Critical Factors in the Willingness to Adopt Innovative Wood- based Building Materials in the Construction Industry: The Case of CLT A DISSERTATION SUBMITTED TO THE FACULTY OF THE UNIVERSITY OF MINNESOTA BY Maria Fernanda Laguarda Mallo IN PARTIAL FULFILLMENT OF THE REQUIERMENTS FOR THE DEGREE OF DOCTOR OF PHILOSOPHY Advisor Dr. Omar Alejandro Espinoza October 2017 ©Maria Fernanda Laguarda Mallo 2017 ©Copyright 2017 Acknowledgements My deepest gratitude goes to my advisor, Dr. Omar Espinoza, for accepting me to join his research group and for his guidance, support and advice during my studies at the Department of Bioproducts and Biosystems Engineering. His knowledge, kindness, flexibility and patience helped me become a better professional. My sincere gratitude to Dr. Robert Seavey, Dr. Urs Buehlmann, and Dr. Jerrold Winandy for their service on my committee, their time, valuable feedback on this dissertation, and their help to my graduate studies. I would also like to thank Prof. Patrick Huelman, Prof. Renée Cheng and Prof. Peter Hilger, for their help and their invaluable support. I would also like to thank University of Minnesota Professors Robert delMas and Ernest Davenport from Quantitative Method Education group at the Educational Psychology Department, for their help on statistical procedures employed in Chapter 7. I would like to thank the Department of Bioproducts and Biosystems Engineering Graduate program and in particular Dr. Gary Sands and Dr. Shri Ramaswamy for giving me the opportunity to pursue my graduate studies at the University of Minnesota. My gratitude is also extended to Jake Tanumihardjo, for his constant love, friendship, support and encouragement over the past two years. Thank you for joining me in this roller- coaster ride and for always being there for me when I needed you the most. Finally, I would like to take this opportunity to express my deepest love and everlasting appreciation to my dearest parents, brother and grandmother for their unconditional love, understanding, support, sacrifice and complete confidence in me. Thank you for always letting me know that, as a Team, no matter wherever I am in the world, you are always there for me. Thank you! i Dedication To my Family ii Abstract Energy use and carbon emissions from the built environment have been gaining significant attention worldwide. The construction of buildings across the world is currently dominated by concrete, but production of cement, a primary ingredient in concrete, is a major source of pollution, producing a ton of CO for every ton of cement. One approach to reducing 2 the environmental impacts of construction involves increasing the use of materials with lower environmental footprints, such as wood. However, the utilization of wood as a building material is not free from challenges. Because wood is a natural material, its properties are not homogeneous, and it must be protected from biological attack. The development of Engineered Wood Products (EWP) was in part a response to those challenges, while at the same time allowing a more efficient use of raw materials. EWPs are manufactured to targeted structural properties. New EWPs, such as Cross-Laminated Timber (CLT), have increased the possibilities of building with wood. CLT consists of multi-layer panels, manufactured with lumber that are glued together, alternating the direction of their fibers for each layer. Cross-lamination confers CLT rigidity, stability and desirable mechanical properties. CLT is currently being used for a wide range of applications, such as houses, high-rise apartment and office buildings, schools, bridges, and wind turbine towers, among others. This has added visibility to the system, which has been able to compete with steel, brick, and concrete in the European markets since its introduction more than two decades ago. The successful introduction of CLT into the Canadian market indicates that there is potential for further market penetration in North America, and more specifically the United States. To increase the understanding of the market potential for CLT in the U.S., this dissertation aimed at identifying the critical factors influencing the willingness of U.S. construction professionals to adopt innovative wood-based construction materials. The overall objective was achieved by: (a) investigating the level of awareness, perceptions, and willingness to adopt CLT among structural engineers and construction firms; (b) developing a conceptual model including the most critical factors that influence the adoption of innovate wood- iii based construction materials among structural engineers and construction firms; and (c) identifying distinct market segments for CLT adoption in the U.S. Through a series of surveys and interviews to U.S. engineering and construction firms, this study found that environmental performance was the main perceived advantage of CLT. Another important benefit of CLT over traditional construction systems, as perceived by construction professionals, is the lower labor cost and faster construction associated with building with CLT. U.S. construction professionals also mentioned CLT’s aesthetic attributes as an advantage of the system. The most commonly cited disadvantages of CLT were its fire performance, durability, and lack of availability in the U.S. market. Regarding familiarity with CLT among the target audience, results show that the level of awareness about CLT is low. Barriers to CLT’s adoption in the U.S. market, as perceived by construction professionals, are lack of availability in the domestic market, high maintenance costs, and lack of experience working with CLT among professionals. Both U.S. engineering and construction firms seem to be interested in adopting CLT for future projects, especially if it is cost-competitive with traditional building systems. Results show that diffusion of knowledge about CLT and the role of early adopters will be essential for the successful introduction of this new building technology into the U.S. market. The conceptual model developed for U.S. engineering firms includes factors such as firm size, aesthetics, moisture performance, vibration performance, LEED credits, and availability of design tools as the main factors affecting willingness to adopt innovative wood-based construction materials such as CLT. In regards to construction firms, location, innovativeness, level of awareness, maintenance requirements, durability, vibration performance, labor cost, and LEED credits were associated with willingness to adopt CLT. Using cluster analysis, distinct market segments were identified in the two populations of interest (U.S. engineering and construction firms). From this analysis, priorities and demographics of those segments were also identified. This information is useful to develop better marketing strategies to target potential adopters and provide more customized services, products, and better design educational programs. The outcomes from this research helps fill the gap in the knowledge about the market adoption process for innovative wood-based materials in the construction industry. This iv study also advances the development of the CLT industry in the U.S. by increasing the demand of wood-based construction materials and supporting the creation of employment in a sector of critical importance to the U.S. economy. The target audience for this study is comprised of construction professionals, manufacturers, organizations supporting the wood industry, government agencies, and building