richtlinien, in Der Architekt, 11/1998, pp. 600-605.

Qulin, Bertrand (1997): Appropriability and the Creation of New Capaiblities Through Strategic
Alliances, in in Sanchez, Ron and Aim Heene, Eds. (1997): Strategic Learning and Knowledge
Management. New York: John Wiley, pp. 139-161.

Redder, Hakon (August 24, 1995): Kaos om udbud af rdgivningsopgaver, in the Danish business daily
newspaper, Brsen.

Redder, Hakon (June 16, 1995): Noter, in the Danish business daily newspaper, Brsen.

Rekom, Johan van (1993): The postmodern heart of successful logical positivism, in Elfring, Tom, Hans
Siggaard Jensen and Arthur Money, Eds. (1993): European Research Paradigms in Business Studies.
Copenhagen: Munksgaard International Publishers Ltd., pp. 121-135.

Rigby, B. (1991): Popular Culture in Modern France. London: Routledge and Kegan Paul.

Ronkainen, Ilkka A. (1984) Project Exports and the CMEA, in Kaynak, Erdener, Ed. (1984):
International Marketing Management. New York: Praeger, pp. 305-318.

Root, Franklin R. (1994): Entry Strategies for International Markets, Revised and Expanded Edition.
San Francisco USA: Lexington Books.

373
Rudelius, William, Steven M. Hartley, and Raymond E. Willis (1990): A Sales Forecasting Model for
Firms Selling Projects To Order, in Woodside, Arch G. (1990): Advances in Business Marketing,
Vol. 4, Greenich USA: JAI Press, pp. 147-176.

Rudolph-Cleff, Annette and Gnther Uhlig (1997): Neue Anforderungen an den Architekten in
Deutschland, Manuskript zum Vortrag in Paris 1997, Sminaire de recherche prospective Les conditions
et les modalits des commandes architecturales et urbaines: Comparaisons europennes. Karlsruhe,
Germany: University of Karlsruhe, Department of Architecture.

Salminen, Risto T. (1997): Role of References in International Industrial Marketing A Theory-
Building Case Study about Suppliers Processes of Utilizing References. Lappeenranta University of
Technology, Finland: Doctoral Dissertation.

Sanchez, Ron and Aim Heene, Eds. (1997): Strategic Learning and Knowledge Management. New
York: John Wiley.

Schfers, Bernhard and Wolfgang Zapf, Eds. (1998): Handwrterbuch zur Gesellschaft Deutschlands.
Opladen, Germany: Leske+Budrich.

Schaumburg-Mller, Henrik and Bodil Khn (1988): Rdgivende ingenirvirksomhed, in Mller, Kim
and Henrik Pade, Eds. (1998): Industriel succes Konkurrencefaktorer i 9 danske brancher.
Copenhagen: Samfundslitteratur, pp. 417 445.

Schlsser, Kurt (1994): VOF Ein Zwischenbericht, in Deutsche Bauzeitung DBZ 1/94, p. 10.

Schmidt, Siegfried J., Ed. (1987): Der Diskurs des Radikalen Konstruktivismus. Frankfurt am Main:
Suhrkamp.

Scholz, Christian (1991): Projektkultur: Der Beitrag der Organisationskultur zum Projektmanagement, in
Zeitschrift Fhrung und Organisation, Vol. 60, No. 3, Mai/Juni, pp. 143-150.

Schramm-Nielsen, Jette (1992): Danish Culture Danish Management Culture. Conference Paper, the
SIETAR XVIII International Annual Congress, Montega Bay, Jamaica, 1992.

Schramm-Nielsen, Jette (1991): Relations du travail entre Danois et Franais dans les entreprises
prives, in Franck Gauthey and Dominique Xardel, Eds. (1991): Management interculturel, Modes et
moddes. France: Economica.

Schramm-Nielsen, Jette and Peter Lawrence (1997): Scandinavian Management. A Cultural
Homogeneity beyond the Nation State, in Enterprises et histoire, Paris, France.

Schriesheim, F., J. von Glinow, and Kerrs, S. (1997): Professionals in Bureaucracies: A Structural
Alternative, in Nystrom, P.C. and Starbuck, W.H. (Eds.): Prescriptive Models of Organizations.
Amsterdam: North-Holland, pp. 55-69.

Schubert, Klaus (1994): Netzwerke und Netzwerkanstze: Leistungen und Grenzen eines
sozialwissenschaftlichen Konzeptes, in Kleinaltenkamp, Michael and Klaus Schubert (1994):
374
Netzwerkanstze im Business-to-Business Marketing: Baschaffung, Absatz und Implementierung
Neuer Technologien. Wiesbaden: Gabler, pp. 8-49.

Schultz, Majken and Mary Jo Hatch (1996): "Living with Multiple Paradigms: The Case of Paradigm
Interplay in Organizational Culture Studies", in Academy of Management Review, Vol. 21 (1996); No. 2,
pp. 529-557.

Schultz, Poul and Ole Wiberg (1981): Samarbejde om byggeeksport. Rapport udarbejdet for Nordisk
Ministerrds Embedsmandskomit for Byggesektoren. Stockholm: Nordiska Ministerrdets
Sekretariat, Oktober 1981.

Schwinge, Wolfgang, Hans-Georg Brunnert, Ulrich Bttger, Susanne Johner-Helppi (1995): GRW 1995
Grundstze und Richtlinien fr Wettbewerbe auf den Gebieten der Raumplanung, des Stdtebaues
und des Bauwesens. Bundesarchitektenkammer, Bonn, Germany: Bundesanzeiger Verlag.

Scott, W. Richard (1995): Institutions and Organizations. Thousand Oaks CA USA: Sage.

Scott, W. Richard (1994): Conceptualizing Organizational Fields: Linking Organizations and Societal
Systems, in Derlien, Hans-Ulrich, Uta Gerhardt, and Fritz W. Scharpf (1994): Systemrationalitt und
Partialinteresse. Baden-Baden, Germany: Nomos Verlagsgesellschaft, pp. 203-221.

Servais, Per (1994): Internationale industrielle indkb - I en strategisk synsvinkel. Odense DK:
Doctoral Dissertation, Department of Marketing, Odense University.

Seyed-Mohammed, Nazeem (1995): Modelling Business Relationships, in Mller, Kristian and David
Wilson (1995): Business Marketing: An Interaction and Network Perspective. Norwell MA USA:
Kluwer Academic Publishers., pp. 555-586.

Sharma, D. Deo (1993): Exporting in a Network: Relationsip between Technical Consultancy and the
Sources of Procurement, in Cavusgil, S. Tamar, Ed. (1993): Advances in International Marketing,
Vol. 5, Industrial Networks. Jai Press, pp. 235-245.

Sharma, D. Deo (1992): Experiential network knowledge in international consultancy, in Forsgren, M.
and J. Johanson, Eds. (1992): Managing Networks in International Business, Philadelphia: Gordon and
Breach, pp. 126-137.

Sharma, D. Deo (1991): International Operations of Professional Firms. Lund, Sweden:
Studentlitteratur.

Sheth, Jagdish N., Atul Parvatiyar (1995): The Evoluation of Relationships Marketing, in International
Business Review, Vol. 4, No. 4, pp. 387-398.

Silcher, Sven (1999): Niederlassungsrecht und anderes Europisches, in Der Architekt, 11/1998, pp.
606-607.

Silverman, D. (1993): Interpreting Qualitative Data. Methods for Analysing Talk, Text and
Interaction. London: Sage Publications.

375
Silvula, Petteri, Frans A.M. van den Bosch and Tom Elfring (1997): Competence Building by
Incorporating Clients into the Development of a Business Service Firms Knowledge Base, in Sanchez,
Ron and Aim Heene, Eds. (1997): Strategic Learning and Knowledge Management. New York: John
Wiley, pp. 121-138.

Skaates, Maria Anne (1997): On Researching Communication between Parent Companies and
Subsidiaries situated in Neighboring Countries. Copenhagen Business School, Department of
Intercultural Communication and Management: Working Paper No. 23.

Skaates, Maria Anne, Henrikki Tikkanen, and Kimmo Alajoutsijrvi (1999a): Internationalization of
Project Selling Firms: The Case of Danish Architectural Firms on the German Market in the 1990s.
Copenhagen Business School, Department of Intercultural Communication and Management: Working
Paper No. 33.

Skaates, Maria Anne, Henrikki Tikkanen, and Kimmo Alajoutsijrvi (1999b): The Internationalization of
Nordic Architectural Firms: Does Territoriality Matter?, Paper presented at the Australia New Zealand
Marketing Conference (ANZMAC) in December 1999.

Slatter, S. St. P. (1990): Strategic Marketing Variables under Conditions of Competitive Bidding, in
Strategic Management Journal, Vol. 11, No. 4 (May-June 1990), pp. 309-318.

Sommer, Adolf-W. (1996): Auftragsbeschaffung fr Architekten und Ingenieure: neue Ideen,
bewhrte Methoden und Konzepte, anschauliche Beispiele. Cologne: Verlagsgesellschaft Rudolf
Mller.

Starbuck, William H. (1992): Learning by Knowledge-Intensive Firms, in Prusak, Laurence, Ed.
(1997): Knowledge in Organizations. Newton MA USA: Butterworth-Heinemann, pp. 147-175.

Starck, R., M. Rothkopf (1979): Competitive Bidding: A Comprehensive Bibliography, in Operations
Research, Vol. 27, No. 2.

Statistisches Bundesamt (1998): Statistisches Jahrbuch fr die Bundesrepublik Deutschland 1992-99.
Stuttgart: Metzler-Poeschel.

Stevens, Garry (1998): The Favored Circle: The Social Foundations of Architectural Distinction.
Cambridge USA: Massachusetts Institute of Technology.

Storper, Michael and Robert Salais (1997): Worlds of Production. Cambridge USA: Harvard University
Press.

Strandskov, Jesper (1995): Internationalisering af virksomheder. Nyere teoretiske perspektiver.
Copenhagen: Copenhagen Business School Press.Sveiby, Karl Erik (1997): The New Organizational
Wealth : Managing and Measuring Knowledge-Based Assets. San Francisco: Berrett-Koehler.

Sddeutsche Zeitung, German National Daily Newpaper (May 14, 1999): Architekten hoffen auf
Boom bei Altbauten. Munich, Germany.

376
Sveiby, Karl Erik (1997): The New Organizational Wealth: Managing and Measuring Knowledge-
Based Assets. San Francisco USA: Berret-Koehler.

Sveiby, Karl Erik and Tom Lloyd (1987): Managing Knowhow: Add Value...by Valuing Creativity.
London: Bloomsbury.

Svensson, Lennart G. (1990): "Knowledge as a Professional Resource: Case Studies of Architects and
Psychologists at Work", in: Torstendahl, Rolf, Michael Burrage, Eds. (1990): The Formation of
Professions. Knowledge, State and Strategy. London: Sage Publications, pp. 51-71.

Symons, John (1996): Realism: Recapturing the Middle Ground, in Elfring, Tom, Hans Siggaard Jensen
and Arthur Money, Eds. (1996): Theory-Building in the Business Sciences. Copenhagen: Munksgaard
International Publishers Ltd., pp. 155-170.

Tetzlaff, Marie (1996): Interview: Henrik Sthr. Article in the Danish daily newspaper Politiken,
September 11, 1996.

Thomsen, Steen (1997): Internationalization by Ideas, Copenhagen: Working Paper 8-1997, Institute of
International Economics and Management, Copenhagen Business School.

Tikkanen, H. (1998): Research on International Project Marketing. A Review and Implications, in
Tikkanen, H., Ed. (1998): Marketing and International Business. Essays in Honour of Professor
Karin Holstius on her 65
th
Birthday, Turku, Finland: Turku School of Economics and Business

Tikkanen, H. (1997): A Network Approach to Industrial Business Processes. A Theoretical and
Empirical Analysis. Ph.D. Thesis, Turku School of Economics and Business Administration, Turku,
Finland.

Tikkanen, H., J. Lindblom (1988): A Network Approach to International Project Marketing. A Case
Study of a Technology Transfer Project to the PRC. Working Paper, University of Oulu, Finland.

Torvatn, Tim (1998): Long-Term Relationships in the Building Industry: Do They Exist?, in Halinen, K.,
N. Nummela, Eds. (1998): 14
th
IMP Annual Conference Proceedings, Interaction, Relationships
and Networks: Visions for the Future, Vol. 3: Work-in-progress Papers, Turku, Finland: Turku School
of Economics and Business Administration, pp. 475-494.

Trauner, Theodore J. (1993): Managing the Construction Project: A Practical Guide for the Project
Manager. New York: John Wiley.

Turnbull, Peter and S. Paliwoda (1986): Research Developments in International Marketing. London:
Croom Helm.

Turnbull, Peter and J.P.Valla, Eds. (1986): Strategies for Internaitonal Industrial Marketing. London:
Croom Helm.

Van de Ven, Andrew H. (1992): Suggestions for Studying Strategy Process: A Research Note, in
Strategic Management Journal, Vol. 13 (1992), pp. 169-188.
377

Veres, Zoltan and Tibor Mandjak (1995): New Possible Research Trends in Project Marketing, in
Bergada, M., Ed. (1995): 24
th
EMAC Conference, Proceedings, Vol. 11, pp. 2071-2086.

Vestergrd-Poulsen, Kaj (1994): Udarbejdelse af kravspecifikationer ved EU-udbud, in Stads- og
Havneingeniren, the Danish journal for publically employed civil engineers, Vol. 85, No. 2 (1994), pp.
41-45.

Vickrey, William (1961): Counterspeculations, Auctions, and Competitive Sealed Tenders, in Journal
of Finance, Vol. 16 (1961), No. 1, pp. 8-37.

Wagner, Johannes (1990): Kommunikative Handelsbarrieren am Beispiel Dnemark und Deutsch-
land, in List, Pia and Johannes Wagner (1990): Rapport over Lov 271 Projekt Kommunikative
Handelshindringer, Odense, Denmark: Odense University: Department of German.

Watkin, David (1996): A History of Western Architecture. 2
nd
Edition. London: Laurence King
Publishing.

Welch, D., l. Welch, I. Wilkinson, L. Young (1996): Network Development in International Project
Marketing and the Impact of External Facilitation, in International Business Review, Vol. 5, No. 6, pp.
579-602.

Weick, Karl (1979): The Social Psychology of Organizing. Reading MA USA: Addison-Wesley.

Wengler-Jrgensen, Peter and Katja Hegh (Sept. 1994): Tjenestydelsesdirektivets anvendelse inden for
bygge- og anlgssektoren. In Ugeskrift for retsvsen, a Danish legal weekly journal, No. 38, dated the
24
th
of September 1994, pp. 311-318.Wentz, Martin, Ed. (1992): Planungskulturen. Frankfurt am
Main: Campus Verlag.

Werner, M. and Martin Freitag (1997): Der Fall Dorsch-Consult, in Bauwirtschaft BW 12/97, p. 55.

Williamson, Oliver E. (1975): Markets and Hierarchies: Analysis and Antitrust Implications. New
York: Free Press.

Williamson, Oliver E. (1979): Transaction Cost Economics: The Governance of Contractual Relations,
in the Journal of Law and Economics, Vol. 22 (1979), pp. 233-261.

Winch, Graham and Eric Schneider (1993): "Managing the Knowledge-Based Organization: The Case of
Architectural Practice", in Journal of Management Studies, 30:6, November 1993, pp. 923 - 937.

Wittrup, Sanne (38/1997): Fiasko for EU-udbudsordning: isr danske virksomheder fr slet ikke deres
andel af kagen, in the Danish Society of Engineers periodical, Ingeniren, p. 7.

Whe, Gnter (1996): Einfhrung in die Allgemeine Betriebswirtschaftlehre, 19. neubearbeitete
Auflage. Munich: Verlag Franz Vahlen.

Yin, Robert K. (1994): Case Study Research. Designs and Methods. 2
nd
Edition. Thousand Oaks CA
USA: Sage.
378

stns, A. (1984): Arkitekterna och deres yrkesutveckling i Sverige. Gothenburg, Sweden:
Gothenburg College of Technology.

stns, A. and L. Svensson (1986): Arkitektarbete. Gothenburg, Sweden: Department of Architecture,
Gothenburg College of Technology.

379
Appendix A. Pilot Study Research on Danish Architectural Exports to Ger-
many.
A.1. Chronological Description of the Pilot Study Research.
In November 1997, Professor Steen Thomsen suggested to me that a study of the
internationalization of the architectural services industry might be interesting. Professor
Thomsen had thought a great deal about this industry in connection with a paper that
he had recently written (Thomsen, 1997). His suggestion prompted me to begin ga-
thering information on architectural service firms and the industry at large.

In the first two months of my literature studies, I examined Professor Thomsens
thoughts but came to the conclusion that, although I found his paper extremely inter-
esting, it would be best for me to draw upon other theories in my study of this topic.
During these first two months, I also decided that limiting my study to Danish archi-
tectural exports to Germany would be an acceptable choice for two very different
reasons:

1. In the 1990s, Germany had by far been the most important export market for
Danish architects and the entire Danish construction industry (Hartung, 1997).

2. I have a double major M.A. (in Danish: the cand. negot. degree) in International
Business and German from the University of Odense and am therefore especially
qualified to examine Danish architectural exports to Germany.

In the next phase of my pilot study research (January - August 1998), I concentrated
on finding the best theoretical framework for my Ph.D. dissertation. In this period, I
used paradigm crossing (see Schultz and Hatch, 1996): By incorporating both sub-
jectivist and objectivist methodologies as well as inductive and deductive reasoning in
my studies, I examined the business of running architectural service firms from many
perspectives and noted the tensions and differences as well as the commonalties in
perspectives. I then compared the scopes, strengths, and weaknesses of the different
perspectives as well as examined which perspectives are compatible with one another
with reference to epistemologies and ontologies in general and the architectural
services industry in particular.

By May 1998, I realized that I was gradually coming to the conclusion that choosing a
specific research groups approach to studying the phenomenon of the inter-
nationalization of the architectural services sector and attempting to work from that
one approach in my further research would be the best alternative. As previously
mentioned in Section 1, during the summer of 1998, I chose the INPM/IMP Groups
380
approach. However, in this subsection of Appendix A, I will briefly elaborate on the
insights I received from my very broad and somewhat scattered introductory pilot
study research which lead me to choose the INPM/ IMP framework.

In January of 1998, I began to examine the broader dynamics of architectural services
in relation to the construction industry in Denmark, Germany, and the European Union
at the industry level. Additionally, I looked at the following issues at the firm level: Are
there small economies of scale in the production of architectural services, as is
commonly assumed? If there are small scale economies, are these caused by
heterogeneous demand, convex production functions, or other factors?

Examining these issues resulted in my writing two initial reports which described the
Danish, German, and EU construction and architectural service industries. These are
not listed in the bibliography; instead Subsections A.3.-A.5. of this appendix contain a
summary of some of my most important results.

Last but not least, I gathered qualitative primary data in an empirical pilot study
undertaken with the goal of gaining an increased understanding of the working world
of Danish architects who are employed by or owners of architectural service firms. I
had previously prepared for this qualitative pilot study work by reading existing works
on architectural practice (e.g. Albertsen, 1996; Blau, 1984; Gerkan, 1995; Harrigan and
Neel, 1996; stns and Svensson, 1986; and Svensson, 1990).

In the period between May and August 1998, I conducted a total of 15 semi-
structured interviews, one in cooperation with Research Professor Per Jenster from
my department, the Department of Intercultural Communication and Management of
Copenhagen Business School; these supplemented an initial interview in March 1998.
The distribution of the pilot study interviews is as follows:

2 interviews with representatives of Danish architects organizations (DAL and
PAR)
1 interview with a person employed at the International Office of the Danish
Ministry of Housing
3 interviews with professors and associate professors at the two Danish Schools of
Architecture
1 interview with a teacher from a Danish Building Technician Schools international
program
2 interviews with Danish architects who had worked in Germany for/with Danish
and German architectural service firms
381
1 interview with two Danish architects who worked for a major Danish architectural
firm that had had a subsidiary in Berlin for several years during the mid-1990s
1 interview with a Danish architect who owned his own firm and had experience
with export to Southern Europe/Africa
1 interview with a Danish architect who worked for a firm that had no exporting
experience
1 interview with a Danish architect who previously had had his own firm (which did
not export) and currently was working as an international design consultant for a
company that sells clothing in its own shops in Scandinavia, Eastern Europe and
the German-speaking countries
2 interviews with 2 unemployed Danish architects, one of which had worked for an
architectural firm in another Nordic country for a number of months

The questions that I asked concerned architects actions and perceptions of their daily
working life. They included topics such as: How do architects act to obtain and pos-
sibly retain customers and projects on the domestic Danish market (as well as the Ger-
man market and/or other foreign markets if they are involved in activities abroad)? Do
they use a network of contacts to acquire some of the project orders they receive?
If so, how do they do so? Do they use a network of contacts to acquire
competencies or new artistic ideas? How do individuals in Danish architectural service
firms view their firms domestic and foreign activities in terms of possibilities and
desired events? If they have attempted exports to Germany, how long have they been
on the German market and how do they view their activities there in terms of
importance and future perspectives? How do architects measure their success, i.e.
what role do economic, artistic, or other factors play for the individual architect inter-
viewed?
35

35
One issue related to method and methodology which remains unresearched is the extent to which the
pre-understanding of the architects in my pilot study may have been unconsciously biased towards or
against the network approach on the basis of architect participation in business-related seminars and
courses. Although I attempted to structure my pilot study interviews to minimize my personal preference for
the network approach, I know that some Danish architects have already been exposed to normative
suggestions based on network theory which have been presented in seminars and practice-oriented
publications. These architects may therefore have a predetermined opinion of these cooperation-related
approaches. As two cases in point, in the early 1990s, both the Danish Federation of Small and Medium-
Sized Enterprises (Hndvrksrdet) and the Society of Associated Danish Architects (Associerede
Danske Arkitekter, ADA) advised firms without previous activities in Germany to cooperate with an
experienced architectural or construction company in the beginning to get more experience as well as
German references (Hndvrksrdet, 1992:14-5; Arkitekt- og byggebladet, March 1994:15). Firms
were also advised to employ e.g. German-speaking persons who had knowledge of the German
construction market and share the costs of this among themselves (Hndvrksrdet: ibid.). This, however,
proved difficult in practice (see Chapter 8). I personally believe that this advice was at least partially based
the recommendations found in some practice-oriented IMP work to the effect that networks can and
382
A few of the broad and somewhat diffuse results of my empirical pilot study research
are listed in Subsection A.5. of this appendix. In relation to my choice of main study
questions, the results from my interviews listed in this subsection directly contributed
to the choice and delimitation of the main study questions in that they pointed to the
fact that, when asked, most respondents stated that they believed personal
connections and relationships with actors on the German market had been a deciding
factor with regard the success of Danish architectural firms efforts on this
neighboring market.

Over and beyond that, my case study results and readings of secondary sources
indicated that while many Danish architectural service firms have had some exposure
to foreign markets by winning competitions, only a very few had attempted and
succeeded in going further by establishing and nurturing contacts and relationships
that would enable them to receive future orders from the export markets upon which
they had won competitions.

Due to the small number of Danish architectural firms that had managed to establish
and nurture contacts, I was not surprised to find a lack of Danish as well as inter-
national research on architectural service firms that had attempted to undertake this
further stage of internationalization. During the course of my pilot study readings, I
found only one (not particularly outstanding) work (Kleckers et al.:1989, a paper
written by a group of bachelor level international business students in their senior year
of their studies) that had actually discussed the hypothesis (ibid.:41, 51) that social
contacts to and interactions with potential customers is a key success factor with
regard to potential Danish architectural services exports to Spain
36
. Therefore it seem-
ed to me to be highly interesting and relevant to study several relatively successful
Danish architectural service firms contacts to and interactions with customers and
potential customers on German market in the 1990s.

A.2. Exclusion of Other Marketing/Economics Perspectives from the Research
Focus.

should be used or created to solve marketing and exporting problems. For a criticism of this perspective,
see Hedaa (1992b).

36
Some of the literature I read contained themes tangent to this hypothesis. In their practitioner-oriented
book, the American architects Harrigan and Neel (1996) write that understanding customers needs is a
general precondition for designing buildings that will satisfy customer needs and lead to useful references.
Additionally, they offer some suggestions for achieving rapport in conversations with (American) customers
about projects. The Swedish works stns and Svensson (1986) and Svensson (1990) deal with the
practical skills architects use in their daily work, including human relations skills.
383
In choosing to focus on interactions and contacts as the focus of my study, I
inevitably have chosen not to focus on other factors that also could have played a role
in relation to Danish architectural firms attempts to export to Germany in the 1990s.
Other factors that could have played a role include:

the technical competency of the Danish firms
the macro-economic and structural dynamics of the German construction industry
and their micro-economic implications for individual architectural firms operating on
the German market

Concerning the issue of technical competency, I chose at the very beginning of my
pilot study not to include this topic in my research because I knew that I did not have
sufficient knowledge of the technical aspects of the field of architecture. On the other
hand, as hinted in the previous subsection and is evident when one reads Sections
A.3. - A.5., I did explore the micro-macro-economic and structural dynamics of the
Danish, German, and European construction and architectural service industries to
some extent before also excluding these factors from the main focus of my study.
Instead I chose to deal with these factors in my first research question, which is
answered in Chapter 6. As mentioned in Chapter 1, research question one deals with
the German economic and structural framework in which the interactions of the three
case study firms have taken place.

In the following I will briefly describe some of the perspectives from the business
administration disciplines of industrial economics and marketing that I first examined,
then rejected on the grounds that they were not especially relevant for my Ph.D.
dissertation study. These include industry and firm analysis from the Porterian
perspective (see e.g. Porter, 1980 and 1985, as well as Winch and Schneider, 1993,
for Porterian strategies for architects), Wroe Aldersons transvection chain concept
(Alderson, 1957; Priem, Rasheed, and Amirani, 1997), and Storper and Salaiss
seminal work (1997) on the action frameworks of the economy.

As for the Porterian framework, it should be noted that the most renowned works of
Harvard Business School Professor Michael Porter, his industry and firm analysis
frameworks (Porter, 1980 and 1985) are normative in character and thus not cannot be
used by themselves as the foundations of further scholarly theory building unless one
subscribes to the instrumentalist view of economic theory.
37
However, in his very

37
Proponents of the instrumentalist view of economic theory argue that economic theories should only be
judged by their abilities to make predictions and not by correctness of the assumptions upon which they
have been built. This view was at one time propagated by, among others, the American economist and
384
successful academic career, Michael Porter has written a huge number of scientific
works for e.g. (mainly English language) academic journals, and he has most certainly
drawn upon insights from his academic research in his books for practitioners (e.g.
Porter, 1980 and 1985), although he does not explicitly explain the connection
between his academic research and his prescriptive suggestions for managers in these
books. This, among other things, has lead some authors to point out that there is
some conceptual fuzziness in his renowned works for practitioners (see e.g. Priem,
Rasheed, Amirani, 1997:153).

Despite this weakness, I found some aspects of Porters industry and firm level analy-
tical frameworks quite helpful in obtaining an initial understanding of the broader
dynamics of the construction industry and the architectural services industry as a
sector within the construction industry. In this connection, Porters so-called Five
Forces Model of industry analysis was an especially useful simple and powerful
model.

Figure A.1. Porters Five Forces Driving Industry Competition

Potential Entrants

Threat of New Entrants

Suppliers Buyers
Suppliers Industry Competitors Buyers
Bargaining Rivalry Among Bargaining
Power Existing Firms Power

Threat of substitute products/services

Substitutes

Source: Porter, 1980:4.

Porters Five Forces model, as depicted in Figure A.1., enabled me to e.g. see that
in Denmark, architectural firms to some extent compete with civil engineering firms
concerning design-related services and with both civil engineering firms and
contractors concerning project management. In Germany, project management firms
are yet another type of firm that the architectural firm competes with concerning the
management of construction projects.

Nobel Prize winner Milton Friedman and other members of the Chicago School of Economists (Andersen,
1988:103-105; Easton, 1995a:427-428).
385
However, studying architectural services using the Five Forces Model had its
limitations as well. The most serious limitation of the model is its failure to incorporate
the potential complexity caused by possibility that the boundaries between companies
involved in construction projects (including, among others, architectural firms) might
change over time. Two examples of a changing boundary within the construction
industry are the recent emergence of the so-called design-and-build contracting
firms with in-house design services in Europe (see Huovinen and Kiiras, 1998, for
IMP Group research about this phenomenon) and the emergence of pre-fabricated
housing on European markets (see Subsection A.4.3. as well as Sections A.5. and
6.2.)

More generally speaking, several leading project marketing researchers including
Finnish Karin Holstius and the Italians Bonnacorsi, Pammolli, and Tani (1996) believe
the boundary issue is especially important with regard to project business, which
includes construction and architectural projects (see Section 2.5.). Holstius (1989:11)
stated the following in a project marketing study:

Strategic behaviour is not explainable by a systems approach with fixed
boundaries and invariable interconnections. In effect, the essence of
strategic work is to transform interconnections and to change the systems
boundaries.

On the basis of the above statement, I did not deem it fruitful to use the Porter Five
Forces model for more than an initial overview of the forces effecting competition
within the architectural profession.. With regard to the level of the firm, I was also
quick to eliminate the prescriptive suggestions of Porter. The reason for this is related
to two of Porters (implicit) key a priori assumptions in both of his well-know books
(Porter, 1980 and 1985), namely the assumptions that firms face homogeneous
markets of customers and that these markets can/should be segmented. In Porterian
terms, the customer is depicted an anonymous and substitutable entity because of
these assumptions.

The architects cited in the works I read about architectural practice (Albertsen, 1996;
Blau, 1984; Gerkan, 1995; Harrigan and Neel, 1996; stns and Svensson, 1986; and
Svensson, 1990) did not describe the customer as being anonymous and/or sub-
stitutable. Instead, these contributions described both the interactions between
representatives of architectural firms and individual clients and the resulting
architectural projects as being unique and containing at least some non-standardized
elements. I therefore chose to eliminate Porters frameworks from my study in April
386
1998. In my subsequent pilot study interviews, the results of which are briefly
mentioned in Subsection A.6., the Danish architects interviewed said they had offered
customized solutions for individual customers, thus confirming my initial hunch that
architects offerings to customers in the 1990s cannot be classified beforehand as
being standardized or substitutable. These responses also indicated that Danish
architectural firms had not seriously considered utilizing strategies encompassing
creating economies of scale in vital service production areas during this time period.

In contrast to Porter, the late renowned American marketing scholar Wroe Aldersons
initial assumption is one of heterogeneous markets (Priem, Rasheed, Amirani,
1997:147; Hkansson and Johansson, 1984:10). However, Aldersons theoretical
framework is also problematic with regard to my empirical pilot study data because it
contains an implicit normative preference for the homogenizing of heterogeneous
markets by the creating standardized offerings to take advantage of economies of
scale (Priem, Rasheed, and Amirani, 1997:149-50):

In heterogeneous markets, the matching between differentiated segments of
supply and differentiated segments of demand is effected through a series of
sorts and transformations. Sorting is the physical process through which
goods, materials, or components are assigned to appropriate segments of
demand. Once a sort is completed, it cannot be reversed without some risk
of demand... A transvection is the outcome of a series of transactions,
sorts, and transformations that creates meaningful homogeneity from
meaningless heterogeneity.

On the basis of the above, Aldersons perspective was also eliminated on the grounds
that Danish architectural firms have not standardized their offerings in the 1990s to
take advantage of potential economies of scale.

Returning now to industry-level analysis, I found Storper and Salais (1997) work a
helpful supplement to Porters and Aldersons contributions because their work
includes descriptions of industry dynamics concerning firms that offer non-
standardized products as well as a treatment of the issue of changing system and com-
pany boundaries.

Storper and Salais work is probably the most well-known description of socialized,
pragmatized macro-economic dynamics to date. These aspects are elaborated upon
further in relation to actors action and embeddedness in Section 4.2. Storper and
Salais describe their contribution in this way (ibid.:26-7):

387
we define four possible worlds of production, frameworks of action in
which producers and users of products are inscribed and which permit them
to coordinate their activities in an economically successful way. In the
process of producing and exchanging, each person confronts uncertainty
with respect to his or her own actions and those of others. This uncertainty
takes radically different forms for each type of product, posing different
dilemmas for actors with respect to others, but it must be resolved for
production to succeed. This means that, for a given type of product, each
actor must have the particular competence and resources needed to get
around uncertainty by acting in ways expected and understood by others
involved in the same productive effort. The result is a process of economic
coordination.

In more concrete terms, each world of production is distinguished by
fundamentally different routines for abating uncertainty; hence each world is
organized according to different principles of optimization, as in orthodox
theory. This framework of action is not necessarily a shared set of interests:
we can differ in interests but still expect others to act in a certain way and
can ourselves act according to mutually established guidelines in meeting
their expectations.

Notice that we do not define a world in terms of the standard trade-off
between structure and action, but as both the observable routines and the
cognitive framework; this is because each world is continuously evaluated,
interpreted, and reconstructed by its actors. [...] We call certain worlds
possible because they are ideal types of coherent action frameworks for
the basic kinds of products found in a modern industrial economy. By ideal
types, we mean that they express, in theoretical terms, the pragmatic
coherence sought by actors themselves. We identify only four such worlds,
and not five, six, or an infinity, because the basic dimensions of production
pragmatics yield these four basic situations for economic actors.

Storper and Salais four possible Worlds of Production are depicted in Figure A.2. on
the next page.

388
Figure A.2. Characteristics of Storper and Salais Worlds of Production.

Critical Resources and Competencies
Specialized Products Standardized Products

The Interpersonal World The Market World

Evaluation of Quality: Price as Evaluation of Quality: Local
Market Indicator of Quality to Buyer Industrial Standard
Type:
Competition base: Quality Competition base: Price first,
Dedicated Quality second
Products
Demand Fluctuation: Local; Demand Fluctuation: Local;
True Uncertainty as to Quality Uncertainty as to Price
Uncertainty
Forms of Flexibility: Forms of Flexibility:
External: Quality External: Quality
Internal: Market (Quantity; Internal: Quantity, Price
Price)

The World of Intellectual Resources The Industrial World

Evaluation of Quality: Scientific Evaluation of Quality: Widely
Market and Ethical Rules Diffused Industrial Standards
Type:
Competition: Via Learning Competition: Via price
Generic
Products Demand Fluctuation: Supply Demand Fluctuation: Widely Diffused
Fluctuation creates Demand Temporal Risks as to Quantity (Business
Predica- Fluctuation Cycle)
bility
Forms of Flexibility: Forms of Flexibility:
External: Quality and Quantity External: Quantity
Internal: Quality Internal: Quality

Source: Storper and Salais, 1997:46.

With regard to the Porterian and Aldersonian theoretical frameworks, these fit best
with regard to firms that belong to the action framework that Storper and Salais call
the Market World:

389
The Market World is that of standardized but now differentiated (what we
call dedicated) products. The user (that is, buyer) defines his particular
needs in the universalizing language of standardization, so these needs can
be translated into objective, codified norms. Competition between those
producers who can respond to the demand, often relatively few in number,
turns on price and rapidity of response.[...] The contemporary restructured
and flexible firm is close to this possible world today (ibid.:20-1).

