Influence of Negotiation Risk Attitude and Power on Behaviors and Outcomes When Negotiating Construction Claims

Abstract

When confronted with construction claims, negotiation is always the preferred method for owners and contractors. The authors conducted a questionnaire survey to explore the correlation between negotiation risk attitude and power as well as the influence of these two parameters on behaviors and outcomes in construction claim negotiations. The results indicate that to some extent, negotiation risk-taking is correlated with high power. The risk taker usually performs collaborating behaviors (better than avoiding and obliging), while the risk averter always adopts obliging behaviors (which are proved to be less beneficial than collaborating and avoiding). The risk averter enjoys a remarkable increase in reaching better outcomes with an increasing degree of adopting dominating behaviors. The high-power party with frequently used dominating behaviors has access to better outcomes than the low-power party while the low-power party that commonly uses obliging behaviors is more likely to face deterioration. The findings can be used by construction practitioners as references to evaluate their negotiation risk attitude and power in negotiations. Consequently, they can adjust their negotiation strategies accordingly to achieve better outcomes.