A smart contract system for security of payment of construction contracts

2020-12-01
Ahmadisheykhsarmast, Salar
Sönmez, Rifat
© 2020 Elsevier B.V.Timely payment of project participants is crucial for successful completion of construction projects, however the construction industry worldwide suffers from poor payment practices. The existing research studied the reasons and the consequences of the payment problem, but very few studies proposed methods for eliminating the problem. In this paper a novel smart contract payment security system named SMTSEC is presented for eliminating or reducing payment issues in the construction sector. The SMTSEC ensures security of payment of construction contracts through an automated computerized protocol that runs on a decentralized blockchain. The potential contributions and limitations of the proposed SMTSEC are studied through a real construction project. The main contribution of the SMTSEC is that it provides a new method for timely and transparent payment of construction projects by guaranteeing security of payment for works under construction without requiring administrative costs and burdens of trusted intermediaries such as lawyers or banks.
Automation in Construction

Suggestions

A knowledge-based risk mapping tool for cost estimation of international construction projects
Yildiz, Acelya Ecem; Dikmen Toker, İrem; Birgönül, Mustafa Talat; Ercoskun, Kerem; Alten, Selcuk (Elsevier BV, 2014-07-01)
Effective risk assessment and management is critical for success in international construction projects. This paper proposes a knowledge-based risk mapping tool for systematically assessing risk-related variables that may lead to cost overrun in international markets. The tool uses an ontology that relates risk and vulnerability to cost overrun [1] and a novel risk-vulnerability assessment methodology [2] to estimate potential risk paths that may emerge in international construction projects. The tool has b...
Improving sub-contractor selection process in construction projects: Web-based sub-contractor evaluation system (WEBSES)
Arslan, Gokhan; Kivrak, Serkan; Birgönül, Mustafa Talat; Dikmen Toker, İrem (Elsevier BV, 2008-05-01)
One of the most important phases in the construction industry (CI) is the bidding process. During the bidding process, selecting the most appropriate sub-contractors (SCs) for the relevant sub-works is highly critical for the overall project performance. In order to select the most appropriate SCs for the project and prepare the most realistic and accurate bid proposal, general contractors (GCs) have to know all financial, technical and general information about these SCs. Within this context, GCs should co...
A Comparative study on direct analysis method and effective length method in one-story semi-rigid frames
Bektaş, Şinasi; Birgönül, Mustafa Talat; Department of Civil Engineering (2012)
Many factors such as unforeseeable events, managerial or financial problems of Contractor, insufficient technical capacity of Engineer's site team and so on may lead to delays in construction projects. Proper analysis of compensability and quantum of a delay event is very important. Any delay analysis application can be considered as a result of the combination of contract documents, scheduler, record keeping mechanism at site, communication among project participants, delay analyst and delay analysis metho...
A statistical approach to lean construction implementations of construction companies in Turkey
Tezel, Bülent Algan; Nielsen, Yasemin; Department of Civil Engineering (2007)
One of the major change efforts for the construction industry is lean construction. This thesis analyzes the practices of the construction companies in Turkey from the lean construction perspective. Prior to the analysis in question, requisite information about change in the construction industry, lean thinking and lean construction will be presented. A questionnaire, based on a lean construction model, is used to survey the practices and gather the data for the analysis. Various statistical analysis method...
A strategic safety management framework through balanced scorecard and quality function deployment
Gunduz, Murat; Simsek, Burak (Canadian Science Publishing, 2007-05-01)
The aim of this paper is to propose a safety management framework for construction companies. A literature review was carried out to identify significant factors that would improve safety performance. Two management tools-namely, the balanced scorecard and quality function deployment (QFD)-were used to construct the framework. Strategic goals were established for each of the following perspectives of the balanced scorecard: financial and cultural, employee, process, and learning. Afterwards, a questionnaire...
Citation Formats
S. Ahmadisheykhsarmast and R. Sönmez, “A smart contract system for security of payment of construction contracts,” Automation in Construction, pp. 0–0, 2020, Accessed: 00, 2020. [Online]. Available: https://hdl.handle.net/11511/56272.