On the other hand, architectural services, as performed in and delivered by todays
Danish and German architectural service firms, can be classified as a part of the
Interpersonal World:

The Interpersonal World is one of specialized and dedicated products, that
is, products made according to the desires of the buyers. In this world,
relationships between buyers and producers rest on conventions of
confidence, reputation, and specificity of image; competition between
producers centers on product quality. (ibid.:20)

In later sections of their work (e.g. ibid.:189-205), Storper and Salais describe the
tensions and selection mechanisms of the four possible worlds of production that lead
to either (a) periods of (temporary) stability or (b) transformation in the boundaries
and relations between firms that belong to the different worlds of production. These
tensions and selection mechanisms are determined not only by the pragmatic actions
of actors but also certain external macro-economic patterns and regularities that lie
outside of the pragmatic practice of the actors. These are elaborated upon in Chapter
6.

These tensions exist in all industries, including the architectural services and
construction industries. As a case in point, although Danish architects produce
customized services of the interpersonal world, far from all buildings built in Denmark
today are designed by architects (see e.g. Kleckers et al., 1989:51 or Madsen,
1991:43). In some cases, especially in the private housing sector, building designs are
drawn by various other actors in the construction process (ibid.). Over and beyond
that, a few types of buildings have been produced in series (e.g. some apartment
house types, also Danish emergency housing for refugees from the war-torn regions of
Yugoslavia), and there is a growing number of standardized components which can be
used and a growing number of computer programs that allow potential builders to
create simulations of buildings they might be considering building (Eurostat, 1995:24-
39). These factors, some of which will be treated in more detail in the following three
sections, all point toward a scenario in which todays architects are experiencing
390
increasing pressure from another of the Storper and Salais world of production,
namely the aforementioned Market World: The construction industry firms of the
Market World are increasingly producing construction solutions which may be
substitutes for the services of the Interpersonal World of the Danish architectural
service firms. This danger is, in my opinion, also present on the German and other EU
markets, although legal requirements which stipulate that an architect or civil engineer
must sign some papers in connection with the application for a building construction
permit or Bauvorlage (see Oliver-Taylor, 1993:35-37) do offer some immediate
protection on the German market (see more on this issue in Sections 6.2. and 6.3. as
well as Sections A.3.-A.5. of this Appendix.

However, as previously mentioned, the dissertation does not focus on possible trans-
formations of worlds of production of architectural and construction services; instead
it contains three historical case studies of Danish architectural service firms selling
and networking activities on the German market in the 1990s. I find this delimitation
permissible because both my pilot study data and the data from my main study almost
unequivocally point to a scenario in which Danish firms in the 1990s have attempted
to market their services in Germany according to the pragmatic action framework that
corresponds to Storper and Salais Interpersonal World.

A.3. The Danish Architectural Service and Construction Industry.
A.3.1. Danish Architects and Their Organizations.

The Danish market is currently characterized by an abundance of architects and has
been so throughout the 1990s. According to Hansen et al.(1994:34), in 1994 Denmark
had a total 5900 academically trained architects, and approximately 1000 of these were
unemployed. However, the total number of persons working or seeking work as
architects is somewhat higher than these figures indicate, as the title of "architect" is
not reserved by Danish law for persons who have an academic degree in architecture;
only the academic degree abbreviation M.A.A. is reserved for these individuals.
Seen in relation to the general population, in Denmark there are 961 architects per
1,000,000 persons (ErhvervsfremmeStyrelsen, 1993:107-8).

Concerning companies, according to the statistics of JB Business Information A/S,
there were 524 private Danish architectural service firms in April 1997 (JB Business
Information, 1997/1:v).
38

38
JB Business Informations statistics are incomplete, because they are not always able to track down
companies with personal liability due to the fact that these companies are not required to make public
391

Because both persons with and without specific architectural training work as archi-
tects in Denmark, Danish architects are organized in a number of organizations and
umbrella organizations, which will be described briefly below.

The National Organization of Danish Architects (DAL, Danske Arkitekters Lands-
forbund) is an umbrella organization for students of architecture and academically
educated architects who have studied architecture at the Academy of Fine Arts in
Copenhagen (Kunstakademiets Arkitektskole) or the rhus School of Architecture,
the only two schools in Denmark that offer academic degrees in architecture. On
August 5, 1998 DAL had a total of 6165 members, including 492 student members
(telephone conversation with Hanne Hansen, DAL). However, because of the econo-
mic problems which many Danish architectural service firms have experienced in re-
cent years, the National Organization of Danish Architects (DAL) is not as strong a
participant in the Danish political debate about the future of architecture as it might be
otherwise (Hansen et al., 1994:36).

Academically educated architects who have worked in private architectural service
firms for a number of years as owners or partners can also join the Council of Prac-
ticing Architects (PAR, Praktiserende Arkitekters Rd), if both they and the firm they
own or are a partner in meet the eligibility requirements. This organization works to
safeguard the special interests of architectural service firms. 692 members of DAL
were also members of PAR on August 5, 1998 (Hanne Hansen, DAL).
39

Academically educated architects who are employed by the public or private sector
are organized in the Council of Employed Architects (AAR, Ansatte Arkitekters Rd),
which had 3851 members on August 5, 1998 (ibid.).

The Society of Associated Danish Architects (ADA) was created in the Spring of
1992, when two previous organizations, Arkitekt-Sammenslutning M.A.S. and Danske
Praktiserende Arkitekter (DPA), merged. This umbrella organization admits owners of
architectural drawing offices who have completed an apprenticeship education (e.g. as
carpenter, plumber) in the Danish construction industry and who have been educated
by a certified building technician school (byggeteknisk hjskole) as building

financial statements. Additionally, companies undergoing bankruptcy proceedings are not included in this
figure (JB Business Information, 1997/1:viii). However, this estimate was judged adaquate for my pilot
study. I deal with this issue more at length in Section 6.3.
39
Here further information can also be found in Section 6.3.
392
technicians (bygningskonstruktrer). To become a member, one must have worked as
an architect for at least 5 years. ADA had 120 members on August 5, 1998 (source:
ADA).

With regard to international organizations, DAL is a member of both the Architects
Council of Europe (ACE) and the world-wide organization Union Internationale des
Architectes (UIA). PAR and AAR are also members of ACE.

A.3.2. Role of the Architect in the Danish Construction Process
In Denmark, the architect was previously involved in the following four phases of the
building process (Kleckers et al., 1989:51):

1. General proposal.
2. Detailed proposal.
3. Pre-construction phase.
4. Construction.

Until the late fifties, all four areas were undisputedly his or hers (Hansen et al.,
1994:33). Today, however, the contractor often takes over after phases two or three
(Kleckers et al., 1989:51) and in many projects, engineers often are used in all four
phases (Madsen, 1991:54) to the detriment of architects.

The reasons for this development are to be found in the vast changes that the
construction sector has undergone in the past four decades (see Hansen et al., 1994:
33-4): Where construction work used to mean custom-made installations of a few
traditional building materials, today's industrialized building process is very
specialized. There are over 100,000 different potential components as well as new
methods of building that include assembly line and logistical planning methods.

Architects lost terrain because they did not have the educational resources to deal with
the wide variety of new tasks. Additionally, new types of tendering for the entire
construction project (including the building design) have further marginalized
architects (ibid.).

In Denmark of today, because of the above-mentioned factors, academically educated
architects working in private architectural service firms compete with the following
groups for projects (Kleckers et al., 1989:159):

1. Architects without an academic education.
393
2. Construction companies who engage in upstream integration (e.g.
Design-and-Build).
3. Engineers.
This competition is the cause of some rivalries and prejudices. According to Madsen
(1991:55), Danish architects' typical stereotype of engineers as project leaders is as
follows:

Engineers think in too much in static dimensions and tend to stick to
conservative work routines to too great of an extent. They do not feel at
home in relation to unclear goals. (my translation)

Danish engineers, on the other hand, are of the opinion that architects mainly have
artistic ambitions and do not pay enough attention to economic aspects. This opinion
is also present in the minds of some Danish private building owners to be (ibid.).

Some Danish engineers also believe that Danish architects are less skilled at solve
technical construction problems than previously. Danish architects often employ spe-
cialists to work out technical details in relation to their projects (ibid.: 62).

Professor Boje Lundgaard from the Academy of Fine Art's School of Architecture in
Copenhagen believes that the lost terrain is a problem for Danish architects. He
commented the lost market share in relation to e.g. engineers in this way (Arkitekt- og
byggebladet, November 1992:31):

Architects must prepare to fight to regain some of their old tasks. An
architect is not just a decorator [...], but a person who because of his
overview of everything - the construction process as well as the final
result - is able to forge links so that everything functions well. Many of
these functions have been taken over by others, but they do not do a
better job. Only the architect can be the entrepreneurs impartial advisor.

Effort must be made to bring disciplines such as technological,
economic, and logistical control back to architecture again. Otherwise
architecture as a profession has lost. [...] Because of his work, an
architect must also be interested in societal mechanisms (economics,
structures, functions) as a whole, because the architect's basic advantage
is that he is the only one who can coordinate and see the big picture. This
requires profound knowledge of society and the construction sector both
as organic units and as bundles of single functions and details. (my
translation)
394

Additionally, according to Boje Lundgaard, Danish architectural firms seem not to be
playing the technological leader role with regard to computer and communication
technology that they potentially could play:

The problem of the construction sector is that none of the involved parties
work to create a systematic foundation for rationalization which can be
achieved by integrating data and communication of data. [...] Because of the
way that the construction sector is structured today, the foundation for
communication of data and digital trade must be laid by the architects who
draw the projects, yet it will be utilized by the firms that produce and deliver
parts and by those who construct the building. (Arkitekt- og byggebladet,
November 1992:34, my translation)

A.3.3. Degree of Competition and Cooperation between Danish Architects
In Denmark, the architectural industry has traditionally been built up around an ideal of
mutual trust which comes from knowing or knowing of one's competitors/colleagues.
Advertisements for architectural service firms are very rare as there is an unwritten rule
that discourages advertising (Kleckers et al., 1989:33, 52), even though rules about
marketing were liberalized to some degree in 1979. Approaching journalists with
information about current or coming projects is, on the other hand, accepted (ibid.).

Price competition has also been quite hidden and not very strong until the late 1980s.
However since that time, and especially since the building crisis in the early 1990s
when total turnover declined in current value terms (Albertsen, 1996:14), this situation
has changed completely. The implementation of the EU Public Services Directive into
Danish law in the early nineties reduced average fees substantially - perhaps by as
much as 50% (Arkitekt- og byggebladet, January 1992: 12-4). In addition, Danish
architectural service firms have begun to rationalize their time for specific parts of
projects and to itemize their bills to clients to an extent that they never previously had
done (interview with Associate Professor Niels Albertsen, March 6, 1998).

A.3.4. The International Competitiveness of the Danish Construction Industry.
A report compiled by the Danish Agency for Trade and Industry (Erhvervs-
fremmestyrelsen) in 1993 was relatively pessimistic about Danish construction export
success. The report claimed that the Danish construction industry is marked by a low
degree of internationalization, too low productivity, and an obsolete structure
(Arkitekten, 1994/2:72) but that if the Danish government were to invest up to DKK
395
500,000,000 per year in an active construction sector business policy, Danish
construction firms might be able to survive competition on international markets
(ibid.). This money was to be, among other things, invested in improving education.
With regard to architects, the report suggested that the Danish architectural education
should be strengthened to include more knowledge of building processes, cash flow
management, and managing construction projects (ibid., ErhvervsfremmeStyrelsen,
1993:109).

With regard to architects, some Danish architectural firms that made their first export
attempts to Germany in the early 1990s aimed to cooperate with experienced German
architectural service firms because the Danes were not familiar with the German market
(see e.g. Hndvrksrdet, 1992:14-5; Arkitekt- og byggebladet, March 1994:15;
Arkitekten, 1993/5:176-8.). In this way, they aimed toovercome potential deficiencies
in knowledge concerning the above mentioned areas as well (see also Chapter 8).

A.4. Structure of the German Architectural Services Industry
A.4.1. Number of Architects and Architects Organizations in Germany

The number of architects in the general populations of the Germany is nearly the same
as for Denmark. In Denmark there are 961 architects per 1,000,000 persons. The
figure for Germany is 985, whereas the EU average is 952 (ErhvervsfremmeStyrelsen,
1993:107-8).

Privately employed architects in Germany as well as owners and partners in German
architectural service firms may be invited to become members of the Bund deutscher
Architekten (BDA), the most prestigious German architectural organization. BDA had
in 1997 approximately 4,500 full members as well as ca. 450 extraordinary or guest
members (BDA: 1997: 30), which means that less than 10 % of all German educated
architects are members of BDA (own calculations). It is therefore difficult to assess
how well BDA represents the interests of the majority of German architects. BDA,
however, seeks to play an active role in political discussions concerning the con-
struction industry, housing prices, new regulations, and the like (see the BDA
Handbooks (Handbcher) for statements concerning the organizations policy), and
is also a member of the Architects Council of Europe (ACE) as well as the world-
wide architects organization Union Internationale des Architectes (UIA).

Other German architectural organizations include Vereinigung freischaffender
Architekten (VfA) which only accepts architects who own an architectural firm as
members as well as Bund deutscher Baumeister, Architekten und Ingenieure e.V.
396
(BDB), a large professional organization which accepts architects, engineers,
contractors, as well as students of architecture and engineering as members. VfA has
1225 members (e-mail from Yvonne Brettscheider from the VfA Secretariat in Bonn
dated August 9, 1999), whereas BDB has a total of approximately 26,000 members
(interview with Civil Engineer Herbert Michaelis, Vice Chairperson of the Hamburg
Chapter of BDB, on July 18, 1999). Of these 26,000 BDA members, approx. 8350
work as architects, 1150 are retired architects and 8000 are students of architecture
(own calculations based on an e-mail from Marianne LeGans from the BDB
Secretariat in Bonn dated August 26, 1999). Both of these organization also seek to
play an active role in German construction industry policy making and are also
members of ACE.

Because Germany is a federal country, many of the legal regulations concerning
building construction are stipulated by the German federal states (or Lnder).
Therefore BDA, VfA, and BDB are federally organized, with branches in the German
federal states and a head office/secretariat at the national level.

A.4.2. Role of the Architect in the German Construction Industry in
Comparison with the Danish Construction Industry.

Generally speaking, there are major differences in the routines and competencies of
architects between the EU member states. Denmark and Germany are no exception to
this rule. The impediments which are relevant for Danish architects working in
Germany include the following (based on OECD, 1996:88-9):

1. Germany, in contrast to Denmark, requires licenses to practice architecture;
a person who wishes to call himself architect must apply for a license at
the Architektenkammer of a German Land. In order to receive such a
license, one must have two years of practical architectural experience as well
as a degree in architecture.
2. In Germany, architects receive extensive engineering training, which often
creates problems concerning professional liability for Danish architects who
have not experienced such extensive training.
3. Differences in construction and urban planning regulations and regulation
traditions.
4. Factors related to the social and cultural context.

With regards to point two, the technical side of German architectural training is more
demanding than in other EU countries. This means that many building design and
construction tasks may be carried out by either engineers or architects educated in
397
Germany (Button and Fleming, 1992:411). Danish architects stand especially weak in
relation to Germans with regards to technical skills, as their education does not focus
on this aspect.

Moreover, with regard to point three, German architects carry out more site super-
vision and management administration than most of their colleagues in other EU
countries (Button and Fleming, 1992:411, Oliver-Taylor, 1993:37). This makes the
German market comparatively less attractive for Danish engineers (Hartung, 1997)
because architects in Germany most often also carry legal responsibility for
supervision and management administration tasks, as can be seen in Table A.1. below.

Table A.1. Normal Allocation of Legal Responsibility in the Construction of
Buildings.

Area of Responsibility Denmark Germany

Ground Contractor Architect + Engineer
Stability calculation Contractor Engineer
Bill of quantities Contractor Architect
Design Contractor Architect
Inspection of materials Contractor Architect + Contractor
Direction of the works Contractor Architect
Final acceptance Both parties Architect

Source: Oliver-Taylor, 1993:25, 35.

The construction laws of the German federal states (or Lnder) specifically stipulate
that either an architect or a civil engineer must sign a piece of documentation
concerning the building to be built (Bauvorlage) in connection with the application for
the permission to build the building in question; this is the only legal stipulation that
requires an architects (or a civil engineers) participation in the construction process
(interview with Architect Sven Silcher, BDAs representative in ACE on July 19,
1999). Previous rules had made the Bauvorlage the exclusive domain of the archi-
tects; in the early eighties, the Bauvorlage had to be signed by an architect according
to the laws of some of the Lnder. However, these laws were changed in subsequent
years to also allow civil engineers to sign the Bauvorlage; these changes have to some
extent decreased the role that architects play in the construction process (ibid.,
Rudolph-Cleff and Uhlig, 1997:2). Additionally, in some of the German federal states,
educated craftspeople such as bricklayers may sign Bauvorlagen for small residential
dwellings.
398

Despite these changes in regulations, German architectural firms still are normally re-
sponsible for more tasks than comparable Danish architectural companies, as depicted
in Table A.1. The normal allocation of legal responsibility influences (a) the
distribution of work between the professional consultants and the other actors in the
construction process, (b) the distribution of work among the professional consultant
groups (i.e. architects and engineers), and (c) insurance rules. Architects working in
Germany must have compulsory indemnity insurance (Button and Fleming, 1992:410).
Due to their greater involvement in site supervision and management,

Architectural practices in Germany are [...] generally multidisciplinary
including specialist technicians and provide a comprehensive design and
project management service. (Button and Fleming, 1992:411).

Furthermore, in contrast to Denmark, the German market is full of interesting potential
projects for Danish architects that are larger, more interesting, and more complex than
anything that can be found in Denmark, with the exception of the greater Copenhagen
area with its international airport, large soccer stadium, and large trade fair center
(Arkitekten: 1993/5: 180).

Moreover, it is also important to note that Denmark's largest contracting companies
are smaller than the largest contractors in e.g. Sweden and Germany (Galkowski et al.,
1997:51-3; Lubanski, 1999). Danish contracting firms may therefore not be interested
in bidding on the largest projects in Germany. In the architectural services industry, on
the other hand, Denmark had in 1994 6 architectural service firms on the list of the
largest 100 architectural design firms in the world (Arkitekten, 1994/ 8:284). These
circumstances practically force Danish architectural firms interested in competing for
complex German architectural projects to follow a market-seeking strategy (see
Majkgrd and Sharma, 1998:9-11 or Section 2.1 for a definition of market-seeking).

Finally, differences in the degree of detail of project material are both related to the
third potential impediment (differences in regulation traditions) and the fourth potential
impediment (factors related to the social and cultural context) in that they mandate that
Danish firms produce project material in another manner than the manner they are used
to on their domestic market. German project plans in contrast to Danish project plans
make use of quantity surveying techniques; therefore Danish architectural firms
operating in Germany are often asked to itemize the total cost of the planned building
by using the so-called Preisspiegel, in which the prices for all components used are
specified (Entreprenrforeningen, 1996:6). Additionally the project material reflects the
399
German DIN-system of norms which to a much larger extent consists of sets of rules
concerning the exact size or strength of specific components or rooms instead of
more flexible descriptions of goals, as is the case in the Danish DN norm system
(ibid.:12-13). Most of the German DIN norms are not legal requirements; however, the
burden of proof lies heavily upon those who do not follow the DIN norms, as
customers in Germany often take firms that produce solutions that deviate from the
DIN norms to court with the aim of achieving a reduction in price (ibid.).

Further differences regarding the fourth type of potential impediment to the potential
internationalization of Danish architectural services on the German market, i.e. the
factors related to the societal and cultural context, will be discussed in Section A6.

A.4.3. Degree of Competition and Cooperation between Architects working on
the German Market.

With regard to the German architectural services market, the German market of the
early nineties was very similar to the way the Danish market previously was in the
sense that overt fee competition was almost nonexistent (see Button and Fleming,
1992:412). Legal statutes prohibiting advertisement for architectural services have only
recently been abolished (see Baus, 1997:45). Additionally, the German market is still
marked by a fee scale for architects which has statute status:

In Germany an agreed scale of fees is laid down in HOAI (Honorar-
ordnung fr Architekten und Ingenieure) which was adopted into law by
the federal government in 1971 (Button and Fleming, 1992:412).

The HOAI has been revised many time since 1971; however, the German Lnder are
still not permitted to alter substantially with the fee scale (Oliver-Taylor, 1993:34). The
HOAI fee scale is at the end of the 1990s still observed by the public sector and
contractors bidding in accordance to EU public tendering procedures due to
government subsidies for their projects. However, some pilot and main study
respondents have indicated that in their opinion not all architects, engineers, and
contractors in the private sector have used the HOAI rules in recent years due to the
overcapacity problems that began at the end of the German construction industry
boom in 1995 and the resulting increasing competition on the German market (see
Chapter 6 for further information).

400
However, the price level in Germany for hourly construction wages was, in a report
compiled by the British Business Round Table the lowest in Europe also during the
German construction industry boom (Arkitekten: 1995/1:369). Architects fees were,
however, during the same period high in comparison with other countries as they, in
accordance with HOAI, are based on a percentage of the total cost of the building that
is constructed (Oliver-Taylor, 1993:35).

A renowned German architect and Professor of Architecture, Meinhard von Gerkan,
has suggested that the German market is segmented into separate national, regional,
and local markets, each with its own types of projects and own networks; additionally,
these markets are hierarchically organized (Gerkan in Der Architekt, May 1990: 246-
50). According to Gerkan (ibid.), the local market is characterized by projects
concerning houses for families, publicly-financed housing, and building modification
projects, whereas the regional market contains projects such as schools,
kindergartens, sports halls, and small and medium-sized public sector facilities and
firm buildings. At the national level, one finds the headquarters of large firms, libraries,
theaters, museums, ministries, and the parliamentary buildings of the German federal
government and the German states (ibid.). Additionally, a few German as well as
foreign architects compete for work on international markets. The types of buildings
that are competed for internationally resemble the buildings built at the national level;
however, the architects who participate in such prestigious competitions in foreign
countries need an extremely high level of corporate identity (ibid.).

Albertsen (1996) suggestions that there is a similar hierarchy of architectural tasks in
Denmark; however the distinction between local and regional markets may be less
prominent due to the fact that Denmark is a much smaller country than Germany. On
the basis of Gerkans and Albertsens work, I have conceptualized a hierarchy of
architectural firms (Figure A.3.) which can be used for both the German and the
Danish market.

Figure A.3. The Hierarchy of Architectural Firms on National Markets.

1. Very Few Firms of international renown


401

e.g. Firms climbing the social ladder,
or

Source: Albertsen, 1996; Gerkan in Der Architekt, May 1990; various other articles in
Arkitekt- og byggebladet, Arkitekten, Der Architekt, and Deutsche Bauzeitung.

In Figure A.3. the internationally renowned firms comprise the very small peak of the
hierarchy. Immediately below them are the small group of firms with national renown
who compete for the countrys most prestigious architectural projects. Finally, the
bottom of the hierarchical pyramid consists of the many firms only active on the re-
gional or local level who bid mainly for the smaller projects, which are also usually re-
garded as less technically interesting and demanding, such as housing, kindergartens,
schools, small firms, etc.

According to the previous Construction Industry Attach at the former Danish Con-
sulate General in Berlin, Germany, Christian Lerche, Danish construction firms on the
German market in the 1990s did not compete on premium quality. Instead they
competed on the ability to build more quickly and more inexpensively than the
Germans due to the fact that they made greater use of prefabricated construction
elements (Arkitekt- og byggebladet, February 1994: 30). Some sources claim that
incorporating industrialized house building elements in the construction process is 10-
15 % less expensive than traditional German building methods (Oliver-Taylor,
1993:28).

These prefabricated elements can be used in building renovation projects as well as in
the German Fertighausbau, i.e. partially prefabricated standardized residential
housing construction (Danish Ministry of Foreign Affairs, 1995:42-3). However, not
all prefabricated element solutions allowed in Denmark and suggested by Danish
architects have been deemed acceptable to German clients. There are three plausible
reasons for this reasons for this: (1) The Danish architect have had difficulty working
with prefabricated element solutions when they at the same time have had to fulfill
DIN-requirements. (2) German clients are not used to building with as great a
proportion of prefabricated elements and thus may be more reluctant to accept a large
number of these elements in a given project. (3) Due to the fact that the EUs
402
Maastricht and Amsterdam Treaties contain an Environmental Guarantee, individual
EU member states may make stricter regulations concerning environmental standards
for construction materials than the EU minimum standards. This has resulted in
different countries having vastly varied environmental requirements and rating systems.
Whereas the Nordic countries have to some extent coordinated efforts in this area,
Germany has its own regulations. These different regulations also affect building
element specifications.

A.5. Some Remarks on European-wide Dynamics.

Looking at Europe as a whole, the total number of architectural firms has decreased in
the past decade, with small firms vying for large firms. (Eurostat, 1995:24-38). There
are several reasons for this (ibid.):

First, a substantial increase in the number of new graduates each year,
contrasted with the sharp decline of activity in the building industry during
the recent recession has deterred architects from going into business on
their own. The next factor is the growing dominance of the commer-
cialization of supply in the building sector, which encourages working as a
salaried member of a staff. Finally, the scale and complexity of some new
building projects no longer require the services of small architectural firms.

With regard to the commercialization of supply of building materials in the construc-
tion sector
40
, after the European-wide harmonization of rules concerning the labeling
of building components, there are a huge number of components available in Europe
(over 100,000). No single person can be knowledgeable about the entire selection of
components. Additionally, because of changes in production methods caused by the
introduction of programmable machines that enable more flexible production runs, it is
today possible to produce many types of components in small series or even made
to order, in accordance to the specifications of the buyer. Over and beyond that,
many producers have developed CAD-design programs that include their components
to promote their product lines. These developments all present major challenges for
independent architects position in the construction industry, as these design programs
make it possible for the layperson, civil engineer, or contracting firm to experiment
with designing structures by putting components together via computers without
involving an architect.

40
The commercialization of the business of large contracting firms is treated in Sections 6.1.-6.3.
403

In Europe as a whole the Danish tendency to use architects less and less in con-
struction projects is also to be found. The Architects Council of Europe (ACE) com-
mented this development in the following way:

[o]ne of the most pronounced tendencies in the demand circuit for con-
struction is that the course of this demand is increasingly going directly
from the consumer to the producer, with designers being passed by.
In other words, to start a project, customers tend to consult less with an
architect and instead turn to a general contractor who can provide them
with all the services leading up to the construction of a building.

Therefore, the self-employed architect is increasingly induced to offer
services which will make him/her better able to meet cost requirements
and time schedules, whatever the size of the commission involved. The
project manager aspect is taking precedence over the demand for
unique, personalized designs. This trend of customer demand has forced
the architect to equip himself with computerized means of tracking price
fluctuations, planning the design work and even executing it.

This increased technological capacity has been supplemented by an ex-
traordinary improvement in computer-aided design facilities. These tech-
niques are becoming common in medium-sized firms and even more so
in big ones. The high performance of such technology opens up pro-
spects which were previously unimaginable.

However, methods still need to be perfected for transmitting data be-
tween the demand from clients and the architects design and then be-
tween the latter and the demand for implementation. These integrated sys-
tems would not only lead to gains as regards performance and cost, but
also would enable the reliability of such communication itself to be
improved.

Such prospects shed a positive light on the architects strategic position
in the economic process of construction by preserving his/her creative
role as designer and his/her active role as coordinator. This necessarily
presupposes a sufficiently independent position to safeguard the
architects credibility in the eyes of those who seek his services.
(Eurostat, 1995: 24-39)

Similar to the role Danish architects have played in Germany, the above passage
emphasizes the way in which prefabrication building components and their
404
complementary computer-aided design facilities are changing the field of architectural
work. Danish architects have already long been parts of construction projects where
computerized designs depicting prefabricated parts have been used (see e.g. Arkitekt-
og Byggebladet, February 1994:30, May 1992:38, and Arkitekten, 1994/7:256), yet
they have as of yet not been able to lead the quest for improving productivity in the
construction sector.

However, the diminishing importance placed on unique, personalized designs leads
some architects to fear that the development in Western Europe will not stop with
prefabricated construction elements, but that we at some time in the future may also
see an increase in prefabricated building constructions, as is the case in the United
States and Japan. If this scenario comes true, many European architects believe that
we will see their role in the construction process diminish further. The Architects
Council of Europe has made the following statement on this topic:

Statistics suggest that the industrialisation of the building sector in the
US and Japan is much more advanced that it is in Europe. This is
attributed in part to the highly sophisticated prefabrication of residential
buildings which exist there. It is still generally accepted that a real demand
for products of this type does not yet exist in Western Europe.
However, if the economic slump were to persist, offering a well-prepared
supply of such products could succeed in resolving the problem of
dwindling resources and time available and increasing needs to some
extent.

EU architects are no more open than producers or consumers to taking
such a step, which would call into question the specific architectural
features which characterise most of the Member States. Nevertheless,
even if the single internal market were to remain insensitive to the search
for effective ways of responding quickly to a housing demand that
requires a minimum degree of comfort and also affordability (such needs
are still immense: 1.5 million new dwellings in ten years are planned for
Germany alone), designers and building firms would still be able to offer
their services and products to many other regions of the world where
housing needs are even more acute (e.g. Eastern Europe). (Eurostat:
1995:24-38)

A.6. The Qualitative Pilot Study Interviews.
A.6.1. Selected Responses of Respondents.
405
As previously mentioned in Section A.1., my pilot study interviews were influenced by
information from secondary literature, as presented in Sections A.2. A.5. One
additional study which greatly influenced the formulation of my pilot study questions
is Entreprenrforeningen (1996): Danske Entreprenrer i Tyskland, i.e. a study
commissioned by the Danish Society of Contractors with the Danish language title
Danish Contractors in Germany. This study, which was based on a number of
interviews with persons responsible for contractors activities in Germany, examined
the day-to-day and strategic problems that Danish contractors have experienced as
well as their practices in relation to their judgment of the factors which are important
with regard to daily work in Germany.

The most important pieces of information that I received from my pilot study
respondents are the following:

Most Danish architectural service firms are oriented towards their home market
only. They consider export difficult and cumbersome and embark upon it only
when they feel they are forced to because of a depressed Danish market.

Most of the Danish architectural service firms that attempted export to Germany in
the early 1990s were export novices; therefore their export attempts were marked
by learning-by-doing efforts. Many firms lost money on their export attempts.

Most respondents believe there are only approximately 15 Danish architectural
service firms that are aiming for, or have already achieved, a continuous export
profile and a large degree of internationalization.

Danish architectural service firms that export have traditionally been nomadic
exporters, i.e. they have wandered from one export market to another, trying their
luck on the booming markets, yet leaving quickly when these same markets began
to wane. This is also true of the majority of these approximately fifteen most
internationalized Danish architectural service firms.

Most respondents agreed that the EU Public Service Directive offers more
advantages than disadvantages for Danish architects. With the exception of
competition from the other Scandinavian countries and competition concerning the
biggest Danish projects, the respondents generally did not expect firms from other
countries to be very interested in bidding on Danish projects because of the small
size of the Danish market. Instead respondents expect that Danish architects will
bid on projects on other European markets to a much greater extent.

406
Respondents believed that only a small number of Danish architectural service
firms regularly inform themselves about public tendering offers in other EU
countries.

Some respondents mentioned that they believed that actors in the construction
industries of Northern Europe are increasingly competing on the ability to design
and build buildings with long-term low maintenance and low energy costs.

Most respondents believed that consumers in different areas of Europe have
different preferences for buildings and will continue to have these in the future due
to climatic and geological differences as well as cultural and legal differences.
Cultural differences influence e.g. basement construction, the position of the
kitchen in the house, the size of childrens bedrooms, the size and construction of
office space, etc. in dwellings and e.g. differences in the size and layout of office
space in commercial buildings.

Many weaknesses and a few strengths of the Danish architectural education were
discussed. Respondents did not believe that the Danish architectural education was
less or more international than architects education in other EU countries.

Respondents believed that their personal contacts to other actors in the
construction industry are very important with regard to receiving project orders or
being invited to compete in competitions. Many respondents believed that certain
circles in the Danish and German construction industry are relatively difficult to
enter because the parties involved know each other, trust each other and will
continue to work with each other.

Competitions and public procurement procedures in both Denmark and Germany
were criticized for not being open and impartial by some respondents.
41

A.6.2. Criticism of Pilot Study Method and Results and Further Delimitation of
my Main Study on the Basis of my Pilot Study.

In relation to my choice of pilot study respondents (see Section A.1. for further
details), two weaknesses may be noted:

1.) I spoke with relatively few respondents who could be considered as representatives
of the most internationalized Danish architectural firms.

2.) I did not speak with any German actors at all.

41
See also Section 6.4.
407
In a telephone conversation in relation to a paper I wrote for Ph.D. course on
qualitative methods in January 1998, Associate Professor Erik Maale of the rhus
School of Business warned me that not including German respondents in my pilot
study might give me (a) a somewhat one-sided picture of the strengths and
weaknesses of Danish efforts to internationalize architectural services to Germany and
(b) might even lead me to choose the wrong theoretical framework. I admits that my
results were mildly biased because I only included Danish architectural perspectives
on internationalization on the German market; however, according to my judgment,
this has not affected my main study research negatively. I choose to only include
Danish respondents in order to minimize my research expenses, as I anticipated that
my main study would require several trips to Germany.

Concerning weakness (a), its consequences could have been more serious: only
interviewing two persons who represented an internationalized Danish architectural
firms gave me little or none pre-main study knowledge about the international
business practice and the process of acquiring projects on export markets. This may
have been one of the reasons why I still had to revise my main study questions several
times in the Autumn of 1998. However, a subsequent study for the Danish Agency for
Trade and Industry (ErhvervsfremmeStyrelsen) by Drbye (1999) about the
successes and fiascoes of the major actors of the Danish construction industry
confirmed many of the results of my pilot study as presented above. Drbyes (1999)
results included the following (my translation):

1. Danish actors believe that there is more initial adversarial behavior at the beginning
of relationships to German partners than they are used to on the domestic market.
Generally Danish actors also have had trouble with differences in the process of
negotiations relating to the scope allowed for negotiating alternative technical
solutions and the methods of negotiating price.
2. In the Danish construction industry, negotiations and agreements are often oral and
informal; therefore Danish parties operating in Germany have had get used to
learning the formal rules and using them as well as putting agreements on paper to a
much greater extent.
3. In Denmark, lawyers do not usually take part in or review construction-related
contractual negotiations; this is in some Danish circles even considered a sign of
defeat. In Germany, on the other hand, this is usual; additionally, a greater
percentage of construction projects end in litigation in Germany than is the case in
Denmark.
4. It can be difficult for Danish parties to discern who is formally responsible for
what in a German firm as the division of responsibility concerning business-related
and technical matters is different than in Denmark.
5. Danish actors find that it is difficult to get their German customers to pay. Much
408
more documentation is required than in Denmark before payment occurs. This has
been the cause of some unexpected liquidity problems for Danish companies
working in Germany.
6. Other competency problems have been experienced with regard to knowledge
concerning the typical requirements for participation in German architectural
competitions and public tendering, especially with regard to the
Verhandlungsverfahren, which is the most common procedure used in German
public tendering concerning architectural services.
7. Danish actors have had problems learning to design buildings that fulfilled the
German DIN-norms.
8. Danish actors have had problems learning which types of building permits were
required for specific projects. This problem was compounded by the fact that
German building regulations vary from Land to Land.

