Over the past decades, the size of engineering market in Korea and East Asia has grown remarkably. At the same time, the main competitive advantage in the industry has changed from technological competence to price competitiveness. Thus, the market for engineering projects has become more competitive than ever.
An engineering project consists of thousands of individual tasks, each of which the engineering company should undertake at all levels of organizations including the project supply chain. As a result, it is critical in project management to coordinate the various activities of numerous suppliers related to the organization of the project.
In this research, we focus on the supply chain management for engineering projects: we study the internal and external customer-supplier relationships, and suggest a model for effective project management. Based on the case studies, we identify key factors for the supplier management in the engineering project. There are three factors that could determine the success of an engineering project, i.e., task process, information management, and human elements. Our analysis indicates that for a successful supply chain management in an engineering project, the company must first put in place the human factors such as project management experience and human relationship. Then, the human factors should support the other two, i.e., task process and information management, so that the entire engineering project can be completed effectively.