officials. Findings from this thesis provide useful information that will help these actors accelerate the adoption of CLT through well-designed educational programs, demonstration projects, marketing strategies, and policy incentives. Keywords: Cross-laminated timber (CLT), massive timber, engineered wood products, sustainable buildings, wood-based construction, adoption, willingness, perceptions, segmentation. v Table of Contents ACKNOWLEDGEMENTS ........................................................................................................... I DEDICATION .............................................................................................................................. II ABSTRACT ..................................................................................................................................III TABLE OF CONTENTS ............................................................................................................ VI LIST OF FIGURES .................................................................................................................. XIII LIST OF TABLES ..................................................................................................................... XV CHAPTER 1 ................................................................................................................................... 1 INTRODUCTION ............................................................................................................................................ 2 LITERATURE REVIEW ................................................................................................................................... 4 CROSS-LAMINATED TIMBER ....................................................................................................................... 6 CLT’s properties .................................................................................................................................... 8 Environmental performance .................................................................................................................. 8 Installation simplicity and cost competitiveness .................................................................................. 10 Structural performance ........................................................................................................................ 11 Design flexibility .................................................................................................................................. 13 Fire performance ................................................................................................................................. 14 Seismic performance ............................................................................................................................ 16 Thermal performance .......................................................................................................................... 17 Design possibilities of CLT .................................................................................................................. 18 Market opportunity for CLT ................................................................................................................ 20 THE PROCESS OF NEW PRODUCT ADOPTION ............................................................................................... 21 Innovation ............................................................................................................................................ 21 Product adoption ................................................................................................................................. 21 New product adoption process............................................................................................................. 22 Innovation adoption in the forest products industry ............................................................................ 23 Innovation adoption in the construction industry ................................................................................ 24 THEORETICAL FRAMEWORK ...................................................................................................................... 25 HYPOTHESES ............................................................................................................................................. 29 PROBLEM STATEMENT .............................................................................................................................. 29 RESEARCH OBJECTIVES ............................................................................................................................. 30 RESEARCH CONTRIBUTIONS ...................................................................................................................... 31 vi Contributions to the field of wood science and technology ................................................................. 31 Contributions to the field of sustainable building ................................................................................ 31 Practical contributions and business implications .............................................................................. 32 OUTCOMES ................................................................................................................................................ 32 DELIVERABLES .......................................................................................................................................... 33 RESEARCH METHODS ................................................................................................................................ 33 (1) Literature review ............................................................................................................................ 34 (2) Survey of U.S. engineering firms .................................................................................................... 34 Data analysis ....................................................................................................................................... 35 (3) Interviews of U.S. engineering firms .............................................................................................. 36 Data analysis ....................................................................................................................................... 36 (4) Survey of U.S. construction firms ................................................................................................... 37 Data analysis ....................................................................................................................................... 37 (5) Interviews of U.S. construction firms ............................................................................................. 38 (6) Model development ........................................................................................................................ 38 Data Analysis ....................................................................................................................................... 38 (7) Market segmentation for CLT in the U.S........................................................................................ 39 Data Analysis ....................................................................................................................................... 39 STRUCTURE OF THE DISSERTATION ........................................................................................................... 