Various Approaches to Early Contractor Involvement in Relational Contracts

Abstract

The main rationale for involving contractors is to apply collaboration to mitigate risk and to harvest opportunities to reduce cost and to increase the project owner’s value. In the paper we argue in the applied analytical model that there are four levels of early contractor involvement (ECI), which are 1) Preparation of the project (before sparking off competition); 2) During the procurement phase (development of what to build); 3) Project delivery model (before construction contract, but after the contractor and designers are selected); 4) Project delivery model (where involvement also continues in the execution phase). In the paper we argue that category 4 have the largest potential in term of project risk mitigation and possibility exploitation, and category 1 least.

Three road construction case studies are conducted. The findings show that each project had different approaches to contractor involvement, and different PDM. Case 1 and 2 can be identified to be in category 2, while case 3 are in category 4. However, case 3 has reached to short in the execution phase to reveal the expected potential when contractor involvement also continues in the execution phase. It seems, however, like all approaches to ECI had positive impacts on the relationship between the client and contractor. Further empirical studies have to be conducted to improve the addressed analytical/theoretical generalization.