Dispute Resolution and Contract Incentives: Perceptions of Project Stakeholders

The emergence of integrated project delivery and collaborative contracts has been the staple of the construction industry in the last decade, with the main goal of fostering a collaborative environment and adding value to the whole project lifecycle. Collaborative contracts generally contain laddered dispute resolution methods and incentive provisions. These process-oriented methods are intended to promote an inexpensive and nonadversarial approach to dispute resolution, while the incentives are meant to add to the project value. However, these process-oriented dispute resolution methods and incentive provisions have been deemed to be vulnerable aspects in which interpersonal relations play an influential role and where they can have unpredictable effects in contrast to their initial purpose. This paper presents the results of an exploratory study comparing perceptions about dispute resolution methods and incentive clauses stipulated by four collaborative standard contract forms. Experienced construction professionals were interviewed for this study, followed by a thematic content analysis of the interview transcripts to identify shared issues in favor and against various aspects of the collaborative contract standards. Interviewees consisted of participants in the design, construction, and legal processes of project delivery. The analysis results were checked by additional consultation with the interviewees and by submitting the results of the critique to additional external reviewers. An important finding of the study was the perceived key role of interpersonal relations for the successful implementation of dispute resolution methods and incentive provisions. Mostly, people factors were perceived as more important than formally stipulated conditions.