Prompt and efficient material flow is crucial for successful construction operations as it ensures that the on-site workforce will receive the required materials at the required time. Construction logistics means managing the material flows i.e., supplying the right materials at the right time to the right customer on the construction site (Janné 2018). Previous studies estimate that cost savings between 10 and 30% can be obtained through specific efficient logistics practices (Said and El-Rayes 2014; Tetik et al., 2019). The use of proper material logistics decreases the time spent on searching for materials, thus leading to reductions in wasted labor time (Lange and Schilling 2015; Tetik et al., 2018). Despite the existence of several successful case examples, the implementation of logistics practices in the construction industry lags behind that of other industries (Lönngren et al., 2010; Said and El-Rayes 2014).

Poor logistics practices occur in the construction industry for several reasons, including the temporary and fragmented nature of construction projects (which affects the implementation of long-term change), the lack of pre-planning activities (Sullivan et al., 2011), the lack of competence (Berawi et al., 2012), and overly high logistics costs, all of which can deter contractors from investing in logistics (Vrijhoef and Koskela 2000). Because of the fragmented organizing of construction operations, subcontractors often order and manage project materials themselves. This fragmentation and lack of coordination has led to a situation in which only around 40% of material deliveries are executed with accurate information, location, and time (Thunberg and Persson 2014).

Problems related to poor logistics consume a large amount of time and resources (Ekeskär and Rudberg 2016). Poor logistics management can cause double handling of materials (Fearne and Fowler 2006) and waste of labor time (Josephson and Saukkoriipi 2005). Information updates on material flow are important for on-site management so that the labor force can adjust to possible changes in material availability. If the delivery of materials is late, subsequent operations will also be delayed. Variability in material demand and supply directly affects project performance, decreases quality and safety, and increases cost and duration (Arbulu and Ballard 2004).

The success of a construction project depends on the coordination of the on-site and external logistics (Ying et al., 2014). Several solutions to these logistics problems can be found in the literature, and multiple logistics practices exist for different material and product types, such as the use of third-party logistics (Ekeskär and Rudberg 2016), consolidation centres (Arbulu and Ballard 2004), material kitting (Tetik et al., 2020), and vendor-managed inventories (Tanskanen et al., 2009). However, this multitude of available sub-solutions can lead to confusion among practitioners as it is often unclear which of the proposed solutions are most essential and generically useful and which are more specific to certain circumstances. To ease similar implementation issues, maturity models have proven useful in several other contexts.

Maturity models determine the maturity of selected domains based on a series of criteria (De Bruin et al., 2005). Maturity represents the attainment of full growth (Maier et al., 2012) and full development (Cookie-Davies 2004). For instance, the use of a maturity model for digitalization in manufacturing has brought several benefits to the industry, including increased process efficiency, lower operational costs, and increased safety and sustainability (Sjödin et al., 2018). Transitioning to highly advanced solutions is difficult because they require several enablers that might be impossible to develop instantaneously. For this reason, determining the steps of maturity is crucial in order for practitioners to gradually learn to excel at logistics operations. A company’s position in the logistics maturity model can determine the next steps in its development work.

While recent research has underlined the effects of material logistics practices on project performance, such as productivity and waste, not a single best practice for logistics solutions currently exists. Therefore, practitioners need more knowledge on development paths toward successful overall logistics solutions. To address this gap, this study seeks to define the different maturity levels of logistics practices in construction and then outline the development paths for project actors to progress from amateur to more advanced and industrial logistics solutions. The purpose of the present research is to determine a proposed order of gradual logistics developments in construction by using the maturity level approach. The theoretical contribution of this study is a new model for logistics maturity evaluation in the construction industry. The practical contribution is a suggestion of how appropriate logistics practices could be gradually implemented to improve logistics capabilities and ultimately increase the performance of companies and their projects.

