The commercial baseline
Collaboration costs money. Bringing the right people together, sharing information and working through the consequences of a decision all require time and resources. On a complex construction project, that expenditure can be considerable. I believe it is worth making, but we need to be more careful about what we include in the cost of collaboration and what we accept, almost without examination, as the ordinary cost of delivering a project.
The construction industry has developed sophisticated arrangements for protecting the separate commercial interests of its participants. Those arrangements influence how we employ people, organise information and approve decisions. When collaborative working is introduced, much of this machinery may remain in place alongside the new processes. The resulting expenditure is readily attributed to collaboration, although part of it may arise from changing established practices or maintaining two systems at once.
My proposition is that we have institutionalised adversarial commercial management to such an extent that its costs have become our accepted baseline. Collaboration then has to justify expenditure that is visible and unfamiliar, while the established approach escapes an equivalent assessment. Neither approach should be assumed efficient without examining what its administration costs and what that expenditure achieves.
Entitlement and the delivery response
A delay illustrates the difficulty. An event threatens completion, and the contractor begins examining its entitlement to additional time and payment. Its commercial team checks the notice requirements, the records and the likely effect on the programme. The client examines the same event to establish its own position. Both organisations may undertake detailed analyses before they agree on what has happened, let alone what should follow.
There are sound reasons for this work. The parties need to understand their obligations and the financial consequences of their decisions. A contractor cannot reasonably be expected to disregard an entitlement, and a client should not pay an unsupported claim. Reliable records and timely notices can also help the people managing delivery. The difficulty arises when establishing responsibility consumes the attention needed to deal with the event itself.
The people who understand the design, construction sequence and operational constraints may be able to identify a better response. A change to access arrangements might allow work to continue. A different sequence might reduce the delay. The client may be able to accept an alternative that the contractor could not propose confidently without understanding the client’s priorities. Identifying the best response requires knowledge held across organisational boundaries, brought together while there is still time to act.
The parties can investigate entitlement while considering mitigation together. Yet their systems may give far greater urgency to preserving the commercial position. A missed notice is readily identified and attributed to an individual. An opportunity to reduce delay that nobody explored may leave very little trace. That difference in accountability can direct attention towards protecting entitlements even while opportunities to improve delivery are being lost.
Commercial managers, quantity surveyors and planners have acquired considerable expertise in establishing what happened and who should bear the consequences. Their work is valuable, including on collaborative projects. How organisations direct that expertise matters. A planner reconstructing a past delay and a planner examining how to avoid a future one may use similar skills, but contribute differently to the management of the project.
The allocation of effort is reinforced through internal reporting and performance measures. Where success is judged principally by the value of claims recovered or resisted, staff have a clear reason to concentrate on those outcomes. A project team may be encouraged to collaborate while its members remain accountable to separate organisations applying different tests of commercial success. Changing the wording of the contract does not, by itself, resolve that tension.
Intentions and established practice
Eriksson (2008) surveyed 87 Swedish construction clients and found that procurement procedures favoured competition, with previous experience strongly influencing subsequent choices. Although two-thirds of respondents wanted greater cooperation with contractors, that preference was not reflected in their procurement decisions. The study concerns a particular market and period, but demonstrates how an intention to cooperate can coexist with arrangements that perpetuate familiar behaviour.
Bresnen, Lennie and Marshall (2025) identify continuing difficulties in translating partnering into practice, including competing commercial orientations and institutional influences. Their review cautions against assuming that adopting a collaborative approach will produce uniform results. It directs attention to how collaboration is practised within and between organisations, beyond the description of the contractual relationship.
Overlapping systems and processes
Consider a contractor introducing NEC4 on one project within a portfolio delivered mainly under other forms. The contractor still needs the systems and competencies required elsewhere in its business. Its reporting arrangements and approval procedures will reflect that wider workload. Training a project team in the new contract does not immediately change the organisation to which the team reports.
The project may establish an Early Warning Register alongside an existing internal risk register. The same emerging problem may be discussed in a joint meeting, reviewed internally by the commercial team and presented again through a corporate reporting process. Some separation serves a legitimate purpose. The contractor will have confidential commercial matters, and specialist safety or environmental controls require appropriate records. Duplication arises where the same information is repeatedly entered, reviewed and approved without improving the decision or its execution.
Programme management can develop in a similar way. A contractor may prepare one programme to manage construction and another to satisfy what it regards as a contractual submission requirement. If the two accounts diverge, the team spends time reconciling them and loses confidence in both. The problem is particularly acute where the people planning the work and those administering the contract do not use the same current information.
