The majority of collaborative relationships in UK construction include some form of incentive system, commonly based upon an agreed target cost with risk/reward element (Bresnen & Marshall, 2000: 826). The detail guidelines for an effective collaboration is illustrated by the Constructing Excellence in the built environment which include three steps, which firstly define collaborative working, then provides three overriding principals for CP
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and finally outlines the six critical factors of CP (2001: 2). This outline is a result of learning based in design, construction and operation that clients, integrated project teams and supply chains have demonstrated on programmes and projects in the UK over 15 years (ibid). The principles outlined in the CP guideline govern collaborative working in the UK. The principles appear to be achievable and realistic. However, past studies show that teams intending to collaborate need to make the shift from traditional contracts to forms of contract that cater for long term relationships between clients and project stakeholders. As a response to the principles laid out in the Latham report of 1994, contracts such as the New Engineering Contract (NEC) and PPC 2000/3 are seeking to modify and address the needs encompassed in collaborative relationships (Shelbourn, 2007: 369). In addition, the former head of Contracts and Law at NBS/RIBA Enterprises Udom (2013: 4), elaborates further on standard forms of collaborative contracts, which include NEC 3 suite of contracts, JCT Constructing Excellence Contract (JCT CE), ACE PPC 2000 and CIOB Complex Construction Contract 2013. Notably, the majority JCT contract updates since 2009 have contained supplemental provisions for collaborative working in binding and non-binding version (ibid). Interestingly, whether parties to a commercial transaction agree to confine themselves to a formal contract or not, the law dictates that by virtue of actions created by the parties, accepted trade and customs, oral agreement or operation of the law, constitutes the existence of an agreement (Udom, 2013: 2).
A realistic approach to building collaborative relationships further requires a break from tradition patterns of interactions between project teams. Procure 21 framework (discussed extensively by Forgues & Koskela, 2009) is a system aimed at improving relations of project teams by changing its power structure and relationship by introducing events and tools to facilitate knowledge sharing (Forgues & Koskela, 2009: 380). Figure 3.1 provides the approval and monitoring process commissioned by UK Treasury upon which project boundaries and interaction must adhere to.
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Figure 3.1: Procure 21 project definition process (Forgues & Koskela, 2009: 381)
Forgues and Koskela (2009, 380-381) provide a breakdown of Procure 21 as a framework of project definition process (Figure 3.1):
• The project director, with the assistance of the principal contractor, negotiates the scope of the project with the Board and the manager of the rehabilitation unit;
• The principal contractor, provides the client with a technical point of view of the project; • The project stakeholders, namely the managers, staff and end-user representatives, are
invited to participate actively in the definition of the features and characteristics of the project, and
• Tools such as Achieving Excellence Design Evaluation Toolkit (AEDET) encourage knowledge sharing and enables continual learning.
With an abundance of guidelines and framework governing and encouraging collaboration, a brief look at relevant case studies in UK construction will assist in forming a balanced view of the adaptation of collaborative working methods.
Case studies background: the cases ranged from £9 million to £400 million in value. These included two oil and gas projects, two process plants two civil engineering and three building projects (see table of project information discussed by Bresnen & Marshall, 2000: 823). Formal agreements consisted of one joint venture, four partnerships, two single project alliance and two conventional contracts.
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Alliance structure: contractor selection varied according to the nature of the relationship. The joint venture case (A) was negotiated and the two more conventional projects (G, H and I) were based on competitive tendering. Project F was serial contracting while projects B – E bid for term agreement with project by project negotiations (Bresnen & Marshall, 2000, p. 826).
Analysis of collaborative working: teambuilding was used in all of the case studies and tended to be formal and intense, with all of the projects using teambuilding workshops with the aid of an external facilitator. This process included agreement of charters and mission statements. Teambuilding was concentrated and intense in the early stages of the project after which on-going interaction (e.g. away days, informal activities or social events) became the aim ways of sustaining the collaborations.
Nature of Alliance: the joint venture and all of the other partnerships and alliances were supported by standard forms of contract. All of the projects governed by partnering/alliancing arrangement included some form of incentive system, commonly based on an agreed target cost with risk/reward element.
