Anita Cerić, author of Trust in Construction Projects discusses the importance of her new book.
Why did Trust in Construction Projects need to be written?
My book is based on ten papers presented at conferences and published in journals over five years. The book itself took another year to shape. The research underlying the papers evolved from step to step without any prior notion of where it would lead me. It was based on the principal-agent theory and the notion of information asymmetry, for which three economists got Nobel prizes in 2001. The theory turned out to be important in several fields close to management, such as sociology and psychology. One of its essential features is that it explicitly acknowledges opportunistic behavior between principals and their agents involved in any enterprise. In construction projects, principals are project owners and contractors are the key agents.
The very notion of opportunistic behavior is refreshing in economics and other fields associated with management. It has long been neglected on the assumption that there is no asymmetry of information between parties. Everything was assumed to be above the table. But it’s amazing how weary of the concept of opportunism are many people in construction project management to this day. The notion that both principals and agents operate with self interest in mind is regularly taken as outright unappealing, and maybe also wrong. Quite a few researchers in the field prefer not to think about transactions between principals and agents that are under the table.
Over the years, I was often surprised by the reactions of some among my colleagues in construction project management research. I had many difficulties with my papers both at conferences and in journals. The very idea of opportunistic behavior was quite foreign. After much struggle with all the papers, I decided to bring them together in a book and to present my research as a whole. I believe that my findings will have a much better chance to be understood and accepted this way. By themselves, all the papers did not have the impact I believed they deserved on account of the underlying research and its foundation in theory.
What findings in writing the book surprised you?
Well, what findings didn’t surprise me? But two main results of the research presented in the book surprised me most. Before I begin, let me introduce the main parties in my research. They are the project owner as principal and contractor as agent. However, both of them have project managers as agents. These project managers are contractually bound to their principals, but there is no contract between them. The relationship between the project managers is thus of special interest in the field of construction project management. By the way, the same holds when other parties to a construction project are introduced—say, the designer, the structural engineer, and so on.
Returning to my surprises, I learned that the project owner’s and contractor’s project managers are key to the construction phase, which often takes years to complete in large and complex construction projects. Their principals play only subsidiary roles in this phase. This was an important finding, which came directly from the project managers surveyed, who had a lot of experience with large and complex construction projects around the world. The second thing that I learned was that the best strategy to make the project owner’s and contractor’s project managers work closely together is trust. This came out of another survey of project managers. Now, these two findings came from the research itself. I didn’t expect these results, either. The research was thus quite exciting in its own right.
The most important thing I learned, I guess, is that researchers and practitioners in construction project management need to work closely together. As my own research has shown, there is much to learn from each other. In addition, it is essential that trust is at the foundations of the relationship between researchers and practitioners. In the long run, trust is crucial to the development of the entire field.
How is it different from other books in the field?
I am not aware of any other book in the field that comes out of a protracted research program, such as my own. On top of that, the research is based on solid theoretical foundations that span economics, sociology, and psychology, the three fields that underpin the field of management. I don’t wish to sound too peppy about this, but the book is quite unique in its approach and its findings. I can only hope that some “competition” will appear soon enough.
What do you hope readers will take from this book?
My greatest hope is that both researchers and practitioners in the field of construction project management will take the book as a point of departure for improving it over time. The key role of trust as a positive phenomenon gives me most hope. But it is important to understand that opportunistic behavior in many of its guises is always lurking in the background. It needs to be understood much better than is the case at present before the field can be improved.
I should also mention that I hope that the book will prompt some rethinking in the principal-agent theory, as well. The situation in which two or more agents, such as project managers, tend to dominate their principals requires careful scrutiny. This is likely to be happening in several fields, not only in construction project management. Here, the question is how best to control the agents, for they can cooperate to the best advantage of their principals, but they can also behave opportunistically. That is, they can collude to cater to their own interests, rather than those of their principals.
What are some of the controversies surrounding the book?
As I suggested in my responses to a couple of previous questions, I believe that it’s essential for both researchers and practitioners in construction project management to understand that opportunistic behavior is part and parcel of economic transactions of all sorts. After all, construction is quite famous for corruption in all its forms. We need to understand all this much better so as to be better able to deal with it. In fact, it is surprising how little research goes this way. It is as though everything is just as it ought to be, which is hardly the case.
Returning to the research on which this book is based, it is most interesting that trust plays such an important role in the field. This comes from the very possibility that many things can go awry during construction projects, which often take years to complete. Without trust, it would be nearly impossible to complete large and complex projects.
This is important to emphasize because many researchers and practitioners in the field believe, wrongly, that everything can be fixed by contracts. Contracts are important, no doubt, but they do not come even close to covering so many things that can go wrong in large and complex projects. As the research presented in my book shows, most relationships between parties in construction projects are non-contractual. Simply put, they are regulated by contracts only indirectly, if at all. As I already mentioned, the project owner’s and contractor’s project managers are in a non-contractual relationship to begin with. And this is precisely why trust between them comes to the fore.
Can you offer some guidelines for the development of the field?
I believe that the key to the construction project management is better communication between all the parties involved. This is why the book ends with a proposal for further work on communication protocols guiding the entire effort. This is where trust is of the essence one more time. Namely, trust between parties to a construction project needs to be developed and maintained. Crucially, it needs to be repaired rather quickly in the case distrust appears between the parties. Trust needs to be rebuilt as fast as possible in order to ensure successful project completion. For instance, trust facilitators may be required to avoid serious difficulties. Communication protocols are needed to make this process smooth and balanced. The theoretical foundations provided by the book are crucial in coming up with the right guidance from start to finish of construction projects. For this reason, further research on communication protocols is needed, as I argue in the concluding chapter of my book.
The relationship between project managers representing project owners and those on the contractor side is often threatened by communication risk. The main communication risk minimization strategy in the construction phase is trust, which plays a major role in the success of key working…
Hardback – 2015-11-26