Same same but different: dynamics of a pre-procurement routine and its influence on relational contracting models

Abstract

To improve the performance of construction projects, the use of relational contracting (e.g. Project Partnering, Alliancing, Early Contractor Involvement, Integrated Project Delivery) has increased among public clients in the last few decades. Despite widespread use, there are still large variations in contracting arrangements. In addition, the outcome of relational contracting remains unpredictable. The aim of this paper is to investigate how these variations may originate from internal dynamics and practices in the project-based client organisation. Adapting organisational routines as an analytical lens, the study investigates the pre-procurement routine applied to develop project-specific relational contracting models (e.g. contract schemes, reward systems, and award criteria) for large construction projects in the Swedish Transport Administration. The study contributes to research on organisational routines in project-based settings, illustrating how flexible enactment of a pre-procurement routine may balance two conflicting organisational goals: centralisation of procurement and project-level flexibility. However, while mitigating conflicting goals, the routine enactments create a variation in project-specific procurement models that hampers long-term goals of predictability and shared practices of relational contracting. Consequently, findings indicate that public clients seeking to transform contracting practices must increase their ability to develop procurement routines that can balance organisational goals and simultaneously benefit long-term goals.