Overcoming the blockers to greater collaboration in construction

However, since collaboration can make construction projects more efficient and ‘greener’, and buildings safer, help reduce disputes and support on-time, on-budget project delivery, organisations across the construction sector should work hard to overcome those blockers – none of which are insurmountable.

The need for collaboration is greater than ever as the UK construction industry comes to terms with the impacts from a number of exceptional events, such as the war in Ukraine, and construction companies having to meet new, stiffer obligations around sustainability and building safety. We have already highlighted how BIM is one of the great enablers for that collaboration.

Lack of familiarity with collaborative contracting models

One obvious blocker to collaboration is that the organisations across the construction sector are reluctant to depart from what they know, and therefore prefer to contract based on amended standard form contracts or their long-standing bespoke suite of contracts. This approach is understandable but ultimately it can be a blocker to change and progress.

Parties are beginning to realise that bringing a team to work together for the first time, with multiple disciplines and stakeholders, is unlikely to succeed using traditional contractual models, with their tendency to be adversarial and to focus on risk transfer and blame allocation. As such, there has been a marked increase in the use of more collaborative forms of contract in recent years, from standard forms such as NEC and PPC 2000 to bespoke alliancing structures.

The simple message is that other forms of contract are available:

• The standard Framework Alliance Contract (FAC-1) uses supply chain collaboration to find efficiencies for the benefit of a long-term programme.

   

• For the largest projects, enterprise models, such as Project 13 by the Institution of Civil Engineers (ICE), can be adopted. Alliance arrangements, for example, the NEC4 Alliance Contract, involve the strategic management of the project being devolved to a project board made up of key stakeholders. Decisions must be made unanimously, and for the benefit of the project. Effectively, the project team acts as a single entity that stands or falls together.

There is a campaign by the UK government to promote longer term, responsible procurement and contract management. The ‘Construction Playbook’, developed in consultation with the construction industry, sets out the government's approach to, and expectations of, future public works projects including roads, railway lines, schools, hospitals and prisons. The government’s recent overhaul of the construction frameworks also opens the door to doing things differently.

There are many benefits that come with greater collaboration. Responsible, “best for project” contracting models and practices are needed if, by way of example, building safety requirements are to be properly complied with, the benefits of green technology fully embraced and supply chain insolvencies avoided.

Supply chain management

Another blocker is poor supply chain management. For collaboration to work on a project, the principles and practices must flow down through the supply chain and be embraced and adopted by all the key stakeholders. 

A properly incentivised, integrated supply chain will create a more resilient sector and ultimately result in increased profitability, sustainability and productivity.

Dispute resolution

A third blocker is the concern that collaboration, with its flatter contracting model, and the enforcement of contractual rights or entitlements are at odds with one another and cannot be reconciled.

They probably are at odds, but that may be no bad thing for the success of the project.

The deepest forms of collaborative contracts include a no claims clause. These clauses limit the parties' rights of action to being able to claim for the cost of actually carrying out the works and enforcing any incentivisation mechanism included in the contract. This can be strengthened by way of an indemnity requiring the innocent party to hold harmless the party it is considering suing, with the effect that anything recovered must be immediately handed back, rendering legal proceedings neutral. The inability to bring proceedings forces parties to resolve issues as they arise for the benefit of the project and each other.

Benefits of collaboration

All-party integration and effective data sharing are essential ingredients of collaborative contracting. Where this is done correctly, there is scope to make construction projects more efficient and ‘greener’, and buildings safer, by harnessing the power of data.

If procured and administered correctly, a collaborative contracting model ought also to reduce the number of disputes and changes on a project, meaning projects stand a better chance of being completed on time, to budget, with the correct as-built information and without the parties having to fall out to protect their margin.

None of the apparent blockers seem insurmountable so the benefits of collaboration are definitely worth fighting for.