DRIVERS AND BARRIERS INFLUENCING THE IMPLEMENTATION OF RELATIONAL CONTRACTING IN PUBLIC CONSTRUCTION PROJECTS IN CHINA

Abstract

Many criticisms on the inefficiency in the construction industry have led to the exploration of adopting a more efficient and effective contracting mechanism for construction projects. Relational contracting (RC), based on relationship-based contractual arrangements, is believed to achieve better project outcomes even in complex construction projects. The rising trend of adopting RC practices and the growing development of China construction industry advocate the need to investigate the possibility of implementing RC practices in China. Public sector projects seem to face more difficulties in adopting RC practices as its competitive bidding process discourages the offer of future relationships to contractors. The aim of this study is to investigate the drivers for and the barriers that impede the adoption of RC in public construction projects in China. Other objectives of this study include identifying significant differences in perception of drivers and barriers among clients, consultants and contractors and providing recommendations on how to increase adoption of RC in China. Due to its large geographical area, questionnaire surveys were conducted in Beijing for data collection. Interviews with China construction professionals with experience in public sector projects were conducted to validate survey findings. Results found that the adoption of RC practices is motivated by 20 drivers and hindered by only 6 barriers, suggesting the great potential to apply RC approaches in Beijing public construction projects. Interestingly, public sector’s institutional constraints are not found to be significantly hindering RC adoption. Significant differences in ratings are found among clients, consultants and contractors on certain factors due to their different priorities in project roles. Notably, consultants are less enthusiastic as compared to clients and contractors. Having recognized the significant drivers and barriers that influence implementation of RC practices in China, it will be useful for industry professionals to cultivate readiness in embracing RC approaches. It is suggested that clients, consultants, contractors and the government adopt recommendations highlighted in this study to increase RC adoption and ensure successful implementation in China.