The effectiveness of relational contracting in a temporary public organization: Intensive collaboration between an English local authority and private contractors

This article evaluates the factors that shaped the effectiveness of three strategic contracts pursued with private firms by a local authority in the English West Midlands. The contracts generated highly political outputs that supported the council's defence of the core interests of local residents. The analysis explores the form taken by the contracts; the mechanisms that delivered and integrated them; and the wider structural factors that helped to secure apparently benign contractual outputs. The evaluative yardsticks used to support the analysis were: relationality; flexibility; and performativity. The article argues that relationality is crucial in determining quality in temporary, project-based organizations. Relationality yields flexibility and effective performance, based on mutual regard and loyalty. The case study highlights the need to explore perceptual gaps between the parties; the importance of the time-path of relationality; the significance of 'value residuals' in incentivizing substantive loyalty; and the potential contribution of zones of flexibility to performance.