A study on the impact of contractor-subcontractor relationships on the performance of construction projects: a case study of the Kenyan Construction Industry

Abstract

Subcontracting in the construction industry has greatly increased In recent years. In most construction projects, especially building projects, it is common for 80 to 90% of the work to be performed by subcontractors. Subcontracting is used much more extensively on housing and building construction projects than on engineering and industrial projects (Clough, Richard & Sears 1994).

There is evidence that constructions project performance in Kenya is poor. An important component of the project life cycle is the chain supply management function whose aim is the coordination of all parties to meet the objectives of the project. The involvement of subcontractors in a building construction project results to relationship with the main contractor and this may have an influence on the performance of the construction projects.

The aim of the study was to investigate the effect of main contractor-subcontractor relationship in performance of a construction project. The study adopted descriptive survey techniques to examine the underlying factors influencing the relationship between main contractors and subcontractors with a view to determining their effect on the performance of construction projects.

The findings of the study confirmed that most contractors (90%) depend on subcontractors for execution of their works and therefore procurement and management of subcontractors highly affects the performance of construction projects. It further established that 70-90% of the work is performed by subcontractors. The main reasons contractors engaged subcontractors were to provide skilled labour, reduce overhead costs and minimise work and financial pressure on the contractors.

The study recommends for cooperative relationships and mainly integration of subcontractors into partnering approach in order to reduce adversarial relationships. In addition, simplified and comprehensive subcontracts would improve relationship between main contractors and subcontractors for effective construction project performance.