Despite the above-mentioned possible weaknesses, my pilot study data enabled me to
chose case study firms. In October and November of 1998, I wrote to five potential
case study firms, i.e. firms that had managed to establish themselves or further
consolidate their activities on the German market in the 1990s, with the hope that at
least three of these firms would be willing to participate in my study.

I was very lucky with regard to their responses. Three of the five firms agreed to
participate. The distribution of these firms was also optimal as well, in that my three
case study firms each represented a clearly different profile with regard to previous
domestic and export activities. The profiles of the three case study firms are as
follows (see also Subsection 4.3.1):

1. An internationally renowned and established architectural firm, whose name
is also familiar to architectural connoisseurs and experts abroad. There are only a
handful of these firms in Denmark.

2. A nationally renowned and established architectural firm. These types of
firms are often responsible for the design of important national buildings and have
strong contacts to large firms and key persons in the Danish economy. The firm
from this category started its market seeking strategy on the German market at the
beginning of the 1990s.
3. A successful and innovative younger firm. These firms do not have as strong or
long-time contacts as the other two types of firms yet they have managed to
establish themselves as players on the Danish arena and have strong ambitions to
increase their importance in the future. This case study firm also started its
activities in Germany at the beginning of the 1990s.

409
Further information about these case study firms and results from my research
interviews and analysis is found in Appendix B as well as Chapters 8 10.

410
Appendix B. The Three Case Studies of Danish Architectural Firms.
B.1. Introduction.

As previously mentioned in the foreword to this dissertation, three Danish architectural
firms that have achieved a degree of success on the German market in the 1990s and
are still present on this market today have generously agreed to contribute numerous
hours of their scarce time to the research project at hand, for which I as the author of
this doctoral dissertation am extremely grateful. In this appendix, I present excerpts
from my 400 pages of transcribed interviews in order to show the reader that I first
have listened to my respondents, as recommended by Bourdieu (1990, see Section
4.2.), but then distanced myself from them, as is evident in the answers to research
questions 3 5 in Chapters 8 10 of this dissertation.

In discussions with these three firms in the Autumn of 1998, all parties agreed that full
anonymity needed not be guaranteed in the sense that employees in the three case
study firms were welcome to mention their participation in this study to relevant
persons in organizations or governmental bodies during the study, if they deemed it
pertinent. I initially guaranteed the members of the case study firms as well as my other
respondents full confidentiality. Therefore, before quoting the respondents in the
subsequent empirical sections of this dissertation, I (a) have received permission from
the person interviewed before citing him and (b) have also obtained permission to
name each of the case study firms by their proper name. Additionally more contro-
versial statements have been necessarily omitted.

In the following, each of the three firms will be dealt with in turn. First, the firm in
question will be briefly introduced, then data concerning research questions 3 5 will
be presented in an abridged version to form the basis for the cumulative discussion of
each of these three research questions in Chapters 8 10. However, in order to
facilitate the comprehension of each Danish firms activities on the German market, the
research questions will be presented in a different order in this section. Data
concerning research question 4 will be presented first, followed by data concerning
research questions 3 and 5.

With regard to translation methodology, all main study interviews also those with the
German-born partners of the first firm - were conducted in Danish. I have translated
all citations using the communicative translation method (see Hansen, 1995). In
order to make the respondents statements comprehensible to the English language
reader, I have thus changed some of the idioms and wording in cases where there is
no good direct translation of the Danish statement. Additionally, I have added
411
footnotes when respondents mention Danish and German institutions and peculiarities
which the foreign reader cannot be expected to be familiar with.

B.2. Case Study Firm 1: DISSING+WEITLING arkitektfirma A/S.
B.2.1. An Introduction to the Firm.

DISSING+WEITING belongs to the small group of internationally renowned and
established architectural firms in Denmark (see Subsection 4.3.1). The firm, which is
one of Denmarks largest architectural firms, was founded in 1971 after the
unexpected and premature death of the world-famous Danish architect and
furniture/industrial designer Arne Jacobsen by two of his closest colleagues and
assistants, the Danes Hans Oluf Dissing and Otto Weitling. Otto Weitling was born in
the southern Danish town of Haderslev (the towns German name is Hadersleben).
Thus he had substantial exposure to the German language and culture during his
childhood and teenage years which he also used in his work at
DISSING+WEITLING. Additionally, the original firms founder, Arne Jacobsen, had
won international competitions since the late 1950s; therefore the newly-founded firm
and its employees had some years of international experience which could be used
also after his death. Finally, Jacobsens international reputation had also attracted am-
bitious foreign-born employees to his firm; some of these continued their work in the
firm DISSING+ WEITLING after Jacobsens death (see e.g. Brsen, February 28,
1996).

Today, DISSING+WEITLING has a relatively international body of employees which
includes Germans, North Americans, and Asians. Three of its ten currently active
partners were born in Germany; two of whom Dieter Fremerey and Reinhard
Schmidt-Petersen - came to Denmark in the late sixties to work for Arne Jacobsen.
The third German-born partner, Reinhard Tlke, came the year after Jacobsens death
(interview with Reinhard Tlke, November 29, 1998). DISSING+WEITLING
concentrated on and succeeded in establishing an acceptable balance between carrying
on the design tradition of Arne Jacobsen and developing a name in its own right in the
years after the death of Jacobsen (Brsen, February 28, 1996). Today the firm is
active in a broad range of architectural projects from e.g. office buildings to
museums to theaters to factories to hospitals to housing to university buildings. It also
has designed buildings for a Danish multinational corporation (MNC) both at home
and abroad for many years, thus it has also been involved in client-following
international activities (see Majkgrd and Sharma, 1998:9-11 or Section 2.1. of this
dissertation) before and during the nineties.
412

DISSING+WEITLING has had both German as well as many other foreign clients for
several decades, and both German and Danish architects have been responsible for
the specific projects in Germany, depending upon the skills required. Additionally, the
firm has had one steady northern German customer for many years. The firm has in
previous decades had a couple of temporary subsidiaries in Germany, and in 1997 a
subsidiary was once again started in Wiesbaden in connection with a specific project
in the German federal state (Land) of Hesse. This subsidiary has subsequently been
moved from Wiesbaden to the nearby city of Frankfurt am Main in 1999 and is run by
one of the firms German-born partners - Reinhard Tlke.

In the 1990s, DISSING+WEITLING has been involved in German projects or
received runner-up prizes/honorable mentions in Germany for e.g. projects concerning
university buildings, a museum, a theater, housing, a hospital, urban renewal projects,
offices, and administrative buildings. In connection with this research project, I
interviewed the firms three German-born partners Reinhard Tlke, Dieter Fremerey,
and Reinhard Schmidt-Petersen, as well as the Danish-born partner responsible for the
firms finances and economic matters, Jimmy Hansen (see Appendix C). I also
received various written documents from the firm.

B.2.2. DISSING+WEITLINGs Architectural Project Acquisition.
During the late 1950s and the 1960s, Arne Jacobsen was the most well-known Danish
architect abroad. Therefore young, ambitious German architects were attracted to
Arne Jacobsen; there were many Germans who wanted to work for Jacobsen. Some
of these received this opportunity and, of these, some also stayed in Denmark
(Interview with Reinhard Tlke, November 29, 1998). This resulted in the import of
country-specific expertise which Jacobsens firm could use in its activities.
Additionally, during Arne Jacobsens last years, i.e. in the late sixties and early seven-
ties, Otto Weitling managed the firms German projects for Arne Jacobsen (ibid.).

After Arne Jacobsens sudden death in 1971, Hans Oluf Dissing and Otto Weitling
took over the firm. In subsequent years the firms name was Arne Jacobsens
Efterflgere (in English: Successors of Arne Jacobsen) (Brsen, February 28,
1996). When the partners felt they were sufficiently established in their own right, they
then changed the name of the firm to DISSING+WEITLING (ibid.).

According to Reinhard Tlke, the purpose of these steps were to create the proper
balance between continuity and renewal (interview, November 29, 1998):
413

When a very well-known architect such as Arne Jacobsen dies, it may be
hard for the firm left behind to stand on its own feet because the well-known
architects contacts no longer use the firm. However,
DISSING+WEITLING managed to create a reputation of its own during the
next 6 10 years after Jacobsens death. The firm was able to continue to
work in almost the same way as during the time of Jacobsen, and it also
received invitations to participate in architectural competitions, including
especially Germany. The firm managed to win competitions to a great
extent. Over a period of several years, the firm won almost 50 % of the
competitions it participated in in Germany. This resulted in concrete
projects, including 1 3 German buildings per year. Included in these
buildings were some very large projects that also received recognition from
other architects.

Concerning the markets of interests for DISSING+WEITLING in the nineties,
Reinhard Tlke stated the following when interviewed by me on November 29,
1998:

[W]e are primarily interested in the German market. DISSING+WEIT-
LING has been active on the German market for decades. We have
German-born partners and also many other employees that are used to
working on the German market. []

[] But I can also tell you that our other major area of work outside of
Denmark is the countries where English is spoken in the world of business.
One cannot say this only includes the countries where English is most
inhabitants mother tongue. We are building the Danish embassy in Nigeria
after having won a competition, and we build bridges almost all over the
world; that is why Poul Ove Jensen was in Stockholm the other day. After
we were chosen as the architectural firm on the Danish Great Belt Bridge
42
,
we have created a division for bridges with 10 12 people who work with
creating bridges for the world, irregardless of whether we are talking about
Malaysia, Taipei, or America. But the division of work is natural the
Danish and English language projects are run by Poul Ove Jensen and a lot
of other employees who either have English as their mother tongue or have
studied in an English-speaking country.

With regard to the total number of foreign employees, Reinhard Schmidt-Petersen has
stated that approximately 30 % of the employees of DISSING+WEITLING are from

42
The bridge over the Great Belt connects the Danish islands of Funen and Zealand. It is the second
longest suspension bridge in the world.
414
abroad (interview, April 26, 1999; statement confirmed by a list of employees
provided by Jimmy Hansen).

Focusing more specifically on the German market, Reinhard Tlke made the following
statement (interview, November 29, 1998):

Germany has traditionally been very open with regard to [] letting foreign
architectural firms work in Germany. There have been many international
competitions which have been open for everyone and they have also invited
foreign firms to participate in the limited competitions. [] This has not
been changed by EU Public Service Directive. The possibilities for winning
as a foreigner have become better because now the public authorities have
to announce the projects. []

In Germany, there are two political trends. One wants to present Germany
as a good European nation. [] Sometimes there is a conscious political
effort to invite participants from abroad to participate in the first round of a
two-phase competition. In the selection for the second phase, I sometimes
have the impression that some foreign firms are also included to insure the
political image of the good European nation. The other trend is that which
one could expect. It comes from German architects []. Traditionally they
have been very open towards letting non-Germans build theaters, museums,
and other buildings, but in the time period where we received the project in
Frankfurt, i.e. the period where the huge level of activity after the fall of the
Berlin wall was waning and things were starting to go in the opposite
direction [], the tide turned. Now there are open protests. Now one
openly hears, Now it is time to stop letting foreign firms take the large
project because we do not have enough work ourselves.

[] But sometimes a non-German firm gets the job because of a Solomon-
like solution. The client in question says If we choose a [local] architect, it
will probably create a lot of problems and discussions in the local world of
architecture so it is a more wise solution to choose an outside firm. []

In the case of the renovation of a building at the Goethe University in
Frankfurt am Main, we experienced delays due to controversies. We had
been chosen because, as we believed, we had convinced them that our
proposal was the best, but the entire decision concerning whether we could
actually get the project drew out over half a year because there was another
architect from Frankfurt who also had made a very good proposal.

415
Additionally, according to Reinhard Tlke (ibid.), most of DISSING+WEITLINGs
projects on the German market in the 1990s have been situated in Northern Germany,
in e.g. the German Lnder Berlin, Brandenburg, and Schleswig-Holstein. In the late
1990s, however, projects in central and south western Germany the Frauenhofer
Institut in Freiburg (Land: Baden-Wrttemberg), the Goethe University in Frankfurt
am Main (Land: Hesse) and a project in Landau (Land: the Rhineland-Palatinate)
concerning the towns celebration hall (in German: Festhalle Landau) have emer-
ged. Due to the large number of projects that DISSING+WEITLING has been in in-
volved in on the German market in the 1990s, I, in cooperation with the respondents
from DISSING+WEITLING, have chosen to only describe four selected projects in
this appendix. Partner Reinhard Tlke believed they would give all a fairly good idea
of the breadth of the firms German activities (interview, December 29, 1998). These
will be presented in some detail in the following paragraphs.

The first project is a housing project in the former eastern part of Berlin near Oranien-
burger Strae in the Berlin-Mitte district. Reinhard Tlke (December 29, 1998)
explained this project originally had been part of a larger project. Initially the piece of
property on which the housing was to be build was to be used for the headquarters of
a bank which DISSING+WEITLING had been asked to build due to German born
partner Dieter Fremereys contact to the German client who had especially liked
DISSING+WEITLINGs museum in Dsseldorf (Land: North Rhine-Westphalia).
The bank had had its headquarters in the very same location before World War II.
However, the current city planning rules for the Berlin-Mitte district specified that on
this piece of property housing and preferably publicly subsidized housing was to
be built (ibid.). After various discussions with the officials of the bank, the bank
agreed that it was okay with them that a substantial part of the property was used for
housing (interview with Dieter Fremerey, April 26, 1999). However, further
disagreements between the person responsible for the housing side of the project and
the bank resulted in the housing part of property being sold to private investors who
then began to build publicly financed housing using DISSING+WEITLING as an
architectural firm in 1995. These private investors chose DISSING+WEITLING after
investigation the firms previous work, although they had not had contact to the firm
beforehand. However this cooperation did not work out very well; in the end
DISSING+WEITLING left the housing project because the firm felt it could not take
responsibility for the final result (ibid.).

The second project concerns the renovation of a playhouse. In the beginning of the
1990s, the theater of the northernmost German Land Schleswig-Holstein, which is
416
located in Schleswig-Holsteins capital city, Kiel, was to be renovated. DISSING+
WEITLING won the project in a negotiated procedure; in the last round of
negotiations, five firms participated including one firm that had previously restored a
renowned theater in Berlin (interview with Reinhard Schmidt-Petersen, April 26, 1999).

DISSING+WEITLING bid as the general contractor for the project and
included a Danish acoustics firm, a Norwegian theater specialist, and two
German engineering firms in the initial project team. However our client
wanted us to use a German theater specialist, so the Norwegian partner was
taken off the team. (ibid.)

In connection with the negotiations, the parties had agreed that the stage and the wings
of the stage would not be changed, but when the construction began, the wings began
to collapse. This led the client to file a lawsuit. As the general contractors,
DISSING+WEITLING were sued. The firms opinion is that if a mistake has been
made, it has been made by one of the engineering firms, even though
DISSING+WEITLING and the firms insurance company will have to pay if they lose
the case. They will then take the engineering firm to court to be reimbursed (ibid.). But
Reinhard Schmidt-Petersen also believes that it is questionable whether the client will
win the lawsuit:

When the digging began, one wall began to move and we found out that
there was no cement inside this wall, only sand. This was so dangerous that
we could not allow any construction workers to go near this area. So we
had to stop the whole project. Our client claims that the engineering firm
responsible for building inspection should have discovered this problem
during the planning phase of the project, but we do not think this was
possible.

Although the verdict on the lawsuit is still pending, the restoration of the theater was
successfully finished in 1997. Concerning the prequalification for the project
concerning the Theater of the Land Schleswig-Holstein, Reinhard Tlke stated the
following (December 29, 1998):

We are relatively well-known in Northern Germany because we have built a
number of buildings in Schleswig-Holstein and Hamburg. It is also likely
that the client was familiar with our renovation of Copenhagens Folketeater
which was a comparable project.

417
The third project concerns a hospital. In the first half of 1995, DISSING+WEITLING
won a two-phase architectural design competition concerning a regional hospital in
Ribnitz-Damgarten, a small town 40 kilometers east of Rostock in the German Land
Mecklenburg-Pomerania (Jensen, June 1, 1995). The hospitals planned size is
approximately 18,000 m
2
and initially it will contain 190 beds with the possibility of
adding approximately 80 beds if the second part of the project is realized (ibid.).

According to Reinhard Tlke (December 29, 1998):

We applied to the competition, and even though we did not have any
previous references in the area of hospitals [] we succeeded in being
asked to participate in the second phase. [] Then we made our proposal
and won the project, and now it is being built. This once again proves []
that we always try to avoid being placed in a niche or being called
specialists. We have done offices, we have done museums, we have done
laboratories and theaters, but now we have also been involved in a project
concerning a hospital because we won a design competition.

But of course concerning such a specialized area which is extremely
complicated to build, we used several engineering firms that have good
references with regard to hospitals. Otherwise the client would be skeptical.
[]

But the [engineering firms] are not such a decisive factor in competitions. In
such a competition one only draws on a scale of 1:200 or the like. With
regard to this one uses engineers with experience in construction hospitals
but this is not the most important factor. The most important factor is the
architecture. [] We won because they liked our architecture best. On the
other hand, if you pick a winner, you must be sure that when you build the
building, the have the necessary knowledge and know-how. And therefore it
was important that we submitted our proposal together with a group of
engineering firms that could assure the client that we could in fact build the
hospital.

The criteria mentioned in the jurys decision included a clear grasp on architectural
design exemplified by a glass covered lobby with a high ceiling that connects the
medical treatment facilities to the building with the hospital beds, the functional
design, and the hospitals flexible structure (Jensen, June 1, 1995).

418
According to Reinhard Schmidt Petersen (April 26, 1999), the area of hospitals was
selected because DISSING+WEITLING believes that this area will be important in the
future.

In Germany the situation is such that all of the equipment that is used in the
operation and examination room is replaced relatively quickly. Things
happen at a fast rate in this area and this is why we have always wanted to
be involved in hospital construction. [] However it can be difficult to
compete with large firms that have experience in the area. But often we also
experience that these firms experience periods of inertia. [ H]ospital
construction in Germany is very difficult due to the huge number of DIN
rules which tell you to divide the task in such and such a way and not to use
one millimeter to much on the hallways everything is decided for you []
the ratio of room in the bedrooms to the room used on hallways, the ratio of
bedroom space to space used for operating rooms and the maternity ward,
etc. With regard to some of these ratios, there is a certain range within
which one must be placed.

Regarding the fourth project, the renovation of a building which is part of the Goethe
University in Frankfurt am Main (Land: Hesse), Reinhard Tlke explained that the
renovation project had been announced as a negotiated procedure tendering which
also included construction management (interview, December 29, 1998). Personally,
Reinhard Tlke believes that negotiations are very good when one is dealing with the
renovation of an existing building because he perceives that there is comparatively less
drawing and totally new conceptualization involved and a comparatively greater need
to discuss the project on the basis of the existing building (ibid.).

Reinhard Tlke participated in all negotiation rounds; however, another German-born
partner from DISSING+WEITLING participated in the initial round, namely Dieter
Fremerey. This constellation is not unusual for DISSING+WEITLING for, as
Reinhard Tlke put it (interview, December 29, 1998):

Sometimes it is an advantage to send two persons because one must
present in front of a panel and one is bombarded with questions. [] But
as I mentioned before, one has the opportunity to present ones project.
This usually takes 20 minutes to half an hour and we usually do this with
slides or other PR materials; in Frankfurt we took slides with us. And in the
second part of the presentation which takes about an hour [] the
panel of at least 10 15 persons asks questions.

419
In the Frankfurt am Main project, it took the panel 2 3 months to choose seven firms
for the next round of negotiations (ibid.). This is not an especially long time in the
opinion of Reinhard Tlke; DISSING+WEITLING has also taken part in a
prequalification in Germany in which it took a year to decide which firms went on to
the next round. However, with regard to this project, the firm received a letter and a
date for the next round of negotiations which was approximately a fortnight from the
date of the letter (ibid.).

After the second round, DISSING+WEITLING was informed 10 14 days later that
the panel had selected two firms. Approximately two weeks later, these two firms - as
previously mentioned the other firm was a local firm from Frankfurt am Main - then
participated in much more in depth negotiations with many concrete questions and
descriptions of how the firm would handle the project. A week after the completion of
the third round of negotiations, DISSING+ WEITLING was told orally that the panel
had chosen them. However, a week after this had occurred, the phone rang again in
Copenhagen; this time the oral message was that the previous decision was not final
(ibid.).

Reinhard Tlke (December 29, 1998):

Subsequently both firms were invited to meet the panel and representative
of two of the ministries of the Land of Hesse because some in fact hoped
that we could divide the renovation project among ourselves. But our firms
and my response was that it is a bad idea to let two architectural firms
decide the important things concerning the same project. [] It then took
half a year before a decision was made. We ended up having to meet with
high officials from two ministries the Hessian Ministry of Finance and the
Hessian Ministry of Culture and Science which was responsible for the
university and after an hour the case was decided. [] The entire process
took almost of a year, and this is unusual. [] By then we were in April
1997. After the final meeting, a press conference was held a few weeks later
at which the decision was made public. Until this time it was a confidential
verdict.

DISSING+WEITLING opened a subsidiary in Wiesbaden, the capital of Hesse, after
winning the renovation project at the Goethe University in Frankfurt am Main.

Maria Anne Skaates (November 29, 1998): When did you open your subsidiary in
Wiesbaden?

420
Reinhard Tlke: In June 1997.

Maria Anne Skaates: Why did you choose Wiesbaden?

Reinhard Tlke: The project at the Goethe University in Frankfurt am Main is so large
and time-consuming that both our client and we ourselves said that if we win the
tendering, we will need to have a local office. All other German projects that I have
mentioned to you are run from Copenhagen. We work on these projects together with
local German architects and engineers. []

The fact that we chose Wiesbaden is related to two factors: The German architectural
firm that we work with regularly, i.e. the firm that helps us through certain project
phases like subcontracting and project management which we never do because we do
not have exceptional competency in this area, has its office in Wiesbaden. So we also
knew that Wiesbaden is a comfortable city [].

This location is also not bad generally speaking. We are situated relatively centrally in
Germany. You now know that we also are working in Landau and in Freiburg. It is
possible that our little group could run the Landau project. Landau is only 1 hours
drive from our office.

Maria Anne Skaates: Has there been a discussion at DISSING+WEITLING
concerning how permanent your subsidiary is?

Reinhard Tlke: Not a discussion. I would put it this way: We have always built and
run things from Copenhagen. Many years ago, during Arne Jacobsens time, we had
offices in Germany in e.g. Mainz and North Rhine-Westphalia in relation to large
projects. [] But we have not had such good experiences with external offices or
subsidiaries.

[] Of course it is clear that the projects we have run from Copenhagen until now
back and forth by airplane once a week have also not been unproblematic. [] One
has to visit an official but he has caught a cold this morning, so the meeting must be
postponed for a fortnight, to take a very simple example. Therefore we thought that
this was a change for our firm because we have received a project which hopefully
also will be able to bear the establishment [of a subsidiary or office]. We said, OK,
well design, prioritize, and carry out the project but we also hope [] that we can
convert this office to something permanent. This is clearly our strategy. This office
can supplement or cooperate with our Copenhagen office. It is not a question of
either-or, but it could be an advantage if we e.g. worked on the Landau project from
Wiesbaden because we can drive to Landau in an hour and a half instead of having to
travel to Landau from Copenhagen. Another good reason to have a branch in Ger-
many is that it sends an important signal to certain clients.

421
[] But many years ago we have bad experiences. And after the fall of the Berlin Wall
and the subsequent euphoria, there were many Danes architectural firms, individual
architects, engineering firms, and contracting firms that threw themselves upon the
German market, especially in the Berlin area. And until now I have mostly heard about
sad endings to these adventures. [] Many went to Berlin without any preparation.
They drove to Berlin, signed a lease, opened an office with two people and then
hoped that they could find work without knowing how to operate on the German
market. We have seen this story before and we have therefore been cautious and have
said, we will only establish ourselves if we have a project that can pay for the cost of
establishment and moving.

Concerning the decision of whether or not to make the subsidiary permanent, other
factors also play a role. With regard to possibilities for acquisition, Jimmy Hansen
stated the following (interview, March 18, 1999):

We have spoken about opening a subsidiary [in later years] because we be-
lieve or at any rate we believed that local presence was important. Dieter
Fremerey has been in contact with Germans on the private market for many,
many years and when he has tried to get projects on this market he has been
told a number of times, You should establish yourselves here; if you did,
you would certainly be taken into consideration. But this perhaps can be
connected to the fact that the German market was booming in previous
years. The situation that we have experienced has been that the prequalifi-
cations that we have applied for from our office in Wiesbaden have not had
a good success rate. The problem is at if we apply as
DISSING+WEITLING Wiesbaden, then we are one firm among 500 local
firms. And why should they choose DISSING+WEITLING Wiesbaden?
No, if you apply for prequalification as DISSING+WEITLING Copen-
hagen, then you are a solid firm with real good references and a German
touch and the Germans get a chance to play the role of Good Europeans
once again. They can in fact be Good Europeans and get a German
contact from Denmark.

However, the question of finding qualified employees willing to move to Germany is
another potential problem area. On April 26, 1999, Reinhard Schmidt-Petersen stated
the following:

It was difficult to get our employees to move to the Frankfurt-Wiesbaden
area. Two moved, as Tlke did, but we had tried to get some more to move
but they would not. Therefore [Reinhard Tlke] is borrowing employees
from another architectural firm in the same building. This firm is also
formally responsible for the construction management. But concerning the
422
most important things, e.g. the design of the lamps and the railings for the
staircases, these are designed in our design department in Copenhagen. This
is a typical division of work in our firm. [] And concerning the lamps,
although they have been designed especially for the Goethe University reno-
vation, they may be sold on the market after the project is completed. We
use this strategy often if our client allows us to do this.

Three of the four projects described above involved public tendering or architectural
competitions, even though these projects were announced before Germany implement-
ed the EU Public Service directive (see Subsection 6.4.2.). With regard to the effect of
the directive, Jimmy Hansen stated the following (interview, March 18, 1999):

In 1992, the EU Public Service Directive was made law, and this
automatically changed our strategy to an extreme degree in that we all of a
sudden had access to a large number of projects which we would not have
had access to in the traditional system where one usually had relatively
steady relationships with an architect. [] We of course decided to use this
opportunity and we found out very quickly that it was here that the projects
were also for us because we have so many good references. So it is
difficult to get around us in a prequalification round. [] We have a hit rate
of over 60 % in prequalifications, including abroad. [] This has had a
positive effect on our acquisitions in Denmark and in Germany.

With regard to EU public tendering notices, approximately 40 % of these concern
Germany. (Interview with Reinhard Tlke, November 29, 1998, see also Danish
Association of Consulting Engineers, 1996-1999). On the basis of experiences with
public tendering both in Denmark and abroad, Reinhard Tlke explained part of
DISSING+WEITLINGs public tendering project selection policy, which emerged
during the 1990s, as follows (ibid.):

I would like to say this very openly and you are welcome to quote me for
it: When the whole procedure with EU public tendering started in Denmark
and Germany, we are also uncertain because we did not know that much
about the directives many types of procedures and how they would be
administered. We have subsequently participated in several public tendering
procedures in Denmark in which the criteria lowest price was used. But we
dont do this anymore because we believe that there will always be bidders
who are so eager to receive a project that they will bid a too low price.

Additionally, DISSING+WEITLING prefers to participate in public tendering pro-
cedures that involve 6-8 prequalified participants. Finally, DISSING+WEITLING is of
423
the opinion that architectural design competitions are the best method to choose an
architectural firm for a specific project. (ibid.).

Although DISSING+WEITLING has been very able to be prequalified and win pro-
jects with its selective project policy, problems related to the use of the EU Public
Service Directive have arisen in other areas, according to Reinhard Schmidt-Petersen
(interview, April 26, 1999):

Today there are a number of projects where one is prequalified but one
does not get the job, even if one wins. Often politicians use a famous
architect to try to get support for a building but this situation is terrible if
this does not work. One starts a public tendering round which includes
foreign architects in hope that one can get permission to complete the
project by using them because one does not have the political power to put
the project through. This has also happened in Copenhagen many times in
recent years. It is a huge waste of resources. For example with regard to the
concert hall in Copenhagen, there were more than 300 firms that participated
in the competition and if one calculated what that has cost perhaps each
firm has used an average of DKK 100,000 on this competition then one
realizes that loads of money have been wasted. []

I have also seen this in a competition concerning a large museum in Munich
(Land: Bavaria) where the entire tendering became a huge political struggle.
We as architects cannot do anything about this. In the competition
advertisement the site is specified but in the aftermath it turns out that this
site cannot be used for this purpose. []

It is very expensive to participate in these competitions. [] It requires a lot
especially in Germany with all of the calculations. We were invited to a
competition in Frankfurt in which there were no limits to the details. One
already had to specify which engineering firms were to be used, whether the
existing walls would be torn down and which materials one would use and
how much one would recycle. [] This costs a huge amount of money.

We have therefore participated in as many prequalifications as we have been
qualified for. We do this almost every week to try to get good projects. But
with regard to architectural design competitions, we do not participate in
very many of these anymore, unless we are invited or receive payment for
doing so. And with regard to these competitions, the Danish contests where
one is invited to participate are much better paid than the comparable
German contests. In Germany the situation is almost such that one does not
receive money for participating.
424

With regard to architectural prequalification it is also interesting to note that according
to Dieter Fremerey (interview, April 26, 1999), two or three German engineering firms
very occasionally inform DISSING+WEITLING when they have heard that a public
tendering may be announced:

They write There is a project on the way here or Something might
happen. And then all of a sudden we see the project in the EU Public
Procurement Bulletin. And then we are often chosen [] to participate in a
competition or invited to negotiations. [] And then we use the German
firm that has notified us about the project in question; this is clear. But this
happens relatively seldom, although it would actually be of advantage to all
parties if it happened more often.

In order to find out to what extent DISSING+WEITLINGs cooperation partners also
play a role in public authorities selection of an architectural firm, I asked Reinhard
Tlke the following question on November 29, 1998:

Maria Anne Skaates: [] Can your cooperation with other firms in the construction
industry have an influence upon your contribution to future projects? []

Reinhard Tlke: This varies from case to case. [] It is my impression that in
Denmark the team of consulting firms is judged as a whole. It may be that the
architects do not seem that convincing but that the engineers are outstanding or the
other way around. [] This is not the way things are done in Germany. [] The
architect still has more status and recognition and weight seen from the clients
viewpoint [] he is in a way the key person, so the client is mainly interested in the
architect, not the engineers who also are a part of the team. It is primarily the architect
one looks at or the architectural firm. We are often looking for members of project
teams. If we think that a certain cooperation agreement e.g. concerning technical
matters related to a certain theaters stage went well and the firm we used is known
for its expertise, then of course we will include this firm the next time we tender for a
theater renovation project because we believe that we strengthen our proposal by
doing so.

But often in connection with EU offers for tendering the announcement only mentions
the architect. But if the tendering concerns all professional services related to the
construction project, we attempt to mention the strong firms we know. But on the
other side this does not mean that we are that engaged to each other. In Frankfurt,
when we tendered for the project we also were asked to mention an engineering firm.
[] After we were awarded the project, the client asked us if we regarded it as an
absolute condition that we had to work with this firm. Of course we said no to this.
425

They then suggested several potential firms in the Frankfurt and Wiesbaden area
whom we also knew and had had good experiences with previously. They of course
must have felt more secure with this solution.

When asked whether such a situation creates bad feelings among
DISSING+WEITLINGs cooperation partners, Reinhard Tlke replied as follows
(December 29, 1998):

This did not create bad feelings [on the part of the German firms we had
suggested]. We do this all the time and the constellations change. We had in
our proposal mentioned the German firms that we knew best but they were
from Northern Germany. [] I think it is very seldom that a move like this
creates bad feelings because this also happens the other way around []
Additionally, this happens relatively openly and therefore it is relatively
seldom that other actors feel insulted or misused.

[] Concerning acoustics [in relation to the Theater of Schleswig-Holstein],
this is a very specialized area. In this case it is relatively unproblematic to
use the firm that one knows. We have a Danish expert in acoustics whom
we have used for decades in our firm and now we use his son. In such an
area of expertise one can include a Danish expert but with regard to other
engineering specialties such as the building framework, electricity, or
ventilation, we prefer to use German firms. We do not have a bad opinion
of Danish engineering firms but 20 30 years ago and also during the time
of Arne Jacobsen we had some German projects also large projects
where we used Danish firms. I was not involved in this but I have been
given the impression that this was not unproblematic because German rules
and construction methods are very different from the Danish rules and
methods.

Concerning potential cooperation partners on specific project, Reinhard Schmidt-
Petersen stated that that he found it an advantage to use local firms but avoid the
largest firms (April 26, 1999):

If we function well together, we try to maintain contact. In my opinion the
biggest problem is employing large firms on large projects. In this case we
have experienced heating and sanitary engineers and electricians who have
not communicated with each other and expected us to coordinate
everything. In my opinion it is better that we use small firms because they
communicate better with us. But when we are preparing to prequalify
ourselves, I try to visit some local engineering firms because I believe that
426
the chance of receiving the project is larger if I do so than if I suggest some
firms from far away. This has the advantage that some of the work has been
done by firms from the area and this has its advantages, also with regard to
maintenance. If one has questions, the engineer is change does not have to
take an airplane from a foreign country. This type of service is necessary in
the area of hospitals, for example.

With regard to Danish advisors and public sector actors, Reinhard Tlkes comments
on the Danish Ministry of Housing and its Construction Industry Attachs were as
follows (interview, November 29, 1998):

[Their offices] have not been to our direct advantage. [] We have been
invited to several official receptions in the past 10 15 years but these have
not resulted in any concrete projects for us.

With regard to the role of DISSING+WEITLINGs long-standing client-customer
relationship to a Danish MNC, the following conversation took place on November
29, 1998:

Reinhard Tlke: Our cooperation with [the Danish MNC] started way back in Arne
Jacobsens time. Most of the cooperation takes place in Denmark but is has also taken
place abroad in the last 10 15 years. []

Maria Anne Skaates: Is it important for your firms export strategy to have relatively
long-term agreements with respected firms?

Reinhard Tlke: Strategy is not the right word. [The multinational firm] is of course an
important part of our customers because most projects with clients in Denmark and in
Germany are one time deals. []

In my interview on March 18, 1998, Jimmy Hansen spoke of DISSING+WEIT-
LINGs one steady customer in Germany, a private firm in Northern Germany that
does not have substantial activities abroad. The relationship has existed since the time
of Arne Jacobsen and is relatively continuous in that there is almost always a project
underway for this particular customer. DISSING+WEITLING is in principle
interested in steady relationships to customers but senses that this is quite difficult. In
later years the firm has attempted to create the basis for a long-term relationship to
another German firm, but the client firm did not seem interested in working this way
(ibid.):

427
I dont think this is impossible but it happens when a customer for one
reason or the other sticks to us. Now there is the bank in [Germany] that has
received good building designed by us. One could imagine that in such a
case there was a chance of a more steady relationship. If they still are
satisfied with the building in three years, it is not unthinkable that they may
phone us if they need a new building in Hamburg or Cologne. And then the
ball is rolling. This is the way it was with [the Danish multinational company]
many years ago. Arne Jacobsen built for them [] in 1958 and they have
been customers since then.