These examples are consistent with concerns identified by Gharouni Jafari, Mottee and Whyte (2025). Their qualitative study drew on 27 interviews concerning Australian water infrastructure projects using NEC4. It identified difficulties involving contract implementation, collaboration competencies, and systems and processes across office and site teams. Participants described information platforms that did not work across organisational boundaries, including the burden of using their own systems alongside those of another organisation. These emerging findings show how supporting systems can obstruct the collaboration a contract is intended to encourage.
Their earlier conference paper also makes a useful distinction between aligning incentives, coordinating activities and being able to work together in practice. Its emerging findings emphasise the skills and workflows needed to limit disruption in collaborative water infrastructure projects (Gharouni Jafari, Mottee and Whyte, 2024). Agreement on a common objective does not ensure that information reaches the right person or that a decision can be acted upon.
These studies support examining how collaboration works in everyday practice. They do not establish how much of its apparent cost arises from introducing it into organisations shaped by adversarial commercial management. Testing that proposition requires a comparison of actual costs and practices over time.
Learning costs and continuing costs
The distinction remains important. Joint planning and the exchange of relevant information require continuing effort throughout delivery. Training staff, adapting systems and revising delegated authority involve expenditure that should, in part, reduce as experience develops. Overlapping procedures may persist for longer, especially where collaborative contracts account for a small proportion of an organisation’s work. An individual project can therefore carry costs associated with a wider business that has only partly changed.
If successive projects repeat the same familiarisation work, develop procedures afresh and encounter the same internal approval difficulties, the organisation is failing to retain what it has learned. Treating all that expenditure as a recurring cost of collaboration obscures an opportunity to improve implementation. Equally, removing a process merely because it appears traditional would be poor management. Its purpose and the assurance it provides need to be understood before it is altered.
Assessing cost and value
The baseline deserves the same scrutiny. The costs of preparing claims, reviewing competing analyses and maintaining protective correspondence are usually absorbed into normal management expenditure. Formal dispute costs are easier to recognise, but a project can spend considerable resources preparing for disagreements that never reach adjudication, arbitration or litigation. An absence of formal disputes does not establish that the commercial relationship has been economical to administer.
Haaskjold, Andersen and Langlo (2023) illustrate the scale of management expenditure. Analysing 134 Norwegian construction projects, they found that client and contractor project management accounted for approximately 18 per cent of total project cost on average. That figure includes necessary management activity; it neither measures adversarial behaviour nor represents a saving that collaboration could simply deliver. It does, however, show that management expenditure is substantial enough to warrant examining how it is used and what value it produces.
An assessment of collaboration should therefore extend beyond the additional hours recorded against workshops or joint meetings. It should consider management expenditure across the parties, the effect on delivery and the cost of decisions made too late. Comparisons also need to account for project complexity and organisational experience. Otherwise, the cost of learning may be mistaken for a permanent disadvantage, or an inherently difficult project may be treated as evidence against the method selected to manage it.
There is also a timing problem. The expense of training and establishing joint processes appears early. The value of resolving an interface before it delays construction appears later and may be difficult to isolate. A dispute that has been avoided produces no invoice recording the saving. These difficulties do not excuse vague claims about benefits, but they make comparisons based only on identifiable additional expenditure incomplete.
Making collaboration effective
Collaboration should still be subject to commercial discipline. A meeting attended by people who can neither contribute nor make a decision is expensive regardless of its description. Requiring consensus on matters already within one person’s authority can delay the work. Poorly defined responsibilities and excessive consultation can make a collaborative arrangement cumbersome. Expenditure arising from those failures should be challenged.
Effective collaboration brings together the knowledge and authority needed for the matter at hand. It allows the contractor’s understanding of construction to inform a client decision, and the client’s understanding of its asset and operational needs to inform the contractor’s response. The additional effort is justified where it produces a better outcome than the parties could reasonably achieve through separate action. On complex projects, the consequences of a poorly informed decision can far exceed the cost of involving the people able to improve it.
Making that work requires attention to internal management as well as the relationship between the parties. Approval procedures must allow decisions to be made when the project needs them. Shared information should serve contractual and operational purposes without repeated re-entry. Commercial expertise should inform the choice of response while its consequences can still be influenced. These changes require investment and, in some organisations, a reconsideration of what good commercial performance means.
Clients also need to recognise how their own conduct affects the cost they later observe. A requirement to work collaboratively is difficult to fulfil where decisions repeatedly wait for internal approval or where procurement rewards behaviour inconsistent with that requirement. Contractors face an equivalent responsibility where they commit to a joint approach but direct their teams through measures that reward separate commercial advantage. The operating arrangements need to support the commitment made at tender.