To specify the need for a maturity model for construction logistics, literature on the role and challenges of material logistics in construction was reviewed. Next, existing logistics practices in construction are reviewed, highlighting the requirements and steps for their implementation. Thereafter, previously developed maturity models from fields of logistics, supply chain management and Industry 4.0 are reviewed, and finally, this literature was synthesized into five relevant maturity model themes and categorized the existing logistic practices under each theme in the logical order of implementation. To validate the themes and the order of the logistic practices that were categorized under each theme, this study analyzed the development of the logistics operations of three companies in the industry. The focus was on the requirements and steps they have taken to achieve these practices, which helped in defining a logical order for implementing logistics practices that reflect the corresponding logistics maturity levels. Finally, the findings are summarized.

This research combines three research streams: 1) the role and challenges of material logistics in construction, 2) logistics solutions in the construction industry, and 3) maturity models. In reviewing this literature below, the need for advanced logistics solutions in construction is described. Following this, the existing partial solutions were analyzed to define current logistics practices and review different maturity models to define their critical themes. Then, the practices against the themes are mapped to create logical ladders from lower-to higher-level practices.

Using the available literature on the logistic practices used in construction and previously developed maturity models relevant to construction, this study first develops a three-stage model for industrial construction logistics. First, previously developed maturity models have been reviewed to determine appropriate themes for construction logistics. Then, based on available literature, logistics practice elements in construction have been determined. After that, a construction logistics maturity model has been proposed. In the next phase, this proposed model is validated in real-life context. Tellis (1997) suggests that single case studies are especially suitable for revelatory cases where an observer may have access to a phenomenon that was previously inaccessible. On the other hand, single case study is often too limited for validation and when research resources are limited, Patton (1990) recommends using a multiple case study approach with purposeful sampling. Therefore, three companies were chosen to validate the proposed model. The companies were selected based on their different size and history of their logistics practices. Furthermore, the fact that the authors had access to reliable data via the selected case companies was a factor in case selection.

The first company (Case 1) is a developer (revenue 976 M€, 1,000 employees) whose projects consist of high-rise residential buildings and shopping malls. The company manages logistics by using TPL and a logistics labor provider company. The second company (Case 2) is a medium-sized contractor (revenue 226 M€, 302 employees) with different offerings, including renovations and new residential projects and its own modules, and it manages logistics through a consultant and TPL. The third company (Case 3) is a large main contractor (revenue 679 M€, 2,177 employees) whose projects include large residential and non-residential buildings. A logistics manager plans the logistics operations for the projects, and logistics personnel are always present on-site throughout a project’s duration.

Data triangulation is needed to test the validity of the work through the convergence of information from different information sources (Carter et al., 2014). To improve validation, different information resources have been used in this research. The companies’ work sites and consolidation centers were observed and secondary data sources, such as company reports, and videos were utilized. Face to face interviews were conducted with the project managers, logistics managers, development coordinators, the site supervisors of the contracting companies, and the material flow engineers of the logistics providers to gain insights into production planning, deliveries, and on-site operations. In total ten interviews were conducted, each lasting about an hour. Interviews included semi-structured questions so the interviewees could answer the questions in a more in-depth way.

Three questions to guide the data collection and analysis toward the maturity model were designed:

1. In order to ensure performance improvement, what is the optimal order of logistics practices in each theme?

Performance was considered in terms of overall project performance, including schedule, cost, quality, and logistics performance.

Sullivan et al. (2011) note that logistics entails strategic and cost-effective storage, material handling, transportation and distribution of resources synchronizing supply chain parties from the origin to the point of use, taking key times/dates into account. Combining the themes from Table 2 and this definition, Table 3 presents the definitions of the relevant logistics themes selected for this study. For a construction activity to be completed, it is necessary to plan the resource requirements (planning). The actors who will conduct the tasks must then be determined (organizing). How the task is done requires knowledge and capability regarding this specific task (operations). To keep all participants up to date regarding the operations, information flow must be fluent (information flow). For the actors to communicate, and for the material flow to be controlled, advanced tools must be used (use of technology).

The first step of each logistic solution starts with activities related to planning, such as determining work locations, lists of materials, and delivery schedules. Logistics planning involves the coordination of supply chain and site activities by integrating decision-making and recognizing existing interdependencies to minimize the total material management cost (Sait and El-Rayes 2014). Planning is crucial for the key dates to be aligned.

