Critical factors affecting the practice of alternative dispute resolution methods in building projects in Sri Lanka

Abstract

The construction industry is a unique and complicated industry that interacts with a variety of stakeholders with differing attitudes, abilities, and degrees of knowledge in the construction process, all of whom must work together to achieve their own objectives and realize their own benefits. Therefore, conflicts, disputes and claims are higher in the construction industry while comparing with other industries. Disputes can arise at any time during the period of a construction project. A dispute is one of the key factors which burdens the successful completion of the project. Mechanism adopts to resolve any dispute arises during the execution of construction project is vital to the success of a project. There are two main ways of resolving disputes in a construction project which are litigation and Alternative Dispute Resolution methods. Due to the disadvantages in Litigation, ADR mechanisms are commonly used mechanisms to settle dispute in the construction industry. However, existing ADR mechanisms are also have various demerits. It is important to identify the factors which are affecting on building projects in Sri Lanka to promote and effectively use ADR methods as a dispute resolution mechanism. The literature review was used to develop research framework for this study. Through literature review, twenty-two factors that are affecting the practice of ADR methods in the building projects were found. Then, a questionnaire survey has been undertaken to identify the impact of those factors on the practice of ADR methods in the building projects in Sri Lanka. Data collected through the questionnaire survey was analysed using mean weighted rating and identified twenty two factors were ranked according to the significant level of factors. As an example, the top five factors are savings in cost, the enforceability of the decision, the flexibility of procedure, savings in time, and reduction in project disruption. Finally, the findings of this research can be used to develop a model to select the most suitable ADR method by comparing it with the other available ADR methods and developing new ADR methods to mitigate the drawbacks of existing ADR methods.