Independent checking and commercial disagreement will remain. The parties still need to account for expenditure and protect legitimate interests. The skills of the commercial professions are central to understanding options and reaching decisions that can be implemented with confidence. More of that expertise could be applied while the outcome can still be improved, reducing the effort later required to argue about consequences that can no longer be changed.
Investment in better decisions
I regard collaboration as worth paying for because construction projects depend on decisions for which the necessary knowledge is spread across several organisations. Bringing that knowledge together can justify considerable effort where it helps avoid delay, reduce construction costs or deliver a better asset. Achieving those benefits requires us to examine the established practices that make collaboration unnecessarily expensive. The industry has invested heavily in protecting each party when decisions go wrong. Investment in making those decisions well together deserves the same commercial consideration.
Research & commentary
The Cost of Collaboration
Abstract
Collaborative contracting requires investment, but some expenditure attributed to collaboration may arise from the construction industry’s established commercial practices. This paper argues that adversarial commercial management has become institutionalised within organisational structures, reporting systems and professional roles. Introducing collaborative working into that environment can involve transitional expenditure and the continued operation of overlapping processes. Drawing on research into construction procurement and collaboration, including studies of Australian water infrastructure projects using NEC4, the paper distinguishes these costs from the continuing resources needed to work effectively together. Their relative significance requires empirical investigation. Assessing collaboration solely by its additional administrative demands nevertheless overlooks the accepted costs of defensive commercial management and the value of better project decisions. The paper argues for investment in effective collaboration, supported by changes to the organisational practices that make it unnecessarily expensive.
The commercial baseline
Collaboration costs money. Bringing the right people together, sharing information and working through the consequences of a decision all require time and resources. On a complex construction project, that expenditure can be considerable. I believe it is worth making, but we need to be more careful about what we include in the cost of collaboration and what we accept, almost without examination, as the ordinary cost of delivering a project.
The construction industry has developed sophisticated arrangements for protecting the separate commercial interests of its participants. Those arrangements influence how we employ people, organise information and approve decisions. When collaborative working is introduced, much of this machinery may remain in place alongside the new processes. The resulting expenditure is readily attributed to collaboration, although part of it may arise from changing established practices or maintaining two systems at once.
My proposition is that we have institutionalised adversarial commercial management to such an extent that its costs have become our accepted baseline. Collaboration then has to justify expenditure that is visible and unfamiliar, while the established approach escapes an equivalent assessment. Neither approach should be assumed efficient without examining what its administration costs and what that expenditure achieves.
Entitlement and the delivery response
A delay illustrates the difficulty. An event threatens completion, and the contractor begins examining its entitlement to additional time and payment. Its commercial team checks the notice requirements, the records and the likely effect on the programme. The client examines the same event to establish its own position. Both organisations may undertake detailed analyses before they agree on what has happened, let alone what should follow.
There are sound reasons for this work. The parties need to understand their obligations and the financial consequences of their decisions. A contractor cannot reasonably be expected to disregard an entitlement, and a client should not pay an unsupported claim. Reliable records and timely notices can also help the people managing delivery. The difficulty arises when establishing responsibility consumes the attention needed to deal with the event itself.
The people who understand the design, construction sequence and operational constraints may be able to identify a better response. A change to access arrangements might allow work to continue. A different sequence might reduce the delay. The client may be able to accept an alternative that the contractor could not propose confidently without understanding the client’s priorities. Identifying the best response requires knowledge held across organisational boundaries, brought together while there is still time to act.
The parties can investigate entitlement while considering mitigation together. Yet their systems may give far greater urgency to preserving the commercial position. A missed notice is readily identified and attributed to an individual. An opportunity to reduce delay that nobody explored may leave very little trace. That difference in accountability can direct attention towards protecting entitlements even while opportunities to improve delivery are being lost.
Commercial managers, quantity surveyors and planners have acquired considerable expertise in establishing what happened and who should bear the consequences. Their work is valuable, including on collaborative projects. How organisations direct that expertise matters. A planner reconstructing a past delay and a planner examining how to avoid a future one may use similar skills, but contribute differently to the management of the project.
The allocation of effort is reinforced through internal reporting and performance measures. Where success is judged principally by the value of claims recovered or resisted, staff have a clear reason to concentrate on those outcomes. A project team may be encouraged to collaborate while its members remain accountable to separate organisations applying different tests of commercial success. Changing the wording of the contract does not, by itself, resolve that tension.
