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The construction industry is acutely aware of the need to improve the integration, planning and control of its design and production processes. A number of projects undertaken within Loughborough, Salford and Cambridge Universities, in collaboration with a number of construction industry organizations, are addressing this issue by investigating, and developing tools to assist, the design and construction process. Emerging from these projects is the common need for IT systems and support that will facilitate the capture, storage and retrieval of project knowledge. It is only by relating these compatible IT applications to a common and recognizable project process framework that construction industry organizations will be able to make optimum use of the available technological developments. This paper describes the development of techniques and strategies to support the integrated planning and control of design through the collaboration of the main designers, suppliers and contractor working on complex building projects, and discusses the relevance of clustering these in relation to the phases and activities of a generic model of design and construction.

The purpose of this paper is to establish whether this type of approach is suitable for maintenance schemes from the perspective of both the public agent and the service provider. Until recently, non‐privately funded public‐private partnerships have been adopted for the maintenance of infrastructure facilities.

In this study, stakeholders involved in a trial of a non‐privately funded public‐private partnerships project were invited to express their opinions on the success and pitfalls of this type of scheme. Semi‐structured interviews were carried out with 12 management and front‐line staff of the public and private partners to capture their opinions on the project. A questionnaire survey was also conducted to uncover the views and standpoints of other stakeholders on PPP. A total of 33 respondents completed the questionnaire.

The results indicate that the non‐privately funded PPP approach is more cost‐effective and efficient in the delivery of maintenance services when compared with the traditional term contract. The performance‐based payment mechanism adopted could help improve the quality of maintenance services performed by the contractor. The inspection and programming tasks are transferred to the service provider relieving the workload of the public agency. Most stakeholders who participated in this study agreed that the non‐privately funded PPP approach can allow higher flexibility, encourage innovation, enhance cost‐effectiveness and improve the efficiency of work when compared with the traditional term contract in the delivery of maintenance services.

This paper provides a general introduction to the method adopted in the non‐privately funded public‐private partnerships approach with particular reference to the maintenance of infrastructure schemes. More important, the potentials and pitfalls of using this type of mechanism with maintenance projects are examined, which helps enhance understanding of this rather unexplored topic.

There is a tension between the literatures on incomplete contracting and transactions cost economics regarding the importance of ex post governance and the extent to which formal theories of incomplete contracting capture salient aspects of exchange relations. In this paper, we empirically examine how firms structure joint R&D agreements to illuminate how contracts can be incomplete and how governance can matter. We employ a dataset of 96 contracts to construct a taxonomy of the types of mechanisms firms use in organizing collaborative R&D, and indicate how groups of mechanisms line up with various types of contracting hazards. The results suggest that the allocation of property rights over innovations at the time of contracting between R&D partners is an important aspect of contract design. But they also suggest that weak property rights admit scope for other dimensions of contract. In particular, the research indicates that while knowledge spillovers may give rise to appropriability hazards, efforts to contain or channel knowledge spillovers may enable joint venture members to strategically block other members’ follow-on commercialization or research. Firms design joint R&D governance mechanisms to balance spillover hazards and strategic blocking.

The external, social, economic and political environments determine the opportunities for work and thereby potential profit. Clients’ needs and attitudes, like the external environment itself, are never static and therefore organizations need to adapt and respond to these fluctuations. Situated between the external and internal environment of an organization and operating at the boundary of the organization is the marketing function. There are many changes occurring in the UK construction industry: a levelling of the trade cycle; methods of placing contracts; increased emphasis on quality, experience and innovations; and increasing competition among firms; clients’ buying behaviour due to changes in the clients’ organization; and developments in technology. Evaluates the role of marketing in seeking to regulate the construction organizations’ relationships with changes within the industry and the external environment.

Effective inter-organisational relationships are key to engendering innovation and ensuring the successful delivery of infrastructure projects. Relationship-based contracts are thus widely used to stimulate best-for-project ideals and attenuate the otherwise adversarial relationship that often exists between clients and contractors. This study examines the effectiveness and limitations of a project facilitation model as coaching tool for developing conducive inter-organisational relationships for construction project delivery.

The study adopts a case-study approach using evidence from triangulated data sources of focus group workshops, semi-structured interviews and document analysis.

(1) The facilitation model enabled an environment for psychological safety to be developed, which engendered a platform for effective cooperation for problem-solving and achieving quasi best-for-project ideals. (2) The model provides the mechanism to develop team behaviours that support enhanced performance and create an environment less adversarial and more collaborative than traditional contracting.

The novelty of this research is that relationship-based principles have been utilised as part of a traditional design-bid-build contract with lump-sum payment arrangements.