The organizing theme is key for integrating supply and site decisions. Logistics is related to the distribution of resources and determining the actors and responsibilities that are directly associated with organizing. Organizing means “to form into a coherent unity or functioning whole” or “to arrange by systematic planning and united effort” (Merriam-Webster Dictionary 2020), and integration has been a common theme in previously developed maturity models.

Operations management is critical for an organization to succeed (Slack et al., 2010). Transforming inputs into outputs is the fundamental activity of any production attempt. In a supply chain, all operations are part of a larger supply network where each individual contribution serves customer requirements (Slack et al., 2010). Considering the definition of logistics—which is strategically and cost-effectively conducting the required activities from the beginning to the end user—the operations theme is a necessary inclusion in the logistics maturity model.

The synchronization of the various parties involved is possible with proper IT tools and an effective information flow. Inventory, distribution, and return operations must be recorded with proper IT tools to prevent information and material loss. Construction operations and schedules can be visualized and simulated with software programs (Kamat and Martinez 2001). IT tools that can be integrated with other project management systems can ease the planning and tracking of logistics operations. Thus, the information flow and use of technology themes were included in this study.

Table 4 shows the independent logistics practice elements currently being used in the construction industry. These practices were derived from the requirements of logistics solutions (see Table 1 and Figure 1), and were used to develop the maturity model. The planning of material deliveries is required for material kitting, inventory buffers, JIT, and consolidation centers. Thus, the use of a bill of quantities (BOQ) for material procurement enables the implementation of these solutions. In construction, the end product is assembled from several generic and specific components via numerous subcontractors; as such, partnering is required when developing material delivery processes (Wegelius-Lehtonen and Pahkala 1998). Therefore, a complete bill of materials (BOM) is needed to successfully order the materials and assemble the end product.

At this point, the difference between the BOQ and BOM must be stated. The BOQ is a collection of work descriptions that specify the quantities of various tasks that should be conducted in order to achieve project targets (Martinez-Rojas et al., 2016). The BOQ is used in construction for cost estimating and procuring materials. The BOM is a structured item list where the elements, parts, or components of the product are listed. It is generally used to keep track of information such as the number of parts used in manufacturing the product; the identification of parts, vendors, part manufacturers, and the costs of the parts (Cesarotti et al., 2006). Thus, the BOM includes more specific information than the BOQ. The BOQ is required for procurement and buffer management, while the BOM is required for more complex logistics practices such as material kitting. The BOM is also used for placing the actual order for products. If the BOM is not available, then subcontractor estimates of the amounts necessary for each material related to a task are used.

Problems can occur while integrating quantity information with planning and procurement. Thus, this research has included the ability to 1) have accurate quantity take-off, 2) generate a complete BOM, and 3) utilize this information in planning as components of higher maturity levels. The final logistics practice in the planning theme means that the complete BOM will be used in various subsequent operations. For instance, materials procurement must be done based on the BOM so that orders can consist of accurate numbers and types of materials.

To have a successful project that is completed within schedule, it is required to have smooth material delivery flows (Suutarla 2016). To have a smooth material delivery, responsible trades for each task for material delivery process, from factory/warehouse till the exact material consumption location, should be determined in the contracts.

TPL providers may act as systems integrators in the supply chain by balancing and integrating the supply chain with the construction site (Ekeskär and Rudberg 2020). TPL can be utilized via partnerships that promote the role of TPL as logistics coordinators (Le 2020). A contractor considering to use a TPL should understand the additional value that it can provide: such usage means that the company does not need to consider logistics as an extra cost, and TPL usage will eventually be translated into additional value. To employ TPL, information transparency is required for effective use, and clear responsibilities must be determined in contracts. When a company understands the value that proper logistics management can bring, it may decide to form its own logistics department.

Centralized procurement is listed under the organizing theme. Procuring the required materials determined by the quantity take-off (BOQ) may generate problems. Thus, centralized procurement can be used to have more control over the materials, including their location and availability (McCue and Pitzer, 2000). It can support logistics solutions by allowing materials to be procured centrally and then delivered to the logistics center (Tetik et al., 2019). The use of centralized material procurement and JIT delivery can guarantee that the required materials will be available on-site at the right moment. Construction projects bring together numerous people who are unfamiliar with each other; they must then closely communicate throughout the project since projects typically require various types of knowledge (Martin et al., 2014). These actors must communicate clearly in order to perform on-site operations. Companies can adopt centralized procurement to avoid miscommunication.

