Factors determining growth of companies: A study on construction companies in Malaysia

Most firms in general have multiple objectives aimed to sustain and succeed in their business. In the short term, firms pay more attention to profit maximization. For the long term however, profit is no longer the prime focus because one of the objectives which may dominate the management of a firm is its growth. The objectives of this paper are to establish factors determining growth of construction companies in Malaysia and also to establish which factors have greater impact on growth. Data collection for the purpose of this study was done through a questionnaire survey which was carried out involving large construction companies from grade G7 as classified under the Construction Industry Development Board of Malaysia (CIDB). Questionnaires were sent to 600 respondents via postal service and by hand. From 600 questionnaires disseminated, 102 of the questionnaires were returned, completed and useable. Data was analyzed by using relevance statistical methods such as frequency, relative important index (RII) and regression analysis to establish findings. Findings of this research show that the good management of a company was found to be the utmost important factor that contributes to the growth of construction companies. Effective organization structure, use of new technology and automation as well as commitment to customers’ satisfaction had a good correlation with employment growth. It was also found that market specialization; good company management, availability of bank loans and other credit facilities and use of new technology as well as automation are significant factors towards growth in turnover.   Key words: Construction companies, growth, Malaysia.

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