Optimization of Risk Allocation in Construction Project Investigation
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Thesis and Dissertation
AI Summary
This thesis investigates the optimization of risk allocation in construction projects, addressing the high risks inherent in the construction industry and their impact on project participants. It reviews existing literature on construction risk management and risk management processes, identifying a gap in capturing the impact of risks based on research objectives. The study aims to analyze risk allocation methods for reducing risks in construction projects, utilizing survey data to review risk classifications and sources. Key areas explored include factors causing time and cost overruns, the effect of construction delays on project success, and the application of risk allocation methods. Data analysis includes quantitative methods and regression analysis to test hypotheses related to risk allocation and project outcomes. The research concludes with recommendations for improving risk management practices in the construction industry, while also acknowledging the limitations of the study and suggesting areas for further research. Desklib provides access to this thesis and other study resources for students.
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Running head: INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN
CONSTRUCTION PROJECTS
Investigation of Optimization of Risk Allocation in Construction Projects
Name of the Student:
Name of the University:
CONSTRUCTION PROJECTS
Investigation of Optimization of Risk Allocation in Construction Projects
Name of the Student:
Name of the University:
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1
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
Abstract
In the construction industry, the concept of risk management is taken as a procedure to identify,
allocate the resource and mitigate the risks which are occurred into the construction industry.
Higher the risks in the construction, it provides with higher effect on the project participants,
while the construction management is required in the industry to manage and handle the risks.
The paper is tending to review the existing literature based on the construction risk management
and risk management processes. The literature study is lacked to processes of risk management
which has ability to capture impact of risks based on selected research objectives. The study is
aimed to review the methods of risk allocation used to reduce risks from the construction project
industry. The survey is used to collect data and information to review various risk classification
as well as sources in existing literature study work.
Keywords: Risk management, risk allocation, risk classification, construction management.
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
Abstract
In the construction industry, the concept of risk management is taken as a procedure to identify,
allocate the resource and mitigate the risks which are occurred into the construction industry.
Higher the risks in the construction, it provides with higher effect on the project participants,
while the construction management is required in the industry to manage and handle the risks.
The paper is tending to review the existing literature based on the construction risk management
and risk management processes. The literature study is lacked to processes of risk management
which has ability to capture impact of risks based on selected research objectives. The study is
aimed to review the methods of risk allocation used to reduce risks from the construction project
industry. The survey is used to collect data and information to review various risk classification
as well as sources in existing literature study work.
Keywords: Risk management, risk allocation, risk classification, construction management.
2
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
Acknowledgement
The research is conducted to enrich the experience of my life. The research enhances my
knowledge and skills on the selected research topic. With gaining of the knowledge, it gives me
opportunity to face some challenges and overcome them. Without the guidance of my professors,
friends and family, I would not able to complete the study. They all contribute me to enhance my
knowledge on the research topic. I would also like to thank my supervisor -------------- for
providing me constant support and guidance during the entire research process. Without all their
help, I am not able to collect primary data and valuable resources. Finally, I would also like to
thank the professionals from the construction Industry who help me to participate in the survey.
It also provides us valuable results for the project work. All their support inspires and enlightens
me to go through the research process.
Heartfelt thanks and warmest wishes,
Yours Sincerely,
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
Acknowledgement
The research is conducted to enrich the experience of my life. The research enhances my
knowledge and skills on the selected research topic. With gaining of the knowledge, it gives me
opportunity to face some challenges and overcome them. Without the guidance of my professors,
friends and family, I would not able to complete the study. They all contribute me to enhance my
knowledge on the research topic. I would also like to thank my supervisor -------------- for
providing me constant support and guidance during the entire research process. Without all their
help, I am not able to collect primary data and valuable resources. Finally, I would also like to
thank the professionals from the construction Industry who help me to participate in the survey.
It also provides us valuable results for the project work. All their support inspires and enlightens
me to go through the research process.
Heartfelt thanks and warmest wishes,
Yours Sincerely,
3
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
Table of Contents
Chapter 1: Introduction..................................................................................................................10
1.1 Background of the study......................................................................................................10
1.2 Aim of the study..................................................................................................................11
1.3 Objectives of the research study..........................................................................................11
1.4 Research questions...............................................................................................................12
1.5 Research hypothesis.............................................................................................................13
1.6 Problem statement...............................................................................................................13
1.7 Rationale of the study..........................................................................................................14
1.8 Outline of the research methodology...................................................................................14
1.9 Structure of the study...........................................................................................................15
1.10 Chapter summary...............................................................................................................16
Chapter 2: Literature Review.........................................................................................................17
2.1 Introduction..........................................................................................................................17
2.2 Types of risk in construction industry.................................................................................18
2.3 Assessment of construction project.....................................................................................22
2.4 Risk allocation methods and mechanisms...........................................................................24
2.5 Risk Management Plan........................................................................................................27
2.6 Problems that are related with the risk allocation methods.................................................30
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
Table of Contents
Chapter 1: Introduction..................................................................................................................10
1.1 Background of the study......................................................................................................10
1.2 Aim of the study..................................................................................................................11
1.3 Objectives of the research study..........................................................................................11
1.4 Research questions...............................................................................................................12
1.5 Research hypothesis.............................................................................................................13
1.6 Problem statement...............................................................................................................13
1.7 Rationale of the study..........................................................................................................14
1.8 Outline of the research methodology...................................................................................14
1.9 Structure of the study...........................................................................................................15
1.10 Chapter summary...............................................................................................................16
Chapter 2: Literature Review.........................................................................................................17
2.1 Introduction..........................................................................................................................17
2.2 Types of risk in construction industry.................................................................................18
2.3 Assessment of construction project.....................................................................................22
2.4 Risk allocation methods and mechanisms...........................................................................24
2.5 Risk Management Plan........................................................................................................27
2.6 Problems that are related with the risk allocation methods.................................................30
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INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
2.7 Optimal risk allocation and its related factors.....................................................................31
2.8 Literature Gap......................................................................................................................32
2.9 Summary..............................................................................................................................32
Chapter 3: Research Methodology................................................................................................34
3.1 Introduction..........................................................................................................................34
3.2 Method Outline....................................................................................................................34
3.3 Research Philosophy............................................................................................................35
3.3.1 Justification for selection of the chosen Philosophy.....................................................36
3.4 Research Approach..............................................................................................................37
3.4.1 Justification for selection of the chosen Approach.......................................................37
3.5 Research Design..................................................................................................................37
3.5.1 Justification for selection of the chosen Design...........................................................38
3.6 Data Collection Method.......................................................................................................39
3.6.1 Data Sources: Primary and Secondary.........................................................................39
3.6.2 Data Techniques: Qualitative and Quantitative............................................................40
3.7 Population and Sample........................................................................................................40
3.7.1 Sampling Technique.....................................................................................................41
3.7.2 Sample Size..................................................................................................................41
3.8 Ethical Considerations.........................................................................................................41
3.9 Research Limitations...........................................................................................................42
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
2.7 Optimal risk allocation and its related factors.....................................................................31
2.8 Literature Gap......................................................................................................................32
2.9 Summary..............................................................................................................................32
Chapter 3: Research Methodology................................................................................................34
3.1 Introduction..........................................................................................................................34
3.2 Method Outline....................................................................................................................34
3.3 Research Philosophy............................................................................................................35
3.3.1 Justification for selection of the chosen Philosophy.....................................................36
3.4 Research Approach..............................................................................................................37
3.4.1 Justification for selection of the chosen Approach.......................................................37
3.5 Research Design..................................................................................................................37
3.5.1 Justification for selection of the chosen Design...........................................................38
3.6 Data Collection Method.......................................................................................................39
3.6.1 Data Sources: Primary and Secondary.........................................................................39
3.6.2 Data Techniques: Qualitative and Quantitative............................................................40
3.7 Population and Sample........................................................................................................40
3.7.1 Sampling Technique.....................................................................................................41
3.7.2 Sample Size..................................................................................................................41
3.8 Ethical Considerations.........................................................................................................41
3.9 Research Limitations...........................................................................................................42
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INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
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3.10 Time Horizons...................................................................................................................42
3.11 Summary............................................................................................................................44
Chapter 4: Data Analysis and Results...........................................................................................46
4.1 Introduction..........................................................................................................................46
4.2 Quantitative Data Analysis..................................................................................................46
4.3 Regression Analysis.............................................................................................................83
4.4 Summary..............................................................................................................................89
Chapter 5: Discussion....................................................................................................................91
Chapter 6: Conclusion and Recommendations..............................................................................95
6.1 Conclusion...........................................................................................................................95
6.2 Linking with the objectives.................................................................................................96
6.3 Recommendations................................................................................................................98
6.4 Limitation of the study.........................................................................................................99
6.5 Further scope of the study..................................................................................................100
References....................................................................................................................................101
Appendix......................................................................................................................................105
Survey Questionnaires.............................................................................................................105
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
3.10 Time Horizons...................................................................................................................42
3.11 Summary............................................................................................................................44
Chapter 4: Data Analysis and Results...........................................................................................46
4.1 Introduction..........................................................................................................................46
4.2 Quantitative Data Analysis..................................................................................................46
4.3 Regression Analysis.............................................................................................................83
4.4 Summary..............................................................................................................................89
Chapter 5: Discussion....................................................................................................................91
Chapter 6: Conclusion and Recommendations..............................................................................95
6.1 Conclusion...........................................................................................................................95
6.2 Linking with the objectives.................................................................................................96
6.3 Recommendations................................................................................................................98
6.4 Limitation of the study.........................................................................................................99
6.5 Further scope of the study..................................................................................................100
References....................................................................................................................................101
Appendix......................................................................................................................................105
Survey Questionnaires.............................................................................................................105
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INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
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Table of Figures
Figure 4.1: Gender.........................................................................................................................47
Figure 4.2: Age group....................................................................................................................48
Figure 4.3: Position of the respondents.........................................................................................49
Figure 4.4: Experience in the construction industry......................................................................50
Figure 4.5: Knowledge about the risk management in the construction project...........................51
Figure 4.6: Construction project implementation is done based on cost, functionality and time..52
Figure 4.7: Risk identification carried out in the construction project..........................................54
Figure 4.8: Health and safety is the main concern in the construction project..............................55
Figure 4.9: High influence of the construction project..................................................................57
Figure 4.10: Risk allocation is required in the construction project..............................................58
Figure 4.11: Deviation in the construction project in terms of cost and time parameters.............60
Figure 4.12: Optimal risk allocation in construction project.........................................................61
Figure 4.13: Requirement of construction in construction project................................................63
Figure 4.14: Collaboration and trust create key significance positive relations............................65
Figure 4.15: Communicating with identified risks and opportunities in procurement phase........66
Figure 4.16: Design and build is the procurement approach.........................................................68
Figure 4.17: Location and site conditions can affect the construction project..............................70
Figure 4.18: Design documents approved on time........................................................................71
Figure 4.19: Construction work should adhere to quality standards.............................................72
Figure 4.20: Formal organization structure required for resolution of disputes in the project......74
Figure 4.21: Contractor require technical skills and experience...................................................76
Figure 4.22: Project execution affected by weather as well as climatic conditions......................77
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
Table of Figures
Figure 4.1: Gender.........................................................................................................................47
Figure 4.2: Age group....................................................................................................................48
Figure 4.3: Position of the respondents.........................................................................................49
Figure 4.4: Experience in the construction industry......................................................................50
Figure 4.5: Knowledge about the risk management in the construction project...........................51
Figure 4.6: Construction project implementation is done based on cost, functionality and time..52
Figure 4.7: Risk identification carried out in the construction project..........................................54
Figure 4.8: Health and safety is the main concern in the construction project..............................55
Figure 4.9: High influence of the construction project..................................................................57
Figure 4.10: Risk allocation is required in the construction project..............................................58
Figure 4.11: Deviation in the construction project in terms of cost and time parameters.............60
Figure 4.12: Optimal risk allocation in construction project.........................................................61
Figure 4.13: Requirement of construction in construction project................................................63
Figure 4.14: Collaboration and trust create key significance positive relations............................65
Figure 4.15: Communicating with identified risks and opportunities in procurement phase........66
Figure 4.16: Design and build is the procurement approach.........................................................68
Figure 4.17: Location and site conditions can affect the construction project..............................70
Figure 4.18: Design documents approved on time........................................................................71
Figure 4.19: Construction work should adhere to quality standards.............................................72
Figure 4.20: Formal organization structure required for resolution of disputes in the project......74
Figure 4.21: Contractor require technical skills and experience...................................................76
Figure 4.22: Project execution affected by weather as well as climatic conditions......................77
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INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
Figure 4.23: Risk management is done by adequate design and construction documentations....79
Figure 4.24: Risk allocation is done based on level of the technological sophistication..............81
Figure 4.25: Project is allocated to right resources........................................................................82
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
Figure 4.23: Risk management is done by adequate design and construction documentations....79
Figure 4.24: Risk allocation is done based on level of the technological sophistication..............81
Figure 4.25: Project is allocated to right resources........................................................................82
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INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
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Table of Tables
Table 3.1: Research timeline.........................................................................................................44
Table 4.1: Gender..........................................................................................................................47
Table 4.2: Age group.....................................................................................................................48
Table 4.3: Position of the respondents...........................................................................................49
Table 4.4: Experience in the construction industry.......................................................................50
Table 4.5: Knowledge about the risk management in the construction project.............................51
Table 4.6: Construction project implementation is done based on cost, functionality and time...52
Table 4.7: Risk identification carried out in the construction project...........................................54
Table 4.8: Health and safety is the main concern in the construction project...............................55
Table 4.9: High influence of the construction project...................................................................57
Table 4.10: Risk allocation is required in the construction project...............................................58
Table 4.11: Deviation in the construction project in terms of cost and time parameters..............60
Table 4.12: Optimal risk allocation in construction project..........................................................61
Table 4.13: Requirement of construction in construction project.................................................63
Table 4.14: Collaboration and trust create key significance positive relations.............................64
Table 4.15: Communicating with identified risks and opportunities in procurement phase.........66
Table 4.16: Design and build is the procurement approach..........................................................68
Table 4.17: Location and site conditions can affect the construction project...............................69
Table 4.18: Design documents approved on time.........................................................................71
Table 4.19: Construction work should adhere to quality standards...............................................72
Table 4.20: Formal organization structure required for resolution of disputes in the project.......74
Table 4.21: Contractor require technical skills and experience.....................................................76
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
Table of Tables
Table 3.1: Research timeline.........................................................................................................44
Table 4.1: Gender..........................................................................................................................47
Table 4.2: Age group.....................................................................................................................48
Table 4.3: Position of the respondents...........................................................................................49
Table 4.4: Experience in the construction industry.......................................................................50
Table 4.5: Knowledge about the risk management in the construction project.............................51
Table 4.6: Construction project implementation is done based on cost, functionality and time...52
Table 4.7: Risk identification carried out in the construction project...........................................54
Table 4.8: Health and safety is the main concern in the construction project...............................55
Table 4.9: High influence of the construction project...................................................................57
Table 4.10: Risk allocation is required in the construction project...............................................58
Table 4.11: Deviation in the construction project in terms of cost and time parameters..............60
Table 4.12: Optimal risk allocation in construction project..........................................................61
Table 4.13: Requirement of construction in construction project.................................................63
Table 4.14: Collaboration and trust create key significance positive relations.............................64
Table 4.15: Communicating with identified risks and opportunities in procurement phase.........66
Table 4.16: Design and build is the procurement approach..........................................................68
Table 4.17: Location and site conditions can affect the construction project...............................69
Table 4.18: Design documents approved on time.........................................................................71
Table 4.19: Construction work should adhere to quality standards...............................................72
Table 4.20: Formal organization structure required for resolution of disputes in the project.......74
Table 4.21: Contractor require technical skills and experience.....................................................76
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INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
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Table 4.22: Project execution affected by weather as well as climatic conditions........................77
Table 4.23: Risk management is done by adequate design and construction documentations.....79
Table 4.24: Risk allocation is done based on level of the technological sophistication................81
Table 4.25: Project is allocated to right resources.........................................................................82
Table 4.26: Summary output of regression analysis conducted for hypothesis 1.........................84
Table 4.27: ANOVA table of regression analysis conducted for hypothesis 1.............................85
Table 4.28: Coefficient table of regression analysis conducted for hypothesis 1.........................86
Table 4.29: Summary output of regression analysis conducted for hypothesis 2.........................87
Table 4.30: ANOVA table of regression analysis conducted for hypothesis 2.............................87
Table 4.31: Coefficient table of regression analysis conducted for hypothesis 2.........................88
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
Table 4.22: Project execution affected by weather as well as climatic conditions........................77
Table 4.23: Risk management is done by adequate design and construction documentations.....79
Table 4.24: Risk allocation is done based on level of the technological sophistication................81
Table 4.25: Project is allocated to right resources.........................................................................82
Table 4.26: Summary output of regression analysis conducted for hypothesis 1.........................84
Table 4.27: ANOVA table of regression analysis conducted for hypothesis 1.............................85
Table 4.28: Coefficient table of regression analysis conducted for hypothesis 1.........................86
Table 4.29: Summary output of regression analysis conducted for hypothesis 2.........................87
Table 4.30: ANOVA table of regression analysis conducted for hypothesis 2.............................87
Table 4.31: Coefficient table of regression analysis conducted for hypothesis 2.........................88
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INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
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Chapter 1: Introduction
1.1 Background of the study
The thesis report is summarizing on “Investigation of Optimization of Risk Allocation in
Construction Projects”. Ameyaw and Chan (2015) stated that as compared to the other industry,
risks are involved into the construction industry at higher rate. An accurate assessment of the
risks are concerned into the construction project will aid to identify the processes to allocate and
minimize the risks. Reduction of the project risks would provide larger profits into the
construction industry. Barr and McClellan (2018) argued that allocation of the development
resources will direct to reduce in friction among the employees those are working at the
construction site, therefore there is an increase into efficiency of the construction project. This
particular thesis study would measures the risk allocation methods which are taken into
considerations into the construction industry for optimization of project risks. Each of the project
risks are allocated with resources so that it is taken as best possible way to measure the risks.
