Collaborative Contracting: Barriers To Adoption In The South African Construction Industry

A. Peer, H. Steyn & T.J. Bond-Barnard

This paper was presented by Prof Bond-Barnard at the 33rd IPMA World Congress that was held in Cape Town from 27 to 29 November 2024.

Abstract:
Companies don’t make purchases, they establish relationships
— Charles S. Goodman

The strained and even hostile relationships between contracting parties in the construction industry, caused by the competitive nature of traditional contracting, are partially to be blamed for poor project performance. Collaborative contracting (CC) emphasizes cooperation, partnership, and shared goals among partners and contributes to improved time, cost, and quality performance. There has been a notable increase in collaborative contracting in some countries, and barriers to adoption of collaborative contracting have been studied. However, little is known about the barriers to adoption in countries that lag in the implementation of CC.

This paper investigates the barriers in a developing country that lags in the adoption of CC. Semi-structured interviews were undertaken with 12 professionals, all of whom have more than 15 years of relevant experience. The findings correlate largely with existing literature, but two additional barriers, societal distrust and lack of local successes, have been uncovered. A model of factors leading to the dominance of traditional contracting is proposed, indicating issues related to trust, a lack of knowledge of CC, awareness, and a perceived loss of control as barriers to adoption. The need for governments, clients, and regulators to promote CC is also stressed. In addition to the contribution to existing literature, this paper also provides practitioners insight into factors that should be considered for implementing CC.

Keywords: Barriers; Collaborative contracting; Construction; Partnering; Trust.

Prof Bond-Barnard presented the paper at the IPMA Congress, and it was very well received. There were many questions about collaborative contracting. Several German delegates shared that while the collaborative contracting approach worked well during times of prosperity (when trust was high), they have, however, now shifted towards traditional contracting. They explained that trust between parties has diminished in more challenging times, and both buyers and sellers now tend to prioritise their individual interests.

Access the presentation here