Reinhard Schmidt-Petersen is, however, more skeptical about this possibility:

I am not optimistic about this. Today we experience a new generation of managers.
They are not as interested in design, they are interested in having a positive result every
year so they go to a general contractor and say I need a building and I can pay DKK
6,000 per square meter. Please build this for me; it should be done in eight months.
[] We also experience this in the public sector for example the mayors in the
German Land Schleswig-Holstein are almost like managers. They may have studied
business or public administration but they know nothing about quality in construction
work. One can also say that if you work in a building that you like and think is pretty
and functions well, this is also an advantage. I believe, however, that the sense of
quality in construction should be built from ones years in primary school so that one
learns to think about this.

When one builds, often the project is more expensive but then the materials last longer
and the cost of maintenance is less expensive [] (interview, April 26, 1999)

Maria Anne Skaates: But could you not emphasize this and also your ability to keep
up with developments in construction to insure low life-cycle costs? Do you not think
that this was one possibility of winning the trust of a client, such that he would say
This firm is able to build well-designed, environmentally friendly buildings with low
long-term costs, and this is important even though the initial price is more expensive?

Reinhard Schmidt-Petersen: This would be the ideal situation. But I still think that
many clients who need for example a new factory want the factory as quickly as
possible and start by stating that they have DEM 2,000,000 and need 1500 square
meters floor space. My cheeks then become flushed and I tell them that for this
amount they can get 800 - 1000 square meters. Then we have to negotiate from the
initial price they have given us [.]

Dieter Fremereys opinion on this subject was as follows (interview, April 26, 1999):

428
It could happen. It could occur. It depends upon how satisfied a client is
with a certain architectural firm and what kind of construction needs the
client has. Most clients have only one project on the immediate agenda and
then the cooperation is over. [] But there is also a new trend in Germany.
The client has changed. The decision is now not usually made by the
managing director but by a group of for example 10 smart people who do
calculations and press the architects to insure that they receive the solution
that they believe is most economical. In this situation they will almost always
decide to use a different architect each time. This means that there is not the
same continuity because one is not dealing with a person anymore but with
a consortium. []

However, DISSING+WEITLING has in later years become quite cautious and
selective when dealing with potential private customers on the German market, due to
bad experiences:

Maria Anne Skaates (March 18, 1999): You have a long-standing relationship to [a
firm in northern Germany]. But are you also interested in working with German private
customers to an increased extent?

Jimmy Hansen: One can say that this ought to be an important area for us. This is
important if we speak of large, serious firms [] the ones whose shares are sold on
the stock exchange. But we have bad experiences with other types of private clients in
Germany. We have lost a hell of a lot of money to clients who have refused to pay.
[] They wait until they are taken to court or cheat by creating chains of associated
limited liability companies. We have extremely bad experiences with this. I would
estimate that we lost DKK 3 million due to this problem and this a very sad to put it
mildly. In this respect we have not been good enough to legally insure ourselves in all
respects. [] We now have a German lawyer, but we usually avoid private German
customers unless we are speaking of serious, large German firms with a good
reputation.

Reinhard Tlke emphasizes that DISSING+WEITLING offers a very broad spectrum
of architectural services, which in his opinion is much broader than what he usually
sees when he has contacts to German architectural firms (November 29, 1999):

DISSING+WEITLING is involved in traditional construction projects,
bridges, and design work concerning everything from chairs to bridges to
eyeglasses to every thing else imaginable. We also have 8 12 people who
are our experts in the area of product design but who are involved in very
different projects from furniture to bridges to shelters at bus stops to the
placement and design of signs on the Great Belt bridge. I would like to
429
mentioned that I have not lived in Germany for 1 years. There it is more
usual that architectural firms have specialized themselves to a great extent
and are experts in a field such as hospitals, schools, museums, universities,
or something else.

But in contrast to this, even though we as a large firm have to have experts,
for example experts in building bridges, we try to avoid being places in
narrow niches for experts. We always try to emphasize without giving
others the impression of being self-centered that our specialty is that we
are not experts in a narrow field. We believe that irregardless of whether we
receive a smaller or a larger project, we are able to work with it based on
our traditions and experience. We do not want to be labeled too narrowly.

As a commentary to the above comment, Dieter Fremerey stated the following on
April 26, 1999:

But the most well-known German architectural firms have the same breadth
that we have []. They operate with the same spectrum of projects as we
do and are not very specialized. But the main part of the German
architectural firms are more specialized.

As the firms expert in economic matters, Jimmy Hansen commented upon
DISSING+ WEITLINGs experiences in the areas of fees, acquisitions, and trends
concerning the scope of architectural projects in the nineties in the following way
(interview, March 18, 1999):

Jimmy Hansen: In the nineties we have not felt pressure expect in the area of fees on
some markets. [] We are less affected by economic downturns. You spoke of
housing but we do not do that many housing projects. But if housing is down,
perhaps investments in infrastructure are up, and if infrastructure projects are not
being built, perhaps the German market is up, and if the German market is not up, it
could be that [a Danish multinational firm] is building factories or perhaps there is
something in the USA or the Far East. It is clear that the more broad you are, the less
sensitive you are to economic up- and downturns like the Danish interest rate which is
still of great importance to us.

If we speak of our main market, which is the large and prestigious projects, I do not
think that [our customers outsource and press the architect] because the signal that
they want to send to their surroundings is that the price of the architect is not the
decisive factor. If we are asked to build a headquarters for [a German bank] for DEM
1 billion then a difference of DEM 1 million in our price and the price of another
architectural firm is not what is going to make the difference. [] It is not the small
430
architectural firm in Hamburg that we are competing against; it is the major German,
English, Danish, and other international architectural firms who are able to offer
projects at a sensible price. We think we should make money on our projects, and I
do not think that this is a problem in our normal segment and our desired segment. But
it is clear that if you speak of architecture for the masses and publicly subsidized
housing, we really have little to offer these segments. We need not even try.

Maria Anne Skaates: The last time we spoke with each other, you mentioned the
tendency in building design that prestigious firms and organizations use world-
renowned architects, but that these architects only make the initial sketches and the
rest is delegated to other parties. What came to mind in my head then was [] that the
traditionally perceived strength of Scandinavian design is functionality and
unobtrusiveness. Therefore I am inclined to see this development as more of a threat
to your firm that to the most showy architects. [] Can you follow my thinking?

Jimmy Hansen: Of course. There is no doubt that we prefer going in and doing what
we usually do but if the market does not want this and I am not sure that this is true
of the market generally speaking but there was a time when this trend was present on
the German market, we must deal with this. This tendency is also very present in the
USA. And on the other hand what is the difference between this and looking at the
largest American firms they have 5 6,000 architects but a core of perhaps 50
to 90 architects who make the design-related decisions. They make these decisions are
their headquarters and then the send their initial sketches to Milwaukee to be finished.
This is almost the same as sending the initial sketches to another firm.

Maria Anne Skaates: How do you attempt to compete with this type of arrangement?

Jimmy Hansen: This is also extremely difficult but we were very close I do not know
if you know this but we won the second prize in the competition concerning the
World Bank Building in Washington D.C. If we had won, we would have built
100,000 m
2
right in the middle of Washington D.C. and then we would have been on
the American market. But we lost to one of these very large firms who received the
first prize. We were as close as one could come to getting a foothold on the American
market. For such a building is very, very visible, but a second prize cannot really be
used for much.

Maria Anne Skaates: Do you mean to say that you cannot use the second prize for
anything?

Jimmy Hansen: Of course one can use them in our public relations to say we are good
architects and we were very close to winning the World Bank building but we are not
present in the USA, we do not have a building that is seen by 10 million people each
year. A lot of people who visit Washington D.C. go by the World Bank because this
is an important building. [] If we had built the World Bank, there probably would
431
have been many American banks who would have considered letting us build their
important buildings [] because if you build a prestigious building, when it is finished
it is received in the media and people visit in when in Washington D.C.. [] That is
how people got to know [the Polish-Jewish architect Daniel] Libeskind and [the British
architect Sir Norman] Foster and others. [] DISSING+WEITLING is not a name
that people you meet on the street knows

Maria Anne Skaates: Many people in Denmark probably have heard of you.

Jimmy Hansen: No, not even in Denmark.

Maria Anne Skaates: I would say yes - at least the well-educated Danes and the Danes
in high positions are familiar with your work.

Jimmy Hansen: OK, but if you ask the average Dane, he probably only can name two
Danish architects, Henning Larsen and Jrn Utzon. Utzon is well-known because of
the Sidney Opera, a building which the whole world has seen. [] A lot of television
programs on Australia start by showing the opera house, so a great deal of people
have seen or heard of the building and an architect named Utzon.

When presented with Cova, Mazet, and Salles (1994) model (see Figure 1 in Chapter
1), Reinhard Tlke stated that he found it difficult to compare DISSING+
WEITLINGs project acquisition activities with the steps mentioned in the model
(interview, December 29, 1998). However he mentioned that DISSING+WEITLING
has been interested in strategic questions for several years and that there is substantial
internal discussion of this issue from time to time. Topics such as nursing relations to
clients, continuing education, or the creation of special units with persons with
specialized knowledge have been on the agenda for many years. However the dilemma
in his opinion is how much time and resources should be used on these issues and
how much should be used on architectural design and the artistic side of the business
which is still regarded as the primary and unique side of the profession of the
architect. Some members of the firm fear that too many resources are being used on
issues secondary to the traditional strength of the architect. But the partners also
discuss the general future of the firm as well (ibid.):

Once in a while some also express doubt as to whether the firm has a
chance of surviving. [] We also speak of this. [] Not over a horizon of
50 years but merely the next 10 15 years. This has been a topic of open
discussion: Do we have a chance. With everything that you speak of
[concerning structural changes in the construction sector] and
computers and the client will only have this and this and money becomes
increasingly decisive. Is this a market for us? this is what we consider to
432
be the important question. Currently things are going well but I will say
openly that we discuss this topic regularly and there are just as many
opinions as there are partners in the firm.

According to Jimmy Hansen (interview, March 18, 1999), DISSING+WEITLING
keeps a record of its acquisitive activities. This is not for the purpose of knowledge
accumulation or strategy but to insure coordination of acquisitive activities and avoid
the embarrassing situation where two partners are in contact with the same e.g.
German firm without knowing it (Jimmy Hansen, March 18, 1999).

Reinhard Tlke had the following further comments to the organization of project
related activities, (interview, November 29, 1998):

When we receive a new project, that is either competition/public tendering
procedure that could lead to a project or an architectural project from a
private customer, we discuss it at our weekly meeting which we have to
arrange because we are 120 people who have to be coordinated. If we have
to choose between a public sector competition/tendering and a concrete
project from the private sector, we prioritize the concrete project, of course.
[] We aim to put the people together who will work with a given project
optimally, irregardless of whether the work is related to a competition/public
tendering procedure or a concrete project. This is of course quite theoretical
because in practice it is not always possible to achieve the optimal team but
it is always our goal.

Concerning contacts to the media, sales, and the conception and use of PR-material in
German-speaking regions, Jimmy Hansen stated the following (March 18, 1999):

One of our secretaries is Swiss and an another has a German brother. But
concerning presentations of previous projects, it is usually Dieter Fremerey,
Otto Weitling, or Reinhard Schmidt-Petersen who write the German text.
We have tried but it is our experience that we cannot just send the text to
a Danish bilingual secretary. Even though what she writes is grammatically
correct, the choice of wording is sometimes not correct. [] Even if you
are a good bilingual secretary, if you are not specialized in the area of
architecture, what you write can very easily sound peculiar in the ears of an
architect.

Concerning the foreign media, Scott Hollingsworth [an American employee]
is responsible for contacts to the English-language press [] and the
German partners usually handle the German-language media [] whereas
433
partner Pouli Hoffgaard Mller is responsible for the Danish press and the
coordination of contacts.

Concerning Cova, Mazet, and Salles (1994) model, Dieter Fremerey stated the
following (April 26, 1999):

I do not think that things are as complicated as the model indicates. The
model suggests that one has a main strategy for analysis and choosing
projects. This is clear: we have a method and we analyze projects in our
internal meetings. But I think we do not consciously invest in our network.
Concerning environmental scanning, this is clear, we do this but not
systematically rather more from time to time. But concerning the part after
the contact, when one first has obtained contact with the client who want to
have a project, then things run their course. One creates the first steps of the
project and the some related economic data, and then one starts. This is
quite usual.

[] When our contact indicates to us that he is ready to use us, the next
step is to get started and discuss the scope of the project. Then one makes
the first sketches of the project, they are checked with regard to whether the
client is satisfied with the costs [] and when we have reached agreement
about that, we start the planning phase.

B.2.3. DISSING+WEITLINGs Knowledge about the German Market.
Although DISSING+WEITLING has many years of experience, the firm is still
acutely aware of the many differences between the Danish and the German
construction industry. In the words of Reinhard Tlke (November 29, 1998):

Even though it is not very far to the German border, there are huge differ-
ences in the world of construction concerning rules and many other
things. [] I would put it this way: The construction industry in Germany is
much rougher than in Denmark. Now I am thinking of the entire industry,
both the relationships between the architectural and the engineering con-
sultants and between the consultants and the clients, including especially the
private clients. One must be very careful with private clients according to
our experience. I have now been involved in a lawsuit against a [German]
private client [] for the past 2 3 years who seems to think that it is more
inexpensive to not pay us, throw us out of the project, and find some
excuse for not needing to pay the agreed fees. And although we have
brought him to court where we will most likely win and receive most of our
fee, this way of behaving is still less expensive for him.

434
And I have heard this from other Danes from bricklayers and skilled
craftspeople to [a large Danish contracting firm] that rushed to Germany
and came back to Denmark saying My God, actors in the Germany
building industry treat each other very harshly. This cultural difference has
been difficult for everyone also Danish architects.

However, some Denmark-related characteristics also are the cause of difficult
situations which must be learned to be dealt with in relation to foreign markets,
including the German market. When I interviewed partners Reinhard Schmidt-Petersen
and Dieter Fremerey on April 26, 1999, the employed architects at
DISSING+WEITLING as members of DAL/AAR (see Appendix A, Subsection
A.3.1.) were involved in a nation-wide strike
43
and the Danish architectural firms had
responded with a lock-out. In relation to foreign projects, a Danish strike/lock-out
situation can be a problem an internationally-oriented architectural firm must know
how to deal with. According to Reinhard Schmidt-Petersen (interview, April 26, 1999):

At the moment we have a lot of projects underway to Germany and many
of our German clients have told us that they do not accept a lock-out as a
force majeure, so we will probably have to pay for any costs that result
from any delays we experience. [ The extent of damages] will really
depend upon who long the strike continues. It has now gone on for a week
and we are starting the second week today. I think we can handle two to
three weeks but after this the situation is critical for us.

With regard to the development of knowledge of Germany among DISSING+
WEITLINGs employees and Danish architects in general, Reinhard Tlke stated the
following (interview, November 29, 1998):

DISSING+WEITLING has been active on the German market for
decades. We have German-born partners and also many other employees
that are used to working on the German market. Here I mean both Germans
who have immigrated to Denmark or, in later years, also Danes who have
worked in Germany, especially in the years after the fall of the Berlin Wall.
At that time the employment market for architects was extremely bad in
Denmark. Therefore many Danish-educated architects went to Germany
after they finished their studies because there were a lot of jobs in Germany.
In the first year after the German unification, architects in Germany migrated
from one firm to another just because they could receive DEM 500 more in

43
The rate of union membership among Danish construction industry employees, including architects, is very
high, as it also is in other industrial sectors in Denmark. This is a unique feature of the Scandinavian
countries today (see e.g. Lubanski, 1998: 315).

435
wages in the new position. Thus there were good chances for a Danish
architect, even if he or she had just graduated, to find employment on the
German market.

I am convinced that today there are many more Danish architects who have
worked abroad than was the case 10 15 years ago. And those who have
worked in Germany for 3 5 years or more have returned to Denmark with
knowledge of how to do business in Germany in relation to German
regulations, authorities and the like. We earlier had huge problems finding
this level of knowledge in Danes. [] I am primarily referring to the German
norms and the somewhat more elaborate construction procedure in
Germany and the fact that German authorities can be more difficult to work
with than is the case in Denmark. But with regard to how things are run
internally by DISSING+WEITLING, one can say that the three German
partners who now have been a part of the firm for over 25 years still today
to a large extent work with the German projects each time we acquire such a
project. Anything else would be peculiar.

However, now that you have mentioned [Managing Partner] Poul Ove
Jensen, he has also been involved in German projects. For example, when I
started [in 1971], he was managing a project concerning a building in
Hamburg [being built for an American multinational corporation]. He had
only had three years of German in school but he took the plunge onto the
German market. We cooperated with each other but I for my part was very
inexperienced, having come immediately from my German architectural
education to the firm. What I mean is that we do not have a predefined
division of work where we say This is done by the German employees, and
this is done by our Danish employees and this is done by our other foreign
employees. But of course this division of work is created almost
automatically.

As for the specific competencies which are necessary to complete certain types of
projects, Reinhard Tlke is of the opinion that DISSING+WEITLING is capable of
acquiring these competencies when they are needed (citation from my interview on
December 29, 1998):

Reinhard Tlke: Specific competencies [] they come from I would not say ran-
domly, but from case to case. The first time we draw a hospital, we also
automatically receive a certain level of competence, and it opens new doors for us.
This is the way things have always been. The is the same in the world of bridges. 12
years ago we did not really even know what a bridge looks like en detail but since
then we have come onto this market and received some competencies that have
opened new doors for us.
436

Maria Anne Skaates: This almost sounds like you are collectively learning while you
are doing things: You get the project and then you also learn while completing it.

Reinhard Tlke: Yes, but it is still the world of architecture we are involved in. And to
begin with when one draws for a competition or a negotiation, it is the architecture one
is judged by. And the competency that you are asking questions about, it comes from
our inclination to learn. We often say to each other that the areas where we do not
already have preexisting knowledge are especially interesting because things happen
that one has never tried before. This is not building seven or project number seven that
is being repeated. This is something new and that is perhaps the essence of what we
like about our work.

However, DISSING+WEITLING also uses resources on proactive skills development
and courses. Regarding the internal skills development and continuing education
projects that the firm has used resources on in the 1990s, Jimmy Hansen (March 18,
1999) mentioned industrial design projects, environmental and energy projects, and
computer technology:

[Concerning environmentally friendly design], we have asked an employee
to specialize himself in this area by participating in courses and he also
has been asked to inform the rest of us concerning what is happening in this
area. And at the moment we have two students from the Royal Academy of
Arts School of Architecture in practical training in our firm. They are
specialists in the area of the environment and they are looking at our regular
way of tackling this type of problem and how to develop a firm policy in
this area. [] They do some showcase projects concerning the buildings
we are designing at the moment to explain how we could approach the
design process by incorporating environmental issues. We then call a
meeting in which everyone participates and the two students present their
results. This is what we currently are doing in this area. []

But we have now luckily received the project concerning the Frauenhofer
Institut in Freiburg, which is a research institution concerning solar energy.
It is clear that we will learn even more from this project, but on the other
hand they would not have chosen us if they did not believe we had a strong
environmental profile they would have chosen another firm.

[] As for CAD, we acquired our first CAD computer rather late, that is in
1987, because they were and are very expensive. Our [Danish MNC client]
said to us Now you have to take the plunge and then came as our biggest
customer and installed the first machine. That is how it started. And we
could quickly see that this was the way the wind was blowing so we got
437
very involved very quickly. We now have very sophisticated CAD
configurations in our firm.

Dieter Fremerey made the following statements on environmental knowledge and life-
cycle costing with regard to the German market on April 26, 1999:

We have to be at the forefront concerning the environment because with
regard to the environment, the Germans have in many respects gone much
further than we have in Denmark. They also know a great deal so we have to
push ourselves a great deal to be just as good as them. []

However, life cycle costing is not a normal part of construction cost
assessment in Germany. The average German client know rather little about
this. When they hear that we are able to produce projects based on life
cycle costing which we have been able to do for some years, initially they
are interested. But when they hear how much this calculation costs, the
interest usually wanes. But there are differences between individuals and the
interest is very slowly developing on the market.

With regard to DISSING+WEITLINGs continuing education budget, Jimmy Hansen
stated that 40% of the budget is used for the firms annual study trip (interview, March
18, 1999) which is used to create dialog and a common knowledge base for all of the
firms employees and partners. Also the firms secretaries and receptionists participate
regularly in the study trips to ensure team spirit among the all the firms employees,
although their participation is not tax-deductible as is the participation of the design-
related employees for whom these trips can be considered as continuing education
according to Danish tax law (ibid.).

In September 1998, to take an example, all members of the firm visited Switzerland to
inform themselves about the life work and specific design features of the Swiss
architect Peter Zumthor who recently had been awarded the Danish multinational
brewery Carlbergs prestigious architectural award. During the trip, Zumthors work
and DISSING+WEITLINGs design profile were discussed, compared, and
constructively criticized by firm members (ibid.).

The last 60 % of the continuing education budget is used for courses (ibid.). The
aforementioned computer courses and environmental courses as well as construction
industry law courses and a Danish course in Construction Economics which is very
expensive DKK 50,000 for one person have been a part of the budget in recent
438
years. Additionally some employees have attended courses held in foreign languages
English or German and some have attended language courses as part of the
continuing education budget (ibid.).

B.2.4. The Role of DISSING+WEITLINGs Previous Project Work in
Relation to Acquisitions.

Subsection B.2.2. dealt with DISSING+WEITLINGs acquisition of projects on the
German market. Inevitably this topic substantially overlaps with the topic of this
subsection, the role that previous project work has play in relation to acquisitions.
Therefore this subsection will contain statements that build on the information in
Subsection B.2.2. and elaborate further upon the role previous project work plays.
This subsection begins with the very general discussion of DISSING+WEITLING in
relation to the concept of Danish or Scandinavian design on the German and other
foreign markets.

Maria Anne Skaates (November 29, 1998): Do the firms Danish roots or the term
Scandinavian design in any way contribute to DISSING+WEITLINGs work
abroad? Arne Jacobsen and Alvar Aalto were in the opinion of many the most
prominent representatives of Nordic functionalism Are you regarded as a
Nordic firm abroad?

Reinhard Tlke: Arne Jacobsen left a legacy behind him which his successors had
mixed feelings about. In some ways in our early days we became weary of having to
deal with Arne Jacobsens legacy again and again because our goal was to stand on
our own feet. [] This took us 8 10 years. Now we mention his legacy from time to
time but we have a much more relaxed relationship to this issue because we believe we
have shown that we represented more than just his legacy even though it also is very
clear that we have been influenced by him in a very positive way.

Maria Anne Skaates: Have you managed to maintain the Danish design tradition?

Reinhard Tlke: Yes, I believe so. Now I dont know how much you know about the
German world of construction but many things happen in Germany in relation to
architectural development and waves. The trends swept across countries like waves. I
believe [] that our buildings in Germany, some of which are 20 25 years old, are
one of the reasons why people say that our firm both in Jacobsens time and as
DISSING+WEITLING has created buildings that differentiate themselves positively
from other buildings in Germany. One can put it like this: There is a greater chance
that the buildings we have built survive the many waves that sweep from country to
country. Or in other words: One does not get tired of them after 20 25 years in
contrast to many German buildings. []
439

This is perhaps putting the matter a bit simplistically but in my opinion a rather concise
statement of why both public and private clients admire our work and think that we
have something else to contribute than that which is usually built in Germany. One can
perhaps call this Scandinavian reserve. Sometimes it is also regarded as being a bit
chilly and the like but there are also many people who insist that this trait is a positive
quality. The quality is characterized by the fact that the materials we have chosen and
our design has a larger chance of standing the test of time [].

Sometimes we are also told that what we build is boring. We then say, It is a shame
that you cannot see the good qualities. We say this also a bit self-ironically because it
is often the case that one first sees the positive aspects of our buildings or buildings
built by other Scandinavians when one examines them for the second time. [...] Some
Germans have a tendency to want to be able to see which architect has drawn a
building at first glance, but if one must look at some of these buildings year after year,
one becomes appalled by them in the end.

[] You may then ask if our reserve is a trump card on the German market. I believe
it still is. I experience this in my daily life, in connection with our [renovation of a
university building in Frankfurt am Main]. [] In discussions with Germans, I hear
that it is nice that there are projects like ours that are not market by showiness or
spectacle or things that do not stand of chance of surviving for many years. I
therefore still think that for us and other Scandinavians our background is a plus on
the German market.

I then asked Jimmy Hansen to elaborate on this point, due to the fact that he is more
directly involved in the business side of the firm and less directly involved in the
artistic conception.

Maria Anne Skaates (March 18, 1999): When DISSING+WEITLINGs architects
speak of quality and strong design, what are your thoughts as the partner who is
responsible for the business and financial side of the firm?

Jimmy Hansen: I hope these terms mean that the client knows approximately what he
is getting. It is obvious that if a private firm wants to build a new headquarters, they
need to make a signal a very important signal. And if the firm in question wishes to
send a signal which we can fulfill with our immediate, functionalistic architecture
without too many unnecessary details and showiness, then they know that they can
purchase this kind of architecture from us they will get some of the best of this type
of architecture from Arne Jacobsens successors. This is what we deliver to the best
of our ability. [] But of course, not every private client wants this. There are some
that would prefer something more lively or deconstructive. But then they dont ask us
because we cannot deliver this. We are the wrong firm for these trends.
440

With regard to strength in design, Reinhard Tlke believes that DISSING+WEIT-
LINGs selective public tendering policy is necessary to help the firm maintain an
exclusive lists of references of the highest quality (interview, November 29, 1998):

I would like to say this very openly and you are welcome to quote me for
it: When the whole procedure with EU public tendering started in Denmark
and Germany, we are also uncertain because we did not know that much
about the directives many types of procedures and how they would be
administered. We have subsequently participated in several public tendering
procedures in Denmark in which the criteria lowest price was used. But we
dont do this anymore because we believe that there will always be bidders
who are so eager to receive a project that they will bid a too low price. We
have usually been in the middle with regard to our price level in the public
tendering procedures in which we have participated. We continue to
participate in public tendering procedures where criteria concerning the
most advantageous tender are used. The public tendering procedure
concerning the Royal Danish Veterinary University the criteria had to do
with both our abilities and our price. This competition was a positive
experience for us because we won the project even though the price in our
bid was one of the highest.

[] As an architectural firm we believe that we can only survive in the long
run if we fulfill various criteria of quality. When we build buildings, we must
build buildings that people like and the building projects also have to be
profitable for us. [] We therefore do not think that competition with
regard to price level fits in with regard to our firms goals. We think that this
type of competition may destroy the reputation and future of architectural
firms if there always is a firm that is willing to say that it will do the job for
DKK 1,000,000 where architectural firms normally would demand about
DKK 3,000,000 for the project. This type of underbidding must also have
consequences for the quality of the projects the firms in question offer,
unless these firms have money from other sources that they use for these
projects.

Additionally, Reinhard Tlke had the following comments with specific regard to the
term reference (November 29, 1998):

But as to whether [our long-term relationship to a Danish MNC] has
contributed positively to our exports, I would say yes primarily because
we have had the opportunity to build up a knowledge base with regard to
certain types of production and research facilities that are relatively difficult
441
to build. This is a very good reference for us. We have just received a
project concerning a solar energy institution at the Frauenhofer Institut in
Freiburg [Land: Baden-Wrttemberg] via a prequalification and the
negotiated procedure. In this case, I would not be surprised if our work for
the Danish multinational company had not played a role. []

But this is the way it is with all good references. We have also received two
theater projects in Germany related to German buildings of historical value
on account of our renovation of Copenhagens Folketeater some ten years
ago. This Danish theater renovation gave us the possibility of working with
German theater renovation projects. [] But if you ask very generally what
contributes to the fact that we can hold our own in a goal-oriented way in
Germany, I believe it is best if we produce a handsome new building or a
renovation project which potential future clients see and acknowledge as
being a successful and good project.

I also discussed the value of the reference DISSING+WEITLING has received by
winning the Ribnitz-Damgarten hospital project with Reinhard Tlke on December 29,
1998:

Reinhard Tlke: It was a new area for us which was not on our reference list before
we won the competition []. This is now over 3 years ago [] but the project has
given us new opportunities. Since the Ribnitz-Damgarten competition, we have gone
after more hospital projects and because of the reference from Ribnitz even though
construction is not completed yet it is my impression that this reference is very
important in the sense that we are not eliminated from the pool of firms immediately. If
people say They are good architects and they also have specific knowledge of
hospitals This is meant that we after winning in Ribnitz have been prequalified I
am not sure exactly how many times, this is my guess 3 to 5 times. Otherwise we
would not have had a chance of being selected for the final round. However, we have
not been awarded more hospitals yet; all I am saying is that Ribnitz had a positive
influence on our ability to apply for this type of projects.

Maria Anne Skaates: In this connection I would like to ask you on the background of
your many years experience as an architect: I understand that just winning the
competition in the area of hospitals has given you a certain reference value. But when
the hospital is finished and if and when the users are content with it, will the reference
value not increase even more when the project is completed and if the general public
considers it to have been a success?

Reinhard Tlke: I do not know if one can say that because Germany is large. This
means that mention if it is positive, it may still mainly occur in local circles and
then I am not sure how much will be transmitted to all of Germany. If we for example
442
tender for a hospital in Stuttgart [Land: Baden-Wrttemberg], perhaps they may have
heard something positive from Ribnitz, and perhaps not. With regard to the theater
renovation in Kiel [Land: Schleswig-Holstein], I can mention that I am not 100 % sure
but that it is very possible that the town hall and bank offices we built in Neumnster
which have been part of the town for 8 10 years could have some influence on ones
opinion of the things we build because Neumnster is only 30 40 kilometers from
Kiel but when you ask about a new hospital, well many buildings are built in
Germany and how much contact there is between one client and the other and how
much notice is made of the projects in the media, this is also a question of chance.

With regard to the influence of articles about DISSING+WEITLINGs projects in
architectural periodicals, Reinhard Tlke stated the following on December 29, 1999:

There is a huge number of architectural periodicals, and my impression is
that it is primarily architects who read them and judge other projects
form an opinion of them. With regard to how widespread this phenomenon
is among clients and engineers they look at there periodicals too, but not
to near the same extent as our colleagues by colleagues I mean other
architects.

I know of a concrete example where a client has seen an architectural
magazine and had a very positive opinion of a certain building that
DISSING+WEITLING had designed. He therefore asked us to work for
him. It is true that architects have their own world and the others have theirs
too but with regard to how much these worlds have in common
concerning engineers and professional clients I know that they do attempt to
keep up to some extent. but the number of periodicals on new projects is so
large that I do not know how much or what the result of this is.

Perhaps I can enlarge upon this in this way: If I now speak of
prequalifications and negotiations in front of the juries, when a German
public institutions is going to chose an architect, in these situations the
people who sit in the committee are to a high degree architects; often the
jury is composed of 50 % architects. This means that they know that we
once upon a time built a handsome museum in Dsseldorf or they have
traveled or to a larger extent read architectural periodicals. This means that
especially the public sector clients are represented by a public sector con-
struction administration unit [] and in this unit one finds architects. This
has the advantage that our projects are critiqued at a relatively high level
because the judges have the necessary knowledge or may even be familiar
with our previous work.

443
But in the private sector I would here like to differentiate between public
and private sector clients there are a few private investors, sometime a
banks board or the chairperson of a board of directors or others, who for
one reason or another are interested in architecture but this is the exception.

Dieter Fremereys commentary on the effect of media coverage both in newspapers
and architectural periodicals was as follows (interview, April 26, 1999):

I am not sure about the exact effect. We do try to see that there are as
much media coverage of our projects as possible. But I do not know if this
has a general effect on a clients decision. It probably has an effect on the
clients that pick us when they choose someone who is competent to parti-
cipate in a limited architectural competition or prequalification. They can see
that DISSING+WEITLING has designed this and this and the results were
good. This has an effect. But with private sector clients I think this is more
seldom. This effect happens first when we show them our own PR-
materials and brochures. [] Concerning the bank official who saw our
museum in Dsseldorf, this was pure chance because he also could have
seen other Nordic-inspired buildings as well. He happened to see the
museum in Dsseldorf because someone told him about it.

From time to time, DISSING+WEITLING also displays its projects at trade fairs. On
April 26, 1999, Reinhard Schmidt-Petersen showed me display plates concerning the
Theater of Schleswig-Holstein which has been shown at a theater construction and
renovation exhibition Quattro, which is held every fourth year in Prague. At this
time, he stated the following:

[Quattro] is mainly an exhibition which theater directors, stage managers,
and people responsible for the technical aspects of theater visit. It is
primarily a type of trade fair where one can find the newest types of
technical scene equipment, spotlights, and audio-visual special effect
equipment. And one can also compare various projects in Europe what
has been built and renovated. I believe a large catalogue is made so that
participants can see what has happened. But the interesting aspect is that
you can see what the buildings looked like before and after renovation
projects.

Dieter Fremerey mentioned on the same day that DISSING+WEITLING also exhibits
its projects at the Architecture Biennial Trade Fair in Venice and has also previously
presented its work in Dresden and in connection with a Danish embassy. However in
444
his opinion this gives some contact to other actors but it is very seldom that these
contacts result in concrete projects.

Last but not least, specific persons from time to time contribute with positive word-
of-mouth for DISSING+WEITLING. Dieter Fremerey informed me of the following
episode (April 26, 1999):

In Dsseldorf we have a construction manager who was effective and did
the job well; he later left Dsseldorf to work for a large construction
company in Frankfurt am Main, and now he is in Munich, but he still keeps
in contact with us. He says things like this to us: Now a new general
manager has been appointed in Frankfurt. I will introduce you to him. This
is the way things are done some places. [] This is in fact a personal
network of contacts that one builds up and maintains or does not
maintain. []

But, as previously mentioned, the personal factor is becoming weaker as the
structure of the clients decision making group is changing. As previously
mentioned, the client is no longer one person but a group of 8 10 people
who think that they can judge everything. And relationships become less
binding towards these people because one cannot create the same type of
contact to ten persons.

B.3. Case Study Firm 2: Arkitektfirmaet C.F. Mllers Tegnestue.

C.F. Mllers Tegnestue was founded in rhus
44
, Denmark in 1924 by the Danish
architect C.F. Mller who is very well-known in Denmark for having designed the
campus of the University of rhus (C.F. Mllers Tegnestue, 1999:4; Lund, 1998:57-
89; Mller, 1978). Today the firm is one of Denmarks large architectural firms with a
strong design profile in Denmark as well as broad expertise from a wide range of
construction project types e.g. museums, sports stadiums, universities, research and
development centers, factories, hospitals, housing. C.F. Mllers Tegnestue can be
classified as a nationally renowned and established architectural firm (see
Subsection 4.3.1.), as it is very well known in Denmark, but had not made a name for
itself abroad, except in Norway and Sweden, at the beginning of the nineties.

44
rhus is commonly spelled Aarhus in English, German and all other non-Nordic languages which do
not contain the letter . This spelling was also the only correct Danish spelling until the Danish Spelling
Reform of 1954.
445
However, similar to the internationally renowned Danish firm DISSING+WEITLING,
C.F. Mllers Tegnestue also has worked to some extent as a client-follower on inter-
national markets by designing factories for a (different) Danish MNC that have been
built in a host of different countries. Today, C.F. Mllers Tegnestue still has its
headquarters in rhus. Additionally it has offices in the Danish cities of Copenhagen,
lborg, and Vejle as well as in Berlin, Germany and Oslo, Norway.

