please get one sentence the most take away and one-sentence criticism from this article How do contract types and incent

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please get one sentence the most takeaway and one-sentencecriticism from this article
How do contract types and incentives matter to projectperformance?
Abstract
How collaborative contracts and contractual incentives mightinfluence project performance remains equivocal. We hypothesizedthat their effects on project performance are mediated byowner–contractor collaboration, measured in terms of relationalattitudes (relational norms and senior management commitment) andteamworking quality (inter-team collaborative processes). UsingPLS-SEM, we analyzed a sample of 113 capital projects. The resultssuggest that through better relational attitudes and teamworkingquality, projects with a partnering/alliance contract are likely toperform better than those with lump-sum and reimbursable contracts.Likewise, the projects with incentive contracts are likely toperform better than those without incentives through betterrelational attitudes and teamworking quality. There were nodifferences in project performance directly associated withdifferent contract types and contractual incentives. Takentogether, a partnering/alliance contract and incentive contracts donot necessarily result directly into better project performance butthrough relational attitudes and how they play out into actualteamworking behavior.
1. Introduction
There is a wide agreement that the choice of contract typesshould be contingent upon various circumstances such as productand/or process uncertainty, desired allocation of risk, ownerin-house capability, and market conditions (Merrow, 2011, Turner,2003, Turner and Simister, 2001, Walker and Rowlinson, 2008). Aproper contract type is chosen to encourage the owner andcontractor to work rationally together to achieve the best outcomesin accordance to their common objectives and within the expectedrisk (Morris and Pinto, 2007, PMI, 2008, Smith, 2002, Turner, 2009,Walker and Rowlinson, 2008). However, two separate empiricalstudies at different times by CII (1986) and IPA (2010) suggestthat there is no clear or direct relationship between the contracttype and project performance. CII suggests that regardless of thechoice of contract type, the real issues that affect the projectcost performance are associated with the alignment between ownerand contractor and their agreement in allocating and managing risk.In a similar vein, IPA suggests that any contract type can deliversuccess or failure because contract is a second-order concern. Onecontract type may work well for some owners but fail for othersbecause different contract types bring different difficulties andsituations.
In this study we focused on three basic types of contractsunderlying the relationship between owner and contractor in theexecution of capital projects: lump-sum or fixed price,reimbursable, and partnering/alliancing (Smith, 2002, Turner, 2003,Turner and Simister, 2001). A lump-sum contract is a contract wherethe contractor is paid a fixed amount for the whole scope of worksdefined in the contract. A reimbursable contract, commonly calledcost reimbursable contract is a contract where the owner reimbursesthe contractor for all costs, reasonably incurred and directlyassociated with the amount of work done for the project; plus acertain fee (fixed fee or percentage fee) and/or an incentive fee(Berends, 2006, Merrow, 2011). A partnering/alliance contract is anextension to reimbursable contract where the owner and thecontractors (often including specialist contractors and keysuppliers) jointly establish the target out-turn cost and share thegain and/or pain resulting from the actual cost (Meng andGallagher, 2012, Ross, 2003, Turner, 2003).
What is the potential influence of different contract types(partnering/alliance versus lump-sum versus reimbursable) on thenature of the relationship between owner and contractor? On oneextreme, the lump-sum contract demands less owner intervention (orless involvement) and therefore offers more flexibility and lessadministrative burden to the contractor in executing a project(Berends, 2006, Lowe, 2007). But it also has some perceiveddrawbacks. A lump-sum contract is often considered to create anadversarial relationship between the parties in dealing withchanges of circumstances during the project execution (Smith, 2002,Turner and Simister, 2001). The reimbursable contract, in contrast,implies that more owner involvement and support can be expected andthus less barriers to building a collaborative relationship and anintegrated team (Berends, 2006, Smith, 2002). But a reimbursablecontract also has some drawbacks from the one party's perspectivetoward the other party (Berends, 2006, Smith, 2002). The contractoroften perceives that the owner will be more demanding for achievingtarget cost and schedule. On the other side, the owner perceivesthat the contractor will come up with additional work and therebyincrease costs over what was initially estimated. In the end, lumpsum and reimbursable contracts have a quite similar implication onowner–contractor collaboration (Müller and Turner, 2005).
On the other extreme, a partnering/alliance contract focuses onthe ‘principles’ of relational contract to change projectparticipants' attitudes from being short-term and adversarialtoward a more collaborative mind-set and behavior (Cowan and Davis,2003, Larson, 1995, Macbeth, 1994, Naoum, 2003, Ross, 2003,Thompson and Sanders, 1998). A partnering/alliance contract isoften advocated to be more collaborative than lump-sum orreimbursable contract (Davis and Walker, 2008, Thompson andSanders, 1998, Turner, 2003, Turner and Simister, 2001).