In practice of risk optimization as well as risk allocation, there is higher increase in
probability of the project risks. Most of the construction industry faces risks such as time as well
as financial project risks. El-Sayegh and Mansour (2015) emphasized that there is higher project
risks such as health along with safety risks, which are mostly occurred among the employees
those are working at the construction site. According to Farnsworthet al., (2015), risk allocation
is needed into the risk management arrangement such that the investigator can able to assign the
risks to overcome all the project related construction risks. Risk allocation shows that there is
proper allocation of resources so that they can link with project benefits and failures connected
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
Chapter 1: Introduction
1.1 Background of the study
The thesis report is summarizing on “Investigation of Optimization of Risk Allocation in
Construction Projects”. Ameyaw and Chan (2015) stated that as compared to the other industry,
risks are involved into the construction industry at higher rate. An accurate assessment of the
risks are concerned into the construction project will aid to identify the processes to allocate and
minimize the risks. Reduction of the project risks would provide larger profits into the
construction industry. Barr and McClellan (2018) argued that allocation of the development
resources will direct to reduce in friction among the employees those are working at the
construction site, therefore there is an increase into efficiency of the construction project. This
particular thesis study would measures the risk allocation methods which are taken into
considerations into the construction industry for optimization of project risks. Each of the project
risks are allocated with resources so that it is taken as best possible way to measure the risks.
In practice of risk optimization as well as risk allocation, there is higher increase in
probability of the project risks. Most of the construction industry faces risks such as time as well
as financial project risks. El-Sayegh and Mansour (2015) emphasized that there is higher project
risks such as health along with safety risks, which are mostly occurred among the employees
those are working at the construction site. According to Farnsworthet al., (2015), risk allocation
is needed into the risk management arrangement such that the investigator can able to assign the
risks to overcome all the project related construction risks. Risk allocation shows that there is
proper allocation of resources so that they can link with project benefits and failures connected
11
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
with risk identification in the construction projects. Mainly, there are schedule and cost risks as
there is delay in the project because of project construction work complexity, handling of the
project resources as well as failure into the construction equipments and machineries and the cost
is also affected (Iqbal et al, 2015). The thesis paper will demonstrate how the governments can
get ability to reduce the likelihood of the project impacts by leveraging of the technical
advantages into the market.
1.2 Aim of the study
The aim of this research study is identification as well as investigation of optimization
techniques along with risk allocation processes into the construction project. The study is based
to identify the project construction risks and investigate on risk allocation techniques which are
required to conquer with the project risks. There should be proper allotment of the resources to
each project risks so that it can provide positive impact on the project success in the building
project plan. The thesis study is based on producing and analyzing a risk management
framework so that there is suitable supervision of the project dangers in the construction project.
The construction project is entailed conclusion of its project on instance plus in estimated cost.
The probability of conclusion of the development on scheduled time in allocated budget is
defined as the construction risks. Therefore, there is required to optimization such as utilization
of the project resources to finish the project effort on instance. This particular research study
would examine how superiority risks into the building construction projects are to be supervised.
1.3 Objectives of the research study
The research study is based on investigating various risk allocation methods so that there
is appropriate assessment of the construction risks. In order to analyze the hindrances in the
construction project work, it gives a huge effect on the completion time of the project. The risk
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
with risk identification in the construction projects. Mainly, there are schedule and cost risks as
there is delay in the project because of project construction work complexity, handling of the
project resources as well as failure into the construction equipments and machineries and the cost
is also affected (Iqbal et al, 2015). The thesis paper will demonstrate how the governments can
get ability to reduce the likelihood of the project impacts by leveraging of the technical
advantages into the market.
1.2 Aim of the study
The aim of this research study is identification as well as investigation of optimization
techniques along with risk allocation processes into the construction project. The study is based
to identify the project construction risks and investigate on risk allocation techniques which are
required to conquer with the project risks. There should be proper allotment of the resources to
each project risks so that it can provide positive impact on the project success in the building
project plan. The thesis study is based on producing and analyzing a risk management
framework so that there is suitable supervision of the project dangers in the construction project.
The construction project is entailed conclusion of its project on instance plus in estimated cost.
The probability of conclusion of the development on scheduled time in allocated budget is
defined as the construction risks. Therefore, there is required to optimization such as utilization
of the project resources to finish the project effort on instance. This particular research study
would examine how superiority risks into the building construction projects are to be supervised.
1.3 Objectives of the research study
The research study is based on investigating various risk allocation methods so that there
is appropriate assessment of the construction risks. In order to analyze the hindrances in the
construction project work, it gives a huge effect on the completion time of the project. The risk
12
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
management is used to assess as well as analyse the project risks such as risk identification, risk
transfer, risk minimization plus risk acceptance into the construction project work. Following are
the objectives of this particular thesis paper based on which completed work is to be accepted out
such as:
To study significant factors causing time and cost overrun into the construction
projects
To analyse of construction delays as recurring problems in construction industry
affect the project success
To study of risk allocation methods and mechanisms into the construction projects
1.4 Research questions
Based on the research objectives, the research questions for this particular study is to be
carried out such as:
1. What are the factors caused overrun of cost and time in construction projects?
2. What are possible causes of time and cost overrun which affect the project success
rate?
3. How are risk allocation methods used into the construction projects for analyzing
time and cost risks?
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
management is used to assess as well as analyse the project risks such as risk identification, risk
transfer, risk minimization plus risk acceptance into the construction project work. Following are
the objectives of this particular thesis paper based on which completed work is to be accepted out
such as:
To study significant factors causing time and cost overrun into the construction
projects
To analyse of construction delays as recurring problems in construction industry
affect the project success
To study of risk allocation methods and mechanisms into the construction projects
1.4 Research questions
Based on the research objectives, the research questions for this particular study is to be
carried out such as:
1. What are the factors caused overrun of cost and time in construction projects?
2. What are possible causes of time and cost overrun which affect the project success
rate?
3. How are risk allocation methods used into the construction projects for analyzing
time and cost risks?
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1.5 Research hypothesis
The research work is to be carried out based in identification of the risk allocation
methods which are taken into considerations for overcoming the construction project activities.
Following are the research hypothesis into the research study such as:
Hypothesis 1: Time and cost overrun into the construction projects are risk factors into
the organization.
Hypothesis 2: Construction delays as recurring problems in construction industry are
affecting the project success.
1.6 Problem statement
Each of the construction industry is innovative as it can intellect that it carries own set of
construction related risks. The risks are to be concerned into the construction project influence
the project stakeholders as well as construction project team members. The stakeholders those
are involved in construction project carries proportion of the risks. The stakeholders are playing
a key role to manage the construction related risks as well as lessen the probability of risks. Risks
are to be moved to the third party such as subcontractors as well as suppliers. There is project
delay due to which there is delay in the estimated project budget. Loss of the construction project
time is connected to appreciation of the project costs, and saving of the time would provide profit
to the project stakeholders (Farnsworth et al., 2015). Saving of instance into the construction
project is associated to boost in direct as well as indirect costs. In the construction project, there
are some construction risks which are not eliminated as well as those are transferred to the
second party. Therefore, the contract in words means the procedure of portion of the construction
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
1.5 Research hypothesis
The research work is to be carried out based in identification of the risk allocation
methods which are taken into considerations for overcoming the construction project activities.
Following are the research hypothesis into the research study such as:
Hypothesis 1: Time and cost overrun into the construction projects are risk factors into
the organization.
Hypothesis 2: Construction delays as recurring problems in construction industry are
affecting the project success.
1.6 Problem statement
Each of the construction industry is innovative as it can intellect that it carries own set of
construction related risks. The risks are to be concerned into the construction project influence
the project stakeholders as well as construction project team members. The stakeholders those
are involved in construction project carries proportion of the risks. The stakeholders are playing
a key role to manage the construction related risks as well as lessen the probability of risks. Risks
are to be moved to the third party such as subcontractors as well as suppliers. There is project
delay due to which there is delay in the estimated project budget. Loss of the construction project
time is connected to appreciation of the project costs, and saving of the time would provide profit
to the project stakeholders (Farnsworth et al., 2015). Saving of instance into the construction
project is associated to boost in direct as well as indirect costs. In the construction project, there
are some construction risks which are not eliminated as well as those are transferred to the
second party. Therefore, the contract in words means the procedure of portion of the construction
14
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
related risks. The construction industry is involved with diverse organizations for delivering the
project work.
1.7 Rationale of the study
The portion of risk as well as optimization of risk is required to make sure about
achievement of the construction project. As each of the construction project risks are linked with
the work, therefore most of them are difficult to mitigate. Process of the risk allocation can help
in proper managing of the risks. This research study will important to the construction industry
linked with various structure projects in development of risk process as well as significance of
the risk allocation in construction related plan.
1.8 Outline of the research methodology
In order to investigate the optimization of risks as well as allocation of risks into the
construction industry, primary analysis is used. This selected data collection method is involved
with interacting with the contractors as well as employees those are working in the industry. The
research objectives are to be taken into consideration for gaining information as well as data
related to the topic. The method used for the primary data collection method is survey using
questionnaires. The survey questions are organized based on the risk optimization as well as risk
allocation processes used in this particular research study. After successfully achievement of the
data by surveying, the investigator can evaluate those raw data as well as analyzed it by means of
quantitative data analysis method. Through this method, the raw data are analyzed to evaluate the
risks allocation in the construction industry. The survey answers are to be evidenced from survey
will assist to identify the investigation questions plus research objectives.
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
related risks. The construction industry is involved with diverse organizations for delivering the
project work.
1.7 Rationale of the study
The portion of risk as well as optimization of risk is required to make sure about
achievement of the construction project. As each of the construction project risks are linked with
the work, therefore most of them are difficult to mitigate. Process of the risk allocation can help
in proper managing of the risks. This research study will important to the construction industry
linked with various structure projects in development of risk process as well as significance of
the risk allocation in construction related plan.
1.8 Outline of the research methodology
In order to investigate the optimization of risks as well as allocation of risks into the
construction industry, primary analysis is used. This selected data collection method is involved
with interacting with the contractors as well as employees those are working in the industry. The
research objectives are to be taken into consideration for gaining information as well as data
related to the topic. The method used for the primary data collection method is survey using
questionnaires. The survey questions are organized based on the risk optimization as well as risk
allocation processes used in this particular research study. After successfully achievement of the
data by surveying, the investigator can evaluate those raw data as well as analyzed it by means of
quantitative data analysis method. Through this method, the raw data are analyzed to evaluate the
risks allocation in the construction industry. The survey answers are to be evidenced from survey
will assist to identify the investigation questions plus research objectives.
15
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
1.9 Structure of the study
Based on following five chapters, the content of entire research study is divided as below:
Introduction: This particular chapter offers summary of the topic with background of the
research study, research aims, objectives as well as research questions. In this particular chapter,
there is investigation of optimization of risk allocation in construction projects. The research
aims as well as objectives are stated that it helps to better recognize chosen research topic. The
study is set forth throughout the problem statement.
Literature Review: The study provides review to recognize and give solutions to the risks
connected with the risk allocation into the construction industry. By means of literature sources,
the investigator is tried to assess conception into standardised method.
Research Methodology: In this particular chapter, there is discussion of the methods
which are used to explore optimization of the risk allocation into the construction projects. The
data analysis is done by collecting data through primary method and survey. It helps to guide
path which can lead to enhanced study the research topic in addition to facilitate to gather details
connected to the research study. In this chapter, there is selecting of research philosophy,
approach, design and others will assist the researcher to enhanced investigation of study. Proper
justifications behind selection of the tools are also provided in this particular chapter.
Data analysis: Based on the data collection methods, the researcher is opted to analyze
the sources such that appropriate results are to be generated in concern with investigating of
optimization of risk allocation methods in the construction industry. The data analysis will assist
the researcher to understand the research topic plus analyse based on responses of the research
participants.
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
1.9 Structure of the study
Based on following five chapters, the content of entire research study is divided as below:
Introduction: This particular chapter offers summary of the topic with background of the
research study, research aims, objectives as well as research questions. In this particular chapter,
there is investigation of optimization of risk allocation in construction projects. The research
aims as well as objectives are stated that it helps to better recognize chosen research topic. The
study is set forth throughout the problem statement.
Literature Review: The study provides review to recognize and give solutions to the risks
connected with the risk allocation into the construction industry. By means of literature sources,
the investigator is tried to assess conception into standardised method.
Research Methodology: In this particular chapter, there is discussion of the methods
which are used to explore optimization of the risk allocation into the construction projects. The
data analysis is done by collecting data through primary method and survey. It helps to guide
path which can lead to enhanced study the research topic in addition to facilitate to gather details
connected to the research study. In this chapter, there is selecting of research philosophy,
approach, design and others will assist the researcher to enhanced investigation of study. Proper
justifications behind selection of the tools are also provided in this particular chapter.
Data analysis: Based on the data collection methods, the researcher is opted to analyze
the sources such that appropriate results are to be generated in concern with investigating of
optimization of risk allocation methods in the construction industry. The data analysis will assist
the researcher to understand the research topic plus analyse based on responses of the research
participants.
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Discussion: This chapter provides with a brief synopsis of the entire findings from the
data analysis so that the student can appreciate the entire research study.
Conclusion and Recommendations: In this section, thesis will present entire observation
of the investigation topic so that it can comprise result and outcomes based on research findings.
Based on the research objectives, the researcher is tried to establish achievement level of
research topic as well as characterize linking of the research objectives with the research
findings.
1.10 Chapter summary
It is summarized that the researcher evaluates risk allocation as well as risk optimization
into the construction industry. Due to existence of the construction risks, it is not potential for the
stakeholders into the construction business to eliminate and overcome with the associated risks.
The parties those are involved into the construction project are trying to convey as well as alter
the predictable risks from the project so that the project can get success. However, this particular
chapter explains contented of the research topic throughout analyzing the research aim,
objectives as well as research questions. Followed by this particular chapter, there is literature
review which included risk management theories as well as concepts associated to investigate
optimization of risk allocation methods and risk factors which offer vast consequence on the
project work. Based on themes which are stated in this particular chapter, it will explain
particulars of the concepts which can improve information level of readers as well as researchers.
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
Discussion: This chapter provides with a brief synopsis of the entire findings from the
data analysis so that the student can appreciate the entire research study.
Conclusion and Recommendations: In this section, thesis will present entire observation
of the investigation topic so that it can comprise result and outcomes based on research findings.
Based on the research objectives, the researcher is tried to establish achievement level of
research topic as well as characterize linking of the research objectives with the research
findings.
1.10 Chapter summary
It is summarized that the researcher evaluates risk allocation as well as risk optimization
into the construction industry. Due to existence of the construction risks, it is not potential for the
stakeholders into the construction business to eliminate and overcome with the associated risks.
The parties those are involved into the construction project are trying to convey as well as alter
the predictable risks from the project so that the project can get success. However, this particular
chapter explains contented of the research topic throughout analyzing the research aim,
objectives as well as research questions. Followed by this particular chapter, there is literature
review which included risk management theories as well as concepts associated to investigate
optimization of risk allocation methods and risk factors which offer vast consequence on the
project work. Based on themes which are stated in this particular chapter, it will explain
particulars of the concepts which can improve information level of readers as well as researchers.
17
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
Chapter 2: Literature Review
2.1 Introduction
Risks Management process is referred to the process of identifying, managing and
monitoring the potential risk that are likely to occur within an organization. Thus it becomes
essential to ensure that proper mitigation strategies are implemented within the organization that
will help in managing the risks within the organization. The major steps that are associated with
risk management process include risk assessment and analysisis, risk evaluation, risk treatment
and responses. These three stages help in addressing the risk at early stages and provides better
way of managing team with an organization. According to the author Larson & Gray, (2017),
there are several risks that are probable to occur within a building project. Thusit becomes
essential to implement proper measures that will minimize the adverse effects of these risks.
Construction projects are practical projects hence the types of risks also gets divided. Mainly the
risk may occur at the time of designing the project or while working at the construction site. This
type of risk mainly arises due to lack of correct coordination and message between the
stakeholders and project members.
According to the author Islam et al., (2017), it becomes essential to recognize the risk
connected with and building project as the risks associated with construction project possess high
threat towards the team members as well as the clients. Mainly the risks that are associated with
construction project include shortage of labours, increase in material costing, natural disaster,
poor project management and improper management in the construction site. These issues need
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
Chapter 2: Literature Review
2.1 Introduction
Risks Management process is referred to the process of identifying, managing and
monitoring the potential risk that are likely to occur within an organization. Thus it becomes
essential to ensure that proper mitigation strategies are implemented within the organization that
will help in managing the risks within the organization. The major steps that are associated with
risk management process include risk assessment and analysisis, risk evaluation, risk treatment
and responses. These three stages help in addressing the risk at early stages and provides better
way of managing team with an organization. According to the author Larson & Gray, (2017),
there are several risks that are probable to occur within a building project. Thusit becomes
essential to implement proper measures that will minimize the adverse effects of these risks.
Construction projects are practical projects hence the types of risks also gets divided. Mainly the
risk may occur at the time of designing the project or while working at the construction site. This
type of risk mainly arises due to lack of correct coordination and message between the
stakeholders and project members.
According to the author Islam et al., (2017), it becomes essential to recognize the risk
connected with and building project as the risks associated with construction project possess high
threat towards the team members as well as the clients. Mainly the risks that are associated with
construction project include shortage of labours, increase in material costing, natural disaster,
poor project management and improper management in the construction site. These issues need
18
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
to be resolved before implementing a project so that the task can be completed within the given
time. It is observed that there is a high need to have proper way of mitigating daddies with Tina
construction project so that it can ensure better result towards the client. The main focal point of
this research study is to deter mine the functionality of each major stakeholder associated with
the construction project. In addition to this the research will also focus on identifying the risk
that is likely to impact the project. The main reason behind identifying the risk associated with
construction project is that this type of project changed to include complex technology and hence
the risks associated with the project also get complexes. Thus it becomes essential to address
each components connected with the project so that the risks linked to can be identified
effectively.
2.2 Types of risk in construction industry
According to the author Iqbal et al., (2015), construction projects are considered to be
one of the complex projects that are carried out by an organization. Hence it becomes essential to
ensure that proper monitoring is being done on each and every activity that is taking place we
Tinder projects. The different type of construction risk required to be recognized at untimely
stage so that the mitigation can be done effectively without any errors.In construction project it
becomes an important to analyze the hazard at early stages so that it is probability can be
identified effectively. The risk analysis will assist in accepting the impact on the project.There
are seven major risks that are related with construction industry (Taylor, Bogdan & DeVault,
2015). The risks are design risk, external risk, environmental risk, organizational risk, project
management risk, logistical risk, technical risk, financial risk and schedule risk. In this part of the
paper the main focus will be on describing the different types of risk that are likely to impact the
performance of construction industry.
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
to be resolved before implementing a project so that the task can be completed within the given
time. It is observed that there is a high need to have proper way of mitigating daddies with Tina
construction project so that it can ensure better result towards the client. The main focal point of
this research study is to deter mine the functionality of each major stakeholder associated with
the construction project. In addition to this the research will also focus on identifying the risk
that is likely to impact the project. The main reason behind identifying the risk associated with
construction project is that this type of project changed to include complex technology and hence
the risks associated with the project also get complexes. Thus it becomes essential to address
each components connected with the project so that the risks linked to can be identified
effectively.
