Partnering: Contracting for the Future

Abstract

The construction industry must seek new strategies to lower costs and to gain a competitive advantage in a changing business environment. Partnering is one approach to conducting business in this new environment. This paper discusses the concept of partnering as a contracting strategy for construction companies and engineering firms. First, partnering is defined and key elements of partnering are addressed. These key elements include commitment, trust, and mutual advantage and opportunity. A discussion of partnering as a contracting strategy examines the use of partnering as a means to form strategic alliances for growth and as a means to strengthen a firm's competitive position. Barriers to the growth of partnering exist, and these barriers are presented. Some current partnering relationships are identified, and the paper concludes by presenting some guidelines on partnering. The guidelines pertain to partnering strategy development, partner selection, contract negotiation, and implementing a partnering agreement.