Impacts of Levels of Trust on Dispute Occurrences in Highway Projects

Abstract

Disputes are common in the construction industry and lead to unnecessary cost and schedule overruns in projects. It is commonly believed that as the level of trust increases among project stakeholders, the frequency and severity of disputes decrease in a project; however, no previous study has empirically tested this hypothesis, especially in highway public projects. Therefore, this study empirically investigated the impact of various categories and levels of trust on the frequency and severity of disputes in public highway projects. Comprehensive literature review was conducted to identify factors that impact disputes in a construction project; this review yielded a survey instrument that captures both independent factors-including three categories of trust (competency, organizational, and relational)-and dependent factors-including the frequency and severity of disputes as well as other project performance metrics related to disputes. Then, the survey was distributed to procurement personnel in state Departments of Transportation (DOT). The data obtained was analyzed to find any statistically significant difference between dispute frequency and severity, relevant performance metrics, and the various categories and levels of trust. The results consistently revealed that high trust across categories resulted in high-performance projects for the aspects studied and organizational trust had the highest significant positive impact on the project performance metrics studied. An interesting observation was that, in most cases, neutral trust-not low trust-corresponded to the lowest levels of project performance for the aspects studied and across all categories of trust. The findings of this study can help DOTs appreciate and facilitate trusting environments for their projects to decrease the frequency and severity of disputes in the construction process.