Analysis Of Risk Management Practices In Construction Companies: Focusing On Yotek Construction, Flintstone Engineering And Akir Construction
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Date
2017-06
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Addis Ababa University
Abstract
Critical reviews of the existing theory and practice of Risk Management within the construction industry particularly in Ethiopia and the world at large suggest that risk management, as one of the nine knowledge areas of the project management, is not only underutilized but also, generally, not well understood. These are simply manifested in the results shown on the ground that construction projects facing time and cost overruns besides to their inferior quality products. The research findings which have been summarized and presented in this study were carried out based on three local construction companies‟ named Yotek Construction, Flintstone Engineering and Akir Construction with the objective of analyzing status of RM practices in construction companies in general and specifically how the risk planning, identification, analyzing, responding and monitoring and controlling experiences or practices. To do so, survey questionnaires were distributed to selected experts particularly related to the risk management practices area like planning, designing and /or executions / implementation levels to see deep in to the detail practices. The findings showed that with some ups and downs, there were some hints of risk management practices specifically, risk management is recognized as a very important input, formal procedures to RM are practiced and RM is a continuous process but some practices still need improvements like team members should participate in risk identification, mainly there are no responsible body to handle and coordinate risks and subjective methods (such as judgments based on experience) rather than more sophisticated methods (such as mathematical techniques) are used to make decisions that affect the key project parameters. There are more or less risk management planning practices but not all team members are invited to participate and there are no defined and well-developed strategies to respond to risks. Risk monitoring and controlling are not done in compliance with the accepted standards and procedures which make risks either worse or might make difficulty to overcome them. In conclusion, RM is not yet fully and maturely practiced but partially and hesitantly. Recommendations are RM management should be in compliance with the standards, there should be a well-developed strategy and responsible body to handle risks.
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Risk, Risk Management, Risk Management Process