Culture change through the use of appropriate pricing systems

Abstract

Purpose

The purpose of this paper is to show how practitioners have not fully responded to calls for change in culture. Given that construction teams are motivated by several key factors including money, payment systems may play a major role in facilitating this change. Traditional pricing methods are still found to be the most popular system but often criticised for their contribution to the adversarial culture witnessed in the industry. Alternative pricing systems aimed at aligning constructors' behaviour with clients' objectives are emerging. As a result, the choice of an appropriate pricing system must be based on the circumstances surrounding the project and the likelihood that the system is to influence behaviour positively. This paper aims to propose an analytical hierarchic process (AHP) to help the industry do that.

Design/methodology/approach

The AHP consists of a MCDM hierarchy structure, pair‐wise comparisons, and the calculation of the relative priorities of MCDM attributes. The attributes used have been identified through a series of interviews followed by postal questionnaires.

Findings

The paper results in the development of a decision aid tool for use by the industry to select appropriate pricing systems. This tool identifies seven project objectives as being important for deciding on what pricing system to adopt.

Originality/value

There has been limited research on how pricing systems are being selected, or should be selected. The novelty of this paper stems from the subject area being addressed, rather than the methodologies being adopted.

Citation

Kaka, A., Wong, C., Fortune, C. and Langford, D. (2008), "Culture change through the use of appropriate pricing systems", Engineering, Construction and Architectural Management, Vol. 15 No. 1, pp. 66-77. https://doi.org/10.1108/09699980810842070