There is a lack of empirical research on risk mitigation strategies for those construction projects procured by guaranteed maximum price contracts (GMP) and target cost contracts (TCC). The paper aims to identify and analyse the risk mitigation strategies for GMP/TCC construction projects from the Hong Kong perspective.

A total of 94 industrial practitioners with both sound knowledge and abundant hands‐on experience of the GMP/TCC methodology participated in an industry‐wide empirical questionnaire survey to indicate their levels of agreement on those 18 risk mitigation strategies identified from reported literature and in‐depth interviews which were later analysed by factor analysis.

The results of factor analysis revealed that the 18 individual risk mitigation strategies can be consolidated into seven underlying grouped factors: relational contracting and mutual trust; clear contract provisions and well‐defined scope of works; involvement of contractor in decision making process; right selection of project team; third party review of project design at tender stage; standard contract clauses for GMP/TCC schemes; and fair treatment of contractor.

Although both GMP/TCC contracts have been increasingly popular in the construction market of Hong Kong, not all of these projects have been equally successful and some of them have been exposed to very high risks or uneven allocation of risks. A detailed analysis and an implementation of recommended effective risk mitigation strategies are essential to the success of GMP/TCC schemes.

The research findings of this study are expected to help the decision makers to generate useful insights into risk mitigation strategies when administering GMP/TCC contracts at an early stage of project delivery and lay a solid foundation for further research on GMP/TCC in both local and international contexts.

This paper aims to investigate the impacts on project delay from the perspective of construction stakeholders. Specifically, it aims to make a comparison between traditional procurement based on standard contract forms and private/public partnerships (PPPs), for the procurement of public sector projects in Scotland.

A structured questionnaire survey was used to elicit perceptions of seven delay impact groupings. Response data were analysed using hypothesis tests to observe perceived differences among these groupings, in respect of each procurement method. Follow‐up semi‐structured telephone interviews further explored stakeholders' views and broader issues.

Significant differences of perception were identified between the impacts of: client, contractor, designer, financial, labour and material related delay factors. These were felt to have greater “delay potential” under traditional vis‐à‐vis PPP procured projects. There was no significant difference among plant‐related factors. Preference for traditional procurement in achieving “project quality” and “value for money” was observed; but at the perceived risk of potentially encountering more delays. PPP was preferred for achieving best “time performance” and was the favoured procurement option “overall”.

Findings add to the existing body of procurement‐choice knowledge generally and their relationship to project delays and associated costs, specifically.

Practitioners may wish to consider the perceived benefits of PPP procurement in better dealing with potential delay impacts.

Reduction in delay and construction cost holds potential benefit to all who procure constructed facilities.

The work is novel in the specific contexts of public sector stakeholders surveyed and their geographical location.

This paper reports early results of a study of construction contractors and their experiences of the PFI market. Utilizing material from semi‐structured interviews with three categories of construction contractor, small, medium and large, consideration is given to the barriers to entry which contractors face when approaching the PFI market. The paper highlights six barriers of entry: lack of appropriate skills; high participation costs; high project values; high risk; lack of credibility and contacts; and demands on management time. These barriers affect the three categories of construction contractor in different ways. The findings suggest that the larger the contractor, the more able it is to overcome these barriers and to compete in the PFI market. The findings also suggest that certain barriers to entry will decline as the industry matures, whilst others will remain.

Steel price uncertainty exposes pipeline projects that are inherently capital intensive to the risk of cost overruns. The current study proposes a hedging methodology for tackling steel pipeline price risk by deploying Asian option contracts that address the shortcomings of current risk mitigation strategies.

A stepwise methodology is introduced, which uses a closed-form formula as an Asian option valuation method for calculating this total expenditure. The scenario analysis of three price trends examines whether or not the approach is beneficial to users. The sensitivity analysis then has been conducted using the financial option Greeks to assess the effects of changes in volatility in the total price of the option contracts. The total price of the Asian options was then compared with those of the European and American options.

The results demonstrate that the Asian option expenditure was about 1.87% of the total cost of the case study project. The scenario analysis revealed that, except for when the price followed a continuous downward pattern, the use of this type of financial instrument is a practical approach for steel pipeline price risk management.

This approach is founded on a well-established financial options theory and elucidates how pipeline project participants can deploy Asian option contracts to safeguard against steel price fluctuations in practice.

Although the literature exists about the theory and application of financial derivative instruments for risk management in other sectors, their application to the construction industry is infrequent. In the proposed methodology, all participants involved in fixed price pipeline projects readily surmount the risk of exposure to material price fluctuations.