How to avoid disputes in the Construction Industry
Disputes within the Construction industry, as with any industry, are unavoidable but in recent years these disputes have fallen by 47%, far below the global average.
Despite this drop the number of mega-projects, such as Hinkley Point C Nuclear Site, are increasing. This means that processes are far more complex; from the contracts to the amount of people involved. As a result, there has been a significant increase in the time it takes to resolve each case with reports showing that the average length of time to solve a dispute is 12.8 months – a 28% increase on last year.
Failing to Properly Administer Contracts
Another worrying trend for the industry is the issue surrounding the failure to properly administer contracts. This has continued to be the number one cause of disputes within Construction and almost two-thirds of those who responded to Arcadis Global Construction Disputes Report 2019 felt that if contracts were administered, then these disputes could be avoided together.
How can the industry solve the issue?
Arcadis have identified that the number one way to help resolve issues relating to contracts, is to introduce clearer, more in depth training to those who are involved with this process, (). Many have also expressed the importance of bringing in an experienced industry advisor to prevent miscommunication and misunderstandings during the initial stages of a contract thus avoiding potential issues arising further down the line.
The need to identify these issues, either before they have happened or early on, is crucial and cannot be downplayed. What may have started out as a minor issue, can quickly escalate into something far bigger, so addressing the issue quickly can reduce disruption and associated costs.
Collaboration across the Built Environment Supply Chain
Ensuring that there is a solid relationship across the supply chain is another key factor in helping to mitigate possible disputes or avoid them altogether. If all parties across the supply chain can focus on building a long-term plan, whereby they outline their proposal in detail and make sure that they communicate with each department regularly, then potential issues can be foreseen and it is more likely that they will be eradicated before progressing into something bigger.