Critical factors affecting the use of alternative dispute resolution processes in construction

Abstract

The use of Alternative Dispute Resolution (ADR) techniques in construction have gained great momentum in the public sector during recent years in Hong Kong. The Hong Kong Government has initiated the inclusion of ADR methods as an integral part of the dispute resolution procedure in the standard forms of contracts for use in Government projects. However, the use of ADR in the private sector has not been apparent, probably due to lack of experience and knowledge. This paper discusses the philosophies behind ADR and reports on an evaluative study on the critical attributes of ADR techniques. Two evaluation methods, scale rating and percentage rating, were employed to establish attribute importance rankings through soliciting views from practitioners with ADR experience. The attributes were then grouped into factors as extracted from Factor Analysis. The rankings of the factors so obtained from the two evaluative methods match well. The study reveals that users of dispute resolution processes are pragmatic and consider obtaining benefits as the most critical factor affecting the use of ADR in the construction industry in Hong Kong. Such benefits include cost minimisation and relationship preservation. It is also suggested that if ADR is to sustain its growth in use, these processes must facilitate a speedy resolution.