No disputing it – it’s time for trust.
Despite an increasing acknowledgement of the importance of partnership, few projects progress without some form of dispute or disagreement between the participating organizations.
Developers/owners, contractors, consultants, architects, sub-contractors…the sheer numbers guarantee a potential for miscommunication. The fact is, where there is a lack of information on who said or sent what, when and to whom, a vacuum effect occurs and parties jockey for position to minimize their exposure. That is entirely understandable when the stakes are so high. On average, disputes and extensions of time claim an eyebrow-raising 10.7 per cent of contract price according to the CRC Construction Innovation, Guide to Leading Practice for Dispute Avoidance and Resolution. In each dispute, there are direct costs for legal arbitration and litigation consultants and indirect costs from delays, wasted effort, lowered staff morale, and decreased trust and confidence among the parties.
The good news is that many disputes are avoidable when the flows of communications, documents and decisions are A) effectively managed and B) traceable amongst all project participants. Better management of these flows – enabling the right people to get the right information and documentation at the right time – minimizes errors throughout a project. In cases where a dispute still arises, traceability – a transparent audit trail shared amongst all parties of who said or sent what, to whom and when – allows for a prompt and equitable resolution. It’s amazing how the simple introduction of transparency between project participants creates a cultural shift from one characterized by competition, where everyone’s primary interest is to minimize their liability (and maximize that of others), to collaboration, where everyone accepts that a source of truth exists and can focus on their scope and the project goals thereby avoiding errors in the first place.
Project collaboration systems – everyone has one these days, right?
Many in the industry have made positive strides toward better information management through the introduction of electronic software systems, often coining these as “project collaboration systems.” However, this term is used to describe a whole range of different systems with varying levels of genuine collaboration among the organizations involved in a project. The vast majority have gone beyond email and servers, and introduced internal software systems to control the documents and correspondence they produce and receive from others. Many have even introduced web-based systems where key organizations participating in a project can communicate and share information and documentation. The past few years have seen exponential growth in the use of these project-wide systems. But even here, there are mixed levels of success in terms of the number of organizations participating in the system. We are now at a stage where we can identify what can be considered an effective and true project collaboration system and how this is achieved. Only then will the industry reap the benefits of reduced dispute costs and a cultural shift towards collaboration for mutual gain.
The Ultimate Goal of Project Collaborations Systems:
Maximizing Information Assets
In order to minimize disputes, information flows between participating organizations need to be effectively managed and remain traceable by all project participants. This recognizes that information is a key asset if distributed and captured properly or a risk and liability if there are pieces missing. A project collaboration system can act as the hub through which all information and communications flows in order for it to firstly be captured and then retrieved, analyzed and traced whenever required throughout the project cycle. The key challenge here is, if information is not entered in equal measures by all participating organizations, there is less information of value for participants to draw out. In other words, project collaboration systems need to actually be collaborative.
By Steven Brant
General Manager – ANZ, Aconex