Client-Contractor Relations: How Fairness Considerations and Interests Influence Contractor Variation Negotiations

Anna Kadefors1

1Research Associate, Dept. of Management of Construction and Facilities, Chalmers University of Technology, SE-412 96 Gothenburg, SWEDEN, +46 (31) 772 1950, fax: +46 (31) 772 1964, anna@mot.chalmers.se

Abstract

In Sweden, it is common that contractors propose variations to the design. Also, in traditional general contracts it is customary that contractors are entitled to replace products specified in the tendering documents with “equivalent” ones. In this paper, factors influencing the conditions for arriving at a constructive and value-adding dialog in such situations are discussed. The theoretical framework used is theory of intuitive fairness judgements and cognitive information-processing biases. The empirical basis is a qualitative case study of client-contractor interaction in a building project. It is argued that a “fairness constraint” sets the rules for interaction. To challenge and reject the contractor’s proposals without running the risk of being perceived as a harmdoer, the client must present arguments and justifications that will be accepted by the contractor. Principal driving forces and dispositions that affect the client, the design team members and the contractor in negotiations of contractor variations are identified. These biases are found to be important in two ways: because of their effect on individual information-seeking and decision-making, and because of their effect on the perceived legitimacy of the participants. The latter aspect has implications for the conditions for communication and joint decision-making.

Keywords

Client-contractor relations, fairness, decision processes, contractor variations, negotiation

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Reference

Kadefors, A. 1999, 'Client-Contractor Relations: How Fairness Considerations and Interests Influence Contractor Variation Negotiations' In:, 7th Annual Conference of the International Group for Lean Construction. Berkeley, USA, 26-28 Jul 1999. pp 231-240

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