Under the use of technology, the overall use of IT is generally recommended to achieve better logistics processes and avoid delays (Ebrahim et al., 2013). The construction coordination process is usually conducted in unstructured ways, such as via telephone and email, which can lead to interruptions and delays (Dallasega et al., 2020). Mobile applications can be used to manage, control, and visualize data scheduling and improve communication (Ratajczak et al., 2017). The use of shared calendars allows project actors to coordinate tasks, such as material deliveries or meetings, in a centralized agenda (Nitithamyong and Skibniewski 2004). Such calendars are significant tools for organizing activities and their corresponding actors. The use of ICT tools as standard on-site logistics management allows room for more developed solutions such as integrating the calendar with other ICT tools (Suutarla 2016).

The technologies required to implement VMI solutions are also listed under the technology theme. To be able to successfully implement VMI, real-time information-sharing systems are required between the supplier and the site storage. The use of electronic data interchange (EDI) also allows rapid data transferal for VMI implementation (Danese 2006). Reorder levels and minimum delivery quantities must be determined to implement VMI (see Table 1 and Figure 1).

The tracking of materials and labor enables production control in construction via the use of several technologies, including RFID (Costin et al., 2012), Wi-Fi, and Bluetooth (Zhao et al., 2017). Tracking devices must be procured and installed on the materials, and connectivity solutions are required to establish indoor positioning systems. Depending on the technical system a company chooses, certain installation guidelines must be followed, and the systems must be tested to evaluate tracking accuracy (Zhao et al., 2019). Thus, companies must be willing to invest resources to implement these solutions. Activity tracking requires a medium level of additional investment to be implemented, and the benefits are somewhat clear (see Table 1).

In terms of the information flow theme, different companies may choose to use different tools and systems. The easiest way to communicate with other project actors on the go is through telephone and email, while the best way to avoid information loss is to use written communications. Mobile applications are more user-friendly and can restore information that can then be connected to emails. For this reason, the applications in Table 4 appear at a higher level than reliance on telephone calls. The ordering of the practices in this theme reflects the logical evolution of information flow activities.

Table 4 which is about the existing logistic practices under the five themes was mainly used for developing the model. For each theme, maturity levels and their corresponding scores are represented. The scores are used for assessing the construction logistics maturity of the case companies for the validation of the model.

Having the BOQ available is considered the basic level for the planning theme. The best practice in terms of planning is where a company generates a complete list of materials for each task and then uses the list in the procurement and material delivery schedule prior to the start of the project. This was considered the industrialized level. To achieve this practice, companies may start with having the BOQ available. Material deliveries should be planned together with project partners. When a complete task-level BOM is available, material deliveries can be made with accurate amounts. It is not always possible to automatically generate a BOM during renovation projects as the BIM on sufficient level of detail may not be available. Companies can achieve a complete BOM during construction projects by having a complete design model at LOD400 before they begin but as stated by Song and Fisher (2020) such models are rare in current practice. Table 5 illustrates the maturity model excerpt for the planning theme.

For the organizing theme, determining which trade will perform which logistics task is the minimum practice for advanced logistics. The main contractor can manage the logistics calendar and share it with the subcontractors. During the planning of a project, organizing which parties are responsible for which logistics practices are crucial for the success of a project. Procuring the materials centrally is considered as a step toward integrated logistics. Having a separate unit responsible for logistics decisions or systematically utilizing the TPL would be best under the organizing theme. Table 6 illustrates the organizing maturity for construction.

Regarding the operations theme (which is closely connected to the planning theme), it is vital to decide on delivery quantities based on material consumption. In the basic level, material consumption amounts are simply scattered throughout a project’s subcontractor network; the main contractor does not usually have this information. The responsibilities of who handles material logistics should be determined in the contracts. If a company cannot manage JIT delivery, then the benefits from material kitting cannot be fully realized. Clear logistics responsibilities should be determined in contracts, and JIT delivery, material kitting, and centralized procurement should all be implemented. When the materials are unloaded on-site, they must be moved to their location of usage. Any other material movement would cause inefficiencies (for instance, unnecessary vertical movement of materials between different floors of a building). Thus, minimizing material movement on-site is considered an advanced level for managing on-site logistics in projects. Material kitting and pre-assembly of materials are considered the best case in this theme due to the high information requirement to implement these solutions. Construction operations maturity is depicted in Table 7.