C.F. Mllers Tegnestue chose to concentrate on the German market in the beginning
of the 1990s and subsequently to locate its subsidiary in Berlin in the spring of 1993
(Tetzlaff, 1996). The subsidiary in Berlin is managed by the Danish-educated Danish
architect Henrik Sthr who became a partner in the firm on January 1, 1997 (ibid.).
The other persons currently employed in the Berlin subsidiary are Germans educated
in Germany. The firm has been involved in German projects or received runner-up
prizes/honorable mentions in Germany for e.g. housing projects, a research and
development center, a sports stadium, a hospital, and a university building. In the
course of my studies I interviewed both Henrik Sthr and partner Lars Kirkegaard
who is responsible for C.F. Mllers Tegnestues economy and budgets (see
Appendix C). I also received some written material from the firm as well as three firm-
relevant books (Arkitektfirmaet C.F. Mllers Tegnestue, 1998; Lund, 1998; Mller,
1978) as gifts.

B.3.2. C.F. Mllers Tegnestues Architectural Project Acquisition.
The initially planned projects that contributed to C.F. Mllers Tegnestues decision to
open an office in Berlin in 1993 were an architectural competition that the firm had
won in Cottbus (Land: Brandenburg) and a building for a Danish multinational firm
that had been planned to be built in Berlin. However, these projects were never
realized. (Interview with Lars Kirkegaard, February 19, 1999).

The firms first realized project on the German market was housing: 170 apartments in
Freiburg-Rieselfeld, a neighborhood of the southern German city of Freiburg (Land:
Baden-Wrttemberg). C.F. Mllers Tegnestue acquired this project through the unex-
pected visit of a German managing director who had warm feelings for Denmark due
to past experiences (interview with Lars Kirkegaard, November 17, 1998). This
managing director visited the firms head office in rhus at the beginning of the
nineties. He and the German employees that accompanied him were shown the nearby
public housing apartment and terraced housing complex Skdeparken, 5 km south of
rhus, by the employees of C.F. Mllers Tegnestue. During the visit to Skdeparken,
the German managing director liked what he saw. However, a spontaneous event
446
during the visit, a sudden conversation with an elderly Danish woman who by chance
spoke German well and was very content with Skdeparken, played a substantial role
in convincing the German managing director to hire C.F. Mllers Tegnestue (ibid.).

The Freiburg-Reiselfeld apartment complex was designed in the newly-opened Berlin
office, Architekturbro C.F. Mller, by the firms Danish employees, due to the fact
that it was almost impossible to employ experienced German architects during the
German construction boom of the early nineties (Tetzlaff, 1996). In connection with
this project, C.F. Mllers Tegnestues architects designed certain features that are
common in Denmark, yet not as usual in Germany, i.e. a combined kitchen and
family/dining room with windows and a door to the balcony. These features were,
however, to a large extent welcomed by the German residents of the apartment houses
(interview with Lars Kirkegaard, November 17, 1998).

On the other hand, German legal regulations and the DIN-norms initially caused much
greater problems for C.F. Mllers Tegnestue because the firm did not know of all the
regulations, and its Danish employees involved in putting the project specifications
into the design plans initially had great difficulty working with the DIN-norms (ibid.,
interview with Henrik Sthr, December 10, 1998). These problems were, however,
greatly alleviated by the flexibility and good-will shown by the city government of
Freiburg (Tetzlaff, 1996). Additionally, C.F. Mllers Tegnestue hired a German
architectural firm to be responsible for construction management, as their office in
Berlin was hundreds of kilometers from Freiburg (interview with Henrik Sthr,
December 10, 1998).

The firms second realized project also concerned housing, i.e. the design of almost
100 apartments in Wiesbaden (Land: Hesse). At the same time, it was the first German
project won by C.F. Mllers Tegnestue though EU public procurement procedures
(Tetzlaff, 1996). The customer was, however, not a governmental or public institution,
as would have been the case in Denmark, but rather the private limited company
Gemeinntzige Wohnungsgesellschaft Hessen GmbH (interview with Henrik Sthr,
December 10, 1999). This is because German publicly subsidized housing is com-
monly built by private persons or companies that are under the obligation to follow
certain rules concerning e.g. rent control and maintenance (see Arkitekten, 1993/5:182-
3).

In connection with this project, journalist Marie Tetzlaff (1996) asked Henrik Sthr to
what extent the Danish background of the firm could be seen in its architectural
447
designs and whether the possible Danish/Scandinavian influence was an advantage or
a disadvantage on the German market. Henrik Sthr replied as follows:

Yes, in Denmark the current predominating way of designing buildings is
easy to recognize. It is known and charming [], but when one designs in
this way in Germany, it is easy to see that it is not a German who has
designed the proposal. [] No [, we are not disadvantaged by this]; as a
Dane, you do not have a poor initial position, especially not within the realm
of housing construction. Germans are quite fascinated by Scandinavia and
they are generally quite positive towards our way of living. (ibid.).

Furthermore Henrik Sthr admitted to Tetzlaff (1996) that housing projects were not
C.F. Mllers Tegnestues original goal when the firm opened its office in Berlin.
However, circumstances provided the firm with its initial success in the area of
housing.

With regard to the Wiesbaden project, there was less room for tolerance from the side
of the customer and the authorities (Henrik Sthr, December 10, 1998). It was
therefore important for C.F. Mllers Tegnestue to learn more about using quantity
surveying methods, i.e. specifying how many of each type of component are to be
used and how many tons of each raw material are necessary:

In Denmark one usually makes a decision in public tendering procedures
on the basis of a description of the functions that the building must fulfill.
The potential customer specifies these functions and, on the basis of this,
the bidding firms draw their conceptual proposals, include some
specifications concerning construction planning, and mention their price.
[] In Germany, things function differently when details concerning
construction planning are mentioned in the public tendering announcement.
Just like in quantity surveying [], all specifications concerning the quantity
of building materials are included in the proposal concerning the
construction planning. Therefore the conceptual drawing often is only used
to illustrate how the materials will be used, as the maximum amounts of
materials may be specified by the potential customer in advance. This was
one of the reasons why we choose to refrain from entering this type of
public tendering procedures without German partners also today we want
to be even better at working with such detailed construction planning
specifications before we try to do all the work ourselves, so we use the
Arbeitsgemeinschaft [in English: project working group]... However, in
Wiesbaden, our customer firm wanted to do the construction planning
specifications itself. [] This was fine with us but we also had to have an
448
idea of what they were going to do after we finished the initial design
concept (ibid.)

C.F. Mllers Tegnestues third German project, the 30,000 m
2
large Technologie und
Grnderzentrum Spreeknie (TGS), i.e. a publicly subsidized domicile for newly
started technology research and development firms, in Kpenick near Berlin was also
obtained through public procurement procedures; the public organization responsible
for it was the Berliner Landesentwicklungs Gesellschaft (BLEG), a company owned
50 % by the Land Berlin and 50 % by the German federal government. The company
has the authority to commence development projects in the Land Berlin (interviews
with Lars Kirkegaard, November 17, 1998 and March 29, 1999, Arkitektfirmaet C.F.
Mllers Tegnestue, 1998:122). C.F. Mllers Tegnestue won this project through par-
ticipation in an international architectural competition (ibid.).

A subsequent major competition concerned the renovation of a large sports stadium;
however Architekturbro C.F. Mller and its bidding team partners did not win this
competition. The other bidding team members included a large German project
management firm, another German firm that specializes in the planning of projects, a
German construction statistics expert, two German engineering firms, and a German
firm that has worked with the development of concepts for managing large sports
stadiums (interview with Henrik Sthr, March 11, 1999).

C.F. Mllers Tegnestue tried to make use of previous innovative solutions in e.g.
Denmark in this sports stadium renovation project. In the words of Lars Kirkegaard
(interview, February 9, 1999):

One cannot just build or renovate a stadium that costs that many millions
of DEM because it is not possible to finance such advanced stadiums if the
soccer games are the only source of income. It is simply impossible
because games are only played at such a stadium once or twice a week.
And part of the admission fee goes directly to the soccer team in question
that rents the stadium. And the rent is also not high enough to pay for the
construction fee. We were familiar with this problem in connection with
Copenhagens large stadium, Parken. Parken has grandstands for soccer
fans on three sides. We added a new grandstand here [LK points at an
architectural drawing] and we also added commercial buildings in the
corners of the stadium. And these buildings also contribute to the rent; in
fact, they pay so much rent that they also contribute to part of the costs of
the stadium. And these building were at first reserved for things related to
449
sports. Additionally squash courts and bowling alleys were placed in the
area around the new grandstand.

This is almost the same solution that we worked out with our German
partners [in the stadium project in question]. But it was the very idea which
was difficult for some people to accept because we also have made use of
sponsors and thus solved the problem of financing in our project [whereas
the winning proposal had not used sponsors].

Architekturbro C.F. Mller has also worked as a consultant for a German pro-
fessional soccer team by evaluating project proposals concerning the construction of
a new stadium. Other consultants used in the evaluation procedure included a major
German bank, a large German project management firm, and an American high-tech
firm. (Interview with Lars Kirkegaard, November 17, 1998).

On the basis of his more that six years of experience, Henrik Sthr considers
Germany to be a country that is extremely open to foreign architectural contributions
(Tetzlaff, 1996; interview with Henrik Sthr, December 10, 1998). However, this does
not necessarily mean that it was easy for Architekturbro C.F. Mller to establish
itself on the German market. This can be seen in Henrik Sthrs (March 11, 1999)
mention of an anecdote concerning establishment of Danish construction-industry
related firms on the German market:

There was someone at the concluding conference concerning Project
Renovations International Projects who said the following: If a
construction industry firm is considering going abroad to survive on the
short term, it should be warned that it should not try this. If a construction
industry firm is considering going abroad because it believes that it is
capable of achieving success in the long term, it should take time to
consider this once more from all aspects before making the decision.

To further illustrated some of the difficulties, I have included part of my interview with
Henrik Sthr on December 10, 1998:

Maria Anne Skaates: [...] both of us know that while it is the custom that Danish
architectural firms do not advertise, when C.F. Mllers Tegnestue or another Danish
firm is working on an unusual project, someone from the firm takes contact to a
Danish journalist and then the project is mentioned in the Danish media. This is a type
of information spreading that is somewhat broader than direct efforts to create
contacts.

450
Henrik Sthr: It is also a very difficult role. It is hard to work with.

Maria Anne Skaates: Spreading information in Germany?

Henrik Sthr: Yes because we are as unknown in Germany as we are. In other
words: nobody is interested in us beforehand. However there is no question that we
have been able to improve our image in Denmark by having an office in Germany. You
referred to an article in Politiken
45
, but also Jyllands-Posten and rhus Stiftstidende
[] have written several articles about us. I was also part of Ulla Terkelsens program
about Berlin. []

It is also certainly not easy to even get close to potential large German customers
because the internal hierarchy in firms is so clear-cut. Now I will mention something
that one experiences when one starts from zero many of the decision makers at the
top have damn good secretaries. You never get permission to speak with the decision
makers. []

However, with regard to obtaining work on the German market, Henrik Sthr regards
contacts to actors and networks as being of paramount importance:

Maria Anne Skaates (December 10, 1999): Sometimes I think about you when I speak
to your colleague Lars Kirkegard; I think that your Danish partners expect you to find
a lot of good contacts. [] and I also guess that your task involves collecting
information on different characteristics of the German market for your partners and
colleagues in Denmark too.

Henrik Sthr: My task is finding suitable contacts; information to Denmark is of
secondary importance. My job is to establish contacts and a network, to contact
potential customers, in reality to create project opportunities. And then to see to it that
they are completed. I am not a scout in the sense that I have to report to my
colleagues in Denmark so that they can judge what we should do next and how we
should do it.

Henrik Sthrs personal definition of networks is as follows (interview, December 10,
1998):

To me, a network is your circle of acquaintances, pure and simple, that is
those you know and with whom you exchange information. A network is to
me not a type of secret society which one only uses to divide projects

45
Politiken and Jyllands-Posten are Danish national daily newspapers. rhus Stiftstidende is a daily
newspaper for the rhus region. Ulla Terkelsen is a Danish television journalist; she is Danish TV2s news
correspondent in Germany.
451
among its members; this is not the way I define a network. A network is a
positive word in my opinion; it can help you get certain positions mainly due
to your communication of your own knowledge and competence.

Networks are, in the opinion of Henrik Sthr, important in both the public and private
sectors, despite the intentions of the EU Public Services directive, as previously
explained in Subsection 6.4. The following excerpt is from my interview on December
10, 1998:

Henrik Sthr: You can receive projects through architectural competitions but an
architectural firm cannot survive by participating in competitions alone because the
investments involved in participating are huge and you do have to win once in a while.

Networks are everything with regard to receiving projects. And in some senses
networks also are everything with regard to winning competitions. And networks are
also everything with regard to whether or not you are invited to participate in restricted
competitions.

Maria Anne Skaates: Are you speaking about Germany or do you also mean
Denmark? Or let me ask this way have you ever seen impartial architectural
competitions where ones network has not be the deciding factor?

Henrik Sthr: Of course. I have seen many of these.

Maria Anne Skaates: But in the competitions where there is a step of prequalification
or the so-called two-phase competitions, here you believe that networks play a role?

Henrik Sthr: Yes I do, most certainly. And it is very understandable that they play a
role. [...] With relation to EU Public Procurement and the German negotiated
procedure (Verhandlungsverfahren), one could perhaps begin to think that we as a
relatively unknown firm in Germany have great difficulty acquiring projects despite our
long list of references. However, I think there are many good reasons for this and
that they are the same reasons that people, including us, in Denmark also make use of.

If you as a public official have had a very long period of cooperation with an architect,
you will of course be interested in continuing this cooperation, and one could imagine
that you might write your EU Public Procurement Announcement in a way that would
allow you to choose the architect you always have chosen. One can, of course, have
many opinions about the morality of this. However, if you are part of, say, a public
committee that is responsible for the construction of a hospital that will costs DEM
600 700 million, you are dealing with a huge sum of money. In this case it is clear
that the committee will make the safest choice. And in Germany this will usually not be
a Danish firm, even if the firm has design hospitals for the past 40 years because the
452
very fact that this activity has taken place in a foreign country implies an element of
uncertainty. This is obvious. I therefore have a hard time getting angry about this
because I understand it very well.

With regard to other actors in the private sector, Lars Kirkegaard has described the
development of actor contacts as follows (interview, February 19, 1999):

In the beginning we worked closely with Danish contractors and
engineering firms in Germany, but now most have them have left the market
again. I believe that this was the wrong decision to make, strategically
speaking, even though almost all of us initially lost money in Germany. We
lost quite a bit of money ourselves, but now the tide has turned, and we
have made profits in 1997 and 1998. This has happened because now
Germans have begun to call our office. [Henrik Sthr] is of course working
mainly with smaller projects renovating floors of a Hilton hotel in Berlin
and the domicile of the Swedish ambassador to Germany, but the situation
is still such that potential German customers are calling us and asking if we
can help them with their specific projects. Additionally, we now have a
group of firms that help us just like in Denmark. [] We help some
members of this informal group with something and perhaps they will assist
us or tell us about a future project that we could work on together. This is
the way we work today. []

[In the middle of the nineties] we said Now we are simply going to wait.
We will adjust our office to the downturn on the German construction
market because when the market picks up again, we will be more prepared
than the others. This is because it takes many years to reestablish an office
abroad. It is next to impossible. And it is very difficult to build up a net of
contacts on the short term, that is before the construction industry boom
changes to a downturn. []

[Today] Henrik sometimes guides Danish guests around Berlin []. There
are many groups that want to look at the construction in the Berlin area.
They call him and ask if he can make a short program for them. In this way
he also builds a net of contacts [to potentially interested Danes].

The above quotation indicates that Architekturbro C.F. Mller today primarily
operates with German actors but keeps the door open for Danish actors, in the case
of future Danish investments or other activities on the German market. With regard to
the firms or actors that assist Architekturbro C.F. Mller in Germany, Lars
Kirkegaard stated the following on March 29, 1999:

453
Our contact net is constantly being enlarged and renewed. Concerning our
contact to engineering firms we had contacts to many larger Danish
engineering firms but many then subsequently left Germany, so we are
building contacts to German engineering firms []

We also have some colleagues whom we are in contact with. For example,
we know a German Professor of Architecture who has married a Dane and
speaks Danish without major difficulty. He also has his own firm, and we
are in contact sometimes

According to Henrik Sthr (March 11, 1999), Architekturbro C.F. Mller has regular
contacts to two or three German engineering firms. Additionally, the firm has regular
contacts to a large German project management firm which has offices in many of
Germanys largest cities.

Architekturbro C.F. Mller has previously worked in an advisory team with this large
German project firm in connection with the soccer stadium project as well as on a
project bidding side in subsequent, unsuccessful bid for tender concerning the
Sportforum in the city of Leipzig (Land: Saxony). Finally, the large project
management firm was advisor to the client firm concerning Architekturbro C.F.
Mllers housing project in Freiburg-Rieselfeld (interview with Henrik Sthr, March
11, 1999). The large German project management firm sometimes informs Archi-
tekturbro C.F. Mller of potential projects on the German market, but Arkitekturbro
C.F. Mller is far from the only architectural firm that is informed of these potential
projects. Usually the large German project management firm informs a handful of
firms about each project and subsequently lets the customer pick the architectural
firm, sometimes in cooperation with the large German project management firm if the
customer desires this (ibid.).

With regard to public sector advisors such as the Construction Industry Attach and
other employees at the Royal Danish Consulate in Berlin (which has now been
replaced by a newly built embassy in the Nordic Embassy Complex), Henrik Sthr
stated the following on December 10, 1998:

[...] I have used the Danish embassy too little. I am actually in relatively
good contact with the people at the embassy. We see each other often and
we discuss many things. But I have not used them as actively as I could
have at least this is what I think. But the reason for this is that we have had
a number of large projects and they take a lot of time. This is the classical
problem with relation to acquisition activities in the general sense of the
454
word: you are working on large projects, and it is difficult to find time for
general acquisitive activities.

Henrik Sthr has, however, participated in a number of receptions arranged by the
Danish Ministry of Housing in Germany (interview with Lars Kirkegaard, November
25, 1999).

In order to establish a potential relationship between contact to other construction
industry actors and contact to potential customers/clients, I asked Lars Kirkegaard on
March 29, 1999 how important it is to have found project-solving partners beforehand
in the project acquisition process. His reply was as follows:

Umm, this is difficult to explain. To be able to acquire a project from a
customer one has to prove that one can win his trust with regard to our
ability to complete the project satisfactorily. One can thus ask: Why should
they choose us and not someone else? One has to ask oneself these
questions all the time: Why do we think we are better than the rest? What
can we do better than others? [] Here we are talking about specific
knowledge or expertise, and therefore we has to also has to know what the
customer would expect from a potential cooperation partner. This means
one has to know enough about the customers needs and organization
before one can find the cooperation partners for the project.

However, this reply does not exclude the potential advantage of knowing of potential
cooperation partners when tendering or negotiating for a project.

With regard to ongoing, long-term relationships with key customers, as mentioned in
the previous subsection, C.F. Mllers Tegnestue has such a relationship to a Danish
MNC. Lars Kirkegaard would in principle welcome such arrangements on the German
market; he explained long-term relationships between customer and architectural firms
as follows (interview, March 29, 1999):

We have a few long-standing relationship with customers which have lasted
many years. These also have their advantages. One can say that the
advantage for the customer is that he knows more about the product he is
going to get than he would if he had to start from scratch every time. This
implies that the work requires less of the customer firms resources. And if
one has a good relationship as customer and deliverer, then both sides are
realistic and fair toward each other with regard to the payment. And as the
architectural firm we do not make the fee higher than it would be if another
455
firm was doing the work. [] We must also convince the steady customer
that we deliver for a very competitive price.

[] I believe that if one is a loyal towards ones customer who after all
has proved his confidence in us by giving us projects without competition,
one must be just as loyal by saying to him Now the market is changing and
this means that we are lowering our prices or the opposite. [] One
must do this before the customer himself discovers the changes on the
market because otherwise he may begin to speak of changes in the premises
for our cooperation.

Furthermore, Lars Kirkegaard specified that this is true both in the situation where
C.F. Mllers Tegnestue is dealing with a customer who almost constantly has contact
to the firm as well as the situation in which the loyal customer has a more off-and-on
contact with the firm (ibid.). However, Lars Kirkegaard can also see disadvantages
with this type of cooperation as well (ibid.):

Look at [Architect XXX]; he projected [many buildings for a multinational
company] and had an agreement but suddenly the cooperation was
terminated. He told me so himself. But when such an agreement is stopped,
one is vulnerable, because a cooperation agreement is only worth a lot as
long as it functions well. [] When it is stopped, things can easily go
wrong because one is in a situation where it seems that one has put ones
stakes mainly on one customer and not on a large group of potential
customers.

However, the creation of such long-term relationships on the German market is not a
strategic goal or priority for C.F. Mllers Tegnestue/Architekturbro C.F. Mller, due
to the perception that such relationships cannot be created on the basis of efforts on
one side only (various interviews with Lars Kirkegaard and Henrik Sthr). Instead the
strategic priorities of C.F. Mllers Tegnestue/Architekturbro C.F. Mller are as
follows, according to Henrik Sthr (interview, April 9, 1999):

Our goal is to work in the entire German region and therefore we aim at
more than one category of project. There is of course some risk connected
with this strategy. But you also run risks by specializing too much for
example, the market for housing is satiated today. Today we have mainly
local projects as well as some regional [according to Gerkans
classifications in Der Architekt, May 1990:246-50].

456
One other reason for this broad focus is the fact that the seven partners of C.F.
Mllers Tegnestue who are architects have different areas of special competence, e.g.
hospitals, industrial and commercial buildings, sports arenas and halls, museums.
They all receive information and support from Architekturbro C.F. Mller in Berlin
concerning potential projects or, in the case of public procurement, they sometimes
also find projects themselves in the EU Procurement announcements. The initial
sketches for the project in question are drawn by teams of Danish architects who have
special expertise in the field in question. Thereafter, when the details are added, the
Dane responsible for the project travels to Germany to work out the project in
cooperation with the German employees at C.F. Mllers German office (interview with
Lars Kirkegaard, November 17, 1998).

Architekturbro C.F. Mller however also attempts to find projects in areas which are
considered to be potential specific Danish strengths, due to the comprehensive Danish
welfare state. One example of this was the forming of a team with a Danish producer
of nursing home attire to bid for a nursing home project to be built for the German
Salvation Army (Interview with Lars Kirkegaard, November 17, 1998).

On the other hand, with regard to strategic priorities, Henrik Sthr has stated that he
does not spend time creating innovative projects using prefabricated elements, even
though he is aware that one of the reasons that German construction projects are more
expensive than the corresponding Danish projects is less use of prefabricated elements
(interview, April 9, 1999). He believes that the German market will increasingly use
prefabricated elements in the long term but that there at the moment also are forces of
inertia, due to e.g. high unemployment and bad experiences with elements of poor
quality in the former East German region, that are delaying this development. He does
not see design innovative projects with elements as a suitable or sensible tasks for him
to promote as customers are not demanding this yet (ibid.).

The agreed-upon strategic goals are operationalized through acquisition work in the
following ways, according to Lars Kirkegaard (March 29, 1999):

One way we deal with acquisitive work is to look at the market and see, for
example, that there is a need for soccer stadiums in Germany. One can sit
down and find cases like that, if one has the time and resources. We know
that the former East German regions will need to build or renovate their
stadiums because they do not fulfill the requirements of the International
Soccer Association. Thereafter we can sit down and try to figure out when
this problem will be solved. And one can also look at the German
457
professional soccer teams and their stadiums and figure out when they will
consider renovations. This is one way to anticipate projects.

[] We have also participated in some tendering concerning hospitals in
Germany, but we have not won any projects. Now there have not been any
new tendering offers concerning hospitals for quite a while 1 years I
think but they will come again at some time. Now we are working our way
into that market but in a different way because we have now been working
on nursing homes and a nursing home is in some ways similar to a hospital.
And we have designed a research and development center in Germany
which included some laboratories, and laboratories are also a part of a
hospital. So as soon as we have German laboratories and nursing homes,
we may be a bit closer [] because it seems to be very difficult to enter
this German market with Danish references.

However, due to the small size of the Berlin office, it is more difficult for
Architekturbro C.F. Mller to operationalize its strategy in its daily doings than is the
case in C.F. Mllers Tegnestue in Denmark. According to Henrik Sthr (April 9,
1999):
C.F. Mllers Tegnestue in Denmark has the volume of projects and the
number of employees that allows the firm to work in situations where you
only will have a chance if you make your proposal extremely quickly. In
Denmark, there will always be some colleagues or employees who can solve
such a time problem. But we dont have this possibility in Berlin because we
are only six persons and usually we have so much to do that no one can just
put their other work aside to prepare a last minute proposal.

[] I receive all the EU Publications on public tendering and architectural
competitions. I then make a judgment as to whether there are some projects
we should attempt to acquire, and I usually react I must say that many
things play a role, including my state of mind typically react to
announcements concerning housing and nursing homes and the entire health
care sector. Stadiums are not usually mentioned in the EU announcements.
As for technology and other medical facilities I also react sometimes
because there we can make use of our references from hospitals and
research centers and the like.

[] But we should also have a broader profile. Our problem is the typical
problem with the critical volume of projects. We dont have the critical
volume yet and therefore it is difficult for us because we are so few
persons because we dont have time to do our work and look for new
projects at the same time. There is no doubt that we will be very active in
the area of nursing homes. [] But with regard to the new market for
458
renovation and building improvements we have a shortage of resources. I
know we are going to do something about that but I dont yet know how.

Additionally, according to Henrik Sthr (March 11, 1999):

Our choice of cooperation partners is not necessarily directly based on our
strategy; our contacts to other firms just seem to develop through the years.
In cases where things went well, there is often a feeling of sympathy for the
other firm. Its a bit like drops of water that make circles in a puddle. The
longer one is active on a market, the more people one gets to know.

However, attempts are made to keep the same firm image in both countries. In 1999,
the firm C.F. Mllers Tegnestue published a book (Arkitektfirmaet C.F. Mllers
Tegnestue, 1998) featuring selected key projects in their history of designing buildings
for commercial use. In addition to photographs and descriptions of 58 buildings from
the years 1918 1997, the book includes three textual contributions from three
partners of the firm in Danish and in a German translation, thus indicating that it is to
be used for both the firms Danish/Scandinavian
46
and German actor contacts.

In the book, C.F. Mllers Tegnestues own understanding of the Danish architectural
tradition is described in the following way by partner Tom Danielsen (ibid.:78):

There is an old, yet still true, saying that states that, with very few
exceptions, past and present Danish architects have not created buildings
that have influenced the international development of buildings for
commercial use. However, on the other hand, new ideas have been accepted
and annexed by Danish architects with the necessary caution and scrutiny.
Danish buildings have been and are still today created in an evolutionary
process with emphasis upon adjustments to climatic and landscape-related
conditions and the adaptation to the building craft traditions of the region.
This method seems to have been transferred from one generation of
architects to the next. This is what has given Danish architects a good
reputation abroad. [] Functionalism, a humanistic viewpoint, and
emphasis upon human needs are characteristics that mark Danish
architecture.

Partner Mads Mller describes C.F. Mllers Tegnestues definition of quality with
regard to buildings for commercial use in the following way (ibid.:4):

46
Danish can be relatively easily read by Norwegians and Swedes as well as Finns who have a knowledge
of Swedish due to the fact that Swedish is the official second language of Finland.
459
The term architectural quality [with regard to buildings for commercial
use] means the unity of shape, function, construction economics, and
technology. This means e.g. that it is very important for the architect to
create optimal workplaces for individuals both with regard to functional and
human-related requirements in cooperation with the customer, the users, and
the engineers. Of course, the goal is to create a good space for work in
which the employees and the physical surroundings are in harmony. Here
the planning of the space and the color of single rooms and their con-
nections to each other can provide much needed sensory experiences as a
contrast to workplace tasks which often are monotonous. To create a good
workplace, the architect must also work optimally with natural sunlight as
well as electric lighting, building material, acoustics, as well as ergonomics
and other factors that provide comfort.

As a architectural firm operating in Germany, C.F. Mllers Tegnestue to some extent
still sees its Danish roots in Danish and Nordic design traditions as a strength. In the
words of Henrik Sthr (Tetzlaff, 1996):

We should not forget that what we have to offer is that we are not a purely
German firm, but a firm able to function on German premises. When
architects go abroad, they take their home countrys culture, experiences,
and building traditions with them. We can therefore offer something new
and communicate something about our views on life through architecture.

However, Henrik Sthr is also very reluctant to place too much emphasis upon
Architekturbro C.F. Mllers Danishness or Danish connections, as he also is
convinced that it is of paramount importance to able to convince potential German
clients that his firm is able to operate on the German market and with the rules and
premises that this entails (ibid.).

The ability to convince potential German clients that Architekturbro C.F. Mller is
able to create viable projects of high quality that are feasible on the German market is
according to Henrik Sthr (March 11, 1999) related to credibility:

I believe that credibility is the most important thing when one makes a
presentation to a potential customer. You have to communicate that you
have the ability to complete a project and the ability to cooperate with the
customer. If you can do that, you are quite close to getting the project. This
is what I mean by credibility. It is not large advertisements or wearing
fashionable ties. I believe the whole thing revolves around credibility and not
460
much else. There are many architects; the problem with architecture is that it
always costs a lot of money, and therefore credibility is very important.

By credibility, I dont only mean that C.F. Mllers Tegnestue is not lying;
rather when I say that we have 150 employees who can do the job, I need to
convince the customer of this. This does not happen only by presenting
facts; it happens when a feeling of credibility is created, for it would not
matter that we have 150 employees, if I seem to be a bit of an idiot. Thus it
is important to make a credible appearance and have a credible image in
architecture.

At the beginning of 1997, Henrik Sthr became a partner in C.F. Mllers Tegnestue. I
asked him and Lars Kirkegaard if this increase in intra-firm status was important in
relation to his general ability to win his German customers trust.

Lars Kirkegaard (March 29, 1999): It might mean something to customers. There is
no doubt of that. For me it is clear that we had some problems in the first years
because he was not a partner. In Germany one is very concerned with meeting with the
person responsible for the entire project.

Henrik Sthr (April 9, 1999): Ummmm, I am not so sure that it was so important. I
recall that we did not have that many different customers at the time that I became a
partner and the ones we had looked at me as the person responsible for the projects,
although I was not responsible in the legal sense of the word. [] There were
previously certain episodes where I had had to consult the partners of the firm in
connection with legal matters.

When I became a partner in the firm, the German customers response was very
positive. Many people congratulated me, but I dont think that it was a matter of great
importance to them this was my impression.

However, beyond the factor of credibility, Henrik Sthr is of the opinion that it is
necessary to do more to impress and convince the customer as a relatively unknown
firm in Germany in comparison to the situation of C.F. Mllers Tegnestue in Denmark:

C.F. Mllers Tegnestue never does any work in Denmark without being
paid for it. For the first sketches, we perhaps only receive a very low fee but
we insist upon charging a fee to ensure that the potential customer is truly
interested. Any idiot can get the opportunity to work for free. And we
sometimes start by developing the project proposal for a symbolic fee, but
again we insist upon the fee for it gives us a larger degree of certainty that
the potential customer is in fact interested.
461

But we are not necessarily in the same situation in Germany because no one
there knows who we are. So our point of departure is very different we
want the concrete project and we want to accumulate the critical volume of
projects in Germany. We dont just have 50 other potential projects that we
could do. We have to get hold of them. We have to increase the level of
knowledge about our firm in Germany and therefore you have to be more
flexible and a bit more humble. You have to stretch yourself further and
make a few more compromises to be allowed to go the next step. And you
also have to be sure that when you stretch yourself, you are prepared to go
the whole way because you damn well better convince the customer. We
have gone the whole way recently, but have not received the project yet.
But the day before yesterday I could see that the customer was impressed
by us. And now we return to credibility once again because it can happen
that the customer does not agree with us but he still cannot help admitting
that he is impressed [] so you are still remembered and you are well on
your way, in my opinion. But we have to go further to get this effect than in
Denmark because in Denmark we are per definition more credible because
we are one of the countrys large architectural firms.

However, although the other Danish partners are impressed by Henrik Sthrs
dedication and hard work, they are also somewhat cautious regarding Henrik Sthrs
deviation from the firms payment policy in Denmark, due to perhaps the harsh and
competitive business climate in Germany. This can be seen indirectly in my interview
with Lars Kirkegaard on March 29, 1999:

Maria Anne Skaates: I have heard that German property developers are very hard
negotiators when they work with German architects.

Lars Kirkegaard: I think so too. I believe they say No Cure, No Pay. And we have
the policy that we want to be paid for the things we do. This is a clear policy for us. If
nothing else, initially a small symbolic sum but we have to receive something for our
work to ensure that the client is seriously interested in our firm.

Concerning credibility and the negotiated procedure in public sector tendering, Henrik
Sthr has participated in negotiations in Germany concerning hospitals together with
C.F. Mllers Tegnestues partner Morten Eriksen, whose specialty is hospitals. In
other situations, Henrik Sthr has participated in negotiations with German engineering
firms, except for the very first time when C.F. Mllers Tegnestue unsuccessfully took
part in negotiations together with a Danish engineering firm (interview, March 11,
1999). His remarks on negotiations included the following (ibid.):
462

Concerning the technology center [TGS], the competition was a
combination of an architectural competition and a negotiated procedure. We
first had to present our design proposal, which for me means that there is an
element of negotiation in the process in that you have the possibility of
presenting yourself in connection with and, hopefully, through your
presentation. [] The negotiated procedure is not a question of negotiating
fees. One tries to communicate that one is competent, that is has the ability
and the know-how to undertake the project in question. []

The procedure with the technology center was unique; we have not
experienced a similar procedure anywhere. We delivered our proposal, then
there was the presentation, thereafter we had a fortnight to revise the
proposal, which once again was presented, and then we won the project.
[]

The German private customer is in many ways for better or worse very
goal-oriented when he asks questions about project economy, time tables,
and other things. The German public institution is represented by a
committee that is judged by whether the project is run according to the time
table and the budgetary framework. But public committees are not happy
about making decisions. They would like to have as much flexibility in a
construction project as possible and furthermore they work in a hierarchy in
which this is my personal opinion a lot of time is used ensuring that one
can prove to ones superior that one has done the right thing. []

In connection with the [large stadium project] the committee was composed
of 30 persons plus their helpers who sat behind them. I think there were a
total of about 50 people present. [] In connection with this competition,
no one knew who sat in the committee. This is otherwise unheard of. I have
never experienced this before. []

[When one is not chosen, the reason given] cannot be used for anything.
[] They write three or four lines and that is nothing at all. Of course, this
is understandable. []

A later passage from the same interview took the following course:

Henrik Sthr: Our strength is the negotiated procedure and the architectural
competition. If the competition is anonymous, it is of course more interesting because
we dont have to speak with our foreign accent.

463
Maria Anne Skaates: In relation to the negotiated procedure, do you believe that it is
possible to win despite your accent?

Henrik Sthr: I believe it is possible but not all the partners agree with me, especially
with regard to hospital projects [] because the programming side of hospital
projects is very complicated. [] I still am adamant about trying to win a hospital
project [].