Intentions and established practice
Eriksson (2008) surveyed 87 Swedish construction clients and found that procurement procedures favoured competition, with previous experience strongly influencing subsequent choices. Although two-thirds of respondents wanted greater cooperation with contractors, that preference was not reflected in their procurement decisions. The study concerns a particular market and period, but demonstrates how an intention to cooperate can coexist with arrangements that perpetuate familiar behaviour.
Bresnen, Lennie and Marshall (2025) identify continuing difficulties in translating partnering into practice, including competing commercial orientations and institutional influences. Their review cautions against assuming that adopting a collaborative approach will produce uniform results. It directs attention to how collaboration is practised within and between organisations, beyond the description of the contractual relationship.
Overlapping systems and processes
Consider a contractor introducing NEC4 on one project within a portfolio delivered mainly under other forms. The contractor still needs the systems and competencies required elsewhere in its business. Its reporting arrangements and approval procedures will reflect that wider workload. Training a project team in the new contract does not immediately change the organisation to which the team reports.
The project may establish an Early Warning Register alongside an existing internal risk register. The same emerging problem may be discussed in a joint meeting, reviewed internally by the commercial team and presented again through a corporate reporting process. Some separation serves a legitimate purpose. The contractor will have confidential commercial matters, and specialist safety or environmental controls require appropriate records. Duplication arises where the same information is repeatedly entered, reviewed and approved without improving the decision or its execution.
Programme management can develop in a similar way. A contractor may prepare one programme to manage construction and another to satisfy what it regards as a contractual submission requirement. If the two accounts diverge, the team spends time reconciling them and loses confidence in both. The problem is particularly acute where the people planning the work and those administering the contract do not use the same current information.
These examples are consistent with concerns identified by Gharouni Jafari, Mottee and Whyte (2025). Their qualitative study drew on 27 interviews concerning Australian water infrastructure projects using NEC4. It identified difficulties involving contract implementation, collaboration competencies, and systems and processes across office and site teams. Participants described information platforms that did not work across organisational boundaries, including the burden of using their own systems alongside those of another organisation. These emerging findings show how supporting systems can obstruct the collaboration a contract is intended to encourage.
Their earlier conference paper also makes a useful distinction between aligning incentives, coordinating activities and being able to work together in practice. Its emerging findings emphasise the skills and workflows needed to limit disruption in collaborative water infrastructure projects (Gharouni Jafari, Mottee and Whyte, 2024). Agreement on a common objective does not ensure that information reaches the right person or that a decision can be acted upon.
These studies support examining how collaboration works in everyday practice. They do not establish how much of its apparent cost arises from introducing it into organisations shaped by adversarial commercial management. Testing that proposition requires a comparison of actual costs and practices over time.
Learning costs and continuing costs
The distinction remains important. Joint planning and the exchange of relevant information require continuing effort throughout delivery. Training staff, adapting systems and revising delegated authority involve expenditure that should, in part, reduce as experience develops. Overlapping procedures may persist for longer, especially where collaborative contracts account for a small proportion of an organisation’s work. An individual project can therefore carry costs associated with a wider business that has only partly changed.
If successive projects repeat the same familiarisation work, develop procedures afresh and encounter the same internal approval difficulties, the organisation is failing to retain what it has learned. Treating all that expenditure as a recurring cost of collaboration obscures an opportunity to improve implementation. Equally, removing a process merely because it appears traditional would be poor management. Its purpose and the assurance it provides need to be understood before it is altered.
Assessing cost and value
The baseline deserves the same scrutiny. The costs of preparing claims, reviewing competing analyses and maintaining protective correspondence are usually absorbed into normal management expenditure. Formal dispute costs are easier to recognise, but a project can spend considerable resources preparing for disagreements that never reach adjudication, arbitration or litigation. An absence of formal disputes does not establish that the commercial relationship has been economical to administer.
Haaskjold, Andersen and Langlo (2023) illustrate the scale of management expenditure. Analysing 134 Norwegian construction projects, they found that client and contractor project management accounted for approximately 18 per cent of total project cost on average. That figure includes necessary management activity; it neither measures adversarial behaviour nor represents a saving that collaboration could simply deliver. It does, however, show that management expenditure is substantial enough to warrant examining how it is used and what value it produces.
An assessment of collaboration should therefore extend beyond the additional hours recorded against workshops or joint meetings. It should consider management expenditure across the parties, the effect on delivery and the cost of decisions made too late. Comparisons also need to account for project complexity and organisational experience. Otherwise, the cost of learning may be mistaken for a permanent disadvantage, or an inherently difficult project may be treated as evidence against the method selected to manage it.