In terms of the use of technology theme, the achievement of BIM-linked digital product data is the best industrialized case. Companies can develop their own material tracking software to increase control over site deliveries, thereby impacting the progress of the on-site work. Smartphone applications which would be used by on-site personnel is considered as the basic case. Table 8 illustrates the maturity levels in terms of use of technology in construction.

The most industrialized logistics practice in terms of the information flow theme was having automatic order updates and order tracking via special software applications, where the progress was tracked on-site and material delivery information is fed to that progress. Real-time information-sharing systems can aid in achieving situational awareness of material deliveries and work progress. The prior steps for achieving this state began from material delivery update systems used by the project participants, real-time information sharing, and integrating those tools into a logistics calendar (which is connected to the organizing theme). Table 9 shows the construction information flow maturity levels.

The maturity model in Figure 2 combines Tables 5–9 and presents the path in each theme: from basic logistics to optimized, industrialized logistics. The elements from basic towards optimized level under one theme in the model do not necessarily have a predecessor-successor relationship. Instead, they also reflect the needed investments and obtained benefits. The intensity of the colors increases when the maturity gets higher. A company can determine its current maturity level by identifying its current operations with the elements of the model and by so, seeing if it is under the basic, advanced or optimized.

The maturity model does have some interdependencies between the items from different themes, as shown via the arrows in Figure 2. The direction of the arrows indicates the direction from the prerequisite. For instance, for centralized procurement (under the organizing theme), a task-level BOM needs to be utilized, which is under the planning theme. Similarly, to be able to integrate a shared logistics calendar with other ICTs such as tracking tools, the company first needs to use the shared logistics calendar. To create a BOQ, material consumption quantities need to be available. The use of real-time information-sharing systems facilitates situational awareness.

The applicability and substance of the proposed model were validated through three industry case examples. The model was first presented to the development and logistics managers of the case companies. Then, inquiries were made on whether they have been following a similar order of practices presented in the model in their organizations. Based on the collected interview data, the practices of the companies were analyzed to see possible compatibility with the proposed model.

For an optimal order of logistics practices, the companies began their efforts toward better logistics by having a fruitful planning phase in which they tried to make the schedule available and complete the BOQ. The companies decided on the logistics practice elements to be implemented based on project-specific conditions, such as the size of the project, the physical conditions of the site, and the distance to the city center. The first logistics practice that Case 3 ever implemented was VMI, meaning that project-specific conditions played a significant role. As such, companies may choose not to follow the logical order stated in this study.

The analysis indicated that the most important themes were planning followed by organizing. Every project started with the planning phase, with the companies putting a great deal of effort into this phase. Based on the industry examples, the work did not progress well unless the project and material delivery schedule for the subsequent 2 weeks were available. It was noted that it was vital to determine which project party was responsible for which tasks. Use of technology and information flow were found to be supporting themes. Thus, every theme does not need to occur at the same level. That is why there are no strict lines between basic, advanced and optimized levels as progress in every theme can be at a different pace. Moreover, a company can be in between two consecutive maturity levels under one theme. While planning was the most important, even with adequate planning, on-site problems could still occur due to the ongoing culture of a construction site. Based on the industry examples, companies could still regard situations as common occurrences if, for example, some of the labor force does not show up on schedule or if, even though there is no on-site storage, a month’s worth of materials are unloaded on-site unscheduled.

The company interviewees mentioned that they still use the logistics practices they had used because they were worth implementing. For instance, Case 3 had long used a form of kitting in the structural phase because it increased the company’s logistics performance. Similarly, Case 1 considered decreasing unnecessary material movements on-site by adjusting the buffer amount. Information on the level of financial gain from the practices was confidential. Thus, this study concludes that continuing to employ the practices meant that better performance was achieved.

