How Can We Build a Good Project Configured Supply Chains

Project configured supply chains, or networks are becoming increasingly prevalent in a number of industries. Construction is one of them. Supplies and products in construction consists of material and immaterial, knowledge, elements. The paper argues however that in a knowledge economy, those two elements are increasingly intertwined and competition and markets will increasingly be constituted by the knowledge element.Creating value for the customers and the enterprises becomes dependent of the ability to organise and coordinate in the supply networks. This includes the issue of quality. The approach taken here is study the emergence of failures occurring in the supply chain, and thereby understanding its quality aspects better.The paper presents case study work done in Chinese construction. The method was to observe work at the construction site and interviewing actors following backwards upstream the supply chain to the origin of the failure. The building project followed generated 160 failures over a three month observation period. These were compiled and analysed. The economic consequences are calculated to be 8% of the production costs. The analysis of relations in the supply chain both shows relations to materials and knowledge aspect of the supply network and these to aspectspsila interaction. Most of the failures was generated in relation to knowledge processes and then occasionally transform into the material process.The paper proposes initiatives to strengthen partnerships in supply chains and especially at engineer to order production. The contradiction between the permanent enterprise organisation potentially capable of handling purchasing and the role of the project manager is discussed as a contradiction to overcome.