2.2 Types of risk in construction industry
According to the author Iqbal et al., (2015), construction projects are considered to be
one of the complex projects that are carried out by an organization. Hence it becomes essential to
ensure that proper monitoring is being done on each and every activity that is taking place we
Tinder projects. The different type of construction risk required to be recognized at untimely
stage so that the mitigation can be done effectively without any errors.In construction project it
becomes an important to analyze the hazard at early stages so that it is probability can be
identified effectively. The risk analysis will assist in accepting the impact on the project.There
are seven major risks that are related with construction industry (Taylor, Bogdan & DeVault,
2015). The risks are design risk, external risk, environmental risk, organizational risk, project
management risk, logistical risk, technical risk, financial risk and schedule risk. In this part of the
paper the main focus will be on describing the different types of risk that are likely to impact the
performance of construction industry.
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INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
Logistical risks: these are the type of risk that is needed to be addressed at the starting of
a project. This mainly includes the issues that are faced with getting proper exes over
transportation services and availability of the equipment. Without addressing this type of risk it
becomes impossible to execute the project (Musa et al., 2016). Hence before planning the project
it becomes an essential to ensure that logistical risks are being mitigated efficiently from the
project.
External risks: external risk is related to the new stakeholders that are participating
within the project. It becomes essential to analyse each and every member’s attitude before
including them within the project. Apart from this external risk also includes the public
objections (Burtonshaw-Gunn, 2017). While developing a project on the site it becomes essential
to ensure that the public associated with that area are in favour of the construction. Otherwise it
will become difficult to construct a project.
Design risks: it is observed that while constructing a project several risks tends to occur.
This also includes risk associated with designing the project. Improper designing will lead to
impacting the whole project. In addition to this it has been observed that at late stages the
stockholder comes up with new changes (McNeil, Frey, & Embrechts, 2015). This turns to be a
major risk for the construction project. Hence it becomes essential to mitigate the risk as soon as
possible.
Technical risks: the technical risk includes anything that is restrictingthe project
manager from developing the project. It’s mainly include uncertainty of resources, improper
investigation of sites, ineffective team members, errors with in design, lack of proper materials
and insufficient funds. This type of error mainly occurs when the client make changes into the
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
Logistical risks: these are the type of risk that is needed to be addressed at the starting of
a project. This mainly includes the issues that are faced with getting proper exes over
transportation services and availability of the equipment. Without addressing this type of risk it
becomes impossible to execute the project (Musa et al., 2016). Hence before planning the project
it becomes an essential to ensure that logistical risks are being mitigated efficiently from the
project.
External risks: external risk is related to the new stakeholders that are participating
within the project. It becomes essential to analyse each and every member’s attitude before
including them within the project. Apart from this external risk also includes the public
objections (Burtonshaw-Gunn, 2017). While developing a project on the site it becomes essential
to ensure that the public associated with that area are in favour of the construction. Otherwise it
will become difficult to construct a project.
Design risks: it is observed that while constructing a project several risks tends to occur.
This also includes risk associated with designing the project. Improper designing will lead to
impacting the whole project. In addition to this it has been observed that at late stages the
stockholder comes up with new changes (McNeil, Frey, & Embrechts, 2015). This turns to be a
major risk for the construction project. Hence it becomes essential to mitigate the risk as soon as
possible.
Technical risks: the technical risk includes anything that is restrictingthe project
manager from developing the project. It’s mainly include uncertainty of resources, improper
investigation of sites, ineffective team members, errors with in design, lack of proper materials
and insufficient funds. This type of error mainly occurs when the client make changes into the
20
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
project objective (Taylan et al., 2014). As soon as the project concept is being changed the
requirement related to the project also gets changed. This becomes difficult to manage the
resources at that point of time. This leads to insufficient resources and hence the project suffers.
Risk associated with health and safety: this risk mainly includes the issues that are
associated with weather and seasonal implications. These risks can impact the performance of
the project. Sometimes it has been of served that due to harmful substances exposed at the time
of construction health of an employee gets hampered. Thus at such situation it becomes essential
for the organization to provide proper health care towards the employees so that they can quickly
recovered the situation (Serpella et al., 2014). In the construction site, people are being stuck by
the materials falling from the loads and it is being lifted as well as materials roll and kicked off
the work platforms. There are structural collapses which are ranged from the walls which are
fallen as the foundations are being undermined by excavations, buildings. People are also
suffering from the electrical accidents as well as burns in the construction site as they are used of
unsafe equipment’s as well as they are in contract in the clouds power lines plus buried of cables.
In the construction site, there is exposure of asbestos which can cause respiratory diseases
like cancer and others to the employees. The workers at the construction site are lifting of heavy
as well as awaked loads which are caused back and injuries. The injuries are being resulted from
single lift, while long term injuries can cause a consequence of repeated minor injuries because
of recurring lifting. In the construction site, there are higher level of noises which can cause
hearing losses as well as repeated usage of vibrating tools cause hand arm vibration syndrome
such as damage to the nerves as well as blood vessels (Islam et al., 2017). It can also cause
damage to the fingers as well as hands. There are also exposures of the materials which are
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
project objective (Taylan et al., 2014). As soon as the project concept is being changed the
requirement related to the project also gets changed. This becomes difficult to manage the
resources at that point of time. This leads to insufficient resources and hence the project suffers.
Risk associated with health and safety: this risk mainly includes the issues that are
associated with weather and seasonal implications. These risks can impact the performance of
the project. Sometimes it has been of served that due to harmful substances exposed at the time
of construction health of an employee gets hampered. Thus at such situation it becomes essential
for the organization to provide proper health care towards the employees so that they can quickly
recovered the situation (Serpella et al., 2014). In the construction site, people are being stuck by
the materials falling from the loads and it is being lifted as well as materials roll and kicked off
the work platforms. There are structural collapses which are ranged from the walls which are
fallen as the foundations are being undermined by excavations, buildings. People are also
suffering from the electrical accidents as well as burns in the construction site as they are used of
unsafe equipment’s as well as they are in contract in the clouds power lines plus buried of cables.
In the construction site, there is exposure of asbestos which can cause respiratory diseases
like cancer and others to the employees. The workers at the construction site are lifting of heavy
as well as awaked loads which are caused back and injuries. The injuries are being resulted from
single lift, while long term injuries can cause a consequence of repeated minor injuries because
of recurring lifting. In the construction site, there are higher level of noises which can cause
hearing losses as well as repeated usage of vibrating tools cause hand arm vibration syndrome
such as damage to the nerves as well as blood vessels (Islam et al., 2017). It can also cause
damage to the fingers as well as hands. There are also exposures of the materials which are
21
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
caused skin problems among the workers. Therefore, those are the problems of health as well as
safety so that those issues are to be overcome by means of risk management plan.
Management risk: the management and risk is referred o the issues that arises while
managing the project. Thus it becomes essential o manage each component of the project
effectively so that it can make sure accomplishment of the project. The development member
needs to ensure that each and every employee is aware of their responsibility and possess
capability to carry out the task within the given deadline (Farnsworth et al., 2015). Every
employee needs to possess proper management skills so that they can handle critical situations
efficiently.
Socio political risks: While constructing a project it has been observed that several type
of risk. Based on the project the risks arise and can cause severe breakdown of the project. Thus
it becomes essential to implement proper rules and regulation for the purpose of protecting the
project from further damages (Xiong et al., 2017).
Financial risks: While carrying out a project it has been of served that financial risk
tends to Arise. The main reason is it that the foreign exchange keeps on changing with time and
this fluctuation will impact the construction project (Pfaff, 2016). Whenever a project is being
carried out internationally then it depends on the foreign exchange for their financial part. This
leads to impacting the significance of the project as it the inflation rate, tax rate and exchange
rate tends to fluctuate over time.
Schedule risks: This risk mainly arises with improper scheduling of the task. Thus it
becomes essential to manage each activity based on the schedule. It has been observed that poor
scheduling process will eventually impact the overall performance of the project.
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
caused skin problems among the workers. Therefore, those are the problems of health as well as
safety so that those issues are to be overcome by means of risk management plan.
Management risk: the management and risk is referred o the issues that arises while
managing the project. Thus it becomes essential o manage each component of the project
effectively so that it can make sure accomplishment of the project. The development member
needs to ensure that each and every employee is aware of their responsibility and possess
capability to carry out the task within the given deadline (Farnsworth et al., 2015). Every
employee needs to possess proper management skills so that they can handle critical situations
efficiently.
Socio political risks: While constructing a project it has been observed that several type
of risk. Based on the project the risks arise and can cause severe breakdown of the project. Thus
it becomes essential to implement proper rules and regulation for the purpose of protecting the
project from further damages (Xiong et al., 2017).
Financial risks: While carrying out a project it has been of served that financial risk
tends to Arise. The main reason is it that the foreign exchange keeps on changing with time and
this fluctuation will impact the construction project (Pfaff, 2016). Whenever a project is being
carried out internationally then it depends on the foreign exchange for their financial part. This
leads to impacting the significance of the project as it the inflation rate, tax rate and exchange
rate tends to fluctuate over time.
Schedule risks: This risk mainly arises with improper scheduling of the task. Thus it
becomes essential to manage each activity based on the schedule. It has been observed that poor
scheduling process will eventually impact the overall performance of the project.
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2.3 Assessment of construction project
Risk assessment for construction project becomes an important concept as it helps in
analysing the risks at early stages and offers better mitigation measures.Therisk assessment
method method typically includes Identifying the risk, analyzing the risks and offering better
mitigation strategies towards the project manager. In addition to this it has been of served that by
allocating sufficient amount of resources it becomes easy to direct the risk connected with the
construction project (Qiang et al., 2016). Thusit can be stated that the resource allocation will
help in overcoming the risk taking place within the construction project.the main objective
behind having a correct risk management strategy is to reduse the costly reworks that are likely
to arise in future. The steps that will help in overcoming the list are described below:
Identifying the risk: at first the project member requires to identify the areas where risks
are likely to arise. Once the risk identified it becomes an essential to ensure that it is being
mitigated within the time.
Avoiding the risk: while performing a construction project the organization requires to
avoid the risks that are likely to impact the general presentation of the project. This is the best
way of managing the risk. Proper measures within the correct time frame will ensure that the risk
is being avoided and the challenges that are likely to come will get eradicated automatically.
Mitigating the risk: Whenever a company is conducting a project it becomes significant
to classify the risk at the first phase. Once it is being identified successful then it becomes
essential to implement proper steps that will help in meeting eating the issues. The mitigation
strategy will either minimise the effect of the risk over the construction project or will help in
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
2.3 Assessment of construction project
Risk assessment for construction project becomes an important concept as it helps in
analysing the risks at early stages and offers better mitigation measures.Therisk assessment
method method typically includes Identifying the risk, analyzing the risks and offering better
mitigation strategies towards the project manager. In addition to this it has been of served that by
allocating sufficient amount of resources it becomes easy to direct the risk connected with the
construction project (Qiang et al., 2016). Thusit can be stated that the resource allocation will
help in overcoming the risk taking place within the construction project.the main objective
behind having a correct risk management strategy is to reduse the costly reworks that are likely
to arise in future. The steps that will help in overcoming the list are described below:
Identifying the risk: at first the project member requires to identify the areas where risks
are likely to arise. Once the risk identified it becomes an essential to ensure that it is being
mitigated within the time.
Avoiding the risk: while performing a construction project the organization requires to
avoid the risks that are likely to impact the general presentation of the project. This is the best
way of managing the risk. Proper measures within the correct time frame will ensure that the risk
is being avoided and the challenges that are likely to come will get eradicated automatically.
Mitigating the risk: Whenever a company is conducting a project it becomes significant
to classify the risk at the first phase. Once it is being identified successful then it becomes
essential to implement proper steps that will help in meeting eating the issues. The mitigation
strategy will either minimise the effect of the risk over the construction project or will help in
23
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
completely removing it from the project. In order to eradicate the risk connected with the project
it becomes essential to follow proper regulations.
Transferring the risk: this is one of the solution that is being provided in order to ensure
that the risk are being transferred so that it. Thus not cost huge amount of money from the
project members.
Accepting the risks: the last stage is that the organization needs to perform feasibility
test within the project so that the issues can be addressed effectively. The construction project
needs to accept the issues so that they can ensure better progress in future.
Construction project needs to focus on addressing the risk effectively so that the risks can
be minimized. The major benefits that are offered with having proper risk management plan
within the construction project are that it helps to develop the project effectively. Please also
ensure that proper feasibility is provided to words the project. In addition to these in construction
project it is oobserved that by including proper resource allocateion risks can be easily mitigated.
Hence it becomes essential for the organization to consider resource allocation as one of the
main concept for mitigating the risk. In construction project it becomes necessary to include
proper resources along with proper team member that will be responsible for performing out the
project successfully. Risk management has considered one of the important factors for
construction project (Nasirzadeh, Khanzadi & Rezaie, 2014). This also helps in risk allocation
methods for the purpose of treating the risks.The major benefits that are opted by construction
industry with risk management is that it helps in reducing litigation risk and provides greater
insight to words insurance, liability issues and indemnity. In addition to the reader becomes easy
to manage the cost and budget or associated with the project and also helps in requisite the
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
completely removing it from the project. In order to eradicate the risk connected with the project
it becomes essential to follow proper regulations.
Transferring the risk: this is one of the solution that is being provided in order to ensure
that the risk are being transferred so that it. Thus not cost huge amount of money from the
project members.
Accepting the risks: the last stage is that the organization needs to perform feasibility
test within the project so that the issues can be addressed effectively. The construction project
needs to accept the issues so that they can ensure better progress in future.
Construction project needs to focus on addressing the risk effectively so that the risks can
be minimized. The major benefits that are offered with having proper risk management plan
within the construction project are that it helps to develop the project effectively. Please also
ensure that proper feasibility is provided to words the project. In addition to these in construction
project it is oobserved that by including proper resource allocateion risks can be easily mitigated.
Hence it becomes essential for the organization to consider resource allocation as one of the
main concept for mitigating the risk. In construction project it becomes necessary to include
proper resources along with proper team member that will be responsible for performing out the
project successfully. Risk management has considered one of the important factors for
construction project (Nasirzadeh, Khanzadi & Rezaie, 2014). This also helps in risk allocation
methods for the purpose of treating the risks.The major benefits that are opted by construction
industry with risk management is that it helps in reducing litigation risk and provides greater
insight to words insurance, liability issues and indemnity. In addition to the reader becomes easy
to manage the cost and budget or associated with the project and also helps in requisite the
24
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
requirements. Thus it can be stated that proper project risk management will assist in completing
the construction development within the given time.
2.4 Risk allocation methods and mechanisms
Risk allocation is mainly referred to the separation of responsibilities that associated with
losses plus gains that are taking place within the project. Risk allocation comes along with risk
management schedule and hence it becomes essential to address the risk at first stage. Risk
allocation decisions are mainly made by a group of people within the project so that they can
provide better results to words the project. The risk allocation mechanism includes carrying out
the total risk assessment processes and communicating it with other major stakeholders. This will
help in addressing each risks associated with the project effectively and will help in meeting the
needs set by the project inside the given time.The construction industry addresses the risk
allocation method before it has a card within the project. Risk allocation method is mainly
divided into two parts that is qualitative and quantities if method. According to the author
Farnsworth et al., (2015), quantitative risk allocation method includes allocating the risk that are
generally arises with the parties and in case of qualitative risk the risk are allocated based on the
risk allocation metrics. In case of contract project risk are outlined based on the contract. The
risk management process includes identifying the risk, assisting the desk at an untimely stage,
controlling over the construction project along with allocating to the best control team. However,
several authors stated that the purpose of risk mitigation strategy is to eliminate the risks after
analysing it properly. It has been of served that risk allocation method tends to influence positive
delivery to words the construction project. This paper tends to describe the risk allocation
method that will help the construction project. However, the conceptual model of risk it states
that risk allocation method helps in mitigating the risk that influences the overall performance of
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
requirements. Thus it can be stated that proper project risk management will assist in completing
the construction development within the given time.
2.4 Risk allocation methods and mechanisms
Risk allocation is mainly referred to the separation of responsibilities that associated with
losses plus gains that are taking place within the project. Risk allocation comes along with risk
management schedule and hence it becomes essential to address the risk at first stage. Risk
allocation decisions are mainly made by a group of people within the project so that they can
provide better results to words the project. The risk allocation mechanism includes carrying out
the total risk assessment processes and communicating it with other major stakeholders. This will
help in addressing each risks associated with the project effectively and will help in meeting the
needs set by the project inside the given time.The construction industry addresses the risk
allocation method before it has a card within the project. Risk allocation method is mainly
divided into two parts that is qualitative and quantities if method. According to the author
Farnsworth et al., (2015), quantitative risk allocation method includes allocating the risk that are
generally arises with the parties and in case of qualitative risk the risk are allocated based on the
risk allocation metrics. In case of contract project risk are outlined based on the contract. The
risk management process includes identifying the risk, assisting the desk at an untimely stage,
controlling over the construction project along with allocating to the best control team. However,
several authors stated that the purpose of risk mitigation strategy is to eliminate the risks after
analysing it properly. It has been of served that risk allocation method tends to influence positive
delivery to words the construction project. This paper tends to describe the risk allocation
method that will help the construction project. However, the conceptual model of risk it states
that risk allocation method helps in mitigating the risk that influences the overall performance of
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INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
the construction project negatively. Hence it becomes important to determine the objective
effectively so that it can provide better benefits.
In construction companies it has been observed that they have separate risk allocation
frameworks for deter mining the behavior associated with each participant and to determine the
progress of the project. The main aim behind implementing proper risk mitigation strategy within
the project helps in proper development process. Moreover, by using proper resources it becomes
easy to handle the possible risks. The risk allocation process will work based on the requirements
of construction project and aims at providing better solution towards the risks. According to the
author Chemweno et al., (2015), there is several risk allocation methodwithin in a construction
industry that helps in mitigating the risk. The possible risk allocation met thirds within the
construction industry are described below:
Risk assessment model: The risk assessment model is used for dealing with the risk that
is raised with various kinds of projects. In this study the use attends to analyse the aspects
associated with risk identification, risk assessment, the sky location and analyses of the disk with
in the construction industry of New Zealand. With the assist of this exacting model it becomes
easy to identify the risks factors that are connected with the project. The risk factors are mainly
considered with the help of contractual factors, environmental factors and financial factors.
Moreover the disks are being classified based on its impact on the project (Ledford & Gast,
2018). Hence the risks are identified based on their priority level this can be high, moderate, low
or it can be very low. In case of risk with low or very low margin then there is no need to
mitigate it urgently. Thus it can be stated that based on the risk assessment model, risks are being
identified.