The key outcome of this study is the proposed and empirically validated logistics maturity model for the construction industry. The developed maturity model consists of five themes: planning, organizing, operations, technology, and information flow. In addition to the maturities in these logistics themes, the paper illustrated the interdependencies between the themes. Previously developed logistics maturity models were not domain-specific, were based on authors’ opinions, and lacked overall maturity evaluation. Building on previously developed maturity models in the logistics field, the model developed in this research was based on similar themes, although it focused more on themes that are of relevance to construction logistics, such as planning, organizing, operations, use of technology and information flow.

This research indicated that material consumption and delivery quantities are important resources that the case companies could tap into. The case analyses showed that unnecessary material movements on-site should be avoided by having only the proper amounts of material buffers on-site. Based on industry examples avoiding unnecessary material movements on-site, except for the initial unloading and later movement of the materials to the exact work location must be achieved. This is in line with those of previous studies in the literature on avoiding having to move materials several times on-site after unloading (e.g., Elfving et al., 2010). A BOM must be available and utilized during operations to determine adequate buffer amounts. Thus, detailed level information on material consumption is key for success in many logistics practices.

This research showed that advanced logistics operations may only be conducted based on a complete design model—more specifically, a complete BOM. Design models should have an adequate LOD to be able to have a BOQ and BOM (Mousharbash 2020). An increased LOD in design models could open up possibilities for digital product data linked to BIM. Exerting effort under the use of technology and planning themes associated with increased LOD in the design models and a complete BOM can lead to the use of accurate models that leave no room for improvisation. The use of a BIM model with a high LOD completed prior to the start of the project may enable the utilization of the design model in subsequent operations, thereby aligning with industrialized construction practices such as Direct Digital Construction (DDC) (Tetik et al., 2019). DDC is an operations management practice that entails the use of a complete digital design model over a building’s lifecycle to prevent improvisations and improve the reusability and automation of designs and processes across projects. The present research indicates that the use of advanced and industrialized logistics processes could be a crucial step toward digital operations at the whole-project level. Finalizing the site layout at an early stage of the planning of a construction project, such as in design for logistics, is also parallel to DDC concept (Tetik et al., 2019).

The practical implications of this study include the requirements for maturity levels that will provide a roadmap for companies. Assessing a company’s logistics maturity can help it obtain more information about the correlation between its maturity and its competitive position, size, and the level of internationalization of its operations (Oleśków-Szłapka and Stachowiak 2018). Companies can choose where to excel and which logistics practices to use based on project-specific needs. Being able to implement the different logistics practices is the key to responding to different project needs and ensuring optimized project performance. Larger companies that take over different kinds of projects may lose focus on which practices to invest in, while smaller companies might be able to limit their scope in terms of which kinds of projects they undertake and by specializing in relevant logistics practices.

In this study, a logistics maturity model for the construction industry has been developed. Regardless of the locations and markets in which companies operate, they may assess their own logistics maturity and improve their maturity levels by using the model developed in this study. Various logistics practices that can be used in construction projects were reviewed as well as exploring their benefits and requirements. The model was developed based on the literature, and company examples were used to validate it. The model includes the best practices and the intermediate steps to reach them.

During the observations of the three companies, each with varying backgrounds and logistics models, it was noted that the companies were finally valuing logistics and that they no longer viewed logistics as merely the delivery and carrying of materials. The use of logistics is vital in terms of construction production. In the future, overall reliability in the construction supply chain as well as the flow of on-site operations could be remarkably improved by increased logistics maturity.

This research and the proposed model do have certain limitations. The study was limited to analyzing the practices of a limited number of companies. Researchers should apply the model to additional companies with different project and operation types to further elaborate on its validity. The proposed model does not include companies’ contextual settings, specific requirements, or business targets, and a company could well have valid reasons for not following it in all of its projects. As the company managers articulated, the size of a project, the distance to the city center, and client preferences all influence the selection of which logistics practices the company will implement in each project. Future research should evaluate the proposed maturity model for different project contexts and reflect on the logistics evolution of further case studies that employ this model. One possible direction is to utilize an operational research approach to analyze the companies’ decision making regarding the development of their logistic solutions.