Barriers to spurring innovation in Swedish transport infrastructure construction

Abstract

The construction industry is struggling with declining productivity. As Sweden’s largest public-sector purchaser of constructions services, the Swedish Transport Administration launched a programme aimed at increasing productivity. One important component of this programme was the introduction of design-build procurement to increase the leeway provided to contractors to identify innovative and efficient solutions. In this case study of the programme, which focuses on design-build contracts, we have conducted 27 interviews with Swedish Transport Administration project managers, contractors, and consultants to examine how successful the implementation of some of these measures has been and what hurdles they have encountered. Our results show that, in many regards, the programme has failed to increase innovation and productivity. To a large extent, this can be attributed to legitimate reasons such as the integrity of the planning process and standardisation of the railway. That said, we have also identified a perceived lack of competence among both project managers and contractors, as well as an apparent lack of trust between them. One important conclusion is that the Swedish Transport Administration has failed not only to implement design-build contracts, but also the structure to make the contracts they have implemented work, in particular the failure to provide project managers with incentives to experiment. We also conclude that, if used incorrectly, this type of procurement could even have a detrimental effect on innovation.