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
the construction project negatively. Hence it becomes important to determine the objective
effectively so that it can provide better benefits.
In construction companies it has been observed that they have separate risk allocation
frameworks for deter mining the behavior associated with each participant and to determine the
progress of the project. The main aim behind implementing proper risk mitigation strategy within
the project helps in proper development process. Moreover, by using proper resources it becomes
easy to handle the possible risks. The risk allocation process will work based on the requirements
of construction project and aims at providing better solution towards the risks. According to the
author Chemweno et al., (2015), there is several risk allocation methodwithin in a construction
industry that helps in mitigating the risk. The possible risk allocation met thirds within the
construction industry are described below:
Risk assessment model: The risk assessment model is used for dealing with the risk that
is raised with various kinds of projects. In this study the use attends to analyse the aspects
associated with risk identification, risk assessment, the sky location and analyses of the disk with
in the construction industry of New Zealand. With the assist of this exacting model it becomes
easy to identify the risks factors that are connected with the project. The risk factors are mainly
considered with the help of contractual factors, environmental factors and financial factors.
Moreover the disks are being classified based on its impact on the project (Ledford & Gast,
2018). Hence the risks are identified based on their priority level this can be high, moderate, low
or it can be very low. In case of risk with low or very low margin then there is no need to
mitigate it urgently. Thus it can be stated that based on the risk assessment model, risks are being
identified.
26
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
Contract clause method: this method includes allocating the risk among the different
participants and stakeholders associated with the project. These are mainly done with the help of
contracts and even with the people outside the contract (Serpella et al., 2014). The contract
clause needs to be identified effectively so that it can meet the need of the contract based project.
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
Contract clause method: this method includes allocating the risk among the different
participants and stakeholders associated with the project. These are mainly done with the help of
contracts and even with the people outside the contract (Serpella et al., 2014). The contract
clause needs to be identified effectively so that it can meet the need of the contract based project.
27
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
2.5 Risk Management Plan
According to Binder (2016), the construction projects are generally complex and it mainly consists of different types of
internal as well as external risks. By analyzing different types of construction risks within the building construction industry, it
is identified that a specific risk is generally categorized into a number of sub-groups depending on the nature as well as on the
reason of occurrences. The construction risks are generally reflected in the table below which will include information about
the impact, probability as well as mitigation strategies of the risk after assessing the determined risks.
Risk
Id
Risk Description Impact Probabilit
y
Rank Responsible
person
Mitigation
1. Technical risk According to Yanek et al. (2016) the
technical risks are generally
considered as the restriction that
generally occurs from creating a
product that the customers generally
want. It is found that it is generally
included within the uncertainty of the
various resources along with proper
availability of different types of
materials as well as risks that are
associated with improper investigation
of the site. It is found that this type of
particular occurs when changes within
the scope of the project, requirements
as well as within the design of the
project is generally done. The
technical risk that occurs in the
construction industry generally delays
the project.
Major Likely High Site
supervisor
It is found that the
technical risk that occurs
within the construction
industry must be resolved
if the contractor as well
as the construction
manager take proper
initiative of checking the
scope, project
requirements as well as
design of the project
before the execution
phase so that the risks
that can arise can be
identified in the initial
stage and can be
effectively controlled.
2. Logistic risk It is stated by Stattin et al. (2018) that
logistic risks are generally considered
as the risk which must be determined
before creating the plan for the
project. The risks generally includes
accessibility of various types of
Moderate Likely Medium Supply
chain
manager
The logistic risks that
are associated with the
project and will create
negative impact on the
progress of the project
must be identified in the
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
2.5 Risk Management Plan
According to Binder (2016), the construction projects are generally complex and it mainly consists of different types of
internal as well as external risks. By analyzing different types of construction risks within the building construction industry, it
is identified that a specific risk is generally categorized into a number of sub-groups depending on the nature as well as on the
reason of occurrences. The construction risks are generally reflected in the table below which will include information about
the impact, probability as well as mitigation strategies of the risk after assessing the determined risks.
Risk
Id
Risk Description Impact Probabilit
y
Rank Responsible
person
Mitigation
1. Technical risk According to Yanek et al. (2016) the
technical risks are generally
considered as the restriction that
generally occurs from creating a
product that the customers generally
want. It is found that it is generally
included within the uncertainty of the
various resources along with proper
availability of different types of
materials as well as risks that are
associated with improper investigation
of the site. It is found that this type of
particular occurs when changes within
the scope of the project, requirements
as well as within the design of the
project is generally done. The
technical risk that occurs in the
construction industry generally delays
the project.
Major Likely High Site
supervisor
It is found that the
technical risk that occurs
within the construction
industry must be resolved
if the contractor as well
as the construction
manager take proper
initiative of checking the
scope, project
requirements as well as
design of the project
before the execution
phase so that the risks
that can arise can be
identified in the initial
stage and can be
effectively controlled.
2. Logistic risk It is stated by Stattin et al. (2018) that
logistic risks are generally considered
as the risk which must be determined
before creating the plan for the
project. The risks generally includes
accessibility of various types of
Moderate Likely Medium Supply
chain
manager
The logistic risks that
are associated with the
project and will create
negative impact on the
progress of the project
must be identified in the
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INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
transportation services with the proper
availability of different types of
equipment’s. It is found that without
properly addressing the various types
of logistical issue, the risks generally
causes delay in addition to various
types of losses.
initial stage before
developing the plan of
the project.
3. Health and
safety risk
Health and safety related risks
generally occur when the people are
generally not familiar with the
conditions of the entire area when the
work of construction is generally
carried out (Szymański, 2017). It is
found that the risks that occur due to
weather conditions generally create
delays in completing the construction
work that further increases the budget
of the project.
Moderate Possible Medium Site
supervisor
It is found that proper
report from the past
weather conditions
should be properly
collected for knowing the
weather quite effectively
so that the issues as well
as challenges that are
related with the weather
can be resolved quite
effectively.
4. Management
risk
It is stated by Waernbaum, Dahlquist
and Lind. (2019) that the management
risk generally uncertain the
productivity of different types of
resources. It is found that before
initiating the work of the project
successfully it generally helps in
ensuring that there are proper staffs
that are generally skilled and the
responsibilities of the staffs are
defined properly. Moreover, it is
analyzed that if the staff are not
experienced as well as skilled then it
will be quite difficult to manage the
risk.
Major Likely High Manager It is quite necessary to
provide proper facility of
training to the team
members and in addition
to this, the roles and
responsibilities of the
project team members
must be properly defined
so that the risks and
challenges that are
related with the project
can get resolved quite
effectively.
5. Financial risk The financial risks generally include
inflation as well as fluctuation of the
various foreign exchanges that are
generally incurred within the
construction work of the project. It is
found that when the entire work of the
Major Likely High Financial
manager
In order to resolve the
financial manager, ut is
quite necessary to track
the expenses of the
project quite effectively
so that the challenges
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
transportation services with the proper
availability of different types of
equipment’s. It is found that without
properly addressing the various types
of logistical issue, the risks generally
causes delay in addition to various
types of losses.
initial stage before
developing the plan of
the project.
3. Health and
safety risk
Health and safety related risks
generally occur when the people are
generally not familiar with the
conditions of the entire area when the
work of construction is generally
carried out (Szymański, 2017). It is
found that the risks that occur due to
weather conditions generally create
delays in completing the construction
work that further increases the budget
of the project.
Moderate Possible Medium Site
supervisor
It is found that proper
report from the past
weather conditions
should be properly
collected for knowing the
weather quite effectively
so that the issues as well
as challenges that are
related with the weather
can be resolved quite
effectively.
4. Management
risk
It is stated by Waernbaum, Dahlquist
and Lind. (2019) that the management
risk generally uncertain the
productivity of different types of
resources. It is found that before
initiating the work of the project
successfully it generally helps in
ensuring that there are proper staffs
that are generally skilled and the
responsibilities of the staffs are
defined properly. Moreover, it is
analyzed that if the staff are not
experienced as well as skilled then it
will be quite difficult to manage the
risk.
Major Likely High Manager It is quite necessary to
provide proper facility of
training to the team
members and in addition
to this, the roles and
responsibilities of the
project team members
must be properly defined
so that the risks and
challenges that are
related with the project
can get resolved quite
effectively.
5. Financial risk The financial risks generally include
inflation as well as fluctuation of the
various foreign exchanges that are
generally incurred within the
construction work of the project. It is
found that when the entire work of the
Major Likely High Financial
manager
In order to resolve the
financial manager, ut is
quite necessary to track
the expenses of the
project quite effectively
so that the challenges
29
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
project is carried then it is quite
necessary to understand the foreign
exchange (Wafa et al. 2018).
Moreover the issues that are
associated with the taxes can generally
cause fluctuation, inflation rate as well
as exchange rate for the allocation of
various types of funds within the
construction projects.
associated with the
project can get resolved
quite effectively.
6. Socio-political
risks
The import as well as custom related
restriction should be properly
disposed that are generally the socio-
political risks that are generally faced
within the construction project. It is
found that depending on the project, it
generally performs a number of
different types of regulations (McNeil,
Frey, & Embrechts, 2015).
Minor Likely Medium Managers It is found that the socio
political risks as well as
challenges can be
resolved by performing
different types pf codes
as well as regulations
that are generally
important and are
considered to be
important for the project
success.
7. Schedule risks It is found that if the schedule of the
project is not properly managed
effectively then it generally creates a
lot of issues and challenges in
managing the project that further
creates delay within the project. It is
found that the delay within the project
generally causes a number of financial
risks as well as challenges (Seaman et
al., 2017).
Major Likely High Project risk It is found that the risks
that are associated with
the schedule can
generally be reduced by
keeping track on the
schedule of the project so
that the project activities
gets completed within the
time and budget that is
presumed by the project
team members.
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
project is carried then it is quite
necessary to understand the foreign
exchange (Wafa et al. 2018).
Moreover the issues that are
associated with the taxes can generally
cause fluctuation, inflation rate as well
as exchange rate for the allocation of
various types of funds within the
construction projects.
associated with the
project can get resolved
quite effectively.
6. Socio-political
risks
The import as well as custom related
restriction should be properly
disposed that are generally the socio-
political risks that are generally faced
within the construction project. It is
found that depending on the project, it
generally performs a number of
different types of regulations (McNeil,
Frey, & Embrechts, 2015).
Minor Likely Medium Managers It is found that the socio
political risks as well as
challenges can be
resolved by performing
different types pf codes
as well as regulations
that are generally
important and are
considered to be
important for the project
success.
7. Schedule risks It is found that if the schedule of the
project is not properly managed
effectively then it generally creates a
lot of issues and challenges in
managing the project that further
creates delay within the project. It is
found that the delay within the project
generally causes a number of financial
risks as well as challenges (Seaman et
al., 2017).
Major Likely High Project risk It is found that the risks
that are associated with
the schedule can
generally be reduced by
keeping track on the
schedule of the project so
that the project activities
gets completed within the
time and budget that is
presumed by the project
team members.
30
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
2.6 Problems that are related with the risk allocation methods
It is stated by Rumrich et al., (2015) that there are number of issues that are mainly
linked with the present procedure of risk allocation within the construction industry which
further can create dispute, overrun of the costs as well as delay within the project as well as
issues that are associated with quality. The issues that are generally referenced with the
present literature as well as evidence that are mainly illustrated below:
Dispute: According to Mace et al., (2015), asserted that main contractual procedures
for resolving the disputes is generally considered for the fair allocation of various types of
hazards on the different contract parties within the entire building industry. It is stated that the
contractual danger of misallocation generally considered as one of the leading factor that
further creates a number of disputes within the construction in New Zealand.
Tensions: According to Hefler et al. (2018), most of the consultancies or the
organization is generally trying their best in shifting the risks to other types of parties that
further leads to more claims as well as disputes. It generally leads contribution of the lawyers
that further causes a number of legal procedures and thus it generally affects the cost as well
as quality related potential within the different projects.
Increases the project cost: It is stated by Vieira et al. (2017) that fallouts within the
risk misallocation within the industry of construction generally lead to disputes, legal
activities as well as delay within the project. It generally accrued the entire command as well
as brought of the parties that further affects the construction project performance. It further
helps in making different types of issues that further underlies the risk allocation related
methods.
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
2.6 Problems that are related with the risk allocation methods
It is stated by Rumrich et al., (2015) that there are number of issues that are mainly
linked with the present procedure of risk allocation within the construction industry which
further can create dispute, overrun of the costs as well as delay within the project as well as
issues that are associated with quality. The issues that are generally referenced with the
present literature as well as evidence that are mainly illustrated below:
Dispute: According to Mace et al., (2015), asserted that main contractual procedures
for resolving the disputes is generally considered for the fair allocation of various types of
hazards on the different contract parties within the entire building industry. It is stated that the
contractual danger of misallocation generally considered as one of the leading factor that
further creates a number of disputes within the construction in New Zealand.
Tensions: According to Hefler et al. (2018), most of the consultancies or the
organization is generally trying their best in shifting the risks to other types of parties that
further leads to more claims as well as disputes. It generally leads contribution of the lawyers
that further causes a number of legal procedures and thus it generally affects the cost as well
as quality related potential within the different projects.
Increases the project cost: It is stated by Vieira et al. (2017) that fallouts within the
risk misallocation within the industry of construction generally lead to disputes, legal
activities as well as delay within the project. It generally accrued the entire command as well
as brought of the parties that further affects the construction project performance. It further
helps in making different types of issues that further underlies the risk allocation related
methods.
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2.7 Optimal risk allocation and its related factors
It is stated by Mercer et al. (2017) that due to various types of fallouts that is
associated with risk allocation as well as impact that is mainly associated with the
construction industry, it is found that optimal risk related allocation is generally needed such
that the stakeholder’s welfare gets increased and the disputes within the entire construction
industry generally get reduced. It is stated by Mace et al. (2015) that optimal risk allocation is
one of the procedure that generally helps in managing the entire project quite effectively that
further helps in reducing the construction costs and generally helps assuming at lower cost. In
addition to this, it is analyzed that the optimal risk allocation generally gets implied for
passing the risks from one or more parties (Wafa et al., 2018). Thus, it generally helps in
seeking a way that further reduces the cost that is mainly raised out of the risks within the
entire construction projects.
Communication and negotiation: According to Stattin et al. (2018), within the
construction industry, it is found that there are number of stakeholders who use proper
communication challenges in order to communicate with other parties as well as in
negotiating with other parties. It further helps in facilitating proper risk management by
properly assisting the flow of the data in order to make proper decision that is mainly related
with the project.
Trust: It is stated by Binder (2016) that most positive as early as proper collaboration
and trust is generally considered as one of the important component that generally creates key
significance positive relations. Moreover, the procedure of optimal risk allocation generally
helps in entire construction industry for reducing the cost as well as the efficient operations.
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
2.7 Optimal risk allocation and its related factors
It is stated by Mercer et al. (2017) that due to various types of fallouts that is
associated with risk allocation as well as impact that is mainly associated with the
construction industry, it is found that optimal risk related allocation is generally needed such
that the stakeholder’s welfare gets increased and the disputes within the entire construction
industry generally get reduced. It is stated by Mace et al. (2015) that optimal risk allocation is
one of the procedure that generally helps in managing the entire project quite effectively that
further helps in reducing the construction costs and generally helps assuming at lower cost. In
addition to this, it is analyzed that the optimal risk allocation generally gets implied for
passing the risks from one or more parties (Wafa et al., 2018). Thus, it generally helps in
seeking a way that further reduces the cost that is mainly raised out of the risks within the
entire construction projects.
Communication and negotiation: According to Stattin et al. (2018), within the
construction industry, it is found that there are number of stakeholders who use proper
communication challenges in order to communicate with other parties as well as in
negotiating with other parties. It further helps in facilitating proper risk management by
properly assisting the flow of the data in order to make proper decision that is mainly related
with the project.
Trust: It is stated by Binder (2016) that most positive as early as proper collaboration
and trust is generally considered as one of the important component that generally creates key
significance positive relations. Moreover, the procedure of optimal risk allocation generally
helps in entire construction industry for reducing the cost as well as the efficient operations.
32
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
2.8 Literature Gap
From the above conversation of existing literature study, into the construction
industry there are included higher diversification of the investigation activities as well as
construction stakeholders are subject to various risks for which it is required to provide with
precise risk management support with the construction companies. The literature study is
provided with type of the project risks, processes of risk management, risk allocation aspects
as well as issues into the construction project plan. There is also discussion of the risk
allocation as well as elements of optimal risk allocation into the construction industry. In this
paper, scholarly evidences are seen to be existed in features of the construction industry,
especially in New Zealand as most of the literature studies are considered to be generic. The
concerned research study is addressed gaps which are found in the literature study, therefore
study of aspects of optimization of risk allocation raised into the construction industry in
business framework of New Zealand.
2.9 Summary
It is summarized that the construction risks are involved with the dangers as well as
harms which are caused due to various reasons. There are different interpretations of the
project risks into the construction projects. There is proper overview of the construction site
so that all the project related risks are mitigated, while after going through the construction
sites, there is identification of the construction risks such as schedule, budget, health and
safety risks and others. The construction industry is being grown in emerging economics as
compared to developed countries by means of growth which are conducted over the coming
years. The various procedures as well as aspects of identified risks are addressed plus reduced
with the issues which are immense in the construction related business organization. The
literature study is conducted to review the scholar and peer review articles plus
interpretations of the risk events which are presented into the construction industry. There are
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
2.8 Literature Gap
From the above conversation of existing literature study, into the construction
industry there are included higher diversification of the investigation activities as well as
construction stakeholders are subject to various risks for which it is required to provide with
precise risk management support with the construction companies. The literature study is
provided with type of the project risks, processes of risk management, risk allocation aspects
as well as issues into the construction project plan. There is also discussion of the risk
allocation as well as elements of optimal risk allocation into the construction industry. In this
paper, scholarly evidences are seen to be existed in features of the construction industry,
especially in New Zealand as most of the literature studies are considered to be generic. The
concerned research study is addressed gaps which are found in the literature study, therefore
study of aspects of optimization of risk allocation raised into the construction industry in
business framework of New Zealand.
2.9 Summary
It is summarized that the construction risks are involved with the dangers as well as
harms which are caused due to various reasons. There are different interpretations of the
project risks into the construction projects. There is proper overview of the construction site
so that all the project related risks are mitigated, while after going through the construction
sites, there is identification of the construction risks such as schedule, budget, health and
safety risks and others. The construction industry is being grown in emerging economics as
compared to developed countries by means of growth which are conducted over the coming
years. The various procedures as well as aspects of identified risks are addressed plus reduced
with the issues which are immense in the construction related business organization. The
literature study is conducted to review the scholar and peer review articles plus
interpretations of the risk events which are presented into the construction industry. There are
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INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
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identification as well as mitigation of the project risks by means of risk allocation methods.