There is also a timing problem. The expense of training and establishing joint processes appears early. The value of resolving an interface before it delays construction appears later and may be difficult to isolate. A dispute that has been avoided produces no invoice recording the saving. These difficulties do not excuse vague claims about benefits, but they make comparisons based only on identifiable additional expenditure incomplete.
Making collaboration effective
Collaboration should still be subject to commercial discipline. A meeting attended by people who can neither contribute nor make a decision is expensive regardless of its description. Requiring consensus on matters already within one person’s authority can delay the work. Poorly defined responsibilities and excessive consultation can make a collaborative arrangement cumbersome. Expenditure arising from those failures should be challenged.
Effective collaboration brings together the knowledge and authority needed for the matter at hand. It allows the contractor’s understanding of construction to inform a client decision, and the client’s understanding of its asset and operational needs to inform the contractor’s response. The additional effort is justified where it produces a better outcome than the parties could reasonably achieve through separate action. On complex projects, the consequences of a poorly informed decision can far exceed the cost of involving the people able to improve it.
Making that work requires attention to internal management as well as the relationship between the parties. Approval procedures must allow decisions to be made when the project needs them. Shared information should serve contractual and operational purposes without repeated re-entry. Commercial expertise should inform the choice of response while its consequences can still be influenced. These changes require investment and, in some organisations, a reconsideration of what good commercial performance means.
Clients also need to recognise how their own conduct affects the cost they later observe. A requirement to work collaboratively is difficult to fulfil where decisions repeatedly wait for internal approval or where procurement rewards behaviour inconsistent with that requirement. Contractors face an equivalent responsibility where they commit to a joint approach but direct their teams through measures that reward separate commercial advantage. The operating arrangements need to support the commitment made at tender.
Independent checking and commercial disagreement will remain. The parties still need to account for expenditure and protect legitimate interests. The skills of the commercial professions are central to understanding options and reaching decisions that can be implemented with confidence. More of that expertise could be applied while the outcome can still be improved, reducing the effort later required to argue about consequences that can no longer be changed.
Investment in better decisions
I regard collaboration as worth paying for because construction projects depend on decisions for which the necessary knowledge is spread across several organisations. Bringing that knowledge together can justify considerable effort where it helps avoid delay, reduce construction costs or deliver a better asset. Achieving those benefits requires us to examine the established practices that make collaboration unnecessarily expensive. The industry has invested heavily in protecting each party when decisions go wrong. Investment in making those decisions well together deserves the same commercial consideration.
References
Bresnen, M., Lennie, S.-J. and Marshall, N. (2025) ‘Partnering in construction re-visited: gauging progress in industry practice and prospects for advances in academic research’, Construction Management and Economics, 43(1), pp. 59–77. First published online 24 October 2024. https://doi.org/10.1080/01446193.2024.2416035 (opens in a new tab)
Eriksson, P.E. (2008) ‘Procurement effects on coopetition in client-contractor relationships’, Journal of Construction Engineering and Management, 134(2), pp. 103–111. https://doi.org/10.1061/(ASCE)0733-9364(2008)134:2(103) (opens in a new tab)
Gharouni Jafari, K., Mottee, L. and Whyte, J. (2024) ‘Effective collaboration in collaborative infrastructure projects’, paper presented at the 37th Australian and New Zealand Academy of Management Conference, Wollongong, Australia, 3–5 December. Available at: Author manuscript on ResearchGate (Accessed: 15 October 2026).
Gharouni Jafari, K., Mottee, L. and Whyte, J. (2025) ‘Collaborating between the construction office and the construction site under collaborative contracts’, in GhaffarianHoseini, A., Ghaffarianhoseini, A., Rahimian, F. and Purushothaman, M.B. (eds) Proceedings of the International Conference on Smart and Sustainable Built Environment (SASBE 2024). Lecture Notes in Civil Engineering, 591. Singapore: Springer, pp. 526–533. https://doi.org/10.1007/978-981-96-4051-5_51 (opens in a new tab)
Haaskjold, H., Andersen, B. and Langlo, J.A. (2023) ‘Dissecting the project anatomy: understanding the cost of managing construction projects’, Production Planning & Control, 34(2), pp. 117–138. First published online 20 April 2021. https://doi.org/10.1080/09537287.2021.1891480 (opens in a new tab)
This article is intended to provide general commentary and insights on construction, commercial and dispute resolution matters. It is not legal, contractual or professional advice and should not be relied upon as such. Specific advice should always be sought in relation to individual projects and circumstances.
Steven Evans
Related training
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Further reading
All articles →Construction Contracts: Risk Allocation Is Not Risk Management
NEC4: Integrating Early Warning with Project Risk Management
NEC4: When the Project Manager Lacks Authority