Moderating claims and disputes through collaborative procurement

Abstract

Purpose Following the global financial crisis in 2008, the construction sector in UAE has been facing emergent criticisms for growing adversarial culture and rising prevalent claims and disputes between stakeholders. The complex, large size and fast track nature of construction projects in UAE, make project management very challenging under the commonly used traditional procurement routes. This paper aims to examine whether implementing collaborative procurement approaches can facilitate resolving the escalating number of claims and disputes in the UAE construction industry. Design/methodology/approach Considering the nature of the study, a quantitative method was selected to realize the research objectives. The questionnaire was uploaded using an online survey facility and distributed through e-mails and professional networks. The questionnaire was piloted with experts to assess whether the questions are unambiguous, easy to respond and intelligible. The feedback received was mostly positive with few comments and recommendations. The pilot responses were incorporated and the questionnaire was modified before the final sending out. The questionnaire survey consisted of six main sections to fulfill the research objectives. Findings Around three-quarters of the experts believe that the relationship is adversarial, with a lack of trust, win-lose attitude, with dismissive and opportunistic behavior. The survey reveals that the top causes of claims and disputes comprise the following: variations because clients initiated change requests; contractors selection on low bid only rather than including quality and performance considerations; and unfair risk allocation where majority of risks are transferred to contractors. The findings also identify eight collaborative practices, which have crucial positive impacts such as early identification of problems, better communication and enhanced trust and teamwork. Originality/value This research contributes to the enhancement of the management of claims and disputes for construction projects, which encompasses the following: the key characteristics of collaborative arrangements to improve the adversarial construction culture comprise: mutual respect, openness, fairness and non-opportunistic behaviors; the foremost roles of collaborative procurement in reducing claims and disputes embrace: early identification and resolution of problems, enhanced trust and teamwork spirit, improved relationships and better quality communication; the major practical barriers of implementing collaborative approaches incorporate: lack of awareness of their benefits, primitive legal framework of partnering arrangements and lack of transparency in procurement processes.

Dispute Avoidance From the Perspective of Procurement Methods: A Conceptual Focus

“…The findings of Table 1 have highlighted the selection of the most suitable procurement method and on the other hand, several authors recognised the collaborative/partnering approach itself as a method of dispute avoidance. The strategies such as team building, improved relationships and communication are also identified as dispute avoidance strategies by the authors which are the special characteristics of the collaborative approach as identified by Elhag et al (2020). Moreover, the early involvement of the contractor is also identified as a dispute avoidance strategy where the focus again moves towards procurement methods because in management oriented, design and build, and collaborative methods early contractor involvement is clearly visible as per Table 2.…”

“…Moreover, Naoum and Egbu (2016), stated that alternative procurement methods like design and build, management contracting and construction project management are introduced to overcome the problems from lack of integration, separation of design from construction, improper communication, uncertainty, changes in environment and client's expectations. Furthermore, Elhag et al (2020) emphasised the use of collaborative approach due to its benefits as improved relationships and communication, better productivity and decrease of disputes and litigation. Moreover, change in attitudes and emphasis on trust are the guiding factors of dispute prevention scheme in collaborative method (Mante et al, 2012).…”

“…Yusof et al (2011) indicated that the traditional procurement method has the highest rate for disputes due to its key features and the other innovative methods like design and build, management and partnering methods have the capability of reducing the disputes. On the other hand, the working atmosphere of collaborative approach can be useful to avoid disputes (Elhag et al, 2020). Therefore, a link of the relationship between the procurement methods and the occurrence of the disputes can be identified especially in terms of dispute avoidance.…”

“…Nevertheless, available literature on construction disputes tends to give more attention to dispute resolution than dispute avoidance (Naji et al, 2020). Furthermore, the growth of complexity and competitiveness in the construction industry has gained a reputation for disputes in the last few years (Elhag et al, 2020) and different types of procurement methods have also developed with the evolvement of construction procurement (Oyegoke et al, 2009). Thus, with the time elapsed, the key features of each method may have varied as well as along with the occurrence of disputes and dispute avoidance strategies.…”

Productivity and innovation in the Japanese construction industry

“…In addition, in research at the level of firm behaviour, a survey of the definition and classification of off-site construction methods (Ayinla et al, 2019), the role of innovation brokers (Sergeeva and Liu, 2019) and the role and evaluation of iContract, an intelligent contracting technology (McNamara and Sepasgozar, 2020), a review of the use of VR to facilitate communication (Wen and Gheisari, 2020), technology management systems and practical guidance for physical-mechanical robotic systems (Linner et al, 2020), building information modelling (BIM), a review of public client initiatives on demonstrations (Lindblad and Gustavsson, 2021). And, in-depth research based on questionnaires and interviews with experts has been conducted, on real-world and impact studies on loosely coupled systems in construction (Sandberg et al, 2020), theories and case studies on the contribution of tact production to construction production flow (Lehtovaara et al, 2021), on lean procurement readiness (Suresh and Arun Ram Nathan, 2020), a discussion on barriers to adoption of building information modelling in small and medium-sized enterprises (SMEs) (Saka and Chan, 2020), an examination of lean building surveying services from a waste reduction perspective (Khan (Khan and Ali, 2020) and a study on collaborative procurement methods to mitigate claims and disputes (Elhag et al, 2020). Although we have surveyed these recent innovation-related studies to some extent as comprehensively as possible, there are not many studies that properly integrate and structure semi-macro, micro and expert-level research.…”