The stakeholders are assigned to each of the project risks for reducing as well as overcoming
with the risks such that the project is completed on scheduled time period plus in the
estimated budget. As compared to other industries, the risks are to be higher in the
construction industry.
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
identification as well as mitigation of the project risks by means of risk allocation methods.
The stakeholders are assigned to each of the project risks for reducing as well as overcoming
with the risks such that the project is completed on scheduled time period plus in the
estimated budget. As compared to other industries, the risks are to be higher in the
construction industry.
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Chapter 3: Research Methodology
3.1 Introduction
The research methodology chapter is essential in terms of carrying out research
learning in a suitable manner. The research methodology selection is a crucial part of
undertaking explores studies in order to affect the most suitable and most appropriate
approach that is required for attaining a complete and detailed evaluation and analysis of the
topic and the various areas and aspects associated with the topic. In addition to that, selection
of the most apt research method is vital for gaining sufficient and relevant results and
outcome of the research process so that the research objectives are successfully met.
According to Brannen (2017), the research methodology chapter essentially helps in
considerate the overall procedure that is assumed for analyzing the specific research process
associated with the optimization of risk allocation in typical construction projects. In this
context, McCuskerand Gunaydin (2015) has pointed out that selection of the most suitable
research methodology helps in avoiding certain common errors that may be creating limits
within a particular research process. Apart from that, it undeniably applies each detail
processes included in the research method that helps in better investigation and evaluation of
the techniques to optimize the risk allocation process in construction projects.
3.2 Method Outline
The research methodology involves specific research approaches along with
procedures that can accelerate the entire process of obtaining relevant and useful information
regarding the research topics along with the associated concepts, ideas and aspects. In
addition to that, it helps in analysing how the construction project managers perform risk
allocation and what optimization techniques are most commonly adopted in those
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
Chapter 3: Research Methodology
3.1 Introduction
The research methodology chapter is essential in terms of carrying out research
learning in a suitable manner. The research methodology selection is a crucial part of
undertaking explores studies in order to affect the most suitable and most appropriate
approach that is required for attaining a complete and detailed evaluation and analysis of the
topic and the various areas and aspects associated with the topic. In addition to that, selection
of the most apt research method is vital for gaining sufficient and relevant results and
outcome of the research process so that the research objectives are successfully met.
According to Brannen (2017), the research methodology chapter essentially helps in
considerate the overall procedure that is assumed for analyzing the specific research process
associated with the optimization of risk allocation in typical construction projects. In this
context, McCuskerand Gunaydin (2015) has pointed out that selection of the most suitable
research methodology helps in avoiding certain common errors that may be creating limits
within a particular research process. Apart from that, it undeniably applies each detail
processes included in the research method that helps in better investigation and evaluation of
the techniques to optimize the risk allocation process in construction projects.
3.2 Method Outline
The research methodology involves specific research approaches along with
procedures that can accelerate the entire process of obtaining relevant and useful information
regarding the research topics along with the associated concepts, ideas and aspects. In
addition to that, it helps in analysing how the construction project managers perform risk
allocation and what optimization techniques are most commonly adopted in those
35
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
construction projects. In order to serve this purpose, a specific research philosophy will be
selected along with the most compatible research approach and research design, which will
guide the way to achieving the desired outcomes of the present study. In other words, the
research philosophy selected for this study will be positivism as it will assist in gaining
sufficient information depending on the specific reason and assessment of the research topic.
Along with that, the deductive research approach will be selected because it will effectively
allow in undertaking the study based on the identified secondary sources having adequate
useful and relevant data and information about the topic of concern. Apart from that, the
descriptive design will aid the study in crucial and using certain functional concepts in a
thorough and detailed manner in order to help yield a deeper impact of the study. Lastly, the
applications of primary in addition to secondary sources are useful for the investigation topic
in order to ensure adequate quality of the research analysis.
3.3 Research Philosophy
The research methodology involves the application of a suitable research philosophy
as it assists in the determination of the required method in order to add adequate facts of the
research topic. In other words, research philosophy helps in gaining a deeper insight and
considerate of the concepts associated with the research topic. According to Flick (2015), the
research philosophy selection is highly significant as it clarifies the assumption process,
which is naturally commenced by the researcher in terms of carrying out a research paper
however, the process of selecting a research philosophy based on the evaluation of a
particular topic is solely based on the scenery of the study and the type of investigation topic
that has been selected to remain a proper arrangement.
The positivism research philosophy mainly deals with the purpose and use of logic for
analysing the hidden facts and figures and information associated with the topic by applying
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
construction projects. In order to serve this purpose, a specific research philosophy will be
selected along with the most compatible research approach and research design, which will
guide the way to achieving the desired outcomes of the present study. In other words, the
research philosophy selected for this study will be positivism as it will assist in gaining
sufficient information depending on the specific reason and assessment of the research topic.
Along with that, the deductive research approach will be selected because it will effectively
allow in undertaking the study based on the identified secondary sources having adequate
useful and relevant data and information about the topic of concern. Apart from that, the
descriptive design will aid the study in crucial and using certain functional concepts in a
thorough and detailed manner in order to help yield a deeper impact of the study. Lastly, the
applications of primary in addition to secondary sources are useful for the investigation topic
in order to ensure adequate quality of the research analysis.
3.3 Research Philosophy
The research methodology involves the application of a suitable research philosophy
as it assists in the determination of the required method in order to add adequate facts of the
research topic. In other words, research philosophy helps in gaining a deeper insight and
considerate of the concepts associated with the research topic. According to Flick (2015), the
research philosophy selection is highly significant as it clarifies the assumption process,
which is naturally commenced by the researcher in terms of carrying out a research paper
however, the process of selecting a research philosophy based on the evaluation of a
particular topic is solely based on the scenery of the study and the type of investigation topic
that has been selected to remain a proper arrangement.
The positivism research philosophy mainly deals with the purpose and use of logic for
analysing the hidden facts and figures and information associated with the topic by applying
36
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
scientific manners. Even though the positivism approach is highly dominated by the use of
scientific method, however, it also considers the potential of a detailed and thorough
knowledge collection and observation and as a result, rejects metaphysics. On the other hand,
interpretivism is a different type of research philosophy that mainly supports epistemology,
where complex structures are involved in terms of analysing the social world and its aspects
and activities. In this context, Kumar (2019) has described the interpretative research
philosophy as the way to define certain objects with the help of concepts and theories
connected with the natural law as well as thereby, discard scientific approaches to a certain
extent. Lastly, the realism research philosophy can be considered as a mixed approach that
has incorporated traits from both the positivism and interpretivism research philosophies.
Realism usually describes the importance of human belief systems and thereby, studies
human interactions with the social world in order to analyse the ideas in addition to aspects
associated with the specific research title.
3.3.1 Justification for selection of the chosen Philosophy
The positivism research analyses the concealed aspects and data associated with the
process undertaken by the construction project managers in terms of applying the
optimization techniques for risk allocation. In this proposed research study, ontology
philosophy is to be used as it is offered with limitations plus guidance to the researcher by
means of the research study. It is based on collecting plus analyzing the recorded raw data.
The selected research philosophy in this study will help to determine and identify the hidden
facts based on the risk allocation procedures. The study is limited, therefore other research
philosophies are not considered for this study. The research philosophy is limited to role of
the investigator to evaluate the data leads to reduce errors of raw data.
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
scientific manners. Even though the positivism approach is highly dominated by the use of
scientific method, however, it also considers the potential of a detailed and thorough
knowledge collection and observation and as a result, rejects metaphysics. On the other hand,
interpretivism is a different type of research philosophy that mainly supports epistemology,
where complex structures are involved in terms of analysing the social world and its aspects
and activities. In this context, Kumar (2019) has described the interpretative research
philosophy as the way to define certain objects with the help of concepts and theories
connected with the natural law as well as thereby, discard scientific approaches to a certain
extent. Lastly, the realism research philosophy can be considered as a mixed approach that
has incorporated traits from both the positivism and interpretivism research philosophies.
Realism usually describes the importance of human belief systems and thereby, studies
human interactions with the social world in order to analyse the ideas in addition to aspects
associated with the specific research title.
3.3.1 Justification for selection of the chosen Philosophy
The positivism research analyses the concealed aspects and data associated with the
process undertaken by the construction project managers in terms of applying the
optimization techniques for risk allocation. In this proposed research study, ontology
philosophy is to be used as it is offered with limitations plus guidance to the researcher by
means of the research study. It is based on collecting plus analyzing the recorded raw data.
The selected research philosophy in this study will help to determine and identify the hidden
facts based on the risk allocation procedures. The study is limited, therefore other research
philosophies are not considered for this study. The research philosophy is limited to role of
the investigator to evaluate the data leads to reduce errors of raw data.
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3.4 Research Approach
It is essential to apply a research approach for guiding the research so that a particular
format can be followed to conduct the research in order to yield a successful outcome. The
chosen investigation topic is undertaken so that it can describe practical application of risk
allocation theories to gain access to the research paper based on selected title. There are two
categories of research approaches are to be taken into consideration such as deductive along
with inductive approach (Silverman, 2016). Into the deductive approach, it is started with the
selected research related questions for answering it in this paper. The selected procedure is
based on converting the theories based on the research questions and collecting data based on
survey questions. On the other hand, the inductive approach is to be used for creating of
theories. The researcher is recognized the research related questions which can follow with
the observations and determine the questions.
3.4.1 Justification for selection of the chosen Approach
In this particular study, deductive approach is used as this method is suitable for this
paper based on selected topic by means of theories of risk management. The investigator is
performed practical data analysis of collected raw data. The various techniques applied by
project managers for optimizing the risk allocation process in construction projects need to be
analysed in a clear and precise manner. Therefore, inductive approach is not appropriate for
implementation in this nature of study and thus, the deductive approach is implemented to
understand the techniques of risk allocation optimization in order to obtain deeper insights
into the topic concepts in a comprehensive manner.
3.5 Research Design
According to Quinlan (2019), the research design selection is part of applying a
research methodology to undertake a successful research has it provides a guiding framework
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
3.4 Research Approach
It is essential to apply a research approach for guiding the research so that a particular
format can be followed to conduct the research in order to yield a successful outcome. The
chosen investigation topic is undertaken so that it can describe practical application of risk
allocation theories to gain access to the research paper based on selected title. There are two
categories of research approaches are to be taken into consideration such as deductive along
with inductive approach (Silverman, 2016). Into the deductive approach, it is started with the
selected research related questions for answering it in this paper. The selected procedure is
based on converting the theories based on the research questions and collecting data based on
survey questions. On the other hand, the inductive approach is to be used for creating of
theories. The researcher is recognized the research related questions which can follow with
the observations and determine the questions.
3.4.1 Justification for selection of the chosen Approach
In this particular study, deductive approach is used as this method is suitable for this
paper based on selected topic by means of theories of risk management. The investigator is
performed practical data analysis of collected raw data. The various techniques applied by
project managers for optimizing the risk allocation process in construction projects need to be
analysed in a clear and precise manner. Therefore, inductive approach is not appropriate for
implementation in this nature of study and thus, the deductive approach is implemented to
understand the techniques of risk allocation optimization in order to obtain deeper insights
into the topic concepts in a comprehensive manner.
3.5 Research Design
According to Quinlan (2019), the research design selection is part of applying a
research methodology to undertake a successful research has it provides a guiding framework
38
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
to understand and evaluate the research topic. This process in turn essentially helps in the
selection of a proper method of data collection and data analysis. There are three main types
of research designs in academic research such as follows.
The exploratory research design is essential in order to acknowledge the dissimilar
ideas, opinions and thoughts that are required for completing a particular research paper. On
the other hand, the explanatory research design is focused at describing the individual
occurrence of the events and incidents that highly influence or hold potential impact on the
outcome of the investigation study. Lastly, the descriptive research design typically aims to
obtain adequate details and information for understanding the sequential occurrence of the
incidents and events that show the proper description of the topic of the study. On the other
hand, the descriptive research design can effectively rationalize the existing practices as well
as undertake desired decisions required for analysing the selected topic under consideration.
3.5.1 Justification for selection of the chosen Design
Explanatory research design is not suitable in this research because it typically
supports the longitudinal type of study. However, the descriptive research design can
effectively scrutinize the various aspects and areas associated with the field of study.
Therefore, in this exacting study, descriptive method is to be taken into consideration which
is provided with detailed methods suitable to investigate the risk allocation methods which
are to be taken in the construction industry. The selected procedure will help the researcher to
complete the research structure in scheduled time instance. The selected method is to be
taken so that the selected research method is justifiable. The research design is to be taken for
defining detailed procedures related to risk allocation procedures into the selected industry.
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
to understand and evaluate the research topic. This process in turn essentially helps in the
selection of a proper method of data collection and data analysis. There are three main types
of research designs in academic research such as follows.
The exploratory research design is essential in order to acknowledge the dissimilar
ideas, opinions and thoughts that are required for completing a particular research paper. On
the other hand, the explanatory research design is focused at describing the individual
occurrence of the events and incidents that highly influence or hold potential impact on the
outcome of the investigation study. Lastly, the descriptive research design typically aims to
obtain adequate details and information for understanding the sequential occurrence of the
incidents and events that show the proper description of the topic of the study. On the other
hand, the descriptive research design can effectively rationalize the existing practices as well
as undertake desired decisions required for analysing the selected topic under consideration.
3.5.1 Justification for selection of the chosen Design
Explanatory research design is not suitable in this research because it typically
supports the longitudinal type of study. However, the descriptive research design can
effectively scrutinize the various aspects and areas associated with the field of study.
Therefore, in this exacting study, descriptive method is to be taken into consideration which
is provided with detailed methods suitable to investigate the risk allocation methods which
are to be taken in the construction industry. The selected procedure will help the researcher to
complete the research structure in scheduled time instance. The selected method is to be
taken so that the selected research method is justifiable. The research design is to be taken for
defining detailed procedures related to risk allocation procedures into the selected industry.
39
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
3.6 Data Collection Method
The data collection method is crucial for conducting the research because it deals with
the classification of the required approach for collecting useful and relevant information and
facts that are necessary to achieve a successful conclusion with sufficient details. According
to Silverman (2016), data collection is performed in a research in order to derive accurate and
exact results yielded from the research process, which can enable a standard format to be
followed for the research work. In this particular study, data collection method is to be taken
into consideration. The procedure is to be taken for gathering as well as collecting data
related to the topic. The methods are to be utilized for reducing errors where accurate data
made sure that collected data are accessible for this investigation study.
3.6.1 Data Sources: Primary and Secondary
Data sources are essential in order to perform a proper penetration on the chosen
research topic and identifying information that are essential for meeting the research
requirements. The primary and secondary data sources are two major types of data sources
that present useful materials in order to gain deeper insight into the research topic.
Mackeyand Gass (2015) has illustrated that the primary data sources are critical to implement
in a research mainly because it essentially needs proper clarification on the viability and
reliability. The data sources under primary data collection methods are survey, interview and
focus group. On the other hand, in case of the use of secondary sources in the research, the
already existing information is gathered from various sources with the purpose of widening
the concept and ideas associated with the research topic in order to enable proper study of the
aspects and factors by involving more detailed description and information.
Based on the selected study, primary data sources are to be taken with the interactive
sessions with the employees as well as contractors those are working into the industry. The
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
3.6 Data Collection Method
The data collection method is crucial for conducting the research because it deals with
the classification of the required approach for collecting useful and relevant information and
facts that are necessary to achieve a successful conclusion with sufficient details. According
to Silverman (2016), data collection is performed in a research in order to derive accurate and
exact results yielded from the research process, which can enable a standard format to be
followed for the research work. In this particular study, data collection method is to be taken
into consideration. The procedure is to be taken for gathering as well as collecting data
related to the topic. The methods are to be utilized for reducing errors where accurate data
made sure that collected data are accessible for this investigation study.
3.6.1 Data Sources: Primary and Secondary
Data sources are essential in order to perform a proper penetration on the chosen
research topic and identifying information that are essential for meeting the research
requirements. The primary and secondary data sources are two major types of data sources
that present useful materials in order to gain deeper insight into the research topic.
Mackeyand Gass (2015) has illustrated that the primary data sources are critical to implement
in a research mainly because it essentially needs proper clarification on the viability and
reliability. The data sources under primary data collection methods are survey, interview and
focus group. On the other hand, in case of the use of secondary sources in the research, the
already existing information is gathered from various sources with the purpose of widening
the concept and ideas associated with the research topic in order to enable proper study of the
aspects and factors by involving more detailed description and information.
Based on the selected study, primary data sources are to be taken with the interactive
sessions with the employees as well as contractors those are working into the industry. The
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selected method is to be taken based on identified research related objectives. Based on the
collected information, literature sources are taken as the output which is taken from the peer
review articles related to the risk allocation. The secondary sources are to be taken both in
online as well as offline sources like the journal articles, websites as well as blogs. The data
collection methods are to be clarified based on reliability as well as validity of the collected
raw data.
3.6.2 Data Techniques: Qualitative and Quantitative
The use of qualitative data analysis is useful in terms of recording the opinions and
thoughts of the concerned people in a narrative form so that the information can better
describer the overall aspects of the research topic in order to serve the purpose of the study.
In this context, Taylor, Bogdanand DeVault (2015) has illustrated that the use of qualitative
data can potentially benefit the study by adding valuable theoretical concepts to lead the
study towards a successful outcome/ conclusion. On the other hand, the quantitative data
analysis process solely deals with the application of statistical methods by recording
numerical samples of data collected from a large sample size. The chose procedure of data
analysis is termed as regression analysis. This data analysis method is selected to collect data
from the raw data using excel sheet. The contractors those are involved into the construction
industry are to be taken for performing the quantitative research methods.
3.7 Population and Sample
A population in a research is termed as a well-defined group of individuals or even
objects that essentially possess certain comparable traits or distinctiveness along with a
general binding of traits. A population is typically referred to as the bigger number of a
particularly selected sample size. The research involves primary data collection and thus,
essentially requires the involvement of target population. Determination of the target
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
selected method is to be taken based on identified research related objectives. Based on the
collected information, literature sources are taken as the output which is taken from the peer
review articles related to the risk allocation. The secondary sources are to be taken both in
online as well as offline sources like the journal articles, websites as well as blogs. The data
collection methods are to be clarified based on reliability as well as validity of the collected
raw data.
3.6.2 Data Techniques: Qualitative and Quantitative
The use of qualitative data analysis is useful in terms of recording the opinions and
thoughts of the concerned people in a narrative form so that the information can better
describer the overall aspects of the research topic in order to serve the purpose of the study.
