Assessing the Practice of Project Risk Management: a case study of Zemen Bank Headquarter Building Construction Project Project Work Submitted in Partial Fulfillment of the Requirements for the Award of Master of Arts Degree in Project Management
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Date
2020-06
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Addis Ababa University
Abstract
Building construction projects are unique and very complex with sophisticated technologies and structures
that are very fraught with uncertainty and risks. Therefore, it is necessary to have well-articulated and
experienced risk management practice in order to achieve project success not only by minimizing negative
consequences but also by enhancing opportunities. This study aimed to assess the project risk management
practice of Zemen Bank headquarter building construction project based on the five project risk
management processes namely, risk management planning, risk identification, analysis, response planning;
and monitoring and controlling, that were identified from reviewing literatures. Therefore, the main
research question was ‘What was the current practice of project risk management of Zemen Bank’s
headquarter building construction project?’. The study used descriptive research design and qualitative
research approach where semi-structure interview was used as primary source of data and documentation
analysis as secondary source of data. The study used semi-structured interview technique as data gathering
instrument and purposive sampling as sampling technique. Hence, the interview included one project
manager and five project team members who were believed to know the area or subject matter very well.
Based on the analysis, this study identified the major gaps in the actual risk management practice of the
project. The research found that the project did not establish the risk management methodology, risk roles
and responsibilities, risk categories, probability and impact scales, risk appetite and tolerances limit, and
frequencies of risk management activities and reporting. The project did not identify a broad range of risks,
in terms threat as well as opportunities, throughout the project lifecycle using effective tools and techniques
with involvement of appropriate stakeholders; and it does not have a risk register. Besides, the result of the
risk assessment was not periodically reported to the project stakeholders. The project mainly used risk
mitigation and risk transfer strategies to response for the identified negative risks (threats). However,
response for positive risks were not used in the project; and contingency plan and fallback plan are not
developed and implemented. The project did not use risk reassessment, risk audit, variance and trend
analysis, technical performance measurement and reserve analysis to monitor and control risks. The
conclusion made from the study indicated, the overall effectiveness of the project’s risk management
practice was poor that lacked standard and consistent risk management process. The project did not
consider risk management as an ongoing that requires dedicated staff, resource and appropriate training.
Finally, recommendations forwarded such as prepare risk management plan, identify broad range of risks
from possible sources, prepare risk register, assess the effectiveness of its project risk management
practice, assign risk management ownership, encourage risk communication and embed risk management
practice in daily project activities using appropriate tools and techniques.
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Keywords
Project Risk Management, Zemen Bank, Headquarter Building Construction Project