Enhancing Claims Management in the Construction Industry Using Analytic Hierarchy Process

Abstract

The complexity of the construction industry makes it vulnerable to disputes and claims, emphasizing the necessity for an effective claims management system. Despite its critical importance, limited research on identifying and prioritizing key factors for efficient claims management exists. This study addresses this gap by using data from Kuwait’s construction sector, which is characterized by distinctive challenges, including reliance on heavily amended International Federation of Consulting Engineers (FIDIC) contracts, fragmented regulatory oversight, delayed payments, and lowest-bid procurement practices. The methodology began with a comprehensive literature review to identify factors influencing claims management efficiency, followed by a pilot survey with seven industry experts to refine factors. Forty-six factors were identified and structured into a four-level hierarchy: goal, criteria, subcriteria, and factors. Using the analytic hierarchy process (AHP), these factors were prioritized through a questionnaire distributed to 51 respondents. Results indicated that strategic criteria, particularly those related to the pre-tender phase, are more effective than operational criteria during construction. The AHP consistency index confirmed the robustness of these assessments. Findings suggest that enhancing contract documentation and establishing clear claims mitigation procedures, agreed upon by all project parties from the outset, can significantly improve claims management. The results provide valuable insights for enhancing claims management in Kuwait’s construction environment or similar contexts.