Several in-depth case studies of partnering/alliance practices,however, reveal that this contract type does not always eliminatethe underlying adversarial attitudes. Lack of top managementcommitment, lack of collaborative mind-set, and insufficientinitial effort to establish shared culture remain in practice(Aarseth et al., 2012, Alderman and Ivory, 2007, Bresnen andMarshall, 2002, Chan et al., 2012, Smyth and Edkins, 2007).Contemplating the practical difficulties of partnering/allianceprojects, it is questionable whether a partnering/alliance contractis better than other contract types. Merrow (2011) coins acontroversial view on the role of alliance contracts, “…, even ifeverything possible has been done to prepare the project(industrial megaprojects)… Alliance contracts … do nothing to helpus understand who is responsible for what” (p.293). Thiscontradiction provokes an important research question, to whatextent do different contract types actually enact different qualityof collaborative relationship between owner and contractor and inturn affect project performance?
This paper adopts Suprapto et al.'s (2015) conceptualization ofowner–contractor collaborative relationship as a set of norms andthe manifested interactional processes by which the project parties(owner and contractor) jointly act and decide on the issuesemerging during the course of a project in order to bring mutuallysatisfactory project outcomes. Owner–contractor collaborativerelationship includes two dimensions: (1) relational attitudes; and(2) teamworking quality. Relational attitudes referto norms and commitment developed and shared by the seniormanagement from both owner and contractor to govern theirproject-specific relationship. The essential elements ofrelational attitudes include fairness, inter-organizational trust,transparency, and no blame culture alongside the commitment ofsenior management to support the project teams (Cheung et al.,2006, Rahman and Kumaraswamy, 2008, Suprapto et al., 2015).Building on the works of Hoegl and colleagues (Hoegl and Gemuenden,2001, Hoegl and Parboteeah, 2007, Hoegl et al., 2004), Salas et al.(2005), Pinto et al. (2009), and Suprapto et al. (2015) defineteamworking as a set of underlying mechanisms reflectingthe task-related and social interactions between owner team andcontractor team in executing a project. They operationalizeteamworking quality as a higher-order construct capturing thequality of inter-team interactions and including 5 facets oftask-relatedinteractions: communication, coordination, balancedcontribution, aligned effort,and mutual support; and 2 facets of socialinteractions: cohesion and affectivetrust.
The efficacy of relational attitudes and teamworking quality onproject performance (in terms of efficiency, effectiveness,perceived satisfaction, and perceived success) has been empiricallysubstantiated whereas relational attitudes indirectly influenceproject performance through teamworking quality (Suprapto et al.,2015). Extending Suprapto et al.'s research model, we addressed theresearch question by examining the effects of contract types(partnering/alliance, reimbursable, and lump-sum) and contractualincentives on project performance through two mechanisms: (i)directly and (ii) indirectly through the mediation of relationalattitudes and teamworking quality.
By quantifying such direct and indirect effects, this paperattempts to make three contributions. First, we extend the scope ofanalysis by considering the ex-post effects ofcontract types and incentives on the quality of owner–contractorrelationships and project performance that have beenassumed ex-ante and lacking empirical support.Second, by moving beyond the direct effects, this study is thefirst to assess potential indirect effects of contract types andincentives on project performance through the parties' relationalattitudes and their inter-teamworking quality. Third, the findingsprovide explanation to which contract type is better than theothers toward project performance and what mechanisms areunderlying it.
The paper is structured as follows. Section 2 presents thetheoretical background on the relationships between contract types,contractual incentives, relationship quality, and projectperformance. Section 3 describes the research methodology used totest the hypotheses. Section 4 presents the results and finallySection 5 discusses the implications and future researchdirections.
6. Conclusions
Researchers and practitioners have acknowledged the importanceof the more collaborative contracts to achieve better projectperformance by promoting a better working relationship betweenowner and contractor. However, mixed results of different contracttypes on project performance suggest the need for research onintermediate mechanisms linking the effects of contract types toproject performance. This study applies a mediation model in whichrelational attitudes and teamworking quality mediate the effects ofcontract types and contractual incentives on project performance.The results support the notion that a partnering/alliance contractis likely to be more collaborative than a lump-sum or reimbursablecontract. However, there is no evidence that a reimbursablecontract is more collaborative than a lump-sum contract.Furthermore, it is supported that through better relationalattitudes and teamworking quality, projects with apartnering/alliance contract are likely to perform better thanthose with lump-sum and reimbursable contracts. In the same way,projects with contractual incentives are likely to perform betterthan those without incentives through better relational attitudesand teamworking quality. The results also suggest the efficacy ofrelational attitudes and teamworking on project performanceregardless of the contract types and the presence of incentives.All in all, contract types and contractual incentives per se arenot the game changer but the parties' attitudes towardcollaborative relationship and how they play out throughout theproject into actual teamworking behavior.