An Investigation into the systems used to select contract forms for construction projects in Kuwait

Abstract

The construction industry plays a vital role in the economic development of Kuwait, and the selection of appropriate contract forms for construction projects is a pivotal decision that directly impacts project outcomes. This research aims to investigate the existing system for the selection of contract forms in Kuwait's construction projects and develop strategies for improving existing practices. The objectives of the research included: a critical analysis of the existing system in place for the selection of contract forms on construction projects in Kuwait; the development of a conceptual framework on best practices for contract form selection; proposing and validating strategies for improving contract form selection process in Kuwait. Kuwait's "New Kuwait 2035" vision has positioned the construction sector as a strategic priority for economic growth and development. However, the existing system for selecting construction contract forms faced challenges related to project delays, cost overruns, and contractual disputes. Motivated by the need to enhance the efficiency and effectiveness of the construction industry, this research undertook a comprehensive analysis of the current state of construction contracts in Kuwait. To achieve the research objectives, a mixed-methods approach was adopted combining a comprehensive literature review, quantitative data collection through questionnaires from construction professionals, and qualitative data collected via in-depth interviews with experts and stakeholders in the Kuwaiti construction industry. The research revealed that various construction contract forms are prevalent in Kuwait, Standard domestic form (CAPT forms) with Design bid build and lump sum contracts being the most commonly used. Selection of contract forms often lacked a systematic approach and was influenced by factors such as project type, complexity, and client preferences. The survey data reveals that the current contract selection process in Kuwait faces challenges related to inefficiencies, risk allocation and resource mismanagement. The qualitative findings echo these concerns, indicating the importance of a new approach. Furthermore, a critical analysis of the existing system identifies shortcomings in contract selection processes and risk allocation. The findings of this research have significant implications for Kuwait's construction industry. The development of a systematic framework for contract form selection is crucial for enhancing the sector's efficiency, reducing disputes and optimising project outcomes. Real Options Theory guides contract selection, treating projects as options to manage choices over time. In Kuwait's uncertain construction projects, ROT integration empowers stakeholders to evaluate contracts strategically for long-term success. The research contributes to bridging the existing knowledge gap in the current method used for selecting contract forms by introducing a strategy framework that integrates theoretical and legal frameworks to select the suitable type of contract form related to the nature of the project, size, type, sector, responsibility and funding sources by using a Multi-Criteria Decision Making (MCDM) approach.