40 CHAPTER 2 ................................................................................................................................. 41 INTRODUCTION .......................................................................................................................................... 42 METHODOLOGY......................................................................................................................................... 43 Sample size determination ................................................................................................................... 43 Sample development ............................................................................................................................ 43 Questionnaire development ................................................................................................................. 44 Survey pretest ....................................................................................................................................... 45 Survey implementation ......................................................................................................................... 45 Data analysis ....................................................................................................................................... 46 LIMITATIONS ............................................................................................................................................. 46 RESULTS AND DISCUSSION ........................................................................................................................ 47 Response rate ....................................................................................................................................... 47 Non-response bias assessment ............................................................................................................. 47 Company demographics ...................................................................................................................... 48 Sources of information ......................................................................................................................... 49 Innovativeness ...................................................................................................................................... 50 vii Type of buildings .................................................................................................................................. 52 Materials used by type of construction ................................................................................................ 53 Importance of materials characteristics .............................................................................................. 54 Level of awareness ............................................................................................................................... 56 Perceptions about CLT ........................................................................................................................ 58 Willingness to adopt CLT .................................................................................................................... 60 Barriers to the adoption of CLT ........................................................................................................... 61 CONCLUSIONS ........................................................................................................................................... 63 ACKNOWLEDGEMENTS .............................................................................................................................. 64 CHAPTER 3 ................................................................................................................................. 65 INTRODUCTION .......................................................................................................................................... 66 METHODOLOGY......................................................................................................................................... 67 Questionnaire design ........................................................................................................................... 67 Interview implementation .................................................................................................................... 68 LIMITATIONS ............................................................................................................................................. 68 RESULTS AND DISCUSSION ........................................................................................................................ 69 Demographic information .................................................................................................................... 69 Type of buildings .................................................................................................................................. 70 Type of structural materials used ........................................................................................................ 71 Perceptions about wood as a structural material ................................................................................ 73 Roles of construction professionals ..................................................................................................... 75 Sources of information ......................................................................................................................... 76 Innovativeness ...................................................................................................................................... 76 Level of awareness ............................................................................................................................... 78 Perceived benefits and disadvantages of CLT ..................................................................................... 78 Perceived factors affecting the adoption of CLT in the U.S................................................................. 80 Likelihood of adoption ......................................................................................................................... 81 CONCLUSIONS ........................................................................................................................................... 82 CHAPTER 4 ................................................................................................................................. 85 INTRODUCTION .......................................................................................................................................... 86 METHODOLOGY......................................................................................................................................... 87 Sample size determination ................................................................................................................... 87 Sample development ............................................................................................................................ 87 Questionnaire development ................................................................................................................. 88 Survey Pretest ...................................................................................................................................... 88 viii