Fu, Y and Zhang, S (2015) The interaction of trust and contractual governance on dispute negotiation strategy in contractor-subcontractor relationships. In: Raiden, A and Aboagye-Nimo, E (eds.) Proceedings of 31st Annual ARCOM Conference, 7-9 September 2015, Lincoln, UK.
Abstract
Supply chain scholars have increasingly gained attention to using governance mechanisms to manage inter-organizational relationship and have pointed out their significant impacts on performance outcomes. However, the typical relationship between general contractors and subcontractors is still potential adversarial and disputes are almost inevitable during the construction process, and using governance mechanisms to promote cooperation and eliminate conflicts in the construction industry has been a relatively new topic. Through a comprehensive review and analysis of literature on governance mechanisms, the study has presented the reasons for the inconsistent findings of the interactions between trust and contract, identified different dimensions of trust and contract with consideration of the characteristics of the construction industry. In spite of the links between governance mechanisms and performance outcomes are well established, less well established is how they influence behaviours which intermediate between governance mechanisms and outcomes. By providing a theoretical framework, we can reach a better understanding of how and when trust and contract interact with each other to influence the development of negotiation strategy, so that both general contractors and subcontractors can promote better cooperation in dispute resolution and better manage their relationship. Drawing on governance mechanism literature, we argue that trust can be approached from the goodwill dimension and the competence dimension, while contract can be approached from the control function and the coordination function in the construction industry. These dimensions of trust and contract may interrelated with each other in promoting the development of dispute negotiation strategy. As our research is in progress, subsequent empirical studies are expected to test our theoretical model and focus on each dimension of the constructs in more detail is needed.
| Item Type: | Conference Paper (Paper) |
|---|---|
| Uncontrolled Keywords: | dispute resolution; governance mechanisms; trust; contract; negotiation; relationship management |
| Index terms: | drawing, general contractor, strategy, dispute, contractor-subcontractor relationship, performance outcome, governance, cooperation, interaction, construction industry, dimension, resolution, negotiation, subcontractor, coordination, construction process, empirical study, relationship management, competence |
| Subjects: | management, research methods, contract management, personnel development, conflict resolution, building construction, industry analysis, behavioral psychology, business, value management, dispute resolution, practitioner, psychology, technical documentation, health monitoring assessment and metrics |
| Topics: | Business Strategy, Health and Safety, Research Practice, Project Management, Stakeholder Management, Roles and Professions, Governance, Legal Issues, Design Practice, Human Resources, Contract Administration, Site Management, Organizational Design |
| Descriptive scope: | 4 PCTA |
N.B. Descriptive scope is a count of how many of the five facets of empirical research are indicated by the words used in title, abstract and keywords. It is not intended as a judgement on the research; merely a count of the kind of word we would expect to indicate Phenomenon, Concepts, Theoretical framing, Empirical techniques, Analytical techniques. If all five are present, then a code of “5 PCTEA” will indicate this. If you feel the coding for this record is questionable, we welcome discussion around the terms we matched or the way we categorized them. The facet you would expect may not be coded, or a facet may be coded inappropriately. This can also bear on a larger question, of which facets should be treated as defining in construction management research. Please get in touch, and we will look at it. More details here