Collaborative incentive contracts: stimulating competitive behaviour without competition

Boukendour, Saïd; Hughes, Will

doi:10.1080/01446193.2013.875215

Cited by 34 publications

(25 citation statements)

References 39 publications

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“…Incentive-based payment is particularly suitable for early procurement of contractors and joint specification (Chan et al, 2007), as it provides collaborative project stakeholders a common fate reward for gains due to innovative technologies and efficient improvements. A disadvantage of incentive-based payment is that rules on adjusting the target cost tends to be rather complex contractual terms that often give rise to discussions or even disputes (Kadefors, 2004;Badenfelt, 2008;Boukendour and Hughes, 2014). It has therefore become increasingly common to abandon the usual type of economic incentive connected to a target cost and instead uses a fixed contractor fee, covering profit, risk and central administration.…”

Section: Procurement Strategies For Enhancing Explorationmentioning

confidence: 99%

“…A problematic aspect of incentive-based payment is the discussions of target cost adjustments that may emerge when project changes are implemented (Kadefors, 2004; Procurement strategies for enhancing exploration Badenfelt, 2008;Boukendour and Hughes, 2014). Client 5 highlights this problematic aspect and the risk of the contractor becoming focused on raising the target cost instead of lowering the actual costs:…”

Section: Data Collection and Analysismentioning

confidence: 99%

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Procurement strategies for enhancing exploration and exploitation in construction projects

Eriksson

2017

JFMPC

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If you would like to write for this, or any other Emerald publication, then please use our Emerald for Authors service information about how to choose which publication to write for and submission guidelines are available for all. Please visit www.emeraldinsight.com/authors for more information. About Emerald www.emeraldinsight.comEmerald is a global publisher linking research and practice to the benefit of society. The company manages a portfolio of more than 290 journals and over 2,350 books and book series volumes, as well as providing an extensive range of online products and additional customer resources and services.Emerald is both COUNTER 4 and TRANSFER compliant. The organization is a partner of the Committee on Publication Ethics (COPE) and also works with Portico and the LOCKSS initiative for digital archive preservation.*Related content and download information correct at time of download. Purpose -The purpose of this study is to investigate how procurement strategies may be designed to facilitate exploration and exploitation in construction projects.Design/methodology/approach -This paper is based on a literature review of organizational research and construction management literature together with a brief interview study of Swedish clients and contractors.Findings -The theoretical and empirical findings propose that small and simple projects with low uncertainty and scarce resources may focus on exploitation to enhance short-term efficiency through traditional procurement strategies including delivery systems that separate the actors and their activities (i.e. pure design-build-or design-bid-build-contracts), fixed price payment and price focus in bid evaluation. Large complex projects with high uncertainty and customization benefit from combining exploration and exploitation to enhance sustainable performance. This requires collaborative procurement strategies including joint specification through early contractor involvement, cost reimbursement coupled with incentive-based payment, bid evaluation based on multiple criteria and collaborative tools and activities in partnering arrangements.Research limitations/implications -This paper contributes to organizational learning literature by pinpointing the need for integrating procurement strategies that enhance combination of exploration and exploitation. The main contribution to the construction management literature involves the investigation of how procurement strategies may affect exploration and exploitation, as identified and articulated in the propositions developed in this paper.Practical implications -From a practical perspective, the findings highlight the importance of tailoring procurement strategies to project characteristics to enhance a suitable balance between exploration and exploitation in construction projects.Originality/value -The explicit focus on the operational project-level is uncommon but relevant in organizational learning literature.

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Section: Procurement Strategies For Enhancing Explorationmentioning

confidence: 99%

Section: Data Collection and Analysismentioning

confidence: 99%

Procurement strategies for enhancing exploration and exploitation in construction projects

Eriksson

2017

JFMPC

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“…It was suggested that opportunism moderates commitment. There is much that catalogues the adversarial nature of the construction industry; for example, a review of the Scopus database identified several examples (e.g., Boukendour and Hughes 2014;Eriksson 2010;Rose and Manley 2014;Smiley et al 2014).…”

Section: Commitmentmentioning

confidence: 99%

“…A major contributing factor is poor relationships that exist within the industry (Davis and Love 2011;Davis and Walker 2009). Many Australian construction firms realize the strategic importance of relationship style contracting in accordance with Boukendour and Hughes (2014), Smiley et al (2014), and Taggart et al (2014). Effective participation in relationship development and the avoidance of traditional business-as-usual thinking has the potential to significantly enhance project outcomes (Love et al 2010).…”

Section: Introductionmentioning

confidence: 99%

Psychological Contracts: Framework for Relationships in Construction Procurement

Davis

Jefferies

2017

J. Constr. Eng. Manage.

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The existence of psychological contracts (PC) in construction procurement is examined. Specific objectives are to identify the presence of the PC in construction project teams and catalogue its effect on procurement delivery. A survey instrument designed with the assistance of two focus groups and subsequently administered to a purposive sample of experienced construction/engineering managers identified unique attributes of significance. Two further focus groups helped develop a conceptual model of PC for construction of a more generalizable nature. Findings suggest PCs are present in construction delivery teams. Antecedent enabling factors, referred to as relational conditions and benefits that form unwritten agreements and unwritten contracting behaviors, are found, which consequently affect team satisfaction. For the professional, advances in knowledge are identified in the new model where factors of trust, commitment, and good faith and fair dealing are described as components of the PC in construction. Revealing these less tangible characteristics of construction management in the PC serves to provide the professional with a novel framework from which to anchor their understanding of procurement teams and enhance their decision-making capability.

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“…Less integrated collaborative delivery models, such as design and construct, partnering, etc., assume that each party takes over its own risk and uncertainty management. In this situation there is little need for routines to demand high levels of accountability and transparency [60].…”

Section: Explanation Of Collaborative Processes Routines and Meansmentioning

confidence: 99%

Understanding Collaboration in Integrated Forms of Project Delivery by Taking a Risk-Uncertainty Based Perspective

Walker

Lloyd‐Walker

2016

Administrative Sciences

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Abstract:Background: Cross-discipline team collaboration between the project ownership team, design team and project delivery team is central to effective management of risk, uncertainty and ambiguity. A recently-developed framework that was developed to provide a visualisation tool to enable various project procurement and delivery forms has been adapted to answer the research question How can uncertainty best be managed in complex projects? Methods: The research involved reviewing transcribed recorded interviews with 50 subject matter experts that was originally analysed using axial coding with Nvivo 10 software to develop the framework that the paper refers to. It extends analysis to focus on risk and uncertainty previously reported upon in that study. Results and Conclusions: The adaptation presents a hypothetical partnering and alliancing project collaboration map taken from a risk and uncertainty management perspective and it also refines its focus on coping and sensemaking mechanisms to help manage risk-uncertainty in a practical and 'how to do' manner. This contributes to theory by extending the relationship based procurement (RBP) framework from taking a purely procurement theory focus to being applied in a risk-uncertainty project management theory domain. It also provides a practice contribution by explaining how the RBP mutation to a collaboration and risk-uncertainty management framework may be applied.

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Collaborative incentive contracts: stimulating competitive behaviour without competition

Cited by 34 publications

References 39 publications

Procurement strategies for enhancing exploration and exploitation in construction projects

Procurement strategies for enhancing exploration and exploitation in construction projects

Psychological Contracts: Framework for Relationships in Construction Procurement

Understanding Collaboration in Integrated Forms of Project Delivery by Taking a Risk-Uncertainty Based Perspective

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