In this context, Taylor, Bogdanand DeVault (2015) has illustrated that the use of qualitative
data can potentially benefit the study by adding valuable theoretical concepts to lead the
study towards a successful outcome/ conclusion. On the other hand, the quantitative data
analysis process solely deals with the application of statistical methods by recording
numerical samples of data collected from a large sample size. The chose procedure of data
analysis is termed as regression analysis. This data analysis method is selected to collect data
from the raw data using excel sheet. The contractors those are involved into the construction
industry are to be taken for performing the quantitative research methods.
3.7 Population and Sample
A population in a research is termed as a well-defined group of individuals or even
objects that essentially possess certain comparable traits or distinctiveness along with a
general binding of traits. A population is typically referred to as the bigger number of a
particularly selected sample size. The research involves primary data collection and thus,
essentially requires the involvement of target population. Determination of the target
41
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
population is an important part of conducting a primary data collection. To be more precise, a
sampling frame needs to be drawn from the identified and agreed upon target population in
terms of researching and analysing.
3.7.1 Sampling Technique
It is highly crucial to select the most appropriate sampling technique when a research
involves the collection and analysis of primary data. In order to serve this purpose, it is highly
essential to choose the most appropriate sampling technique from the available sampling
techniques such as systematic sampling, clustered sampling, convenience sampling, stratified
sampling and simple random sampling. Sampling technique will be selected in order to apply
it to the questionnaire survey that will be based on the Likert scale for evaluation purpose.
3.7.2 Sample Size
The total number of people those are assigned to the research process is the
population. In this particular thesis paper, contractors are to be taken as the population. The
researcher is not to be taken as the research participants; hence there is smaller population
those are considered for the research sample. Based on the simple random probability
sampling, the contractors are to be taken. The online questionnaires are used so that survey is
being performed on strongly agree and strongly disagree platform. The sample size of this
study is to be considered as 25.
3.8 Ethical Considerations
The research essentially follows a code of conduct for maintaining proper research
ethics. The research ethics are important for identifying the right and wring set of behaviour.
Following ethical principles are applied in this study:
Respondent’s involvement: The respondent voluntarily participated in the study and
were not pressurized or forced in any way.
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
population is an important part of conducting a primary data collection. To be more precise, a
sampling frame needs to be drawn from the identified and agreed upon target population in
terms of researching and analysing.
3.7.1 Sampling Technique
It is highly crucial to select the most appropriate sampling technique when a research
involves the collection and analysis of primary data. In order to serve this purpose, it is highly
essential to choose the most appropriate sampling technique from the available sampling
techniques such as systematic sampling, clustered sampling, convenience sampling, stratified
sampling and simple random sampling. Sampling technique will be selected in order to apply
it to the questionnaire survey that will be based on the Likert scale for evaluation purpose.
3.7.2 Sample Size
The total number of people those are assigned to the research process is the
population. In this particular thesis paper, contractors are to be taken as the population. The
researcher is not to be taken as the research participants; hence there is smaller population
those are considered for the research sample. Based on the simple random probability
sampling, the contractors are to be taken. The online questionnaires are used so that survey is
being performed on strongly agree and strongly disagree platform. The sample size of this
study is to be considered as 25.
3.8 Ethical Considerations
The research essentially follows a code of conduct for maintaining proper research
ethics. The research ethics are important for identifying the right and wring set of behaviour.
Following ethical principles are applied in this study:
Respondent’s involvement: The respondent voluntarily participated in the study and
were not pressurized or forced in any way.
42
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
Data application: Application of the collected data will only be for academic
purposes and no form of commercial applications will be entertained in the study.
Respondent’s anonymity: The primary data collection will be carried out by
maintaining anonymity of the respondents. Their identities have been anonymised along with
the information provided by them and will not be disclosed without their consent.
3.9 Research Limitations
Wildemuth (2016) stated that there are natural research limitations which can define
areas with the limited scope of this study. Based on this particular research work, following
are list of the research limitations which are taken into consideration such as:
1. The participants who are taken for this research study are not involved in any type of
pressure. The contractors are involved into the construction industry are being biased in the
organization as they can provide affect on the chosen topic (Hickson, 2016). The challenges
which are based on reliability are also identified in this paper.
2. Because of the cross sectional nature of this selected study and chosen title, the project
researcher is being time limited which can lead to the research work into shorter period of
time (Walliman, 2017). Due to this nature of research work, a detailed work as well as
analysis is not done.
3. Due to limited budget of this study, the researcher is faced limitations in the study
(Glesne, 2015). The budget can limit the application of using the SPSS software as it will
provide with quality data analysis by means of statistical tools.
3.10 Time Horizons
The nature of the present study is cross sectional and thus, the estimated time taken for
completing the study in a successful manner will be depending upon the overall nature of the
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
Data application: Application of the collected data will only be for academic
purposes and no form of commercial applications will be entertained in the study.
Respondent’s anonymity: The primary data collection will be carried out by
maintaining anonymity of the respondents. Their identities have been anonymised along with
the information provided by them and will not be disclosed without their consent.
3.9 Research Limitations
Wildemuth (2016) stated that there are natural research limitations which can define
areas with the limited scope of this study. Based on this particular research work, following
are list of the research limitations which are taken into consideration such as:
1. The participants who are taken for this research study are not involved in any type of
pressure. The contractors are involved into the construction industry are being biased in the
organization as they can provide affect on the chosen topic (Hickson, 2016). The challenges
which are based on reliability are also identified in this paper.
2. Because of the cross sectional nature of this selected study and chosen title, the project
researcher is being time limited which can lead to the research work into shorter period of
time (Walliman, 2017). Due to this nature of research work, a detailed work as well as
analysis is not done.
3. Due to limited budget of this study, the researcher is faced limitations in the study
(Glesne, 2015). The budget can limit the application of using the SPSS software as it will
provide with quality data analysis by means of statistical tools.
3.10 Time Horizons
The nature of the present study is cross sectional and thus, the estimated time taken for
completing the study in a successful manner will be depending upon the overall nature of the
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study. The study essentially involves a restricted time limit and thereby, Gantt chart has been
used for ensuring an easy, concise and comprehensive representation of the research activities
and their interrelations. The Gantt chart represented below shows the segregation of the key
tasks as per the structure of the research study by following a systematic and sequential
approach.
Main
activities/
stages
Week 1 Week 2 Week 3 Week 4 Week 5 Week 6 Week 7
Topic
Selection
Data
collection
from
secondary
sources
Creating
layout
Literature
review
Formation of
the research
Plan
Selection of
the
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
study. The study essentially involves a restricted time limit and thereby, Gantt chart has been
used for ensuring an easy, concise and comprehensive representation of the research activities
and their interrelations. The Gantt chart represented below shows the segregation of the key
tasks as per the structure of the research study by following a systematic and sequential
approach.
Main
activities/
stages
Week 1 Week 2 Week 3 Week 4 Week 5 Week 6 Week 7
Topic
Selection
Data
collection
from
secondary
sources
Creating
layout
Literature
review
Formation of
the research
Plan
Selection of
the
44
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
Appropriate
Research
Techniques
Primary data
collection
Analysis &
Interpretation
of Data
Collection
Findings of
the Data
Conclusion of
the Study
Formation of
Rough Draft
Submission
of Final
Work
Table 3.1: Research timeline
(Source: Created by the Author)
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
Appropriate
Research
Techniques
Primary data
collection
Analysis &
Interpretation
of Data
Collection
Findings of
the Data
Conclusion of
the Study
Formation of
Rough Draft
Submission
of Final
Work
Table 3.1: Research timeline
(Source: Created by the Author)
45
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
3.11 Summary
It can be summarized that the construction project risk factors will be analysed by
means of set of questionnaires which are being distributed among the research participants
into the construction industry. The risk management theories are also taken into consideration
so that it provided with application of risk allocation methods as well as experience with
predicting the hazards caused through entire execution of the project. The researcher is
required to identify the nature of this paper so that they can identify best methods which are
helpful for this study to select methods as well as procedures. The methods are used to
analyse the optimization of risk allocation methods identified into the construction industry.
The research approach is selected to build risk theories with classification of the data analysis
concepts.
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
3.11 Summary
It can be summarized that the construction project risk factors will be analysed by
means of set of questionnaires which are being distributed among the research participants
into the construction industry. The risk management theories are also taken into consideration
so that it provided with application of risk allocation methods as well as experience with
predicting the hazards caused through entire execution of the project. The researcher is
required to identify the nature of this paper so that they can identify best methods which are
helpful for this study to select methods as well as procedures. The methods are used to
analyse the optimization of risk allocation methods identified into the construction industry.
The research approach is selected to build risk theories with classification of the data analysis
concepts.
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Chapter 4: Data Analysis and Results
4.1 Introduction
In this particular chapter, the researcher is required to try and show data analysis of
the investigation of optimization of risk allocation in construction projects. By means of the
quantitative data analysis, it helps to become part of the research procedure to raise quality of
data as well as information. Silverman (2016) pointed that the data analysis is helped the
researcher to realize the hypothetical knowledge into the practical applications. Taylor,
Bogdan and DeVault (2015) examined that data analysis is occupied with complications as
well as limitations and also the exploitation of collected raw data. There is also lack of
genuineness into the research work. The practice of crosscheck is being observed via the data
analysis into the research investigation. Investigation of optimization of risk allocation in
construction projects is being evaluated in this particular chapter by means of feedbacks
which are to be taken by the respondents based on the construction organizations. Based on
the composed data, there is analyzing of the investigation findings to add validity into data
collection processes. The respondents those are considered for the primary data collection
process are employees those are working into the construction projects so that more detailed
data is being extracted with this investigation work.
4.2 Quantitative Data Analysis
In this current section, the junior employees of the construction projects are measured
for the qualitative analysis such that the researcher can appreciate investigation of
optimization of risk allocation in construction projects. The total numbers of respondents
those are involved for the quantitative section are 25 as other employees are not involved as
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
Chapter 4: Data Analysis and Results
4.1 Introduction
In this particular chapter, the researcher is required to try and show data analysis of
the investigation of optimization of risk allocation in construction projects. By means of the
quantitative data analysis, it helps to become part of the research procedure to raise quality of
data as well as information. Silverman (2016) pointed that the data analysis is helped the
researcher to realize the hypothetical knowledge into the practical applications. Taylor,
Bogdan and DeVault (2015) examined that data analysis is occupied with complications as
well as limitations and also the exploitation of collected raw data. There is also lack of
genuineness into the research work. The practice of crosscheck is being observed via the data
analysis into the research investigation. Investigation of optimization of risk allocation in
construction projects is being evaluated in this particular chapter by means of feedbacks
which are to be taken by the respondents based on the construction organizations. Based on
the composed data, there is analyzing of the investigation findings to add validity into data
collection processes. The respondents those are considered for the primary data collection
process are employees those are working into the construction projects so that more detailed
data is being extracted with this investigation work.
4.2 Quantitative Data Analysis
In this current section, the junior employees of the construction projects are measured
for the qualitative analysis such that the researcher can appreciate investigation of
optimization of risk allocation in construction projects. The total numbers of respondents
those are involved for the quantitative section are 25 as other employees are not involved as
47
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
well as interested, therefore they are being discarded from the sample of this particular
research study.
Section 1: General information
1. Gender
Options No of respondents Total respondents Percentage of
responses
Male 11 25 44%
Female 14 25 56%
Table 4.1: Gender
Figure 4.1: Gender
From the above figure, it is found that 44% of the respondents involved in the survey
is male and 56% of the respondents involved in the survey is female.
2. Age group
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
well as interested, therefore they are being discarded from the sample of this particular
research study.
Section 1: General information
1. Gender
Options No of respondents Total respondents Percentage of
responses
Male 11 25 44%
Female 14 25 56%
Table 4.1: Gender
Figure 4.1: Gender
From the above figure, it is found that 44% of the respondents involved in the survey
is male and 56% of the respondents involved in the survey is female.
2. Age group
48
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
Options No of respondents Total respondents Percentage of
responses
25-29 years 4 25 16%
30-39 years 15 25 60%
40-49 years 2 25 8%
Above 50 years 4 25 16%
Table 4.2: Age group
Figure 4.2: Age group
From the above figure, it is found that 16% of the respondents involved in the survey
is 25-29 years, 60% of them are age group between 30-39 years. It is found that 8% of the
respondents are between 40-49 years while 16% of them are above 50 years.
3. Please mention your position
Options No of Total Percentage of
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
Options No of respondents Total respondents Percentage of
responses
25-29 years 4 25 16%
30-39 years 15 25 60%
40-49 years 2 25 8%
Above 50 years 4 25 16%
Table 4.2: Age group
Figure 4.2: Age group
From the above figure, it is found that 16% of the respondents involved in the survey
is 25-29 years, 60% of them are age group between 30-39 years. It is found that 8% of the
respondents are between 40-49 years while 16% of them are above 50 years.
3. Please mention your position
Options No of Total Percentage of
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INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
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respondents respondents responses
Junior construction engineer 10 25 40%
Junior designer 6 25 24%
Junior legal assistant 5 25 20%
Junior property developer 4 25 16%
Table 4.3: Position of the respondents
Figure 4.3: Position of the respondents
From the above figure, it is found that 40% of the respondents involved are junior
construction engineer, 24% of them are junior designer. It is found that 20% of the
respondents are junior legal assistant while 16% of them are junior property developer.
4. Experience in the construction industry
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
respondents respondents responses
Junior construction engineer 10 25 40%
Junior designer 6 25 24%
Junior legal assistant 5 25 20%
Junior property developer 4 25 16%
Table 4.3: Position of the respondents
Figure 4.3: Position of the respondents
From the above figure, it is found that 40% of the respondents involved are junior
construction engineer, 24% of them are junior designer. It is found that 20% of the
respondents are junior legal assistant while 16% of them are junior property developer.
4. Experience in the construction industry
50
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
Options No of
respondents
Total
respondents
Percentage of
responses
1 year 2 25 8%
2 years 11 25 44%
3 years 8 25 32%
Above 3 years 4 25 16%
Table 4.4: Experience in the construction industry
Figure 4.4: Experience in the construction industry
From the above figure, it is found that 44% of the respondents involved in the survey
have experience of 2 years, 8% of them have 1 year, 32% of them have 3 years and 16% of
them have above 3 years.
5. Are you knowledgeable in the risk management used in the construction project?
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
Options No of
respondents
Total
respondents
Percentage of
responses
1 year 2 25 8%
2 years 11 25 44%
3 years 8 25 32%
Above 3 years 4 25 16%
Table 4.4: Experience in the construction industry
Figure 4.4: Experience in the construction industry
From the above figure, it is found that 44% of the respondents involved in the survey
have experience of 2 years, 8% of them have 1 year, 32% of them have 3 years and 16% of
them have above 3 years.
5. Are you knowledgeable in the risk management used in the construction project?
51
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
Options No of respondents Total respondents Percentage of
responses
Yes 14 25 56%
No 11 25 44%
Table 4.5: Knowledge about the risk management in the construction project
Figure 4.5: Knowledge about the risk management in the construction project
From the above figure, it is found that 56% of the respondents involved in the survey
are having knowledge into the risk management use into the construction projects. It is found
that 44% of them have no such knowledge about the risk management.
Section 2: Investigation of optimization of risk allocation in construction projects
1. How far do you agree that the construction project implementation is done based on cost,
functionality and time?
Options No of Total Percentage of
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
Options No of respondents Total respondents Percentage of
responses
Yes 14 25 56%
No 11 25 44%
Table 4.5: Knowledge about the risk management in the construction project
Figure 4.5: Knowledge about the risk management in the construction project
From the above figure, it is found that 56% of the respondents involved in the survey
are having knowledge into the risk management use into the construction projects. It is found
that 44% of them have no such knowledge about the risk management.
Section 2: Investigation of optimization of risk allocation in construction projects
1. How far do you agree that the construction project implementation is done based on cost,
functionality and time?
Options No of Total Percentage of
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respondents respondents responses
Strongly disagree 7 25 28%
Disagree 2 25 8%
Neutral 5 25 20%
Agree 9 25 36%
Strongly agree 2 25 8%
Table 4.6: Construction project implementation is done based on cost, functionality and
time
Figure 4.6: Construction project implementation is done based on cost, functionality
and time
From the above figure, it is found that 36% of the respondents involved in the survey
are agreed that the construction project implementation is done based on cost, functionality
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
respondents respondents responses
Strongly disagree 7 25 28%
Disagree 2 25 8%
Neutral 5 25 20%
Agree 9 25 36%
Strongly agree 2 25 8%
Table 4.6: Construction project implementation is done based on cost, functionality and
time
Figure 4.6: Construction project implementation is done based on cost, functionality
and time
From the above figure, it is found that 36% of the respondents involved in the survey
are agreed that the construction project implementation is done based on cost, functionality
53
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
and time. It is found that 20% of them are neutral, 8% of them are disagree, 8% are strongly
agree and 28% of the respondents are strongly disagree.
The cost of the construction work is included initial capital cost plus operations in
addition to the maintenance cost. Each of the project cost category is included cost
components such as acquisition of the land included holding as well as improvement,
construction finance and others. The operation as well as maintenance cost is included over
the project lifecycle such as operating staffs, insurance, finance costs and expenses of owner.
Changes in the price is included an impact on the construction cost which will increase in
relative prices. The decisions are to be taken throughout design as well as construction based
on forecast of implications of cost. There is review of the contingency plus risk allowances at
the intervals and also reports the assessment into the risk management process. The
construction project work should complete in scheduled timeframe as well as cost.
2. How far do you agree that risk identification is main risk management processes carried
out in the construction project?
Options No of
respondents
Total
respondents
Percentage of
responses
Strongly disagree 7 25 28%
Disagree 2 25 8%
Neutral 5 25 20%
Agree 9 25 36%
Strongly agree 2 25 8%
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
and time. It is found that 20% of them are neutral, 8% of them are disagree, 8% are strongly
agree and 28% of the respondents are strongly disagree.
The cost of the construction work is included initial capital cost plus operations in
addition to the maintenance cost. Each of the project cost category is included cost
components such as acquisition of the land included holding as well as improvement,
construction finance and others. The operation as well as maintenance cost is included over
the project lifecycle such as operating staffs, insurance, finance costs and expenses of owner.
Changes in the price is included an impact on the construction cost which will increase in
relative prices. The decisions are to be taken throughout design as well as construction based
on forecast of implications of cost. There is review of the contingency plus risk allowances at
the intervals and also reports the assessment into the risk management process. The
construction project work should complete in scheduled timeframe as well as cost.
2. How far do you agree that risk identification is main risk management processes carried
out in the construction project?