Potential operationalisation of collaborative practices in the supply chain: all cases placed considerable emphasis on continuous improvement and benchmarking. There was a general satisfaction expressed by project clients, contractors and designers with the quality of relations found on more collaborative projects, particularly with regards to information flows, communications, decision - making and approaches to problems and resolving them (Bresnen & Marshal, 2009: 829). Potential problems were raised, the concern that constant pressures to improve performance might cause rifts between collaborators thus requiring the client to accept that performance improvement might possibly diminish their returns.
Above and beyond contractual provisions and theoretical framework, real collaboration in the UK requires development and subsequent improvement of soft skills such as organising effective meetings and project leadership of the client representatives.
3.4. LESSONS LEARNT
Literature reviewed provided and understanding of the application of collaborative practices in Australian and UK construction industry. To enable understanding of the nature of collaboration in the context of the countries under exploration, a brief background of the respective construction industries were explored. One commonality between the two
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industries (Australia and UK) was fragmentation and intense competition prevailed as a hallmark of construction industries.
The Australian construction industry refers to collaboration as alliancing. As such alliancing is a system used to reduce antagonistic nature of construction project. Alliancing and the discussion of relational contracting is used interchangeably thus emphasising the management of relationships between collaborators to ensure effective collaboration. With RC as a tool for collaborative working, five core principles of effective collaboration were noted: commitment; trust, cooperation and communication, common goals and objectives and win-win philosophy. In the Australian context, various challenges were identified that hindered collaboration, namely, fragmentation of the construction sector; large numbers of small enterprises in the SC; differences between manufacturing and construction SC and adversarial nature of relationships in the industry.
An informed comprehension of the application of collaboration was carried out by means of an analysis of existing case studies of projects completed under collaborative environment. By the use of eight articles, three major projects were analysed, namely: The National Museum of Australia, an upgrade to three Water treatment plant and construction of 270 Water treatment plants commissioned by a private client. Notably, from these three case studies, the alliance strategy was incorporated into the project as a result of: complexity of the project; disappointing outcomes produced by traditional contracts and time constraints. Although the Qualitative Content Analysis (QCA) process initially began with 8 articles pertaining to alliancing in Australian construction, six of these articles were qualitative studies thus enabling an insightful analysis into the nature of collaborative working. One article (CS No. 7) was a quantitative study which was ineffective at establishing the efficacy of this phenomenon. This is due to the fact that by mere definition of collaboration calls for a study into human relationships and interactions which is supported by qualitative methodology. The quantitative nature of CS No. 7 did however emphasise that the Australian construction industry acknowledged the importance of collaboration in construction projects. The UK construction industry has made considerable strides in establishing collaborative practices. This in part is due to various factors such as: the wide recognition of the importance of SC collaboration in the industry; support from the government (propelled by the Latham (1994) and Egan (1998) reports); the wide acceptance of collaborative working as a management strategy; an imbalance of relationship development in the industry. The review
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of the literature focused on the various systems incorporated in the UK construction to encourage collaboration. This includes the modification of standard forms of contract suites to accommodate collaborative working as well as the development of various frameworks placing importance on early contractor involvement. In addition, facilitation of workshops and meetings before and during the execution of works is also encouraged. In the UK construction context, six critical success factors are established to ensure collaboration takes place (i) early involvement (ii) selection by value (iii) aligned commercial arrangements (iv) common processes and tools (v) performance measurement (vi) long-term relationships. The literature indicated however, that while collaborative working in UK construction has been a reoccurring theme for over 10 years, research conducted by various institutions suggests that although the benefit of collaboration is known widely in the industry, few projects are actually adopting collaborative working on their projects.
3.5. SUMMARY
This chapter discussed the nature and application of collaboration in the Australian and UK construction industry. The literature shows that fragmentation and adversarial relationships in is encouraging the use of CP to drive performance improvement. The cases in this chapter were examined to enrich the efficacy of collaborative working in construction. The next chapter reviews literature related to collaborative practices in South African construction industry.
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CHAPTER FOUR
COLLABORATIVE PRACTICES IN SOUTH AFRICA
4.1. INTRODUCTION
This chapter presents the concept of collaborative working in South Africa. This chapter provides a theoretical perspective of CP in the region. The review of existing literature provides the extent to which collaboration is practiced in the South African construction industry. The chapter thus draws comparisons of the concept with the countries discussed in the preceding chapter in order to highlight the gaps in research that prevail in the south African construction industry at present.