This is again the discrepancy between the well-known C.F. Mllers Tegnestue in
Denmark and the unknown Architekturbro C.F. Mller in Germany. In Germany one
often has to act very differently because we are unknown here []. We have had to
stretch ourselves a bit more to get projects. []

Maria Anne Skaates: Do you take architects who are native speakers along to the
presentation rounds?

Henrik Sthr: No.

Maria Anne Skaates: Do you mean never is it always only you who participates?

Henrik Sthr: Yes.

Maria Anne Skaates: OK, you are the managing director, after all.

Henrik Sthr: It has to be me. [] With our present constellation of employees in
Berlin, I do not think it would be reasonable to take employees or others along. The
paradox of the matter is that I as a Dane experience initial sympathy when I come. []
This of course is a very good way to start things, but often we experience that the fact
that we are Danes is a problem when the decision is finally made.

Maria Anne Skaates: I have also heard this from other persons, in connection with
Project Renovation. Could this have something to do with that Danes are less hard
negotiators and more obliging and the Germans initially find this sympathetic, but
when it comes down to business, they still are more comfortable with someone who
pounds his fist on the table?

Henrik Sthr: We pound our fists on the table in another way this is the cultural
difference. Think about the fact that we in Denmark have managed to build the bridge
over the Great Belt
47
. We act differently in conflict situations than Germans do.

47
Henrik Sthr is here referring to the recently built freeway bridge between the Danish islands of Funen
and Zealand which is the second longest suspension bridge in the world. DISSING+ WEITLING designed
the bridge.
464
Maria Anne Skaates: [] But would it not help to take a German along then?

Henrik Sthr: The thought is not totally foreign to me. However I believe that I as a
partner in the firm must be present to show our interest and credibility. I think that if
we had a convincing project manager among our German employees who was a very
convincing person and very competent both with regard to details and the main
technological features, then it would be fine to use him.

With regard to the selection of limited competitions or two phase competitions, which
are the main type of competition that Architekturbro C.F. Mller participates in,
Henrik Sthr has indicated that the number of participants plays a major role (April 9,
1999):

In the cases where we have to decide whether we will participate in a
competition, we look at the size of the project and how many firms will be
invited to participate. And if there are 30 35 invited firms, we usually
choose not to participate. [] We prefer a competition where there are 8
10 firms in the final round or firms invited to participate. Of course there are
exceptions as there always will be. There will always be projects that are so
fascinatingly interesting that one feels one has to participate, but this is not
the rule.

When presented with Cova, Mazet, and Salles (1994) model (See Figure 1 in Section
1), which is the subject of research question 4, Henrik Sthr had two comments.
First, he stated that the acts of getting to know construction industry actors in
Germany and learning to get to understand the signals of the German environment (i.e.
steps two and three in the model) in his opinion actually happen at the same time
(interview April 9, 1999). Additionally, concerning the last steps of the model, he had
the following criticism as a representative of a very newly established and relatively
unknown architectural firm in Germany:

Completion, this is when you sign the contract and then start? No, we
have started a long time ago because our project proposals are very
detailed even before we have won the contract. And of course we also
have to fight to win the contract. For example, we have an oral agreement
concerning a nursing home, but we are put under pressure all the time and
have to give more and more and then when we reach the point of no
return, then we hope that we get the contract and a signature. This is the
way the real world works. [] For us the risk is that we use our resources
and develop projects but do not get the contract. This does happen. If we
could live our lives in a way that allowed us to started the projects after
465
having received the contract, a lot of things would look very different.
(ibid.)

B.3.3. C.F. Ml lers Tegnestues Knowledge about the German Market.
The previous subsection has described C.F. Mllers Tegnestues acquisitional
activities on the German market. Inevitably many direct and implicit statements about
the accumulation of knowledge related to the German market have also been included
due to the difficulty of separating acquisitive activities from knowledge accumulation.
Therefore the remarks presented in this subsection should be regarded as knowledge-
specific supplements to the general description of the previous subsection.

According to partner Lars Kirkegaard, knowledge acquisition was one major reason
for the establishment of Architekturbro C.F. Mller in Berlin (interview, February 19,
1999):

[With regard to Freiburg-Rieselfeld and Wiesbaden] and Berlins TGS,
having an office in Berlin was actually a very expensive way of doing things.
We could have done these things more inexpensively from Denmark
together with a German cooperation partner; we did not need the office in
Berlin for these things. We have the office because we have made a strategic
decision to learn in the long term to do all of the phases described in the
German HOAI. In the future, we do not want to be as dependent on
cooperation partners. [] That is what makes the Berlin office necessary.

However, the amount and types of knowledge that C.F. Mllers Tegnestue needed to
acquire concerning the German market were initially falsely estimated. This can be
seen be the following statement which Partner Henrik Sthr provided to Danish
journalist Marie Tetzlaff (1996):

When we look back at how we started here in Berlin, we are forced to
smile at ourselves. We had done a lot of serious research about the market
and had made conservative budgets, yet not one of the projects that
contributed to our decision to open the Berlin office ever were realized! []

[Additionally,] we have made all the typical mistakes that were possible to
make. This happened because one does not ask that questions that one
does not know are necessary to ask.

As mentioned in the previous subsection, participation in architectural competitions as
well as other types of public tendering in which project proposals play a role required
the accumulation of Germany-specific knowledge with regard to the greater demands
466
concerning detail, documentation, and the DIN-requirements in comparison to
Denmark (interview with Lars Kirkegaard, November 25, 1998). When commenting
upon these differences, Henrik Sthr made the following general statement, which also
relates to the importance of knowing the way of things are done in order to establish
credibility (interview, March 11, 1999):

It is fantastic to speculate about how it can be that two neighboring
countries that have a similar climate and many common cultural
characteristics can have such a different construction industry law tradition.
In Germany, you have to write everything down on paper; otherwise you are
not taken seriously at all. And you are not allowed to round up figures such
as 20.357 to 20.4. Why havent you written the exact figure? is the typical
German question to the Dane. Thoroughness is a part of the entire German
process, and once in a while one actually has the feeling that the Germans
are a bit surprised that houses in Denmark can withstand the cold of the
night They believe that we have a lower technical standard than is the case
in Germany, and this may in fact be true. German construction is extremely
solid. But it is also 30 40 % more expensive to build in Germany than in
Denmark, and the Germans would like to lower this price level because of
the large demand for housing in Germany.

With regard to knowledge of German quantity surveying practices, Architekturbro
C.F. Mller has operated with three different types of actor constellations. In the
Freiburg-Reiselfeld housing project, the firm hired a German architectural firm from
the Freiburg area to complete the specifications. In the Wiesbaden housing project,
the customer firm was responsible, whereas the quantity surveying specifications for
the TGS-Berlin were completed by the firms in the Arbeitsgemeinschaft. Especially
the use of an Arbeitsgemeinschaft allows for the transfer of knowledge through the
many discussions inherent in this type of constellation (Henrik Sthr, interview, De-
cember 10, 1998).

During 1992-1994, when C.F. Mllers Tegnestue was making its initial efforts to build
up a customer base and name for itself on the German market, there was a tradition
that Danish and other Nordic construction industry actors, including Bendt Almvig
from Almvig & Partnere A/S, the third case study firm, met at certain restaurants and
pubs in Berlin (interview with Lars Kirkegaard, November 25, 1998). Here some
information concerning experiences with difficulties, success, and failure were
discussed. This was of value for obtaining knowledge of the German construction
industry (ibid.); on the other hand, this Danish/Nordic social activity did not usually
result in projects for the participants (interview with Henrik Sthr, March 11, 1999).
467

In contrast, Henrik Sthr considers the knowledge he has accumulated concerning
dealing with German actors to be of primary importance in receiving projects. This
knowledge also resulted from his own contemplation on the basis of experiences
(ibid.). According to him, social and organizational relations among German actors
function differently in Germany than they do in Denmark (ibid.):

The role of the architect in Germany is the traditional role that the Danish
architect had twenty to thirty years ago. Everything revolves around the
architect in the sense that the architect is the responsible for the completion
of the construction project, that is the building and its surroundings. He
coordinates everything. People do as he says, yet also blame him, if things
do not work out. In Denmark, civil engineers have managed to take over this
role, but this has not happened yet in Germany luckily. The civil engineers
in Germany have to follow the architects instructions. []

However, our firm does not currently coordinate construction projects. We
form a kind of project team which is called an Arbeitsgemeinschaft with a
constellation of other firmse.g. firms that have specialized in competing in
public tendering procedures or in construction management. And of course
each engineer has his area of responsibility. The heating and sanitary
engineer and the electrical engineer must do their respective tasks
conscientiously, because the architect is not able to judge whether e.g. the
electrical wiring has been installed properly or optimally. But still the
architect as the project manager is responsible for coordinating the entire
project and thus must ensure that the electrical wiring is installed at the right
point in time. []

The German customer prefers to deal with the man in charge of things,
even if he is not the most competent person with regard to a particular
question. I have attempted to be more assertive and not go to some of the
many meetings I have been asked to attend because the very competent and
polite people whom we have hired to work at our Berlin office, they often
know more about the exact topic of the meeting then me. []

But when the building is going to be built, the German customer often
becomes increasingly insistent at seeing me. But in my opinion this takes all
to much time. On this point I have begun to be quite stubborn. I simply
delegate the responsibility to the in-house expert. []

[However] I of course attend the meetings where the most important
decisions are made or the meetings where I know we are going to be
scolded. I do not want my employees to be reprimanded by others. I
468
receive my pay for dealing with the criticism we may or may not deserve.
[...]

The workplace culture is more hierarchical and the process of producing
project designs extremely bureaucratic. The Germans pride themselves with
their perceived thoroughness, but I do not think that there is unequivocal
justification for this pride. Their thoroughness is quite a heavy burden. We
write a lot of things down. We write a huge amount of letters. And we use
way too much time to insure that we are in the right and cannot be held
responsible for mistakes. Compared with our colleagues, we are extremely
fortunate that we have not been involved in major lawsuits. In Germany you
sue someone. In Denmark, this is still not as common. In Denmark, you first
solve the problem and afterward you talk about who was at fault. In
Germany, in contrast, you first find out who was at fault and after this has
been determined, you go on to solve the problem. This is a very different
way of cooperating.

In Germany you can sit at a meeting and be thoroughly and very loudly
scolded something that does not happen in Denmark [] and one half
hour later you go out to eat lunch with your partner because he did not
mean his harsh criticism personally. This is difficult to accept; it is really a
huge cultural difference.

The perceived difference concerning hierarchy is also present in the following
anecdote: For several years, the office space that Architekturbro C.F. Mller was
renting in Berlin at the time contained a room with a bed as well as a bathroom with a
shower. rhus-based partner Lars Kirkegaard stayed in the office during his visits in
Berlin, instead of spending money on a hotel room. Some of the German employees
found this solution unusual, but it has also helped familiarize them with the more
informal Danish norms concerning work versus free time and internal hierarchies in
firms (interview with Lars Kirkegaard, November 25, 1998).

With regard to project management, Henrik Sthr elaborated upon the national
differences in the following way (April 9, 1999):

The major differences between the Danish and German construction work
is that the Danish skilled workers are perhaps better educated and their
structuring of the work is more flexible than in Germany. German skilled
craftspeople are very oriented towards their own craft. There is probably
not as much cooperation between the crafts in Germany as there is in
Denmark, although one has to be careful with this generalization. In
Germany everyone expects the architect to draw all details: Screws, nuts,
469
and bolts have to be drawn. If they are not drawn and the German
craftsman protests about this, then it is the architects fault.

This is of course also a game about the placement of responsibility. Who
should bear the burden? If the skilled craftsman is pressed by deadlines and
some drawings are missing, he will immediately say that he cannot made the
deadline due to the missing drawings. And this is true. So it is our job to
communicate the details so that the skilled craftspeople can build according
to our instructions.

Additionally, on the basis of his experiencial knowledge, Henrik Sthr believes
potential strengths for Danish architects on the German market do not have much to
do with the fact that buildings are generally more inexpensive in Denmark; instead, the
Danish welfare state provides some areas of competitive advantage:

If we can contribute anything to our large southern neighbor, it probably is
in the realm of public housing and nursing homes, that is the social sector.
[] However, we cannot build more inexpensively in Germany because
Germany has its traditions and its laws about how construction is to be
undertaken. And we cannot change that.

However, some issues of judgment concerning the management of relations to other
actors are still difficult, despite the accumulated knowledge of the German market. An
example is the decision concerning when one should accept poor treatment from a
customer and when one should decide to take him to court (Henrik Sthr, March 11,
1999):

We also have some German customers whom we would reprimand much
more strongly than is common in Denmark, e.g. through a lawsuit. But this
is also a question of strategy because one really has to think twice before
one goes to such measures with clients who are so large that we also want
to work for them in the future. You see, this is a very difficult decision.

Similarly, certain issues are still difficult to judge in relation to German authorities
(interview with Henrik Sthr, April 9, 1999):

It is also the architects responsibility to ask the right questions in the right
places. Seen from the customers viewpoint, this is also something we are
paid for. This of course sometimes causes a sort of fear of not receiving the
right answers or not speaking to the proper authorities. I sometimes also
experience this fear. In Denmark, I look forward to every answer I receive
470
but I sometimes find myself wanting too many written answers. This is not
an easy situation. It is not always so clever to ask the authorities for written
answers. Even though one has a right to do so, you sometimes fall into
disrepute with these authorities and then cooperation is pure hell. This
means that in some situations you have to develop some kind of confidence
or trust for otherwise everything becomes writing, and we already write a
great deal today. But it is a very difficult balance to find.

To take an example, we had an experience in connection with the first
German construction project in Freiburg-Rieselfeld. Everything, simply
everything, had been discussed from all angles and we had been through
some very difficult negotiations with our customer firm and the city of
Freiburg. After everything was in place, the customer firm demanded a so-
called Bauvoranfrage from the city of Freiburg to receive legal proof that
the project could in fact be built. This is something you have the right to do
before you begin to build. But the city of Freiburg was furious because we
had argued back and forth for many months and had finally reached an
agreement. [] The city of Freiburg seemed to see this as a provocation
and perhaps they were right because such a Bauvoranfrage requires 3 4
months work and this is quite a burden to place on an authority that also has
other democratic concerns to attend to.

In order to deal with the legal aspects of these dilemmas:

C.F. Mllers Berlin office uses a German lawyer and a German auditing
firm, and all correspondence, contracts, and other activities take place in
German. This sometimes results in language and communication problems
in relation to our partners situated in rhus. However, it is important to
speak German, if one wants to be active in the German market. It is
impossible to work in Germany if you speak poor German, for your
arguments do not have the same weight and credibility and the customer
loses his patience. All parties are very sensitive about construction projects
because there is so much money involved. Okay, we have been scolded
thoroughly by German actors when we have deserved it but it is not been
because of a poor ability to speak German. (Henrik Sthr in Tetzlaff,
1996)

Lars Kirkegaard made the following remarks with regard to the necessity of having a
German attorney (March 29, 1999):

The legal requirements concerning documentation are greater in Germany;
one has to remember this as a Dane, especially so that one is prepared for
the potential court case. We use a very talented German attorney [] who
471
was recommended to us by the Danish Consulate General. Sometimes he
has had to say to us that he cannot take our case to court because our
documentation is not thorough enough. [] I think it is fair for our lawyer
to say this to us directly because we need to know it.

However the German market is not worse than the Danish because of this.
Perhaps it is a little bit more regulated than in Denmark, but if one has ones
documentation complete, then there is no question as to what one must do
according to HOAI and then one can also defend ones rights.

With regard to auditing and bookkeeping, partner Lars Kirkegaard, who has been
educated as a Danish certified public accountant, has through the years developed his
knowledge of German auditing law, yet the following citation also indicates that he is
aware that he does not now everything about the subject (interview February 19,
1999):

I am the one who is responsible for the internal bookkeeping. I prepare the
data for Denmark as well as for our offices in Germany and Oslo. But we
also have German and a Norwegian CPAs. In Germany, we use [a local firm
from the town of Flensburg, immediately south of the Danish border],
whereas in Denmark we use [a well-known multi-national firm]. However,
[the local firm in Flensburg] is especially good at auditing annual reports in
accordance with both the Danish and German rules because their employees
have substantial experience concerning both countries.

With regard to the dilemmas concerning the role of the Boundary Spanner (see
Subsection 3.3.3.), partner Henrik Sthr stated the following (December 10, 1998):

In Denmark, C.F. Mllers Tegnestue is almost an institution within the
construction industry, and because of our history and long tradition of
building, we do not have to explain very many things to customers and
potential customers in Denmark, as they know quite a bit about us already.
In Germany, on the other hand, no one had even heard of us. So you start
from zero and speak with a foreign accent. And in our industry the only
thing you really sell is trust. You do not have much to offer beside
trustworthiness. You have to be able to convince your potential customer
that you have the talent and the know-how to use his millions of DEM
sensibly.

In this situation, C.F. Mllers Tegnestue is weighed down by its history. It
is not always easy to explain to the others in Denmark that we have started
472
from zero in Germany. Another thing that is difficult to explain is that the
workplace culture is very different here.

Further remarks on the subject from Henrik Sthr on March 11, 1999 were as follows:

When you sit in Germany [] knowing that your Danish partners have a
very abstract relationship to how things function outside of Denmark []
this of course is a source of conflict because one often feels encumbered
by questions which one thinks are of no importance. And once in a while
when one does try to explain something one has a feeling of doubt as to
whether they will understand [] but I may be overemphasizing this
problem.

However, partner Lars Kirkegaard does not see this potential problem area in exactly
the same way (interview: March 29, 1999):

The person who is responsible for the project proposal has to travel to
Germany because we cannot draw a project idea in Denmark that can be
realized in Germany. We are not capable of this. The German employees
who are going to continue with the work on the project have to be in contact
with the Dane and make some corrects by saying This cannot be done, but
this can. Therefore we cannot say that our organization in Denmark does
not know or should not know how one builds in Germany. [] The big
problem is that they do not know enough about how to build in Germany.

Additionally, according to Lars Kirkegaard, the Danish project Project Renovation
has given some of the employees at C.F. Mllers Tegnestues Copenhagen and rhus
offices a better idea of the German building culture (interview, February 19, 1999):

Together with the Copenhagen company SBS Byfornyelse [the name
literally translates to English as SBS Urban Renewal], we have completed
a pilot project concerning the renovation of a building in [the Berlin
neighborhood of] Prenzlauer Berg by preparing a renovation proposal. At
the same time, some Germans have worked to prepare a proposal for a
building on Enghavevej in Copenhagen. [] Now the project on Enghavevej
is being realized, whereas the realization of the Schliemannsstrae proposal
has not yet begun. This is a signal to our employees that even though we
often think that urban renewal is a long process in Denmark, things perhaps
go even slower in Germany.

However, the fine distinctions between the German and the Danish construction
industries as well as German and Danish business culture may indeed by very difficult
473
for partners working in Denmark to comprehend and capture in their actions. To take
an example, in her vision of The Future of Buildings for Commercial Use, Italian-
born partner Anna Maria Indrio (Arkitektfirmaet C.F. Mllers Tegnestue, 1998:138-9)
focuses upon four key aspects:

1. Automatization and other high technological processes
2. The role of new information technology
3. Increasing demands concerning the environmentally friendliness of buildings
4. The increasing use of participatory and democratic management styles

Anna Maria Indrio elaborates upon the fourth point (ibid., 1998:138) in the following
way:

[A] need is created for so-called intercommunicative space, i.e. space
where people meet spontaneously, where the lines of communication
between the departments are simple and natural, where each individuals
understanding of the general workplace framework is unambiguous, and
where the hierarchical dimensions of workplace roles are replaced by
spaces of equality with logical and democratic contexts. []

We thus experience a general tendency towards breaking down hierarchies
to the advantage of greater coherence in project- and group-based work.

However, if one compares the previous statements from both Henrik Sthr and Lars
Kirkegaard in this subsection concerning their perception of a much more hierarchical
workplace culture in Germany to Anna Maria Indrios above statement, one may easily
be tempted to ask the question of how general the tendency of breaking down
hierarchies is in Germany compared to Denmark. This then leads to the question of
whether the above statement by Anna Maria Indrio will have the same positive effect
that most probably has been hoped for when presented to German clients. This
discussion then also points to the difficulties in understanding the many minute cultural
differences between the two countries.

With regard to formalized continuing education, C.F. Mllers Tegnestue coordinates
its employees education plans through a process of dialog. The firms continuing
education committee is composed of two partners from the firm as well as two
salaried employees. In the words of Lars Kirkegaard (interview, February 19, 1999):

When we speak of continuing education of employees, each employee in
our firm has an average of DKK 12,000 per year to use for this purpose.
474
[] Our employees first make their individual plan proposals for continuing
education. [] Then we as a committee look at the requests of our
employees do they fit well with the needs of our firm? Some employees
may want to take computer-related or sketching-related courses, and others
would like to take part in a study trip, for example to look at innovative
stadiums or hospitals. After this groups are made, as everyone has the right
in principle to participate in one study trip per year. [] This means that we
divide people up in groups of 10 15 persons for the study trips according
to their interests and previous areas of expertise. When the group comes
home, they are obliged to report upon what they have seen; this always
takes place in connection with a slide presentation. In this way we
continually up-date our employees knowledge bases.

However, study trips and courses have as of now not been requested by Danish
employees for the purpose of learning more about the German construction markets
rules and conventions (ibid.).

B.3.4. The Role of C.F. Mllers Tegnestues Previous Project Work in
For the reasons previously mentioned at the beginning of Subsection B.3.3., this
subsection will only contain a few supplementary statements related to previous
project work references that have not been included in the previous two subsections.

Concerning Architekturbro C.F. Mllers work as a consultant for a German
professional soccer team considering the construction of a new stadium as well as the
German offices efforts to compete for stadiums in Germany (see Subsection B.3.2.),
it must be mentioned that C.F. Mllers Tegnestue has substantial previous references
in the Nordic countries. It renovated a large stadium in Oslo, the Bislett Atletikstadion,
and designed the addition to the largest Danish stadium, Copenhagens Parken.
(Interview with Lars Kirkegaard, November 17, 1998).

Additionally, with regard to the perceived strength of Danish firms in social services
project, Henrik Sthr stated the following (April 9, 1999):

At the moment, I am using most of my efforts on the nursing home sector.
I believe that in the next 3 5 years we will be able to win quite a few
projects within the health and nursing sectors. We are working on two
nursing homes at the moment and I must admit that I also expect a third one
this year. All statistics predict that all over Europe the number of people
who require nursing care will increase greatly in the next 10 15 years, and
the requirements for nursing homes will also change substantially in
475
Germany. Here is an area where we Scandinavians can contribute positively.
This was something we spoke of before nursing homes designed for more
activities, greater respect for the elderly, more individualism.

However, with regard to the above two statements, the value of such references
should not be overestimated according to Lars Kirkegaard (interview, March 29,
1999):

speak English very well if he decides to call Denmark. But why would one
call Denmark concerning a Danish architect when one can find a German
architect with similar German references? We could also look at the
situation from the opposite viewpoint. There are no Danish customers that
would call Germany to inquire about a German reference if they know
Danish architects who have references that are equally solid. []

One may also say that C.F. Mllers Tegnestue has a long list of references
from a country of only 5 million inhabitants. Therefore the act of coming
from Denmark with references that pertain to 5 million inhabitants
corresponds to drowning in the sea of German firms as Germany is a
country with 80 million inhabitants. One does not think about this in the
beginning. One only thinks about the fact that we are a large architectural
firm in Denmark, which we are, but when we arrived in Germany, we
suddenly became a much smaller firm without references.

Sometimes major national buildings are also reviewed by the foreign press. This was
the case with Partner Anna Maria Indrios renovation of the Danish National Museum
of Art. However, the review in the German national daily Sddeutsche Zeitung in 1998
was, however, only lukewarm. Lars Kirkegaard was therefore questioned as to the
effect of such a bad review on activities in Germany. He replied as follows (March 29,
1999):

People dont remember everything. A German newspaper that is not enthu-
siastic about the result is of little importance. It is soon forgotten. The very
fact that a building has been built implies that there will always be someone
who does not like it. [] But we would like the museum to be presented in
the German architectural and construction industry magazines [] to make
people aware that we are here and become more known. Because of course
it is quite certain that art museums will be built in Germany in the nearer
feature.

476
Henrik Sthrs comments to the same issue were as follows (April 9, 1999):

Of course it is a bit sad that this has happened in Germany because there
is a large German market for museums and Germany also has a reputation
for using foreign architects for that kind of project. But I think that Anna
Maria takes this kind of unfortunate review very easily. Her self-confidence
is not easily shaken.

B.4. Case Study Firm 3: Almvig & Partnere A/S.

Almvig & Partnere is this studys Successful and Innovative Younger Firm, in
accordance with the classifications mentioned in Subsection 4.3.1. It was founded in
1985 by Architect Bendt Almvig and employs approximately 30 persons, of whom
most are either educated as architects or certified building constructors, or have
received some other construction industry relevant education. Almvig & Partneres
original strength in 1985 was housing. However the firm has subsequently sought and
succeeded in broadening its areas of expertise in Denmark, especially after the so-
called lgaard report, which was made public by the Danish government in 1989
(interview with Bendt Almvig, November 19, 1998). The main conclusion of the
lgaard report was that there would be a decreased need for publicly funded
housing in Denmark in the 1990s (see Hansen et al., 1994:28-9, 108). Today the firm
receives orders for many types of construction and urban renewal projects on its
domestic market (interview with Bendt Almvig, November 18, 1998).

Almvig & Partnere has been active on the German market since 1990. Its initial form
of activity was a cooperation agreement between itself and a German architectural firm
situated in Hamburg. However, Almvig & Partnere terminated this agreement after the
first year because it did not provide the expected and perceived fair share of income
from the joint projects (ibid.).

In the beginning of 1992, a strategy concerning the establishment of a subsidiary in
Germany was discussed in Almvig & Partneres professional advisory board. After
some modifications to the strategy, a subsidiary was established in Berlin. From 1995
1999, the subsidiary has been led by a Danish certified building technician, Mikael
Srensen, who has years of experience on the German market, in cooperation with a
German architect educated in Germany. Almvig & Partnere has been involved in
German projects or received prizes in Germany concerning, among other things,
gasoline stations, housing, urban renewal, and shopping centers.
477

For the purposes of this study, Almvig & Partnere provided me with written
documents related to the firm as well as a series of interviews with founding partner
Bendt Almvig, Mikael Srensen, and Per Lindrup, who is responsible for the firms
budgets and finances (see Appendix C).

B.4.2. Almvig & Partneres Architectural Project Acquisition.
As mentioned in the previous subsection, Almvig & Partneres first move on the
German market was to enter a cooperation agreement with a German architectural firm
around 1990. Bendt Almvig found this firm through a Danish contact in Hamburg who
had a firm that was specialized in renting Danish and Northern German summer
cottages to Germans. The cooperation agreement specified that Almvig & Partnere
would send two of its employees to the German architectural firm which would pay
for their wages while they worked in Hamburg. Furthermore, the German architectural
firm and Almvig & Partnere would share the profits that came from joint projects.
However Almvig & Partnere terminated this agreement one year later because they
found it peculiar that according to the Hamburg architectural firm there were never any
profits. The cooperation agreement did not cost Almvig & Partnere a lot of money,
but a lot of time (interview with Bendt Almvig, November 19, 1998). Thereafter
Almvig & Partnere began to search for a new way to tackle the German market
because the firm was still interested in this market.

On February 7, 1992, the document Main Strategy Establishment in Germany was
presented to Almvig & Partneres professional advisory board. It included the
following chapters:

1. Market research Preliminary work done
2. Market conditions
3. Strategy
General
Subsidiary/board of directors
Organization/employees
Matters concerning economy and financing
4. Analysis
5. Suggested decision

Chapter One included the following excerpt:

478
In the Berlin area, the firm has examined the East German public housing
societies. The firm has made German-language promotional material that
focuses on the larger renovation projects it has undertaken in Denmark. This
material was presented personally to several public housing societies, some
of which were also contacted afterwards. This means that personal contacts
have been established which could lead to various cooperation
constellations or perhaps invitations to participate in architectural
competitions. The examination of the market has been summarized in a
report which tells how large each public housing association is and
summarizes its needs and wishes with regard to technical consulting.
Beyond this, a memorandum on Berlin has been written which describes the
meetings in Berlin, including those with other architectural firms, which also
resulted in good contacts.

Additionally the examination of the market of the German Land Mecklenburg-
Pomerania and its capital city, Schwerin, were also briefly described in Chapter One.

Chapter Two contained the following passages:

In Schwerin there is a good potential for establishment of an architectural
firm both with regard to construction projects and contact to public
authorities. The next 5 10 years construction projects will encompass
housing, vacation facilities, commercial buildings, and shopping centers.
[]

The Berlin area will without any doubt be the largest market in the unified
Germany. The possibilities for projects will be almost inexhaustible,
especially when one includes the former East Berlin and the German Land
Brandenburg with its capital city Potsdam. Here it should be remembered
that Berlin will become the new capital and the main seat of government.

As for the flow of money to the new German Lnder, Berlin and
Brandenburg will receive 60 70 % of all funds. The former East Berlin has
a total of 11 large public housing associations with a total of 450,000
apartments. According to the memorandum on Berlin, the firm has
established contact to a German attorney XXXX who has a large network of
contacts.

On the basis of the above, we have chosen to concentrate our efforts on
one area. We believe that Berlins potential and our contact to attorney
XXXX will provide our firm with the best possibilities in this region.

479
The rest of the Main Strategy Establishment in Germany outlined the plans for the
establishment of a subsidiary. It was suggested that a joint stock company
(Architekturbro Almvig AG) be established, and that Almvig & Partner A/S in
Denmark would complete the initial project proposal and design stages, whereas
Architekturbro Almvig in Berlin will be responsible for the project details according
to German law and norms and construction management. Furthermore, it was
suggested that the Danish connection be mentioned in marketing activities in
Germany because the goal of the subsidiary was to build up a good reputation as a
Danish cooperation partner.

In the proposed strategy, the German attorney XXXX suggested that the location for
the office should be the west city center of Berlin, somewhere in the vicinity of the
posh streets Kurfrstendamm, Kantstrae, or Kurfrstendammstrae. Finally the
strategy plan stated that the subsidiary was to employee the following people:

1 manager: a Dane with a good command of the German language, not necessarily
an architect
1 2 architects: Danes with a good command of German who also have
knowledge of Danish sketches
1 2 civil engineers: Germans
1 secretary: A German or a Dane

and that the proposed first half year establishment budget required a sum of DKK
609,700 for establishment and initial wage costs. The strategic estimate and goal was
that the subsidiary would earn enough money to pay back the establishment costs as
well as bear its own costs within two years.

The professional advisory board was, however, skeptical about these plans and
suggested that much less money be used and a much more cautious start be planned
(interview with Bendt Almvig, November 19, 1998). After this meeting, Bendt Almvig
visited Berlin again to improve his contacts to the public housing associations. This
however seemed to him to be ten times as difficult than he had previously imagined
(ibid.). He also made a number of presentations for German housing associations
about Danish housing at the Danish House of Architecture (Arkitekternes Hus) in
Copenhagen as well as in various German cities (ibid.).

One day, after seven days of acquisitive and promotional activities, a manager from a
German public housing organization phone Bendt Almvig. He suggested that it was
not worth taking contact to the German public housing organizations if one did not
480
have an office in Germany. This man then subsequently helped Bendt Almvig find a
German apartment on the outskirts of Berlin so that he could begin to work from
Germany (ibid.).

Thereafter, the firm Almvig & Partnere A/S changed their policy for the coming
subsidiary to We will only work if we receive payment for our efforts. During his
visits to Berlin in 1992 - 1993, Bendt Almvig had the habit of visiting the restaurants
and pubs where many Danish and other Nordic construction industry actors, including
Lars Kirkegaard and Henrik Sthr from C.F. Mllers Tegnestue (see Subsection
8.3.2.), met informally. However, for Bendt Almvig, one visit resulted in his first
project on the German market (ibid.).

While he was eating dinner at a restaurant in Berlin that was popular with the
Scandinavian construction industry actors, he met the managing director for the
Norwegian petroleum company Statoil. This man ask Bendt Almvig if he could design
gasoline stations and Bendt answered yes. A meeting was agreed upon the next
morning. Bendt spent most of the night on the telephone reviewing the details of
building gasoline stations with a Danish consultant in Denmark. On the basis of the
following meeting, Almvig & Partnere A/S received its first German project, designing
in all 10 gasoline stations for Statoil in Germany (ibid.).

Shortly before this meeting, Bendt Almvig had found office space for the German
subsidiary. In cooperation with a department manager from a Danish asphalt and
cement firm, a contract was signed for an office with 200 m
2
of space on the southern
outskirts of Berlin, near the Tempelhof Airport. Each firm used 100 m
2
for its
activities. Bendt Almvig then hired a secretary, and Almvig & Partnere began to work
on the gasoline stations (ibid.).

Shortly afterwards the firm moved to more central offices, on the exclusive shopping
street Kurfrstendamm. Upon the advice of German contacts, Bendt Almvig sold his
old Citron and bought a more expensive car, a second-hand car that previously had
been used as a taxi in Denmark
48
, to make a better impression to potential German
colleagues. Additionally upon the advice of his lawyer, XXXX, Bendt Almvig made
the subsidiary a limited liability company (GmbH in German) to protect the Danish

48
Cars are heavily taxed in Denmark and thus much more expensive than in Germany. Danish taxis are,
however, always expensive and relatively new cars that are sold when they reach a certain, relatively young
age.
481
joint stock parent company Almvig & Partner A/S in the case of lawsuits. The
German subsidiary was named Architekturbro Almvig GmbH (ibid.).

From another client, Bendt Almvig received information about 100 m
2
of relatively
inexpensive office space on Kurfrstendamm that was only available for two years. He
followed up on this information and the office was moved once more. By this point in
time, the Architekturbro Almvig employed a secretary, a Danish engineer, and a
German architect on a part-time basis. Many other Danes were in the Berlin area, but
most of them did not succeed in receiving contacts and projects (ibid.).

In connection with a Danish firms purchase of a former East German production
facility, Archikturbro Almvig received two orders from the Danish firm, one
involving office space for an automobile factory, the other involving housing property.
These construction projects were, however, stopped, but the German office did
receive its payment for its work. Additionally, through Almvigs German lawyer,
contact was established to a German politician who also worked with property
development in his own firm. Architekturbro Almvig completed the initial project
proposal for this persons firm for a fixed fee. It concerned a combined sport hall and
housing project which was to be submitted to the German authorities (ibid.).
However, at this time, there were some general organizational problems with the
German projects. Most of the details of the projects were specified in rhus by a
Danish building technician, and the German office was mainly used for expedition of
the projects. This caused problems concerning the degree of details and relations to
German authorities (interview with Mikael Srensen, February 23, 1999).

Around this point in time, in late 1994, the former manager of Architekturbro Almvig
in Berlin, a Danish engineer, told Bendt Almvig that he had to find another job because
his wifes asthma had worsened substantially since their move to Berlin, and her
doctor recommended that they move to a smaller community. Bendt Almvig then
recruited the young Danish building technician Mikael Srensen
49
, who previously had
worked for Danish contracting firms in northern Germany and written a 100 page
thesis on their activities in connection with his studies. Mikael had also worked for the
Hamburg architectural firm that had had the cooperation agreement with Almvig &
Partnere at the beginning of the 1990s (interview with Bendt Almvig, November 19,
1998). He thus had been on the German market since the early nineties (interview with
Per Lindrup, February 18, 1999).