Options No of
respondents
Total
respondents
Percentage of
responses
Strongly disagree 7 25 28%
Disagree 2 25 8%
Neutral 5 25 20%
Agree 9 25 36%
Strongly agree 2 25 8%
54
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
Table 4.7: Risk identification carried out in the construction project
Figure 4.7: Risk identification carried out in the construction project
From the above figure, it is found that 36% of the respondents involved in the survey
are agreed that risk identification is main risk management processes carried out in the
construction project. It is found that 20% of them are neutral, 8% of them are disagree, 8%
are strongly agree and 28% of the respondents are strongly disagree.
Most of the participants are opined that in the construction projects, they are subject
to the uncertainties where risks are occurred due to complex scenery of the construction
projects. The construction project is innovative based on its scope, schedule as well as
financial constraints. The risk management is identified as a tool for meeting with the project
targets. In the construction industry, risk identification is required as it is included three
methods such as identification, analyzing plus responding to the risks into the project work.
As the initial point of the risk management processes, the risk identification is playing a key
role into the construction projects. When the risks are not identified on time, and it is not
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
Table 4.7: Risk identification carried out in the construction project
Figure 4.7: Risk identification carried out in the construction project
From the above figure, it is found that 36% of the respondents involved in the survey
are agreed that risk identification is main risk management processes carried out in the
construction project. It is found that 20% of them are neutral, 8% of them are disagree, 8%
are strongly agree and 28% of the respondents are strongly disagree.
Most of the participants are opined that in the construction projects, they are subject
to the uncertainties where risks are occurred due to complex scenery of the construction
projects. The construction project is innovative based on its scope, schedule as well as
financial constraints. The risk management is identified as a tool for meeting with the project
targets. In the construction industry, risk identification is required as it is included three
methods such as identification, analyzing plus responding to the risks into the project work.
As the initial point of the risk management processes, the risk identification is playing a key
role into the construction projects. When the risks are not identified on time, and it is not
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assessed as well as dealt with, then a completed reporting of the project risks are not possible.
The risk management is required to cover up required risks as complete as probable. The risk
identification into the construction industry is carried out with progress of the project work.
3. How far do you agree that health and safety is the main concern in the construction
project?
Options No of
respondents
Total
respondents
Percentage of
responses
Strongly disagree 0 25 0%
Disagree 10 25 40%
Neutral 3 25 12%
Agree 11 25 44%
Strongly agree 1 25 4%
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
assessed as well as dealt with, then a completed reporting of the project risks are not possible.
The risk management is required to cover up required risks as complete as probable. The risk
identification into the construction industry is carried out with progress of the project work.
3. How far do you agree that health and safety is the main concern in the construction
project?
Options No of
respondents
Total
respondents
Percentage of
responses
Strongly disagree 0 25 0%
Disagree 10 25 40%
Neutral 3 25 12%
Agree 11 25 44%
Strongly agree 1 25 4%
56
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
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Table 4.8: Health and safety is the main concern in the construction project
Figure 4.8: Health and safety is the main concern in the construction project
From the above figure, it is found that 44% of the respondents involved in the survey
are agreed that health and safety is the main concern in the construction project. It is found
that 12% of them are neutral, 40% of them are disagree, 4% are strongly agree and 0% of the
respondents are strongly disagree.
As per most of the respondents, health as well as safety is main concern into the
construction industry as fatality rate is four times increasing as compared to speed across all
other industries. Into the construction industry, there is relatively larger number of employees
and therefore it is predictable to have higher figure of the industry related fatalities. Health as
well as safety is a concern for the human as it is required accurate management control. The
construction manager is tend to believe that it is introducing as well a executing safety
measures which ensure that health as well as safety will lead to provide higher cost and low
in the productivity. Investment into the health as well as safety will increase into profitability
which will cause increase in rate of productivity, boost the morality of employee plus
decrease into attrition.
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
Table 4.8: Health and safety is the main concern in the construction project
Figure 4.8: Health and safety is the main concern in the construction project
From the above figure, it is found that 44% of the respondents involved in the survey
are agreed that health and safety is the main concern in the construction project. It is found
that 12% of them are neutral, 40% of them are disagree, 4% are strongly agree and 0% of the
respondents are strongly disagree.
As per most of the respondents, health as well as safety is main concern into the
construction industry as fatality rate is four times increasing as compared to speed across all
other industries. Into the construction industry, there is relatively larger number of employees
and therefore it is predictable to have higher figure of the industry related fatalities. Health as
well as safety is a concern for the human as it is required accurate management control. The
construction manager is tend to believe that it is introducing as well a executing safety
measures which ensure that health as well as safety will lead to provide higher cost and low
in the productivity. Investment into the health as well as safety will increase into profitability
which will cause increase in rate of productivity, boost the morality of employee plus
decrease into attrition.
57
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
4. How far do you agree that there is high influence of project actor on the risk
management?
Options No of
respondents
Total
respondents
Percentage of
responses
Strongly disagree 2 25 8%
Disagree 7 25 28%
Neutral 6 25 24%
Agree 7 25 28%
Strongly agree 3 25 12%
Table 4.9: High influence of the construction project
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
4. How far do you agree that there is high influence of project actor on the risk
management?
Options No of
respondents
Total
respondents
Percentage of
responses
Strongly disagree 2 25 8%
Disagree 7 25 28%
Neutral 6 25 24%
Agree 7 25 28%
Strongly agree 3 25 12%
Table 4.9: High influence of the construction project
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Figure 4.9: High influence of the construction project
From the above figure, it is found that 28% of the respondents involved in the survey
are agreed that there is high influence of project actor on the risk management. It is found that
24% of them are neutral, 28% of them are disagree, 12% are strongly agree and 8% of the
respondents are strongly disagree.
Most of the respondents agreed that there is participation of the actors into the project
phases, roles into the risk administration processes and control on the risk management. The
contractors are involved into the risk management processes as compared with the actors as
well as they have larger authority on the risk management of the project work. Various actors
are involved into the construction project those have no as well as limited collaboration with
each others. As per the results of the questionnaire survey, it is showing that most of the
project actors are perceived risks as the negative project events. It is provided with clear
picture of risk management processes from perceptive of various actors. There is lower risk
responses rate that the clients let the actors into the value chain deals with the recognized
risks. The consultants are passive actors when it is coming to project risk management.
5. How far do you agree that risk allocation is required in the construction project?
Options No of
respondents
Total
respondents
Percentage of
responses
Strongly disagree 4 25 16%
Disagree 5 25 20%
Neutral 2 25 8%
Agree 12 25 48%
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
Figure 4.9: High influence of the construction project
From the above figure, it is found that 28% of the respondents involved in the survey
are agreed that there is high influence of project actor on the risk management. It is found that
24% of them are neutral, 28% of them are disagree, 12% are strongly agree and 8% of the
respondents are strongly disagree.
Most of the respondents agreed that there is participation of the actors into the project
phases, roles into the risk administration processes and control on the risk management. The
contractors are involved into the risk management processes as compared with the actors as
well as they have larger authority on the risk management of the project work. Various actors
are involved into the construction project those have no as well as limited collaboration with
each others. As per the results of the questionnaire survey, it is showing that most of the
project actors are perceived risks as the negative project events. It is provided with clear
picture of risk management processes from perceptive of various actors. There is lower risk
responses rate that the clients let the actors into the value chain deals with the recognized
risks. The consultants are passive actors when it is coming to project risk management.
5. How far do you agree that risk allocation is required in the construction project?
Options No of
respondents
Total
respondents
Percentage of
responses
Strongly disagree 4 25 16%
Disagree 5 25 20%
Neutral 2 25 8%
Agree 12 25 48%
59
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
Strongly agree 2 25 8%
Table 4.10: Risk allocation is required in the construction project
Figure 4.10: Risk allocation is required in the construction project
From the above figure, it is found that 48% of the respondents involved in the survey
are agreed that risk allocation is required in the construction project. It is found that 8% of
them are neutral, 20% of them are disagree, 8% are strongly agree and 16% of the
respondents are strongly disagree.
The construction project is involved the risks and there is no such opportunity to
remove the risks which are associated with the project. There is regulation of the risk
allocated to various parties in addition to then it can administer the construction related risks.
All the construction related risks are allocated to person based on their skills as well as
abilities to manage it. The allocation processes of the risk factors are required to take proper
decisions. The decisions are done via comparing among the construction projects to help the
decision makers to determine most risky of the project work. The risk allocation method is
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
Strongly agree 2 25 8%
Table 4.10: Risk allocation is required in the construction project
Figure 4.10: Risk allocation is required in the construction project
From the above figure, it is found that 48% of the respondents involved in the survey
are agreed that risk allocation is required in the construction project. It is found that 8% of
them are neutral, 20% of them are disagree, 8% are strongly agree and 16% of the
respondents are strongly disagree.
The construction project is involved the risks and there is no such opportunity to
remove the risks which are associated with the project. There is regulation of the risk
allocated to various parties in addition to then it can administer the construction related risks.
All the construction related risks are allocated to person based on their skills as well as
abilities to manage it. The allocation processes of the risk factors are required to take proper
decisions. The decisions are done via comparing among the construction projects to help the
decision makers to determine most risky of the project work. The risk allocation method is
60
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
included to carry out the risk assessment processes plus communicate with the main
stakeholders. This method can tend to influence on positive delivery towards the construction
work. The risk allocation framework is determined the behavior of each allocated persons and
also determined the project progress.
6. How far do you agree that there is deviation in the construction project in terms of
cost and time parameters?
Options No of
respondents
Total
respondents
Percentage of
responses
Strongly disagree 2 25 8%
Disagree 7 25 28%
Neutral 2 25 8%
Agree 9 25 36%
Strongly agree 5 25 20%
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
included to carry out the risk assessment processes plus communicate with the main
stakeholders. This method can tend to influence on positive delivery towards the construction
work. The risk allocation framework is determined the behavior of each allocated persons and
also determined the project progress.
6. How far do you agree that there is deviation in the construction project in terms of
cost and time parameters?
Options No of
respondents
Total
respondents
Percentage of
responses
Strongly disagree 2 25 8%
Disagree 7 25 28%
Neutral 2 25 8%
Agree 9 25 36%
Strongly agree 5 25 20%
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Table 4.11: Deviation in the construction project in terms of cost and time parameters
Figure 4.11: Deviation in the construction project in terms of cost and time parameters
From the above figure, it is found that 36% of the respondents involved in the survey
are agreed that there is deviation in the construction project in terms of cost and time
parameters. It is found that 8% of them are neutral, 28% of them are disagree, 20% are
strongly agree and 8% of the respondents are strongly disagree.
As per the respondents, quality control is the main concern into the construction
project work. Defects as well as failures are resulted into larger cost. Increase cost as well as
project delay is a result when the quality of the construction materials is failed. In this case,
failures are caused personal injuries plus fatalities of the construction workers. With the cost
control, important decisions are to be taken regards to quality control. Into the construction
project, concrete pavements of better strength is resulted into cost savings by causing delays
the time at which repairs as well as reconstruction are needed. When there is failure into the
quality of construction project work, then there is a deviation in cost as the constriction cost
is increased and time due to delay in project completion.
7. How far do you agree that optimal risk allocation is one of the procedure help to
reduce construction cost?
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
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Table 4.11: Deviation in the construction project in terms of cost and time parameters
Figure 4.11: Deviation in the construction project in terms of cost and time parameters
From the above figure, it is found that 36% of the respondents involved in the survey
are agreed that there is deviation in the construction project in terms of cost and time
parameters. It is found that 8% of them are neutral, 28% of them are disagree, 20% are
strongly agree and 8% of the respondents are strongly disagree.
As per the respondents, quality control is the main concern into the construction
project work. Defects as well as failures are resulted into larger cost. Increase cost as well as
project delay is a result when the quality of the construction materials is failed. In this case,
failures are caused personal injuries plus fatalities of the construction workers. With the cost
control, important decisions are to be taken regards to quality control. Into the construction
project, concrete pavements of better strength is resulted into cost savings by causing delays
the time at which repairs as well as reconstruction are needed. When there is failure into the
quality of construction project work, then there is a deviation in cost as the constriction cost
is increased and time due to delay in project completion.
7. How far do you agree that optimal risk allocation is one of the procedure help to
reduce construction cost?
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Options No of
respondents
Total
respondents
Percentage of
responses
Strongly disagree 1 25 4%
Disagree 7 25 28%
Neutral 6 25 24%
Agree 5 25 20%
Strongly agree 6 25 24%
Table 4.12: Optimal risk allocation in construction project
Figure 4.12: Optimal risk allocation in construction project
From the above figure, it is found that 28% of the respondents involved in the survey
are disagreed that optimal risk allocation is one of the procedure help to reduce construction
cost. It is found that 24% of them are neutral, 20% of them are agree, 24% are strongly agree
and 4% of the respondents are strongly disagree.
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
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Options No of
respondents
Total
respondents
Percentage of
responses
Strongly disagree 1 25 4%
Disagree 7 25 28%
Neutral 6 25 24%
Agree 5 25 20%
Strongly agree 6 25 24%
Table 4.12: Optimal risk allocation in construction project
Figure 4.12: Optimal risk allocation in construction project
From the above figure, it is found that 28% of the respondents involved in the survey
are disagreed that optimal risk allocation is one of the procedure help to reduce construction
cost. It is found that 24% of them are neutral, 20% of them are agree, 24% are strongly agree
and 4% of the respondents are strongly disagree.
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INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
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Most of the respondents opined that optimal risk allocation is not one of the main
procedures to decrease to the construction cost. Sometimes, it is seen that the risks are
allocated to the resources those have lack of knowledge in addition to experience to manage
the construction risks. It is a method which helps to imply for passing the construction risks
from one party to other. In some cases, it helps to diminish the cost and raise out the
construction risks in the project work. There are large numbers of stakeholders those are
facing communication issues when they are going to communicate with others and negotiate
with other parties to manage the project risks. The optimal risk allocation is required in this
construction industry so that they can reduce the construction related cost plus effective
business operations at the time of building work.
8. How far do you agree that stakeholders require communicating with others to
overcome with communication challenges?
Options No of
respondents
Total
respondents
Percentage of
responses
Strongly disagree 1 25 4%
Disagree 5 25 20%
Neutral 8 25 32%
Agree 7 25 28%
Strongly agree 4 25 16%
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
Most of the respondents opined that optimal risk allocation is not one of the main
procedures to decrease to the construction cost. Sometimes, it is seen that the risks are
allocated to the resources those have lack of knowledge in addition to experience to manage
the construction risks. It is a method which helps to imply for passing the construction risks
from one party to other. In some cases, it helps to diminish the cost and raise out the
construction risks in the project work. There are large numbers of stakeholders those are
facing communication issues when they are going to communicate with others and negotiate
with other parties to manage the project risks. The optimal risk allocation is required in this
construction industry so that they can reduce the construction related cost plus effective
business operations at the time of building work.
8. How far do you agree that stakeholders require communicating with others to
overcome with communication challenges?
Options No of
respondents
Total
respondents
Percentage of
responses
Strongly disagree 1 25 4%
Disagree 5 25 20%
Neutral 8 25 32%
Agree 7 25 28%
Strongly agree 4 25 16%
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Table 4.13: Requirement of construction in construction project
Figure 4.13: Requirement of construction in construction project
From the above figure, it is found that 32% of the respondents involved in the survey
are neither agree nor disagree that stakeholders require communicating with others to
overcome with communication challenges. It is found that 28% of them agree, 20% of them
are disagree, 16% are strongly agree and 4% of the respondents are strongly disagree.
As per most of the respondents, lack of communication can cause unnecessary delays
into the project work. Issues into the construction project can rose when the team members
are not performing the task in proper ways. The issues are raised when the project manager is
not communicating with the stakeholders on scheduled time. Most of the project work is
failed because of poor communication. Communication into the construction project is a
challenge as there are many individuals those can communicate with others throughout
implementation as well as evaluation. Poor communication is reflected into over-
communicating to the project stakeholders. Communication across the cultural boundaries is
added element of complexity as well as challenge into the communication on the project
work. In order to overcome with the communication challenges, two ways information
sharing procedure is involved with the party to send message by receiving the party. Effective
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
Table 4.13: Requirement of construction in construction project
Figure 4.13: Requirement of construction in construction project
From the above figure, it is found that 32% of the respondents involved in the survey
are neither agree nor disagree that stakeholders require communicating with others to
overcome with communication challenges. It is found that 28% of them agree, 20% of them
are disagree, 16% are strongly agree and 4% of the respondents are strongly disagree.
As per most of the respondents, lack of communication can cause unnecessary delays
into the project work. Issues into the construction project can rose when the team members
are not performing the task in proper ways. The issues are raised when the project manager is
not communicating with the stakeholders on scheduled time. Most of the project work is
failed because of poor communication. Communication into the construction project is a
challenge as there are many individuals those can communicate with others throughout
implementation as well as evaluation. Poor communication is reflected into over-
communicating to the project stakeholders. Communication across the cultural boundaries is
added element of complexity as well as challenge into the communication on the project
work. In order to overcome with the communication challenges, two ways information
sharing procedure is involved with the party to send message by receiving the party. Effective
65
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
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communication is facilitated the information sharing among the employees of company as
well as sustainability or contribution of commercial successes.
9. How far do you agree that collaboration and trust create key significance positive
relations with the project client?
Options No of
respondents
Total
respondents
Percentage of
responses
Strongly disagree 1 25 4%
Disagree 6 25 24%
Neutral 2 25 8%
Agree 11 25 44%
Strongly agree 5 25 20%
Table 4.14: Collaboration and trust create key significance positive relations
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
communication is facilitated the information sharing among the employees of company as
well as sustainability or contribution of commercial successes.
9. How far do you agree that collaboration and trust create key significance positive
relations with the project client?
Options No of
respondents
Total
respondents
Percentage of
responses
Strongly disagree 1 25 4%
Disagree 6 25 24%
Neutral 2 25 8%
Agree 11 25 44%
Strongly agree 5 25 20%
Table 4.14: Collaboration and trust create key significance positive relations
66
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
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Figure 4.14: Collaboration and trust create key significance positive relations
From the above figure, it is found that 44% of the respondents involved in the survey
are agreed that collaboration and trust create key significance positive relations with the
project client. It is found that 8% of them are neutral, 24% of them are disagree, 20% are
strongly agree and 4% of the respondents are strongly disagree.
Most of the respondents agreed that there is higher importance of collaboration as
well as trust as the factors which can contribute to the construction project. With increase into
competition, it becomes a key significant requirement for encouraging creativity into the
project for improving productivity as well as promoting health related employee relations.
Working with the project team can enable the employees to become effective in work focused
on people those are working on the project on own. Collaboration can lead to project success
as employees are become more responsible by raising the motivational levels when the teams
are working virtually. Collaboration can allow the project team members to come on common
construction project platform as well as work to achieve organizational goals. As per the
respondents, collaboration and trust among the employees can lead to complete the work on
time.
