Potential for Implementing Relational Contracting and Joint Risk Management

Abstract

This paper focuses on the outcomes of the second survey in a broad Hong Kong-based study on joint risk management (JRM) through relational contracting (RC). The questionnaire survey itself focused on issues relating to the formation of a coalesced team for JRM at the postcontract stage, comprising owners, consultants, contractors, subcontractors, and suppliers. Results indicate the greater importance of more relational, trust, and joint responsibility-related factors in general, both for selecting different parties and for building a successful relational contract. While some differences in group perceptions emerge, respondents recommend mobilizing project participants at earlier stages of projects, that is, mostly before the contract award, and they strongly support the JRM option for managing various unforeseen risks. Respondents also suggest adjustment/extension of contract provisions for managing unforeseen events, indicating emerging preferences for flexibility in contracts. All these are indicative of a perceived trend toward more RC, teamworking, and collaborative working environments.