49
Mikael Srensen was born in 1968.
482
During the middle of the nineties, Almvig & Partnere involved themselves for the first
time in an international project sponsored by the Danish Ministry of Housing: Project
Renovation. While this project was being realized, the former Danish Minister of
Housing, Mr. Ole Lvig Simonsen, visited the firms head office in rhus to hear
about the firms experiences on the German market (interview with Bendt Almvig,
November 19, 1998). At the same time Architekturbro Almvig assisted a Danish
contractor in building a housing project in Brandenburg (interview with Mikael
Srensen, February 23, 1999).

Almvig & Partnere had two projects that were connected to Project Renovation. One
concerned terraced housing built by the world-renowned German architect Bruno Taut
in the 1920s in Magdeburg (Land Saxony-Anhalt) that was badly in need of
renovation; the other concerned apartment housing renovation near Leipzig (Land
Saxony) (interview with Bendt Almvig, November 19, 1998). In Magdeburg, one of
the criteria used in choosing the winning firm was that the rules for preservation of
works of architectural significance had to be kept (interview with Mikael Srensen,
February 23, 1999).

In relation to the Mrkische Huser project, i.e. the Project Renovation project in
Leipzig, Bendt Almvig had the following to say (March 29, 1999):

Concerning the Mrkische Huser, which are located here [Bendt Almvig
points to a neighborhood on a map of Leipzig], we worked with the city of
Leipzigs technical director, Mr. XXXX. He is very good at keeping the
project on track. He says, We have agreed to do things the way Almvig &
Partnere have suggested. [] But not everyone in Leipzig likes that. Some
say Now there is an empty apartment? Shouldnt we just add new linoleum?
But we have made a report that says that such partial renovations should not
be undertaken. We believe in larger wholes as we have written in our report.
[] So when the director of the Public Housing Association suddenly says,
Shouldnt we just repair these roofs? or Shouldnt we add extra
apartments on the top floor, directly under the roof?, we say No. We
havent written anything about that. To insure that the housing is good in the
long run, we have to follow the plan we have made. And Mr. XXXX is very
good at insuring this.

Mikael Srensens comments to the project were as follows (interview, February 23,
1999):

483
I think that our [project renovation project] in Leipzig fulfilled [the
programs goal of 15 % cost savings]. One can imagine that we saved 15 %
of the costs because at the beginning we tried to calculate what the public
organizations costs would be if they bought the usual renovation solution
[] and what they would save if they purchased the model we have
developed; we also did calculations concerning the degree of flexibility.

But there were many, many factors that played a role in their investment.
Because the public housing organization does not have enough tenants to fill
the newly renovated apartment and because in this case a private client
probably would not invest in renovation at all, I think they decided to follow
our ideas vigorously with regard to organizing construction work in teams to
optimize the quality of the product the tenant gets instead of the normal
German solution where we have five different craftspeople and each works
independently with his own area of specialty. When we get them to work in
teams, we tell them that they are jointly responsible for the entity of the
bathroom and everything that belongs in the bathroom. And we also have
gotten the client to actively involve the tenants in the process and chose
clusters of tenant needs as input in the solutions we have proposed for the
apartments for new customers. And the public housing organization also
now tries to attract new tenants because their apartments and the environs
[] have a level of quality which others cannot offer. They can now go out
on the housing market and differentiate themselves because of high quality
construction.

[] This is important in Leipzig because people are leaving the city. The
degree of empty apartments in Leipzig is very high. Approximately 8 % of
the apartments in Leipzig are empty.

Bendt Almvigs commentary to Project Renovation was as follows (March 29,
1999):

We were very enthusiastic about Project Renovation. Our firm does not
usually apply for public subsidies I do not know if this is a poor principle
to have after all one can receive support if one keeps up with information
concerning the types of development that the public sector wants to sup-
port. [] We had, however, to also use our own money; this has to do with
the public sectors policy concerning this type of development project.
Concerning [the Bruno Taut renovation in Magdeburg], we used perhaps
too much money around DKK 2.3 million of our own money and around
DKK 1.5 million from Project Renovation. But it was also an investment
with the expectation that we would get the chance to renovate 700 terraced
484
houses. But now even though our pilot project has been successful, nothing
has happened. []

In Leipzig we only received DKK 300,000 from Project Renovation but this
project has been a success. There we also have contracts concerning the
next two planned renovation phases. So there is also an element of chance
that cannot be managed.

Seen from our viewpoint, the Danish Ministry of Housings cooperation
agreements have also been advantageous to us. Normally, as one German
official in a public housing association said, We are somewhat skeptical
about using foreign firms. This is probably because of the many
misunderstandings that have resulted in lawsuits when the German market
was booming. However the cooperation agreements have been helpful as
door openers, and when one first has completed a few German projects
successfully, the acquisitive work or cooperation in Germany does not
seem that different from the work in Denmark.

In the mid-nineties, Architekturbro Almvig GmbH also began to present itself as
Germans and Danes who incorporate the ideals of Scandinavian architecture in
Germany instead of just Danes, because, among other things, the firm had found out
that it is not possible to build as inexpensively in Germany as in Scandinavia, due to
the German legal framework (interview with Bendt Almvig, November 19, 1998).

Concerning the change to a more explicitly German strategy, I had the following
conversation with Mikael Srensen on February 23, 1999:

Maria Anne Skaates: Are you critical of Danish actors meeting too often in Germany?

Mikael Srensen: Yes, for the simple reason that we cannot sell projects through their
network. I know pretty much about the Danish network and I do not believe that we
can sell our projects through it just by meeting and talking about the general course
of events. I am much too concrete for that kind of thing. I have experienced it during
my time in Hamburg [] when we built with Danish contractors and knew a lot of
Danes. The experiences I have from that time have given me the attitude that the topic
of conversation is always The way of doing things is different here; everything is
different than in Denmark. But this is true irregardless of where you go outside of
Denmark []

Maria Anne Skaates: So when the Danes are together, they want to talk about their
own traditions and the like?

485
Mikael Srensen: Yes, and I do not think that we should act as activists for Denmark
on foreign markets. I only compare the current German market and us Almvig &
Partnere internally. In this situation I ask myself: What is good in Denmark? What is
good in Germany? What is poor in Denmark? What is poor in Germany? And one
can use these thoughts to find ways of converting work from one country to the other.
Concerning the social differences, I do not think that they are that large but I also
know that many Danes in Germany often meet to discuss these differences, but for me
it seems that these Danes want to put the Danish flag on the table and then be happy
that all of the Danes are together again and think about how things would be done in
Denmark instead of here in Germany []

[] I have also chosen not to involve myself in the Danish network because I know
from experience that many Danish producers and consultants as well as foreign actors
from many other countries have not delivered the product properly in Germany.
Therefore mentioning that ones firm is Danish or foreign may also have a negative
effect on potential German customers who may have had bad experiences with Danes
or other foreigners. In my opinion, one should generally also avoid merely profiling
oneself on the basis of rumors about national reputation, and instead focus upon firm-
specific characteristics and competencies.

With regard to public tendering procedures concerning Germany, Almvig & Partnere
and their German subsidiary systematized their efforts in the mid 1990s. Each EU
Public tendering publication usually contains 10 20 pages concerning German
housing projects. These are followed up on and a decision is made as to which
projects to bid for (interview with Bendt Almvig, November 19, 1998).

Almvig & Partnere is still relatively specialized in housing at the end of the nineties,
both in Denmark and in Germany. In Denmark, housing accounts for approx. 50 % of
total turnover, whereas urban development and city planning, office buildings and pro-
jects concerning public sector institutions make up the other 50 %. In Germany, on
the other hand, 80 % of total turnover has come from housing. This is too large a
percentage, in the opinion of Bendt Almvig (interview, November 19, 1998):

Housing has proved to be both our strength and our Achilles heel, as we
are very vulnerable when the market for housing is depressed.

Bendt Almvig sees two ways out of the situation where the firm is so specialized in
housing (ibid.):

486
1. Receiving projects through personal contacts.
2. Winning architectural competitions and public tendering procedures.

Participating in architectural competitions, including open competitions, has therefore
been a high priority for the firm. The firm participated in a competition concerning the
student cafeteria (in German: Mensa) at the University of Leipzig and received an
honorable mention, i.e. 5
th
place out of 400 participants (ibid.). With regard to urban
development and city planning, Bendt Almvig also hopes to be able to use the firms
Danish experiences in Germany in connection with German architectural competitions
and public tendering procedures. Many Germans cities have decided to focus upon
improving the quality of life by improving city planning and adding more gardens
(ibid.).

Per Lindrup sees the generalization-specialization dilemma in the following way
(interview, February 18, 1999):

Our increased level of specialization takes place within the firm. Towards the outside
world [] we should present ourselves as generalists that is, we can build housing
but we can also build other things. But internally we have to make sure that the
members of our firm can deal with many different types of tasks. [] We have some
people in our firm who are good a housing because of our history. [] But if a
private firm comes and asks for a headquarters, we also have to be able to make a
project proposal. And this requires other areas of expertise. [] But we still have to
be able to function as a whole. [] Our market in Denmark is so little that we cannot
just offer public housing projects; this would be much too narrow.

Maria Anne Skaates: I understand this strategy in relation to Denmark and I
personally believe that this is a good strategy for countries such as Norway, Sweden,
and Finland, but

Per Lindrup: Germany may be different.

Maria Anne Skaates: Yes. And this may put you in a dilemma.

Per Lindrup: But what we typically do in Germany is concentrate on the things that we
are best at doing. [] We know we are good at both renovation and housing. So in
Germany we do not just go in and use our resources on bidding for, say, a museum
because we know that we probably will not get the job.

I asked Mikael Srensen about his opinion concerning the scope of Architekturbro
Almvigs offerings on the German market on February 23, 1999:
487

Maria Anne Skaates: In Denmark Almvig & Partnere follows the typical Danish
strategy of being a generalist firm that can bid on many types of architectural projects.
What is your opinion on that in relation to Germany. Is this a good idea or should one
be more specialized in Germany?

Mikael Srensen: One should be open toward niches but one should also be able to
do other projects than just niche projects. And that is something we can do with the
project experiences we have we can move from a house to a larger project
commercial building, for example. But we have a core competence in Germany
renovation and construction of housing. This is what our employees and the entire
organization is geared towards.

Because if one is going to go after commercial projects, that is mainly business clients,
then we would need a totally different organization because then the expectations
concerning project management and the role of the general contractor. And then there
are the expectations that we already have completed five other large commercial
projects -in order to be chosen. And we cannot claim that we have. What we have
already developed is renovation concepts for housing. This is our core area which we
also have to build upon. We can attempt to reach other groups of customers through
architectural competitions and it is also a possibility that we can organize ourselves in
another way which will give us the possibility of serving other customer groups. []
Finally there is the unconscious acquisition efforts if we meet a contact and we feel
we understand each other well, then there may be a basis for a project which will open
up possibilities in another area for us. Then we can organize ourselves around
projects. We are very good at this quickly getting ourselves organized and quickly
assigning the right people to projects. I think we can maneuver very well in this way
because our lines of commando are short.

In the late nineties, Almvig & Partnere have also experiemented with innovative
concepts in Germany on the basis of their knowledge of the German market. One
such concept concerns working with a broader understanding of costs in the
construction and maintenance of buildings instead of the standard Danish formula of
using more prefabricated components. In the words of Mikael Srensen (February 23,
1999):

And more expensive, does this mean the current market value of the
project or the does this include the total building maintenance or heating and
electrical costs in the next decade? It may be that the client pays DKK 500
more per square meter for our proposal but that the total energy bill will be
less expensive in the long run so that this initial extra investment saves
money in the long term. This is what we usually mean when we speak of
488
cost savings. The initial costs of the skilled construction workers are not
easy to cut. However, you can save money by using prefabricated
components [] that are standardized. You have fewer hourly wages costs
[] but this makes the project so inflexible that it is difficult to sell such a
project to a German client because the German client especially the client
from the former East Germany says This is all well and good but we had
this kind of system in the old regime and now we want more customer
choice or tenants choice, if we are talking about a public housing
association. Then one has a problem with the more standardized solution
because people are willing to commit themselves beforehand. Therefore the
value of building inexpensively seen with Danish eyes means
prefabrication to made the construction project shorter but the disadvantage
the need for commitment to one design at the beginning is difficult to sell
to the German client.

Additionally, Mikael Srensen mentioned an example concerning yet another housing
project in Leipzig, in the neighborhood of Leipzig-Grnau. This neighborhood is
comprised of huge concrete apartment blocks badly in need of renovation (February
23, 1999):

We have submitted a proposal for a project in Leipzig Leipzig-Grnau, a
public housing area with 80,000 apartments where the Federal Republic of
Germanys Ministry of Housing want to create an on-location architectural
workshop that can determine the most general criteria for how this
apartment complex area can develop over 5, 10 and 30 years this means
they are looking at three different time horizons. We have applied for
participation in the architectural workshop with a proposal that presents
how we would like to adapt Danish urban planning knowledge to the
Grnau-area in cooperation with [the Copenhagen chapter of a major
Danish public housing association] which has made proposals concerning
[] experiences with local planning, tenants democracy, and facility
management.

Now, to take a concept from the former East Germany. [] We have tried
to put the skilled craftspeople together the way they were. Formerly there
was a technique called Taktstraen.
50
[Mikael Srensen fetches an old
German Democratic Republic handbook on this subject.] This is from the
former East Germany. This is how they planned their construction work.
[ We want] to be able to take the fundamental ideas that were part of the
Taktstraen program from the GDR and put them into use in new ways.
This is the underlying idea behind our construction teams which are a type

50
In English, Taktstraen translates idiomatically to working in coordinated steps.
489
of cooperation, a cooperation-oriented team of skilled craftspeople who
receive the joint responsibility for the total outcome of an area.

In terms of legal contracts, it is difficult to use these teams because the
client has a criterion: He want to work with one cooperation partner who is
responsible for everything. But we have used this proposal to get the
interest of the skilled craftspeople. [] Last year we presented a project at
the Chamber of Crafts in Leipzig where we presented these types of coop-
eration in combination with the bathrooms that were to be remodeled in the
Leipzig-Grnau apartments. After this the firms could apply for membership
of the team. It was then the responsibility of the main contractor to decide
which firms to use in the team but in our tendering material we made an
address list of the firms that had shown interest for teams and we hope that
the construction firms that the main contractor has chosen for bidding will
also include these team-oriented small craftspeoples firms. []

However, the main contractor does not have to name the firms he will use in
his proposal; he just has to name how many people he will put on a team for
the bathrooms and how he will organize the work. In theory there can be
one or more teams. If he only works with one team, then he can only work
with one water pipeline connection at a time. But if he has many pipeline
connections and there are 34 of them in the first apartment house then
he could in theory work with three parallel teams. We have suggested one
set of teams that improves the bathrooms and one set of team that renovates
the rest of the apartments to make the concept more flexible - so that some
tenants could say I only want a new bathroom whereas other tenants could
say I want my entire apartment renovated and I will move in an empty
apartment while the work is being done.

Concerning the Leipzig-Grnau proposal, Bendt Almvig informed me of the following
on March 29, 1999:

We just received the reply I dont know if you have heard this yet, but
we have not been prequalified. They picked 5 more traditional bidders.

But our idea was extremely good. And the reason that we submitted it was
that we kept hearing how happy people were to live in [Leipzig-Grnau],
about all of the positive things and the many activities. We then said, Here
is a neighborhood with 10 15,000 inhabitants, if these people become
involved in its future, this will make things even better. They could then say
Let us get rid of two apartment houses and build an activity center or
come with another proposal that we could then decide upon. So we went in
and said, It does not matter that we only play the role of the architect in this
490
process. If we are included in the project team it is likely that the tenants
would say to us, Please make a design proposal for these ideas and then
we would do it. Because we are used to this and the Danish public
housing association that led the team has a lot of knowledge of how to
manage tenants democratic rights to be heard; they are actually experts in
this field and could use us as the technical advisors to formulate their
proposals as well [] But I do not think the Germans were ready to go this
far yet.

1998 was a bad year for Architekturbro Almvig, mainly due its cooperation with a
Danish contractor who left Germany with unfinished buildings and unpaid bills. For
the first time, the firm had a year with a large negative net result due to the lack of
payment on the part of the Danish firm. Two German architects who had worked for
Architekturbro Almvig since 1996 were therefore fired (ibid.).

In 1999, things went even worse. In the late spring of 1999, after I had completed my
interviews, the public client in Leipzig who initially had been very pleased with Almvig
& Partners Project Renovation contract suddenly began to refuse to pay the fees
required by the subsequent contracts that had been entered into with Architekturbro
Almvig GmbH regarding project management work in connection with the Project
Renovation project. This resulted in insolvency for Architekturbro Almvig GmbH,
and the firms German lawyer advised Almvig & Partnere to close their German
subsidiary immediately to minimize their losses, as the firm would otherwise be forced
to keep working for the public client in Leipzig, even though the client was not paying
in accordance with the agreement. However, Almvig & Partnere are still interested in
the German market; they recently submitted a proposal for the new parliament building
of the Land Schleswig-Holstein in a restricted architectural competition they are invited
to participate in and are currently looking for other ways to be active on the German
market (telephone conversation with Bendt Almvig, October 6, 1999). Mikael
Srensen and Thomas Schnball, the remaining employees of the Berlin office, have,
however, moved to positions in other firms (ibid.).

Concerning the role of the architect in Germany in relation to acquisitions in general
terms, Bendt Almvig stated the following (March 29, 1999):

The architect is very important. [ The other actors] gather around him
because they are the cooperation partners. [...] we can also go out and
choose which cooperation partners we would like to have but it is also
important that we choose the right partners. But you also have many more
partners to choose among in Germany that at home. If you look at the size
491
of the main Danish engineering firms, e.g. Cowi or Carl Bro or Rambll or
one of the other large firms, they have many departments covering almost
everything and do not advertise in Denmark with [their specific areas of
expertise]. But on a German construction billboard one can read: Architect
XXX and then come the names of perhaps 20 engineering firms with very
different areas of expertise.

[] Sometimes the client suggests [certain engineering firms]. In Leipzig,
for example, our client said, We would like you to use these firms because
they know our buildings and we have used them earlier. So you work it out
with the client. But the firms know their place in relation to the architect.

Concerning the literature on Boundary Spanners and Relationship Promoters (see
Subsection 3.3.3.), Per Lindrup indicated that throughout the nineties many people in
the firm recognized that Bendt Almvig had done the main job of creating contacts,
especially in Germany (interview, February 18, 1999):

Bendts flair for creating contacts and being very outgoing [] is also very
useful [on the German market] because we have more problems in
Germany. There is a lot of sales potential connected to his abilities, if
one can put things this way. This ability cannot be valued by us in monetary
terms but it is absolutely certain that is it tremendously valuable for us.

Bendt Almvig described his activities as a relationship promoter in the following way
(March 29, 1999):

In our relations to the large public housing associations in Berlin, I have
probably gotten further because I have introduced myself to them and to the
people that they know. There was one public housing association where we
almost got a project we were very close to it, however neither our
contacts nor my promotion nor the other factors were enough for us to
receive the project.

However Bendt Almvig has learned from experience that it can be much more difficult
to be a relationship promoter on the German market due to its size (ibid.):

One can say that Denmark including both rhus and Copenhagen are
small social areas compared to Berlin. [] We should perhaps never have
chosen Berlin because we will never be well-known in Berlin; the city is too
large, and your social network has to be very large before anyone will
consider using you. It is much easier for me to contact the office of the
Mayor of Social Services in the city of rhus and say that I have heard of
492
the plans concerning a new nursing home and I would like to be informed of
them in the future. You cannot automatically do this in Berlin. People would
shake their head in disbelief if one even tried: What kind of idiot was that
who just phoned?

Concerning contacts to other construction industry actors, Bendt Almvig stated the
following on March 29, 1999:

We have not had contact with producers of components. [] Concerning
contractors, we are not sure but we think they will become more important in the next
5 10 years [] like in the USA and most other places. Although contractors do not
yet openly do developing work in Germany, many German developers in fact do have
ties to contractors. They are often a part of the same concern.

Concerning contact to Danish and German engineering firms, it is basically zero
because they are not the ones who give us projects. Concerning our contacts to our
competitors, one can only say that we have contact to some Danish colleagues and a
few German firms. And we can only use these contacts for exchange of knowledge
of experience. [] We do not talk with each other that much concerning our
domestic market, but I would consider saying to Henrik [Sthr from C.F. Mllers
Tegnestue], Henrik, things are not looking good for us. Would you consider trying to
find an inexpensive office lease in Berlin together with us so that both firms can save
money? I would never do this in Denmark.

[One] of the German architects we know in Germany is very nice. She has helped us
when we have had meetings with clients and our current German employee, Thomas,
has previously worked for her. But German architects are not known for speaking with
each other. However we had some contact to [a partner in a nationally renowned firm
situated in Hamburg].

[] We turned our initial situation around 180 degrees in connection with this contact.
We asked him to be a part of a team so that we could bid for more prestigious
projects in Denmark for example, airports. [] But we were not prequalified for
these projects [] We found this situation peculiar because our German partner firm
was extremely qualified. The highest Danish public authorities were also consulted on
this matter.

We have also used the Danish Consulate General in Berlin and the Danish
Construction Industry Attachs. [] They are very helpful. []

Maria Anne Skaates: Have you had contact to construction research and development
institutions in Germany? []

493
Bendt Almvig: None whatsoever.

Maria Anne Skaates: But you have been involved in very innovative projects, for
example in Leipzig?

Bendt Almvig: Yes, but the constellation was different. We have, however, had
contact to a German private firm XXXX that is specialized in urban planning project
proposals. They were one of the factors that played into our decision to participate in
the competition in Mncheberg [] where we won 1
s t
prize.

When subsequently discussing Gemnden and Walters (1994:5-6) characteristics of
the Relationship Promoter in Subsection 3.3.3, Bendt Almvig stated the following

I feel that in one way or another all [of Gemnden and Walters] points are important
and depend upon each other. One cannot omit any of them for each one is part of the
big picture. Expert knowledge is absolutely necessary but it is just as important to
know something about the cooperation partners one has. I considered numbering
them in order of importance but I am not sure this would be 100 % right because
my personal level of empathy and ability to understand the customers needs and
wishes these social competencies are just as important as expert knowledge because
if you have expert knowledge without empathy, you risk loosing the order - if you mis-
understand or are not able to establish affinity with your customer. [] Of course, the
ability to find appropriate cooperation partners and convince them to take part in our
project, this is of course not as important as the other points. []

Maria Anne Skaates: [Gemnden and Walter (1994: 4-5)] have also written that a high
position in the internal hierarchy of the firm can also make a difference. I would like to
hear your opinion about this in relation to Mikael who is in charge of the daily business
in Germany. [] He is neither an architect nor a partner in your firm but I have the
impression that he does his job well.

Bendt Almvig: Yes, he does. But perhaps this is a part of our difficulties in Germany
that he is not a partner and also not an architect. [] Mikael is a creative strategist but
it is important that he is given the details of a project. He does not create the project
design himself and he cannot converse on architecture. This is difficult to explain. If
one looks at things from a business perspective, we are selling architecture as
architects. To be able to do this you have to be educated as an architect at a school of
architecture to know which architectural tendencies one speaks about and what kinds
of ideas are used, that is what is the architectural basis of planning. And this
knowledge is something that you do no acquire unless you have studied architecture
otherwise you just dont know the jargon. []

494
Sometimes I travel to Berlin for very small things, just to present myself. These are
situations where I possibly could leave well enough alone if Mikael were an architect
and a partner for then he could do these things.

Maria Anne Skaates: [] Will you then continue to play this role, Bendt, in the future?

Bendt Almvig: Well, in the long term, it is not the plan that I am supposed to continue
but this also concerns my responsibilities here [in rhus]. But it always turns out
that I still continue to do these things.

Maria Anne Skaates: Is this because you feel you cannot stop?

Bendt Almvig: I think it is because the contacts know me. And it also has something
to do with my flair for being about to sense when a potential project is on its way or
something else important is about to happen.

Maria Anne Skaates: Because not all good architects are good at getting projects? I do
not believe one learns this in the Danish architectural curriculum?

Bendt Almvig: If you are good at this, this is of course a very good thing but an
architect is not automatically good at getting projects. Things work like this in this
firm: I acquire the projects if we do not acquire them through participation in
competitions or tendering. And this is also the way things are in Germany. We have
not really increased our area of business in relation to the area we started with in
Germany. [] But the most effective way to establish a network in Germany is to win
a first prize, then another, then yet another When things happen like this, the
projects come by themselves.

Bendt Almvig also indicated that he finds his role of relationship promoter
somewhat problematic, as it meant a lot of traveling and responsibility (interview with
Bendt Almvig, November 19, 1998). With regard to cooperation between Bendt
Almvig and Mikael Srensen at meetings with German clients, Bendt Almvig stated the
following in my interview of March 29, 1999:

Maria Anne Skaates: How does it effect [your cooperation with Mikael] that you are
stronger with regard to the designing and historical side of architecture whereas Mikael
is more focused on the calculations to put things a bit roughly?

Bendt Almvig: It is somewhat problematic. But the problem is not that large that it
blocks for the visionary and creative thoughts that come from our firm and also
include long conversations with Mikael who does not just sit quietly and then say
Now I have received my orders. Mikael also contributes with his input, perhaps most
like the input of a client. And then we draw and specify and deliver either to a
495
competition or a customer or a public tendering procedure. So what can say that both
roles are equally important for if we only had the visionary ideas without someone like
Mikael, things could go wrong very fast.

But [] Mikael probably is lacking direct contact to a person with whom he could
communicate and who could tell him more about architectural theory which is very
important. It is not by chance that ones project proposal looks the way it does or that
certain shapes look the way they do. This is something to do with the surroundings
and location of the buildings and the requirements concerning height [] Mikael has
never learned this things and he has never tried to hide the fact that this side of the
business is not his strength.

For his part, Mikael Srensen said the following in my interview on February 23, 1999:

Mikael Srensen: I function like this: I am oriented toward the details of the project,
but I can very easily see the participants in a negotiated procedure from a Danish
viewpoint, if I want to. But because I know the German market and I know the criteria
concerning how decisions are made and how the German world looks at an architect
and because I know it is different than the way one looks at architects in Denmark, my
reactions are different in Germany. However I also sometimes feel that at a meeting
where one has to convince the clients that they initially look down on one because
this is a typical Danish impression of the German mentality in a selling situation

Maria Anne Skaates: Do you mean that you take the floor as the underdog and only if
you can tackle this situation do you stand a chance of being selected?

Mikael Srensen: Yes, and this is something that I as a Dane feel is unnecessary and I
really do not wish to waste my time dealing with the underdog role. But when we have
decided to work in Germany, we have to use time on this and accept this. One must
play by the rules of the market with the goal of selling the projects that one believes
one is capable of delivering and one has to present them in a way that the actors on
the market understand. Bendt is very different during the negotiations. He is much
more visually oriented and less detail oriented than I am. This is usually a strength in
negotiations and conversational situations. We just have to be very careful about
presenting each of our strengths and still being very coordinated; otherwise we may
seem less credible.

[]There is a totally different level of project detail in Germany in relation to
Denmark. This can also be seen in the amount of project documentation the project
contains a lot more detailed planning than would be the case in Denmark. The potential
customers expectations are totally different and therefore it is paramount that one
knows their criteria. And therefore it is difficult to use a Danish architect in Germany
496
to work out the details of the project. But a good Danish building technician could do
this if he has lived several years in Germany I would say at least five years.[]

Bendt Almvig and Mikael Srensens personal styles of doing business with clients are
also quite different. In the words of Bendt Almvig (March 29, 1999):

Bendt Almvig (March 29, 1999): Sometimes Mikael almost thinks too much about the
projects. He forgets - for example that when we are visiting a client and we are
getting to know each other to ask, Shouldnt we go out to dinner sometime? This
does sometimes help the cooperation simply saying, Now we have come this far, I
would like to invite you out for dinner if I may? and then enjoying a social evening
together.

Maria Anne Skaates: But here I have to ask you, Bendt, if Mikael is not too young to
suggest such a thing in Germany? I think it must be easier for you to do this because if
he has some clients who are quite a bit older than him - 15 or 20 years, which
probably is a relatively usual situation for him, it could be more difficult for him to be
the one to suggest such an invitation? []

Bendt Almvig: Yes, that may be a part of it. But it also has something to do with that
when we sit down for meetings, we dont just discuss business. There are also limits
to how long a client just like all other types of people, by the way can sit and
concentrate You have to also include the social element a chat about something
else, a cup of coffee, or a cigarette during a break. [] Now I do not know whether
the fact that I have been in this business so many years has that much to do with my
sometimes saying, Now I am beginning to concentrate a bit less and I would like to
request a short break or that we talk about something else for a few minutes If it
were Mikael, he would discuss business for eight hours without stopping.

Mikael Srensen has also been practicing for the role of relationship promoter
during the 1990s:

Maria Anne Skaates (Interview February 23, 1999): Can you say a few words about
your general efforts to meet with construction industry actors and keep in touch with
developments []?

Mikael Srensen: I visit an English club regularly, a place where English investors,
clients, and developers meet.

Maria Anne Skaates: Is this a potential market and is this a club you have
consciously chosen or did you just meet these people someplace?

497
Mikael Srensen: It was a conscious choice but these types of choices are also
questions of using the possibilities that turn up randomly. In ones unconscious
acquisitive activities one takes advantage of chances and suddenly there is some
reward but in Berlin there are also discussion groups at many publicly owned urban
planning companies where one can meet to discuss concerns or positive ideas with
regard to the current state of development. But I have not used this possibility very
much yet.

We also have contact to a developer or middleman XXXXXX. This is a middleman
in Berlin who also is English. He wanted to create a distribution group a year or so ago
where architects, engineering consultants and inhabitants from the different regions
could meet and exchange opinions about the development here. This middleman
wanted to use this information in working out marketing and action plans to ensure
that his firm comes closer to the market. This is also the type of people we also want
to work with. []

Maria Anne Skaates: May I ask why you have chosen to stick with these English
investors? Is it perhaps because you as a Dane speak English very well and the English
also as foreigners have had to learn a lot of things about the German market that the
Germans take for granted?

Mikael Srensen: They know these things as well. Some of them have been here
longer than I and some are also leaving the area again because their investments have
not gone as planned. And some of the project ideas that they had hoped to use here
cannot be used. [] The group of construction actors who has done the best is the
native Germans. The foreigners have come as investment companies or as other
interested persons that wanted to work with a selected few projects in this city. They
could be Italians or Englishmen even though the general level of interested has
waned since the beginning of the 1990s. They have had shopping center or malls
types of shops that are very well known abroad in mind. They have envisioned that
they could sell these concepts in Brandenburg or Schwerin [Land: Mecklenburg-
Pomerania] so that one could concrete many shops in one small area to an even
greater extent than already is the case. There are already a certain number of malls, and
many of them have discovered that it is difficult to convert the English concept of the
mall to Germany.

But there are also British and American project management firms like Philip Morrison
and Hans Komm that have offices in Berlin and interesting networks with regard to
project acquisition. But they are world-renowned firms that have a different
relationship to their customers and can market at a totally different level than a small
firm like us. But there is a little chance with regard to construction projects although
they often choose English architects. But they really want to do the same thing we
want to do: make profits, so if we can make a good offer with for example a Danish
498
engineering consulting firm also present in Berlin, perhaps there is some basis for
cooperation with these project management firms. One has to start someplace.

Concerning Almvig & Partners strategy, Per Lindrup stated the following (February
18, 1999):

You heard what Bendt said yesterday [] Denmark is a very small market and
Denmark is very much market by economic downturns and upswings. Actually this is
true of the entire construction industry also in Germany. [] Germany is a much
larger market. There is therefore a greater chance that we experience an upswing in
Germany at the same time that Denmark is experiencing a downturn. Today Germany
is of course in a downturn, but at some point this will change. And therefore it is
important for us that we in reality to not just sporadically enter and leave the
German market but build up a base there.

Maria Anne Skaates: May I play the role of the devils advocate for a moment? The
German unification was a unique chapter of history which will not repeat itself. Now
the common currency, the Euro, is on its way, and there are stringent budgetary
requirements for the nation states connected to the Euro, which we also have to fulfill
in Denmark, regardless of whether we say yes or no to the common currency. So as
the devils advocate I would like to ask you if you really can bet on the German
market being up when the Danish market is down?

Per Lindrup: No, we cannot count on this, absolutely not. But we must also look at
our alternatives. If the alternative is that we are exclusively based I am making a
point here; I am aware this is a hypothetical case in rhus, what are our alternatives?
Well, our perspectives are not that good because typically growth, if we look at
Denmark alone, will not only occur in rhus. It will perhaps to a greater extent occur
in Copenhagen we can already see this now. [] The prognoses for Copenhagen
are very different than those for rhus [because of, among other things the restad
project
51
].

Maria Anne Skaates: And that is why Almvig & Partnere recently bought the firm
XXXX in the Copenhagen suburb of Gentofte?

Per Lindrup: Yes, thats right. One should perhaps say that we also want to be in
Copenhagen. That is our strategy we want to be three places rhus, Copenhagen,
and Berlin. So it is our tasks to nurture these offices and support them with all they
need everything from competition proposals, project management, experience and
financial matters. [] We see things this way: In our area of work there is a much

51
The restad project refers to a bridge that is being built across the resund, between Copenhagen and
Swedens third largest city, Malm. Many people believe that this infrastructure improvement will result in
increased activity in the region.
499
greater chance that we will achieve success if we have offices in potential areas of
growth instead of merely one office in rhus.

[] Bendt says, You know, we must also realize that we are not that different than
engineers and large law firms and all other professional services. We do do something
that they do not: we produce buildings which may be called art by some. But the hard
economic reality of our day-to-day life is exactly the same

Bendt Almvig, when asked to explain this statement himself, said the following on
March 29, 1999:

What I meant by this is that we have to see our area of work in the
following way: If we are creating art, then let the others call it art. We ought
not use all too much time to speculate abut this. We should of course try to
create good architecture every time we work with a project. If others call
our work art and consider it to be very good art, this is fine with us, but we
have to keep our feet on the ground and concentrate on working
professionally [] in direct relation to our customers. Every single
customer has to feel that he is very important. [] One can put it simply:
We believe we are good at architectural work, and if our customer is happy,
then he will continue to use us. We accept that other architects constantly
discuss whether our work is good or not but we do not want to use a lot of
time on these discussion. [] The discussion of what good architecture is
was in reality created for the architects. However in Denmark things have
developed in such a way that today every person feels he or she has the
right to call a building an eye-sore
52
and state his or her opinion on
architecture, regardless of his or her level of knowledge about
construction.

Concerning the coordination of the projects on the German market and in internal
consensus in the firm about the importance of Germany, Bendt Almvig stated the
following on March 29, 1999:

Not all partners are equally gung-ho about our activities in Berlin but I
believe most of us are very goal-oriented and believe that we have to stick to
our strategy. Concerning the rest of the Danish employees [] I imagine
that half of them think that we partners can do what we want and that our
activities in Berlin are okay, especially because Bendt enjoys them to some
extent. But when we say we have decided to participate in a German
competition or public tendering procedure, there are two employees in

52
In recent years, the Danish tabloid Ekstra Bladet has started campaigns against certain newer trends in
architecture, calling certain buildings eye-sores.
500
rhus who have worked or studied in Germany and we use them again and
again more than any of the other employees.

