Strategic perspectives for modular construction adoption

Muianga, Elisa Atália Daniel; Oliveira, Kaio Pimentel Rego de; Granja, Ariovaldo Denis

doi:10.1590/s1678-86212025000100924

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Special issue: the best papers of SIBRAGEC 2025 • Ambiente Construído 25 • 2025 • https://doi.org/10.1590/s1678-86212025000100924 linkcopy

Strategic perspectives for modular construction adoption

Perspectivas estratégicas para adoção da construção modular

Authorship SCIMAGO INSTITUTIONS RANKINGS

Abstract

The use of industrially manufactured elements for on-site installation has been recommended for the construction industry, although its application remains limited. The main barriers of off-site construction adoption, defined in this study as modular construction (MC), include the lack of technical knowledge, the need for innovative technologies, and the absence of well-defined business strategies. Well-structured business strategies can potentially enable the construction sector to gradually benefit from MC, aiming at reducing delays, improving project quality, controlling costs, and scaling production. This study aims to propose a theoretical framework for business strategies, which allow gradual MC adoption, based on integrating MC phases, product architecture, production strategy, and modular product platforms. A systematic literature review and qualitative meta-synthesis were conducted. The main theoretical contributions of this investigation consist of a set of fundamental concepts of MC and a theoretical framework that contains three business strategies to guide construction companies in adopting MC. From a practical perspective, these research results can help to improve construction managers' understanding of MC, helping them make strategic decisions related to its implementation.

Keywords
Modular construction; Production structure; Product architecture; Product platform; Business strategy

Concept	Description	Support research
Concept To Order - CpTO	Demand-driven, where products are customized to meet specific customer requirements and are not defined prior to confirmed order/demand	Jansson, Johnsson and Engström (2014), Winch (2003) and Rudberg and Wikner (2004)
Build To Order - BTO
Design To Order - DTO	The basic product concept is defined, however, engineering is carried out for a specific client/consumer, before and after bidding	Winch (2003) and Rudberg and Wikner (2004)
Engineer To Order - ETO	The product is designed and built to meet customer requirements. ETO design can be customized	Jansson, Johnsson and Engström (2014), Jensen, Olofsson and Johnsson (2012) and Jensen, Lidelöw and Olofsson (2015)
Make To Order/ Made To Order - MTO	The final product is based on a pre-project; however, its final definition is carried out after receiving the customer's order, enabling more customization.	Jansson, Johnsson and Engström (2014), Winch (2003) and Rudberg and Wikner (2004)
Modify To Order - MdTO	Developed from a generic product structure, with restrictions applied to size (heights, standardized flooring, technical solutions, finishing for external and internal walls and types of windows)	Jensen, Olofsson and Johnsson (2012) and Rudberg and Wikner (2004)
Assembly To Order - ATO	A strategy where products are assembled upon receipt of an order	Jansson, Johnsson and Engström (2014)
Configure To Order - CTO	Defined as a hybrid model of MTS and MTO, where predefined options, through combined or modified modules or subsets, can be used for the intended configuration.	Jensen, Olofsson and Johnsson (2012) and Jensen, Lidelöw and Olofsson (2015)
Make To Stock - MTS	A strategy in which products are prefabricated and stored. The product is usually defined through prefabricated modules and components.	Jansson, Johnsson and Engström (2014)
Ship To Stock - STS	Similar to MTS, where products are defined and stored, without the need for traditional inspection and testing.	Jansson, Johnsson and Engström (2014)
Make To Forecast - MTF	Production is made for storage and subsequent sale.	Winch (2003)
Select Variants - SV	Selection of a variety of ready-made products	Winch (2003), Jensen, Olofsson and Johnsson (2012) and Jensen, Lidelöw and Olofsson (2015)

-	Business strategy based on:
-	product flexibility through unique projects	cost, deadline and quality	finished product
Product definition:	Active client participation, together with stakeholders with knowledge and experience in MC.	Pre-defined product, through a precise feasibility study. Participation of stakeholders with knowledge and experience in projects and MC.	Pre-defined product, through feasibility study and market trends. Presented in a wide variety for different clients and segments.
Investment:	Depending on the type of product, the equipment can be simple, for customized products, or highly specialized, for ready-made products.	Highly specialized equipment, repetitive processes based on feasibility studies.	Highly specialized equipment, repetitive processes based on more accurate feasibility studies.
Production strategy:	CpTO, BTO, DTO, ETO, for product definition. Part of the production process without MC uses.	MTO, ATO, CTO, suitable for pre-defined, varied and assembled products according to the customer's wishes.	MTS, STS, MTF, SV, suitable for products to be stored and sold as demand dictates.
Production:	Not scalable.	Scalable, inline, coupling more functions into common components, allowing complementarity and sharing of platforms.
Products:	Unique, they can be volumetric and non-volumetric, or hybrid.	With controlled variability, based on options pre-defined by the company together with interested parties, which can be volumetric and non-volumetric, or hybrid.
Interfaces:	Slot or module-podium and bus systems, unique arrangements fixed to an existing structure.	Slot or module-podium, bus or module-core and sectional or module-module systems, enabling construction.	Slot or module-podium, bus or module-core and sectional or module-module systems, enabling maintenance and use.

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[1] Source: based on Winch (2003), Rudberg and Wikner (2004), Jensen, Olofsson and Johnsson (2012), Jansson, Johnsson and Engström (2014) and Jensen, Lidelöw and Olofsson (2015).