Alliancing is one way to institutionalise collaboration. It is not the only way to create collaborative project behaviour.
The Week 10 South Australian research makes an important distinction. Interview participants described relationship contracting as broader than alliancing and suggested that collaborative principles could be incorporated into other procurement systems, including managing contractor and more conventional arrangements.
That matters because organisations sometimes frame the choice too narrowly:
Either use a traditional contract or use an alliance.
The more useful question is:
Which elements of collaboration does this project need, and which commercial structure best supports them?
The Strategic Context
Projects operate through both formal contracts and informal working systems.
The contract establishes legal obligations, risk allocation, payment and change mechanisms.
The working system determines how people communicate, solve problems, escalate issues, share information and respond to uncertainty.
A conventional contract can still support collaborative behaviours if the parties design for them.
Likewise, an alliance contract can still fail relationally if participants revert to defensive behaviour.
This means contract form and relationship capability are related but not identical.
What Leaders Commonly Misread
The first mistake is treating collaboration as a feature that exists only in alliance contracts.
The second is assuming traditional contracts require adversarial behaviour.
The third is attempting to overlay “partnering” language onto a contract whose incentives and governance actively reward positional behaviour.
The fourth is using collaborative workshops as a substitute for fixing structural problems in scope, incentives or authority.
The fifth is assuming that because parties cooperate early, they will continue to cooperate when margin, delay and liability become material.
Reframing the Issue
Relationship contracting should be viewed as a management philosophy that can be expressed through different commercial forms.
Its recurring elements include:
- aligned objectives;
- transparency;
- integrated teams;
- constructive dispute resolution;
- shared problem solving;
- appropriate risk allocation;
- leadership commitment;
- behavioural expectations.
The degree to which these elements can be embedded depends on the contract.
A fixed-price design-and-construct arrangement may still use joint risk workshops, shared governance forums and behavioural charters.
A managing-contractor model may create deeper integration.
An alliance may go further by aligning commercial outcomes through shared painshare/gainshare mechanisms.
The relationship system can therefore be scaled.
Strategic Analysis
The South Australian case material is useful because the studied projects did not all rely on pure alliance structures. Collaborative principles were incorporated into modified contract arrangements and management-contracting approaches.
That suggests the organisation should not start with the label.
It should start with the problem.
If the project has high interface complexity but relatively mature scope, it may need strong integration without full commercial risk sharing.
If the project has substantial uncertainty that cannot be allocated efficiently, a deeper alliance model may be justified.
If the project is routine and well defined, a conventional contract with disciplined relationship management may be enough.
The procurement model should fit the uncertainty, not the fashion.
The Enterprise View
This distinction creates strategic flexibility.
An organisation that equates collaboration only with alliancing may overuse complex alliance structures.
An organisation that equates conventional contracting with adversarial behaviour may underinvest in relationship capability.
The stronger enterprise builds a portfolio of commercial models and a common relational capability across them.
That allows leaders to ask:
- How much integration is needed?
- How much risk sharing is justified?
- How much price competition should be preserved?
- How much behavioural investment is proportionate?
This is a more mature procurement capability than choosing between labels.
Decision Framework
Use a two-axis test.
Axis 1: Delivery uncertainty
How difficult are scope, interfaces, risks and dependencies to define in advance?
Axis 2: Relationship dependency
How much does project success depend on sustained joint problem solving between organisations?
Low uncertainty and low relationship dependency may suit conventional contracting.
High relationship dependency with moderate uncertainty may suit collaborative overlays or managing-contractor models.
High uncertainty and high relationship dependency may justify alliancing.
The exact model should then be tested against market capability, owner capability and transaction cost.
From Strategy to Execution
Immediate action: separate the project's relationship strategy from its contract-form decision.
Medium-term capability building: develop repeatable collaborative practices that can be applied across several procurement models.
Long-term strategic positioning: build evidence about which combination of contract and relationship practices performs best for different project types.
The aim is to create a flexible commercial operating system rather than a preference for one procurement label.
Signals to Monitor
Watch for teams claiming a project must become an alliance simply because collaboration is needed, conventional contracts being managed adversarially by default, behavioural charters that conflict with commercial incentives, or relationship practices disappearing when delivery pressure rises.
Another warning sign is using collaborative language while retaining governance processes that reward individual optimisation.
Questions for the Leadership Team
- Which collaborative behaviours does the project need regardless of contract form?
- Which uncertainties actually justify shared commercial risk?
- Could a conventional or managing-contractor model achieve the required integration?
- Are incentives aligned with the behaviours we expect?
- How much transaction cost does a full alliance add?
- Is our organisation capable of collaborative delivery across multiple contract types?
- Are we choosing a model because it fits the problem or because it is familiar?
Closing Perspective
Relationship contracting is bigger than alliancing.
The strategic capability is the ability to design commercial and behavioural systems together.
Alliancing is one powerful expression of that capability, but it should be selected because the project needs its particular governance and risk-sharing logic, not because collaboration itself is desirable.
Related article: Collaboration Is a Capability: Facilitation, Team Alignment and Subcontractor Behaviour
Related article: Procurement Model and Contract Type Are Different Decisions
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