Alternative Dispute Resolution Selection Framework to Settle Disputes in Public–Private Partnership Projects

Abstract

Effective use of alternative dispute resolution (ADR) methods is critical because disputes are one of the biggest concerns in public–private partnership (PPP) projects. However, decision makers still struggle to implement ADR effectively due to limited knowledge about selecting the most appropriate ADR method that meets the needs of their PPP projects. Although some research has been conducted to develop approaches for ADR selection, most of these studies ignored critical points such as PPP projects and inherent characteristics of disputes. Moreover, fuzzy set logic and integrated multicriteria decision-making (MCDM) methods have not usually been chosen in these studies, posing various limitations. This study aimed to bridge these gaps by proposing a decision support framework for decision makers in selecting the most appropriate ADR method to settle disputes in PPP projects. Initially, an in-depth literature review was conducted to design the initial version of the framework. Then, the focus group discussion (FGD) sessions were organized and subject matter experts refined the draft framework. In total, a list of 16 selection factors and 30 dispute types were identified through literature review and the FGD sessions. At the final step, fuzzy analytic hierarchy process (AHP) and integrated fuzzy AHP and fuzzy TOPSIS were performed to determine the priority of each ADR method for each dispute scenario. Results showed that ADR selection is strongly influenced by inherent characteristics of dispute types. In other words, an ADR method cannot settle all dispute types, and thus, inherent characteristics of dispute types should also be considered during the ADR selection. Second, dispute management in PPP projects necessitates project-specific approaches. Thus, decision makers should not rely fully on standard contract forms such as those of the International Federation of Consulting Engineers (FIDIC). By developing a specific ADR selection framework for PPP projects by considering dispute types, this study significantly contributes to the theory of ADR domain and has important managerial implications.