When we make decisions where we ask for our employees opinion, we
also ask for the opinion of our employees in Berlin. And when the members
of the firm go out of town together or use a couple of days to talk business,
we also invite those from Berlin. The Danish and German employees get
along well together. []

But our strategy was agreed upon 2 years ago at that time I was spending
a lot of time in Berlin. Because of our belief that the Danish market goes up
and down all the time, we agreed that we should keep our office in Berlin
and in the worse case scenario operative on a very low level from Berlin
because when the Danish market is very depressed there a good chance that
the German market will be doing better. And the longer we have been in
Germany, the easier it is to convince German customers that we are capable
of helping them.

Per Lindrups opinion of the strategy of the firm is as follows (interview, February 18,
1999):

We are not in doubt about our goals, but we havent written them down.
[] Therefore strategic planning is something that we mainly do when we,
say, take a couple days time to discuss things and we do this once in a
while. [] Our market is not stable, and we are constantly effected by
outside forces. This is our everyday life and we have to deal with it. But this
does not have to play a daily role in relation to our strategic goals e.g. our
decision to have offices in Copenhagen, Berlin, and rhus instead it to a
larger extent causes problems in our daily dealings. [] We can both have
big goals and a long-term strategy, and also work in our daily life according
to the course of events.

In choosing this three city strategy, the partners at Almvig & Partnere have also dealt
with the concern that the firm does not spread itself over too large of a geographical
area, as Bendt Almvig is the person mainly responsible for external contacts.
Therefore the firm declined when the Norwegian petroleum company Statoil offered
them the possibility of building gasoline stations in Poland in the mid-nineties, as this
would have required the opening of a third office in Warsaw. Additionally, although
some employees and partners of Almvig & Partnere have a relatively favorable
impression of the Netherlands due to the perception that this countrys architectural
competitions and public procurement procedures are quite fair, open, and impartial,
501
Almvig & Partnere has decided for the time being not to enter the Dutch market
(ibid.).

However, with regard to strategy on the German market, Mikael Srensens opinions
are somewhat divergent from many employees and partners in the firm (interview,
February 23, 1999). During this interview, Mikael Srensen stressed that he would
have preferred a more precise strategy and time schedule for acquisitive activities, i.e.
in the realm of housing projects. The number of German actors working with housing
projects is vast, and in the opinion of Mikael Srensen, it is good idea for an
architectural firm operating on the German market to segment the net of actors and
target specific actors and actor constellations to a greater extent because many of
Bendt Almvigs vast efforts neither bore as much fruit nor brought in as many fees as
they might have, had the firm segmented the market (ibid.). However, Mikael Srensen
also sees this problem as a difference in professional cultures. In his opinion, building
technicians and engineers are more likely to think in terms of marketing terminology
than architects, because, among other things, the Danish architectural education does
not focus upon the possibilities of marketing (ibid.).

According to Per Lindrup, the firm monitors the very resource consuming activity of
participating in architectural competitions in the following way (interview, February 18,
1999):

If we look at the German public service tendering offers that do not involve
the negotiated procedure but a two-phase architectural competition, then we
know that there are incredibly many participants. We therefore try to
minimize our costs in the first phase for there is no reason to spend DKK
100,000 on a competition with 800 participants, to put it mildly. []

Many of these competitions are such that participants do not have to send
that many specifications in the first phase. And that is an advantage. So we
attempt to finish the first phase relatively quickly. If we then are lucky and
are invited to participate in the second phase we then [] use a great deal
more resources, however without breaking our budget.

Per Lindrup, who is educated as a certified public accountant, employed full-time by
Almvig & Partnere, yet also works as a part-time lecturer at the rhus School of
Business, was asked to examine the model of Cova, Mazet, and Salle (1994, see
Figure 1 in Section 1). He was of the opinion that steps two and three (network
investments and environmental scanning) do not necessarily happen in the order
specified in the model. In his opinion, things are much more accidental and determined
502
by certain critical events which cannot always be foreseen beforehand (interview,
February 18, 1999).

Additionally, with regard to the models points 4.1. and 5, Per Lindrup believed that
one could only speak of core competencies very broadly as:

a general accumulation of the previous experience in the firm which one
uses when one prepares to bid. This knowledge of experience is not always
well organized or clear. In some situations, it can be a bit of a matter of
chance how you use your previous experience. It is very clear that you have
a broad experience base but this is a big difference between collecting
knowledge systematically and just recalling earlier events when necessary.

However, sometimes one has the feeling that we want to try to make
something very new and innovative every time [] If we are talking about a
competition, we want to make a proposal that will make a very good
impression and differentiate itself from the others - without spending more
money than would be economically sound.

No, [one cannot speak of a core offer] because in a situation with
competition, e.g. where you are prequalified with four other architectural
firm, you have to differentiate yourself. You have to create a winning
project. Also when we are speaking about public housing and the financial
framework when has been determined by the authorities in the
prequalification material we have a lot of experience concerning how
things should look in a competitive proposal and how we can built it for the
specified amount of money. But it can also be difficult to make a winning
project under these circumstances.

[] In Germany the situation is not always exactly the same concerning the
financial framework, but you have the same competitive situation if you are
talking about a two phase competition and you want to be among the firms
that are invited to participate in the second phase. There you also have to
think about making a winning project all the time while still taking budgetary
considerations into account. Even though you have a lot of broad and good
experience and you know a lot about how things have to be done so that the
project is coherent, you also have to make a project that will position you.
This is a dilemma that we live with all the time.

8.4.3. Almvig & Partneres Knowledge about the German Market.
During the negotiations concerning the termination of the cooperation with the
architectural firm from Hamburg, Bendt Almvig received initial knowledge about the
503
harsher German business climate which is a common perception among Danes
(interview, November 19, 1998).

Bendt Almvig has however in later years learned that individual German management
styles vary greatly. However, his experiences during the 1990s have given him the
general impression that during the nineties some former East Germans have been more
willing to work with Danish people than with West Germans but that these former East
Germans often haven taken more time and have found it more difficult to make a
decision and stick to it (interview, November 19, 1998). This was one of the problems
connected with the renovation of the Bruno Taut housing in Magdeburg (Bendt
Almvig, March 29, 1999):

We used a lot of money on this project. More than we should have
because we counted on the client being more professional that the case was.
We have in fact made a complete project proposal for the man in charge but
he does not want to do anything with it. Nothing happens. We have also
heard from 20 families who would like to have their houses renovated and
also are willing to pay for the renovations through increases in the rent, and
still nothing is happening. We cant do anything about it. I think this has
something to do with the local mentality concerning decisions: If we dont
make a decision then things cannot go as badly as the worst case scenario if
we do decide upon something.

Almvig & Partnere have recruited their staff so that there are a few employees at their
rhus office aside from Bendt Almvig who understand the basics of the German way
of making projects (interview with Bendt Almvig, November 19, 1998).

Per Lindrup explained the importance of this and the extent to which the knowledge
has been spread among firm employees in my interview on February 18, 1999:

Let us take a German competition how should we organize the work?
We do the work in house but you must also use the people who are
interested in the projects. And this is not always everybody so it takes some
effort to create the interest [] We have a man, [XXX who works here in
rhus], whom we have used for many competitions, also in Germany,
because he spent half a year or eight months studying architecture in
Germany. It is clear that he has the ballast and background that we need but
also a ballast and background which is different from that of our other
employees. This is just fine but it also has some disadvantages. One
disadvantage is that it is difficult for our entire organization to stand together
with the same level of commitment towards the German projects. Only
504
some of our people are interested in them and it is typically a guy like
[XXX], because of his background. It is a good background, one we really
can use. The unique extra part of his educational background is very
important for us.

Bendt also has an unusual background in that he worked as a carpenter in
Switzerland and the spend a large part of the 1980s in Germany.

This knowledge has been used in connection with e.g. architectural competitions,
where as mentioned in the previous subsection, the German architect Thomas
Schnball also played a substantial role by adding the details in cooperation with
Mikael Srensen. Almvig & Partnere have also in the latest years worked to further
improve their submissions to architectural competitions in the following way

Bendt Almvig: We have begun to purchase a greater number of architectural
periodicals from Germany [] because I believe that our problem has to do with that
our projects look very impressive but that they still have too much Scandinavian flavor
if you look at them as a member of the German jury with knowledge of architecture.
[] Therefore we have not been able to say, We will win a first prize there. So we
have change this and make our presentations a bit more German without the Germans
discovering it because we still want to deliver the Scandinavian functional house. But
this is a difficult balancing act. The Germans are very good at making projects, but we
are just a short distance too far from them in our presentation. []

The process of preparing a submission to a competition works like this in our firm: we
are four partners plus the employees that we choose to work on the competition. Each
person takes the project home for a week or a fortnight. And each persons tries to
interpret what is written between the lines in the proposal. [] And then we discuss
what it important in the group. Thereafter we get the two or three persons from the
competitive team going with the proposal. They draw for a while and then we discuss
the proposals again. And then one changes things and then discusses. And in the
end we have the competitive project proposal.

There are many theories we could use. We have heard a lot of opinions about German
architectural in general. Some of it is true. With regard to some German proposals
[shown in German architectural magazine], a Dane would never use the same colors as
the German has used. The Dane would dress the proposal a bit more up, so to speak.
But we have to learn from these things how to do it like the Germans do.

[] However in Germany in contrast to Denmark, you do not always have the feeling
that you can guess which firm might have submitted the proposal. In Denmark,
505
insiders can often guess whose proposal is whose, despite the anonymity that is
practiced.

Maria Anne Skaates: But couldnt less well-known firms then try to get a project by
imitating the style of the better known firms? (Laughter on the part of both Maria and
Bendt.)

Bendt Almvig: Yes, this has been known to happen. We could also sit down and draw
a building the way the German architect Behnisch does without too many problems.
But we dont do it because our heart is not in it. But perhaps if we did this, we could
turn the situation around to our favor but our heart would still not be in it.

Additionally, continual knowledge acquisition has also been necessary in the area of
negotiating with public sector clients. In the words of Per Lindrup (interview, February
18, 1999):

[At the German negotiated procedure tendering round concerning public
housing in Mncheberg], the way of judging was very different from what
we were used to you had a large panel with people who fired very
different questions [at Bendt and Mikael]. This was a new situation for us
[].

The EU announcement had looked very much like a Danish architectural
competition so if it had been Denmark we would have done exactly what we
usually do without any problems. Also in Denmark there would be a panel
of judges with architectural knowledge. But in Germany the way of judging
was different the panel asks questions about just about everything.

We have to insure that we can handle these situations well.

Mikael Srensens comments on the knowledge needed to participate in negotiations
before a German jury and the need to adapt proposals to the German way of
presenting them were as follows (interview, February 23, 1999):

Maria Anne Skaates: If you have a German jury, then there are typically say 20
people in the jury. The winning proposal is made public when the competition
concerns public funding. But when the presentation round is a closed occasion can
you obtain information on rounds of presentation are there any books written on this
subject that you know of or you do know of any seminars where one can practice
this?

506
Mikael Srensen: No, I dont. [] I have been to a presentation round when I had to
deliver a project concerning housing two years ago. The situation is formal but there
are individualized features depending upon how large the project is. Normally it is the
chair of the jury who prepares the statements and initial judgment concerning each
individual proposal in a folder just like in Denmark. The jury then receives this folder
with a description of the projects quality and an assessment based on the concrete
criteria, that is does the proposal fulfill the floor space requirements, the functional
requirement, and the like. Thereafter the jury members discuss aesthetics and their
general individual impressions of the project. And it is at this stage the distinction is
made does the concept sell itself in a precise and convincing way? And at this stage
one can see differences between the projects whether a Scandinavian or a German
architect has drawn the proposal. Therefore it is very important to be very conscious
of what the German project is characterized by and how its recipient reacts to it.

However, there are certain aspects of the German market that still remain more difficult
for Almvig & Partnere to comprehend and, therefore, deal with. The role of bribery
and other non-legal means of promoting oneself, although also not altogether unknown
on the Danish market, are one example. Bendt Almvig stated the following on this
topic in my interview on March 29, 1999:

It is my impression that I as well as other Danes have a difficult time
understanding exactly how and to what extent some actors on the German
market sometimes use money to bribe certain people in the construction
industry. In Russia the system is much easier to understand because this
kind of activity is done more openly whereas in Germany those who do this
have to be very careful because they are in trouble if they are caught.

With regard to the knowledge obtained from Architecturbro Almvig GmbHs annual
figures, the situation has been as follows: In Germany, the auditing requirements for
limited companies (Anpartsselskaber (ApS) in Danish and Gesellschaften mit
begrenzter Haftung (GmbH) in German) are different than in Denmark. The German
GmbHs annual reports do not have to be approved by a certified public accountant
as do a Danish ApS annual reports; they only have to be accurate with regard to
income tax purposes (compare Ernst & Young, 1992:41 and Whe, 1996:1004-6).
Therefore I asked Per Lindrup to explain the auditing practice of Almvig & Partnere
with regard to Germany. His reply was as follows (interview, February 18, 1999):

In the beginning we used [the same multi-national accounting firm that
checks our annual reports in Denmark], but this was a bit too expensive for
us. This company is very large, and we think that their German subsidiary
507
has a tendency to send us enormous bills.[] Now we use a small local
auditor and tax advisor to assist us with and check our annual report.

Therefore one can ask the question of to what degree our German figures
are comparable to a profit and loss account and to what degree are they
merely figures which we are required to give to the German tax authorities.
[] You asked whether our German subsidiarys figures provide a true and
fair view of profit and loss I must admit that because these figures to a
higher extent are gathered for the sake of the tax authorities [] the true
and fair criterion is not fulfilled for the German figures because German law
does not emphasize this. [] But if you look at the profit and loss
statement for the entire concern, it fulfills these criteria.

Thus the firm Almvig & Partnere has received its true view of the economic
situation of its subsidiary from the concerns profit and loss account.

With regard to formal continuing education, Mikael Srensen has participated in a
number of courses about the construction industry business in Germany, among
others Adolf-W. Sommer's course Auftragsbeschaffung fr Architekten und
Ingenieure (English translation: How Architects and Engineers get Project Orders)
53

which is organized by BSB Specialseminarbau, an engineering firm what has worked
with methods and concepts for acquisitive work. Mikael Srensen explained the aim
of the course as follows (interview, February 23, 1999):

[Sommers] goal is to make architects and engineers more inclined to
search for projects and work with sales than they usually are. It is to get
them to go beyond the traditional model of acquisition, that is where you
know each other and you say to your contact, If I am good at projecting
this steel framework, then you will hire me. The competitive system does
not work like this anymore, especially not in Berlin; it is much more an open
market. [] If you go for finding a client, you can use [Sommers]
mechanisms to find him. It does not matter that much if you have built for
many well-known firms and institutions; it is more about being create in the
way one sells the projects one has completed.

Sommer [] also believes that the role of the architect is not only design
but also project management. He tries many times to argue for the architect
doing the project management work. Here in Germany project
management is regulated in 31 of HOAI. As an architect you can do the

53
See also Sommers (1996) practitioner-oriented book on marketing for architects and engineers working
on the German market.
508
project management but today it is usual in relation to larger projects that
the client hires an independent consultant or an independent engineering firm
or a controller to take care of the total management. And this goes so far
that this person sometimes controls the architect [] It is also sometimes
the case that this person also is responsible for facility management that
he develops the concepts and thereafter is responsible for the management.
But Sommers goal is that the architect should have higher priority and a
much higher position than he currently has the tendency to receive.

Bendt Almvigs remarks on formalized continuing education were as follows (March
29, 1999): I believe that our employees see their daily work as the most interesting type
of continuing education there is. We have a hard time convincing many employees to
take part in courses.

Maria Anne Skaates: Do you have any wishes concerning continuing education?

Bendt Almvig: I could envision that some of our staff were more goal-oriented with
regard to environmental issues [] as well as the technical side of the construction
industry. We have requested that certain employees specialize themselves
concerning fire regulations or certain environmental issues. In my opinion, it would still
be the most optimal situation if all persons could have a large, general all-around
know-how but this is not possible anymore. However I am very much a believer in the
initiative of the individual where the individual comes to us and suggests a course
because it interests him or him. If we push too hard, we wont get as much value for
the huge sums such courses cost. But it could also be that we partners in the future
will push harder concerning such courses.

Maria Anne Skaates: But Mikael [Srensen], he is really interested in taking courses.

Bendt Almvig: Yes, Mikael even visits some courses that I would never consider
participating in. Ummm, Mikael is a young man, and as he says, There are a lot of
things one usually learns from experience and many dont take part in courses because
they believe they know what they need to know. [] But Mikael is very ambitious
and when he feels that his knowledge base is not large enough, he then tries to find a
course to help him, for example courses in management. And this is actually very
positive because I learned to be the person in charge of the firms economy by doing
if our cash credit account at the bank was nearing its limit, I HAD to do something.
After the cash flow has gone up and down ten times you learn to keep an eye on it,
also when things look like they are improving. This kind of thing can either be learned
by experience or you can take a course in it. It is actually more complicated to learn
these kinds of things by experience.

509
But Mikael only has this possibility because he can apply for money to do so. He is
very good at telling the firm what he has learned. But sometimes I think that some of
what he learns is voodoo for managers. But this is the way things are. Per Lindrup
recently lent me a book by Peter Zobel, the managing director of CODAN
54
. I took
the book with me on a skiing vacation and when I came home I had underlined certain
places for example the place where Peter Zobel explains how much nonsense there
is in the strategy and goal-setting fads. []. When I started this firm, my only goal
was that I wanted to enjoy going to work. And I still have this goal today.

But Erik [another partner] and I, we do sit down and discuss what we want from our
German subsidiary. It is a great help for us to reflect upon our experiences until now.
This is in fact much more valuable than trying to predict the future. And you also limit
costs if you say, We would like to do this and this and this and then you think about
it a little more and then say Oh, damn, we dont have the money to do it this way.
What is a good alternative?. This is the way we discuss things.

This requires a lot of experience; you learn this by getting your hands dirty, so to
speak. But a person like Mikael can participate in a course and learn something in five
days that I have used 1 years to learn. He then says to me, Did you know that?,
and I say Yes. [...]

In Denmark in the nineties the big must in courses has been environmental friendliness.
Today we can produce proposals that are environmentally friendly according to many
criteria. We dont have problems doing so but it requires more time. If the client wants
this, they get it but as an extra service for money because it does take extra time. But
it turns out that not that many clients are willing to pay for it []. But in the long run, I
think it will become an automatic requirement. We can see this in all of our EU
procurement projects participants have to know more and more about
environmentally friendly technology and it is more often mentioned that the projects
must be environmentally friendly. We have just finished 100 Danish dwellings that have
been built according to environmentally friendly principles.

[] This is a very good reference but we also always have a policy that says that our
work must be environmentally sound [] but it also must be nice architecture. We
say that we in principle do not want to install a top-soil based toilet facility in Danish
public housing. [] We do not believe that most Danes are ready for this extreme
sort of ecological lifestyle. [] But I have visited ecological centers like the Danish
Center for Ecology to look at this type of thing. Many of their proposals go so far that
I would not consider living in them but they are good sources of inspiration.

8.4.4. The Role of Almvig & Partneres Previous Project Work in

54
CODAN is one of Denmarks largest insurance companies.
510

As was the case in the previous two subsections concerning previous project work,
i.e. Subsection B.2.4. on DISSING+WEITLINGs previous project work and
Subsection B.3.4. which contained information on C.F. Mllers Tegnestues previous
project work, this subsection will also build upon the information in Subsection B.4.2.
by supplying supplementary information about Almvig & Partners previous project
work in relation to acquisitions.

As previously mentioned in Subsection B.4.2., Bendt Almvig stated on November 19,
1999, that there are two ways to win projects in areas new to the particular
architectural firm:

1. Receiving projects through personal contacts.
2. Winning architectural competitions and public tendering procedures.

Furthermore, Bendt Almvigs personal definition of marketing in the field of
architecture is as follows (interview, November 19, 1999):

I believe that marketing in the architectural sector takes place in the
following way: Information is spread in construction industry circles by the
firms immediate contacts; it then spreads like the circular waves a drop
makes when it falls into a puddle of water. An architectural firm therefore
needs a person who has the natural ability to use his network. It is also very
important to be able to ask intelligent questions at meetings.

However a certain amount of market knowledge and serious consideration is
also necessary concerning foreign markets. Our plans for Germany are long
term and we hope that our German office will be able to give us work when
the Danish market declines. However, many other Danish architectural firms
make last minute decisions and run from one market to another without
analyzing their realistic possibilities beforehand.

According to Per Lindrup, information about the firms previous projects are available
to both German and Danish customers (February 18, 1999):

In our firm, all our public relations materials are available in both Danish
and German. We have some general references concerning our firm, lists of
projects, and some more specific material concerning urban planning or
renovation project, to take two examples. In relation to each specific
511
project, we assess which of our materials are specially suited. Then we put
together a folder of materials that fits the potential client.

Bendt Almvigs contacts that spread like circular waves (see above) have resulted in
some projects in foreign markets. To take an example, Almvig & Partnere heard about
the plans of the Danish chewing gum concern, Dandy A/S to build an factory in
Russia through a Danish contact that Bendt Almvig had met in Germany. Almvig &
Partnere then bid and won the contract concerning the design and project inspection
of a chewing gum factory in Novgorod
55
, Russia. However, one of the reasons that
Almvig & Partnere won the project was their international competence: They
impressed Dandy A/S with their ability to deliver the plans for the project in four
languages (Danish, English, German, and Russian) in a relatively short time. Ad-
ditionally, their knowledge of the German market is in some ways useful to them in this
project, as Russia has developed a legal tradition of using German construction law
for cases which are not covered by Russian law (ibid.).

However, Mikael Srensen does not believe that the firms Danish references play a
role on the German market. Instead he offered the following comments concerning the
part of the German market that Architekturbro Almvig has worked with (interview,
February 23, 1999):

[T]he traditional model of acquisition, that is where you know each other
and you say to your contact, If I am good at projecting this steel
framework, then you will hire me. The competitive system does not work
like this anymore, especially not in Berlin; it is much more an open market.
[] If you go for finding a client, you can use [Sommers] mechanisms to
find him. It does not matter that much if you have built for many well-known
firms and institutions; it is more about being creative in the way one sells the
projects one has completed.

[]Those that have had contacts in West Berlin or in Brandenburg or
Potsdam before [the fall of the Berlin wall], they are of course much more in
the center of events but on the other side they probably do not work as
creatively as those have come from the outside do. For those who come
from the outside have a huge desire to win projects and [] there is no
limit to what they might try to develop. So the constellation is are follows:
One comes into a net of contacts rooted in history, that is a closed net, like
a comet, and the comet has to go in and crystallize itself in the closed net

55
Novgorod is situated in Western Russia, approximately half-way in between St. Petersburg and
Moscow.
512
[] by developing an idea that will create waves and repercussions. These
effects create sales.

We cannot run around and say as Danish architects We are very good at
projecting single family houses. We may really be good at this, but this is
not enough. Why isnt it enough? Because there has to be more to it. The
message has to fill more than the simple statement that we are good at
drawing small houses. Outsiders have to believe that we are good at
understanding exactly what it is that the customers reacts to. And the
customer does not react to statements about being good at projecting
terraced housing or other types of housing because good, what does
good mean and by which criteria does one define good? This is what the
Danish architect often does not understand that the criteria are different [in
Germany].

But there is also a different between the level upon which you operate. If
you are at the more non-concrete level where the relevant questions have
to do with design, layout, and style, that is brands, so to speak [] then
the case is that you have sold a good idea without it being too concrete. The
Danish architectural industry is good at this.

We had the project in Mncheberg (Land: Brandenburg); it concerned
terraced housing. We participated in an architectural competition which we
won. We won because we drew relatively small, but well-designed houses
also in the opinion of our client without being too concrete. But we were
also able to subsequently add the details that made the project concrete
when we had to work with the public housing subsidizing office in
Brandenburg ILB. During this period we had at the same time both to
stick to our concept and to change it without changing it so much that all of
a sudden we were not allowed to project the storage space the way we had
or calculate the total floor space the way we have done. But we were aware
of these uncertainties beforehand. We therefore know approximately how
much flexibility you have to include in your design contest contribution.

This is a question of how you begin the design phase. How you describe
the boundary that determines exactly what you should include, how to you
check the project before you deliver it so that you are absolutely certain that
you are guarded against any factors of uncertainty that might be created by
the Germans through your flexibility. []

We are good at selling our brand but we are not good enough at selling it
yet because we are capable of receiving a 5
th
, 6
th
, or 7
th
place in a large
German architectural competition but we havent gotten a 1
s t
place yet. And
this must mean that we are lacking something. Of course, one cannot expect
513
to win every time but on the other hand one can also say that a 5
th
place out
of 280 participant is quite impressive but we as a multinational firm need to
have even more dynamic proposals in architectural competitions because
we are competing against architects that organize themselves much more
dynamically than we do they include subsidiary advisors concerning the
environment, facility management, acoustics, building dimensions, and
landscape architecture. [] There are many competitions where this is done
in this way but also some where it is not done like this. But this happens
often because the competition between architects is very keen. When we
submit a proposal, there are often 500 participants. []

[The Arbeitsgemeinschaft] is one of the ideas we are looking at in our
examination of how to deal with these problems conceptually. But we must
ask ourselves the critical question of whether the Danish architect can win
[] If he is very good, what about the final stretch is this chance or can
one influence it at all? There one can sit down and have a good discussion
with architects about how and whether one can influence the last 5 % so that
one really wins. []

I have read about theories concerning this possibility and we have also been
perceived as being much better than most other firms but this is still not
enough. I can use theories for something but theories are still only theories
and if we are going improve the last 5 %, I do not know whether we need to
change what we are doing or not. We cannot accept that we only are at the
95 % level but perhaps the cost of aiming for the 100 % is too expensive
when measured in real money. It is also possible that it is only worth trying
this with regard to certain projects because we know that with regard to one
or more selected projects we can do an extraordinarily good job. And in
this case it may also be worth using a group of German subcontractors to
make the very good idea even better.

But this must be judged project by project. It is clear that there is always a
statistical chance of winning a project when one begins to draw the first
lines but the competitions presentation of the project and their preparations
and theoretical knowledge and the effects that are put into their projects to
try to motivate the jury to choose them are different then those we add to
our project. So the last 5 % might lie in our presentation of the project, in
the degree of detail, in the solution itself, in the facades of the building in
question, in the architecture, or in other factors. Therefore we need to
receive the criteria of judgment, we have to understand the criteria of
judgment not only in relation to our understanding of a good idea but we
have to verbalize our ideas in relation to what the jury perhaps really has in
mind.

514

Bendt Almvigs comments concerning references were the following (interview, March
29, 1999):

[T]he most effective way to establish a network in Germany is to win a first prize, then
another, then yet another When things happen like this, the projects come by
themselves.

Maria Anne Skaates: Now Mikael is very concerned that you have to win some 1
s t

prizes. [] He says that when you as a firm receive a 4
th
or a 5
th
place, he is
disappointed, even though there may have been 250 participants.

Bendt Almvig: Yes, seen from one perspective this is not logical but a 2
nd
or a 4
th

place does not give us anything of value.

Maria Anne Skaates: Can you not put these runner-up prizes on your reference list?

Bendt Almvig: Of course you can put them on your reference list. But this does not
mean that we will be chosen as the next firm. We won an runner-up prize for [] the
student cafeteria [in German: Mensa] at the University of Leipzig. But this has not
meant anything for us.

Maria Anne Skaates: [] How quickly can you then realistically expect to acquire
more and new types of projects?

Bendt Almvig: I believe that we in fact only will be able to get other types of work by
winning architectural competitions and public tendering.

Bendt Almvig then stated that he believes that his firm is also strong in the nursing
home and child care area due to its Danish experiences and that these references may
be of more importance on the German market due to the need for nursing homes in
Germany. Before 1996, the firm made three project proposals concerning day care
centers for German housing associations but none of these have resulted in a project.
Bendt Almvig attributes this to the fact that the firm did not have German employees at
this time, not to a lack of suitable references.

515
Appendix C. List of Interviews.

March 6, 1998. Interview with Associate Professor Niels Albertsen, Aarhus School of
Architecture, rhus, Denmark.

May 6, 1998. Interview with Annette Blegvad, International Secretary of DAL, Copen-
hagen.

May 7, 1998. Two interviews with two unemployed Danish architects, one with some
non-German international experience, Greater Copenhagen area.

May 11, 1998. Interview with Architect Peter Theibel, Special Advisor, the Inter-
national Office of the Danish Ministry of Housing, Copenhagen.

May 11, 1998. Interview with a Danish architect with experience on the German market
on the basis of work for a Danish public housing association, Greater Copenhagen
area.

May 19, 1998. Interview with Paul K. Jeppesen, International Secretary of PAR,
Copenhagen.

May 25, 1998. Interview with Associate Professor Nils Lykke Srensen, Aarhus
School of Architecture, rhus.

May 25, 1998. Interview with Ernest Mller, Teacher at the Horsens School of
Building Constructions International Program, Horsens, Denmark.

June 3, 1998. Interview with two partners from a Danish architectural firm. Research
Professor Per Jenster from the Department of Intercultural Management and
Communication also participated in this interview, Greater Copenhagen Area.

June 6, 1998. Interview with a Danish architect with four years of work experience in
Berlin, Copenhagen.

June 23, 1998 Interview with a Danish architect who is a partner in a firm as well as a
Professor at a Danish School of Architecture, Greater Copenhagen Area.

July 3, 1998. Interview with a Danish architect who works for a firm that does not
export to Germany, Copenhagen.

July 27, 1998. Interview with a Danish architect who previously had his own firm and
now works as a decorating consulting for a Danish firm that is opening shops in
Germany, Greater Copenhagen Area.
516
August 10, 1998. Interview with a Danish architect who has previously worked for a
large architectural firm with international projects outside of Germany and who
currently is building up his own firm, Greater Copenhagen Area.

November 1998. Telephone Interview with Flemming Hallen, ADAs Vice President
and Spokesperson regarding the EU Public Service Directive.

November 1998. Telephone Interview with Ministerial Principal Bjarne Strand,
Spokesperson for the Danish Ministry of Housing regarding the EU Public Service
Directive.

November 1998. Telephone Interview with Jacob Scharff, Spokesperson for the
Danish Organization of Municipalities concerning the EU Public Service Directive.

November 1998. Telephone Interview with Keld Mller, Managing Director of PAR
and Spokesperson concerning the EU Public Service Directive.

November 1998. Telephone Interview with Jesper Kock, DALs Architectural
Competition Secretary concerning the EU Public Service Directive.

November 17, 1998. Interview with Partner Lars Kirkegaard, C.F. Mllers Tegnestue,
Copenhagen.

November 19, 1998. Interview with Partner Bendt Almvig, Almvig & Partnere, rhus.

November 25, 1998. Interview with Partner Lars Kirkegaard, C.F. Mllers Tegnestue,
Copenhagen.

November 29, 1998. Interview with Partner Reinhard Tlke, DISSING+WEITLING,
Greater Copenhagen Area.

December 10, 1998. Interview with Partner Henrik Sthr, Architekturbro C.F.
Mller, Berlin.

December 29, 1999. Interview with Partner Reinhard Tlke, DISSING+WEITLING,
Copenhagen.

February 18, 1999. Interview with Per Lindrup, In-House Accounting and Business
Administration Expert, Almvig & Partnere, rhus.

February 19, 1999. Interview with Partner Lars Kirkegaard, C.F. Mllers Tegnestue,
rhus.
517
February 23, 1998. Interview with Michael Srensen, Managing Director of Archi-
tekturbro Almvig-Berlin, Berlin.

February 24, 1998. Interview with Construction Industry Attach Jrgen Skovgaard
Vind at the Danish Consulate General in Berlin.

February 24, 1998. Interview with Elke Knig, the International Secretary of BDA,
Berlin.

March 11, 1999. Interview with Partner Henrik Sthr, C.F. Mller Tegnestue, Copen-
hagen.

March 18, 1999. Interview with Partner Jimmy Hansen, DISSING+WEITLING,
Copenhagen.

March 29, 1999. Interview with the Export Manager of a Danish Producer of Building
Components, rhus.

March 29, 1999. Interview with Partner Lars Kirkegaard, C.F. Mllers Tegnestue,
rhus.

March 29, 1999. Interview with Partner Bendt Almvig, Almvig & Partnere, rhus.

April 9, 1999. Interview with Partner Henrik Sthr, Architekturbro C.F. Mller,
Berlin.

April 9, 1999. Interview with the Danish Managing Director of the German subsidiary
of a large Danish Engineering Firm, Berlin.

April 12, 1999. Interview with a Danish partner in a Danish-German architectural firm
in Berlin.

April 12, 1999. Joint Interview with Dr. Tillman Prinz, Legal Advisor of BDA and Elke
Knig, the International Secretary of BDA, Berlin.

April 26, 1999. Interview with Partner Reinhard Schmidt-Petersen, DISSING+
WEITLING, Copenhagen.

April 26, 1999. Interview with Partner Dieter Fremerey, DISSING+WEITLING,
Copenhagen.

July 19, 1999. Interview with Architect Sven Silcher, the Representative of BDA in the
Architects Council of Europe (ACE), Hamburg.

518
July 19, 1999. Interview with Engineer Herbert Michaelis, Vice-President of the
Hamburg Chapter of BDB, Hamburg.

August 18, 1999. Interview with the German Export Market Development Contact Per-
son of a large Danish Engineering Firm, Greater Copenhagen area.

August 20, 1999. Interview with the Danish-born Managing Director of the Berlin
subsidiary of a large Danish Engineering Firm, Greater Copenhagen area.

October 14, 1999. Interview with Architect Mahmood Sairally, the Representative of
BDB in the Architects' Council of Europe, Hamburg.

October 14, 1999. Interview with a renowned German Architect/Professor of
Architecture who also is a partner in a large, renowned German architectural firm,
Hamburg.

October 18, 1999. Joint interview with the German Construction Department Director
of the subsidiary of a Danish engineering firm and a Dane who has been employed by
a Danish contracting firm on the German market in the 1990s, Berlin.

October 22, 1999. Interview with Managing Director Jes Ltzhft, Kuben Bau GmbH,
a subsidiary of the Danish real estate investment firm Kuben A/S that has invested in
real estate in Northern Germany in the 1990s, Copenhagen.

November 1, 1999. Interview in Copenhagen with Architect Elsebeth Terkelsen, the
former Danish Construction Industry Attach in Dsseldorf, Germany. She is current-
ly employed by a Danish firm specialized in urban renewal and building renovation.

SDanish Architecture Sales To Germany in The 1990skaates (2001) Phd-Thesis

Diunggah oleh

Informasi Dokumen

Judul Asli

Hak Cipta

Format Tersedia

Bagikan dokumen Ini

Bagikan atau Tanam Dokumen

Opsi Berbagi

Apakah menurut Anda dokumen ini bermanfaat?

Apakah konten ini tidak pantas?

Hak Cipta:

Format Tersedia

SDanish Architecture Sales To Germany in The 1990skaates (2001) Phd-Thesis

Diunggah oleh

Hak Cipta:

Format Tersedia

1

Danish Architecture Sales to Germany in the 1990s:

Anda mungkin juga menyukai