The Effect of Relational Capabilities and Managerial Capabilities on Performance Outcome : A Comparison between Architecture Firms and Real Estate Development Companies

Building projects are complex, unique and involve many stakeholders, such as contractors, architects, engineers, investors and developers. Creating and maintaining networks to partners and clients is of crucial importance for a successful project completion and for the competitive advantage of project-based organizations. The aim of this paper is to investigate the role of coordinative capabilities, specifically relational capabilities (RC) and managerial capabilities (MC) for the strategic performance of real estate development companies and architecture firms. It is hypothesized that RC and MC, which are embedded in the organization itself and developed through projects and individual capabilities, influence the strategic performance of architects and real estate developers, and thus lead to competitive advantage and higher firm performance of these companies. The research framework is empirically evaluated by using data from 97 real estate development companies and 79 architecture firms from Austria, Germany, and Switzerland. The hypotheses are tested by applying a stepwise regression analysis. Further on, the findings for these two types of professional service firms are compared and their implication discussed. Our results indicate that under higher environmental uncertainty, relational capabilities are more important for the performance of architecture firms and managerial capabilities are more important for the performance of real estate companies