Building absorptive capacity in a mega-project program alliance: Learning to mitigate rework

Collaborative procurement forms such as program alliancing can create a burgeoning environment for absorptive capacity to materialize, enabling learning and rework to be mitigated. However, little is known about the learning routines and practices enabling program alliances to tackle their rework effectively. As a result, this has stymied best practices that can be used to reduce rework from being made available to other construction organizations. This paper fills this void by addressing the following research question: How does a program alliance develop its absorptive capacity to learn and mitigate its rework? We use an illustrative case study approach to draw on the practices of a transport mega-project (>AU19 billion) delivered using a series of program alliances to address our research question. We reveal how one of its program alliances utilized its absorptive capacity to assimilate and apply new knowledge to manage errors and mitigate rework. Additionally, we unearth the presence of desorptive capacity, as the alliance exploited its error knowledge and transferred it to others as part of an incentivization scheme manufactured by the client authority to stimulate learning and continuous improvement within the project. The knowledge gleaned from the program alliance case examined in this paper provides an opportunity for organizations to learn how to deal with errors and rework, which has been absent in the literature.