10. How far do you agree that clients are required communicating with identified risks
and opportunities in procurement phase?
Options No of
respondents
Total
respondents
Percentage of
responses
Strongly disagree 0 25 0%
Disagree 7 25 28%
Neutral 6 25 24%
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
Figure 4.14: Collaboration and trust create key significance positive relations
From the above figure, it is found that 44% of the respondents involved in the survey
are agreed that collaboration and trust create key significance positive relations with the
project client. It is found that 8% of them are neutral, 24% of them are disagree, 20% are
strongly agree and 4% of the respondents are strongly disagree.
Most of the respondents agreed that there is higher importance of collaboration as
well as trust as the factors which can contribute to the construction project. With increase into
competition, it becomes a key significant requirement for encouraging creativity into the
project for improving productivity as well as promoting health related employee relations.
Working with the project team can enable the employees to become effective in work focused
on people those are working on the project on own. Collaboration can lead to project success
as employees are become more responsible by raising the motivational levels when the teams
are working virtually. Collaboration can allow the project team members to come on common
construction project platform as well as work to achieve organizational goals. As per the
respondents, collaboration and trust among the employees can lead to complete the work on
time.
10. How far do you agree that clients are required communicating with identified risks
and opportunities in procurement phase?
Options No of
respondents
Total
respondents
Percentage of
responses
Strongly disagree 0 25 0%
Disagree 7 25 28%
Neutral 6 25 24%
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Agree 9 25 38%
Strongly agree 3 25 12%
Table 4.15: Communicating with identified risks and opportunities in procurement
phase
Figure 4.15: Communicating with identified risks and opportunities in procurement
phase
From the above figure, it is found that 36% of the respondents involved in the survey
are agreed that clients are required communicating with identified risks and opportunities in
procurement phase. It is found that 24% of them are neutral, 28% of them are disagree, 12%
are strongly agree and 0% of the respondents are strongly disagree.
As per the respondents, there are three main procurement processes such as purchase
order, order receipts as well as vendor invoices which are aligned and highlighted to make
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
Agree 9 25 38%
Strongly agree 3 25 12%
Table 4.15: Communicating with identified risks and opportunities in procurement
phase
Figure 4.15: Communicating with identified risks and opportunities in procurement
phase
From the above figure, it is found that 36% of the respondents involved in the survey
are agreed that clients are required communicating with identified risks and opportunities in
procurement phase. It is found that 24% of them are neutral, 28% of them are disagree, 12%
are strongly agree and 0% of the respondents are strongly disagree.
As per the respondents, there are three main procurement processes such as purchase
order, order receipts as well as vendor invoices which are aligned and highlighted to make
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INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
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sure that communication plan is require to identify the project related risks as well as
opportunities. The construction team members are performed the procurement of the orders
which are required to perform the project work. Communication is required in procurement
phase to plan, select, administer as well as close all the procurement related work into the
construction project. Planning is involved with creating official procurement plan so that it
can define all the construction products as well as services obtained from the external
suppliers. The communication is required in procurement so that it can help to procure the
entity for defining the requirements of procurement as well as decide when as well as when it
can procure.
11. How far do you agree that design and build is the procurement approach employed
for the construction project?
Options No of
respondents
Total
respondents
Percentage of
responses
Strongly disagree 4 25 12%
Disagree 4 25 16%
Neutral 9 25 16%
Agree 5 25 36%
Strongly agree 3 25 20%
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
sure that communication plan is require to identify the project related risks as well as
opportunities. The construction team members are performed the procurement of the orders
which are required to perform the project work. Communication is required in procurement
phase to plan, select, administer as well as close all the procurement related work into the
construction project. Planning is involved with creating official procurement plan so that it
can define all the construction products as well as services obtained from the external
suppliers. The communication is required in procurement so that it can help to procure the
entity for defining the requirements of procurement as well as decide when as well as when it
can procure.
11. How far do you agree that design and build is the procurement approach employed
for the construction project?
Options No of
respondents
Total
respondents
Percentage of
responses
Strongly disagree 4 25 12%
Disagree 4 25 16%
Neutral 9 25 16%
Agree 5 25 36%
Strongly agree 3 25 20%
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INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
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Table 4.16: Design and build is the procurement approach
Figure 4.16: Design and build is the procurement approach
From the above figure, it is found that 36% of the respondents involved in the survey
are agreed that design and build is the procurement approach employed for the construction
project. It is found that 16% of them are neutral, 16% of them are disagree, 20% are strongly
agree and 12% of the respondents are strongly disagree.
It is analyzed that design as well as build method of the procurement into the
construction project describes the procurement route where the main contractor is being
appointed for designing plus constructing the project. The client is appointed consultants for
designing into the development as well as contractor is being appointed for constructing the
project work. It is such a method for delivering the construction project in which design as
well as construction services are being contacted by single entity identified as design build
contractor. The client should consider it for simple projects, where the design quality is not
considered as key significant consideration. This construction approach is accounted for
increase in proportion for building construction output in New Zealand. This method usage is
increasing with the clients perceived it as it is providing with better value for the money. This
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
Table 4.16: Design and build is the procurement approach
Figure 4.16: Design and build is the procurement approach
From the above figure, it is found that 36% of the respondents involved in the survey
are agreed that design and build is the procurement approach employed for the construction
project. It is found that 16% of them are neutral, 16% of them are disagree, 20% are strongly
agree and 12% of the respondents are strongly disagree.
It is analyzed that design as well as build method of the procurement into the
construction project describes the procurement route where the main contractor is being
appointed for designing plus constructing the project. The client is appointed consultants for
designing into the development as well as contractor is being appointed for constructing the
project work. It is such a method for delivering the construction project in which design as
well as construction services are being contacted by single entity identified as design build
contractor. The client should consider it for simple projects, where the design quality is not
considered as key significant consideration. This construction approach is accounted for
increase in proportion for building construction output in New Zealand. This method usage is
increasing with the clients perceived it as it is providing with better value for the money. This
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project delivery method is used where the owner contracts by means of entities used for
design as well as construction of project work.
12. How far do you agree that location and site conditions can affect the construction
project?
Options No of
respondents
Total
respondents
Percentage of
responses
Strongly disagree 1 25 4%
Disagree 6 25 24%
Neutral 6 25 24%
Agree 7 25 28%
Strongly agree 5 25 20%
Table 4.17: Location and site conditions can affect the construction project
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
project delivery method is used where the owner contracts by means of entities used for
design as well as construction of project work.
12. How far do you agree that location and site conditions can affect the construction
project?
Options No of
respondents
Total
respondents
Percentage of
responses
Strongly disagree 1 25 4%
Disagree 6 25 24%
Neutral 6 25 24%
Agree 7 25 28%
Strongly agree 5 25 20%
Table 4.17: Location and site conditions can affect the construction project
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INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
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Figure 4.17: Location and site conditions can affect the construction project
From the above figure, it is found that 28% of the respondents involved in the survey
are agreed that location and site conditions can affect the construction project. It is found that
24% of them are neutral, 24% of them are disagree, 20% are strongly agree and 4% of the
respondents are strongly disagree.
When the location as well as conditions of construction site is not proper, then it can
provide an influence on the completion time of the construction work. Delay into the
construction project can affect on the construction cost. It takes long time to complete the
work when there is addition of extra materials and equipments. It I sometimes seen that the
construction work is badly influenced by the location when weather can cause high effect on
project completion work. Each of seasons is bringing various weather patterns, therefore
based on the location the season brings rainy weather which is followed by the dry heat of the
summer. The location can cause safety hazards to the workers on the construction site.
13. How far do you agree that there is significant requirement for the client to get the
design documents approved on time?
Options No of
respondents
Total
respondents
Percentage of
responses
Strongly disagree 2 25 8%
Disagree 5 25 20%
Neutral 5 25 20%
Agree 10 25 40%
Strongly agree 3 25 12%
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
Figure 4.17: Location and site conditions can affect the construction project
From the above figure, it is found that 28% of the respondents involved in the survey
are agreed that location and site conditions can affect the construction project. It is found that
24% of them are neutral, 24% of them are disagree, 20% are strongly agree and 4% of the
respondents are strongly disagree.
When the location as well as conditions of construction site is not proper, then it can
provide an influence on the completion time of the construction work. Delay into the
construction project can affect on the construction cost. It takes long time to complete the
work when there is addition of extra materials and equipments. It I sometimes seen that the
construction work is badly influenced by the location when weather can cause high effect on
project completion work. Each of seasons is bringing various weather patterns, therefore
based on the location the season brings rainy weather which is followed by the dry heat of the
summer. The location can cause safety hazards to the workers on the construction site.
13. How far do you agree that there is significant requirement for the client to get the
design documents approved on time?
Options No of
respondents
Total
respondents
Percentage of
responses
Strongly disagree 2 25 8%
Disagree 5 25 20%
Neutral 5 25 20%
Agree 10 25 40%
Strongly agree 3 25 12%
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Table 4.18: Design documents approved on time
Figure 4.18: Design documents approved on time
From the above figure, it is found that 40% of the respondents involved in the survey
are agreed that there is significant requirement for the client to get the design documents
approved on time. It is found that 20% of them are neutral, 20% of them are disagree, 12%
are strongly agree and 8% of the respondents are strongly disagree.
The project manager is responsible to make sure that there is capturing of all the project
related requirements. The project manager is required to be agile while there is collecting of
project related needs. The project requirements are those conditions as well as tasks which
are required to make sure about successful completion of construction related project work. It
is meant to align with the project resources plus objectives of project organization. Into the
construction project work, design specifications are required in form of the technical design
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
Table 4.18: Design documents approved on time
Figure 4.18: Design documents approved on time
From the above figure, it is found that 40% of the respondents involved in the survey
are agreed that there is significant requirement for the client to get the design documents
approved on time. It is found that 20% of them are neutral, 20% of them are disagree, 12%
are strongly agree and 8% of the respondents are strongly disagree.
The project manager is responsible to make sure that there is capturing of all the project
related requirements. The project manager is required to be agile while there is collecting of
project related needs. The project requirements are those conditions as well as tasks which
are required to make sure about successful completion of construction related project work. It
is meant to align with the project resources plus objectives of project organization. Into the
construction project work, design specifications are required in form of the technical design
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which is part of the designing documents in addition to construction design and business
process diagrams.
14. How far do you agree that the construction work should adhere to quality standards?
Options No of
respondents
Total
respondents
Percentage of
responses
Strongly disagree 0 25 0%
Disagree 7 25 28%
Neutral 7 25 28%
Agree 9 25 36%
Strongly agree 2 25 8%
Table 4.19: Construction work should adhere to quality standards
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
which is part of the designing documents in addition to construction design and business
process diagrams.
14. How far do you agree that the construction work should adhere to quality standards?
Options No of
respondents
Total
respondents
Percentage of
responses
Strongly disagree 0 25 0%
Disagree 7 25 28%
Neutral 7 25 28%
Agree 9 25 36%
Strongly agree 2 25 8%
Table 4.19: Construction work should adhere to quality standards
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INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
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Figure 4.19: Construction work should adhere to quality standards
From the above figure, it is found that 36% of the respondents involved in the survey
are agreed that the construction work should adhere to quality standards. It is found that 28%
of them are neutral, 28% of them are disagree, 8% are strongly agree and 0% of the
respondents are strongly disagree.
As per most of the respondents, quality control is required which is part of the quality
management ensures that construction related products as well as services are complied with
the project requirements. It is such a way which can facilitate measurement of the quality
standards of the units, as compared with established standards and analyzed differences
among obtained results plus desired results to take decisions which are correct. One of the
methods to control quality is dependent on inspection as well as verification of finished
products. The construction industry is reduced costs of bad quality and ensured that results of
the processes are complied with requirement of project clients. Quality assurance is
considered as set of the planned actions to make sure that products are complied with
particular construction needs. Quality management system is defined as standards for the
business organization.
15. How far do you agree that a formal organization structure required for resolution of
disputes in the project?
Options No of
respondents
Total
respondents
Percentage of
responses
Strongly disagree 0 25 0%
Disagree 10 25 40%
Neutral 5 25 20%
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
Figure 4.19: Construction work should adhere to quality standards
From the above figure, it is found that 36% of the respondents involved in the survey
are agreed that the construction work should adhere to quality standards. It is found that 28%
of them are neutral, 28% of them are disagree, 8% are strongly agree and 0% of the
respondents are strongly disagree.
As per most of the respondents, quality control is required which is part of the quality
management ensures that construction related products as well as services are complied with
the project requirements. It is such a way which can facilitate measurement of the quality
standards of the units, as compared with established standards and analyzed differences
among obtained results plus desired results to take decisions which are correct. One of the
methods to control quality is dependent on inspection as well as verification of finished
products. The construction industry is reduced costs of bad quality and ensured that results of
the processes are complied with requirement of project clients. Quality assurance is
considered as set of the planned actions to make sure that products are complied with
particular construction needs. Quality management system is defined as standards for the
business organization.
15. How far do you agree that a formal organization structure required for resolution of
disputes in the project?
Options No of
respondents
Total
respondents
Percentage of
responses
Strongly disagree 0 25 0%
Disagree 10 25 40%
Neutral 5 25 20%
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INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
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Agree 7 25 28%
Strongly agree 3 25 12%
Table 4.20: Formal organization structure required for resolution of disputes in the
project
Figure 4.20: Formal organization structure required for resolution of disputes in the
project
From the above figure, it is found that 40% of the respondents involved in the survey
are disagreed that a formal organization structure required for resolution of disputes in the
project. It is found that 20% of them are neutral, 28% of them are agree, 12% are strongly
agree and 0% of the respondents are strongly disagree.
Into the construction project work, formal organization structure is not always
required for the resolution of the disputes into the project work. It is pathways into the
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
Agree 7 25 28%
Strongly agree 3 25 12%
Table 4.20: Formal organization structure required for resolution of disputes in the
project
Figure 4.20: Formal organization structure required for resolution of disputes in the
project
From the above figure, it is found that 40% of the respondents involved in the survey
are disagreed that a formal organization structure required for resolution of disputes in the
project. It is found that 20% of them are neutral, 28% of them are agree, 12% are strongly
agree and 0% of the respondents are strongly disagree.
Into the construction project work, formal organization structure is not always
required for the resolution of the disputes into the project work. It is pathways into the
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construction industry by which the sponsors as well as applicants are seek to resolve at the
divisional levels. Into the business organization, conflict can occur into the business
arrangement as well as mechanisms for resolving into the contract documents. It is identified
that the parties are being aware of the future positions as well as seek to reduce the losses.
The construction industry is being built based on ideas, decisions as well as judgments which
are made by various stakeholders. By anticipation of the disputes, the parties are agreed on
dispute resolution procedures. The contract document is provided with details about
construction work scope as well as services of the parties involved into the construction
project.
16. How far do you agree that contractor require technical skills and experience to work
in the construction project?
Options No of
respondents
Total
respondents
Percentage of
responses
Strongly disagree 5 25 20%
Disagree 4 25 16%
Neutral 7 25 28%
Agree 7 25 28%
Strongly agree 2 25 8%
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
construction industry by which the sponsors as well as applicants are seek to resolve at the
divisional levels. Into the business organization, conflict can occur into the business
arrangement as well as mechanisms for resolving into the contract documents. It is identified
that the parties are being aware of the future positions as well as seek to reduce the losses.
The construction industry is being built based on ideas, decisions as well as judgments which
are made by various stakeholders. By anticipation of the disputes, the parties are agreed on
dispute resolution procedures. The contract document is provided with details about
construction work scope as well as services of the parties involved into the construction
project.
16. How far do you agree that contractor require technical skills and experience to work
in the construction project?
Options No of
respondents
Total
respondents
Percentage of
responses
Strongly disagree 5 25 20%
Disagree 4 25 16%
Neutral 7 25 28%
Agree 7 25 28%
Strongly agree 2 25 8%
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Table 4.21: Contractor require technical skills and experience
Figure 4.21: Contractor require technical skills and experience
From the above figure, it is found that 28% of the respondents involved in the survey
are agreed that contractor require technical skills and experience to work in the construction
project. It is found that 16% of them are neutral, 20% of them are disagree, 28% are strongly
agree and 8% of the respondents are strongly disagree.
As per most of the respondents, the contractor is required technical skills to perform
the construction related project work. The construction tasks are required hard physical labor
for a period of time such as power tools as well as operating hand tools. Therefore, the
contractor is required to handle those tools using their construction skills. They should
require having skills in manual dexterity, better vision, depth perception as well as
coordination. The skills which are required among the project team members are
communication, teamwork, negotiation, problem solving, as well as leadership. They should
have building as well as mechanical knowledge so that all the construction works are
completed on scheduled timeframe. Success into the project management is required wider
range of skills of technical, management of construction business plus leadership
competencies.
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
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Table 4.21: Contractor require technical skills and experience
Figure 4.21: Contractor require technical skills and experience
From the above figure, it is found that 28% of the respondents involved in the survey
are agreed that contractor require technical skills and experience to work in the construction
project. It is found that 16% of them are neutral, 20% of them are disagree, 28% are strongly
agree and 8% of the respondents are strongly disagree.
As per most of the respondents, the contractor is required technical skills to perform
the construction related project work. The construction tasks are required hard physical labor
for a period of time such as power tools as well as operating hand tools. Therefore, the
contractor is required to handle those tools using their construction skills. They should
require having skills in manual dexterity, better vision, depth perception as well as
coordination. The skills which are required among the project team members are
communication, teamwork, negotiation, problem solving, as well as leadership. They should
have building as well as mechanical knowledge so that all the construction works are
completed on scheduled timeframe. Success into the project management is required wider
range of skills of technical, management of construction business plus leadership
competencies.
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17. How far do you agree that the project execution affected by weather as well as
climatic conditions?
Options No of
respondents
Total
respondents
Percentage of
responses
Strongly disagree 2 25 8%
Disagree 5 25 20%
Neutral 1 25 4%
Agree 10 25 40%
Strongly agree 7 25 28%
Table 4.22: Project execution affected by weather as well as climatic conditions
Figure 4.22: Project execution affected by weather as well as climatic conditions
From the above figure, it is found that 40% of the respondents involved in the survey
are agreed that the project execution affected by weather as well as climatic conditions. It is
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
17. How far do you agree that the project execution affected by weather as well as
climatic conditions?
Options No of
respondents
Total
respondents
Percentage of
responses
Strongly disagree 2 25 8%
Disagree 5 25 20%
Neutral 1 25 4%
Agree 10 25 40%
Strongly agree 7 25 28%
Table 4.22: Project execution affected by weather as well as climatic conditions
Figure 4.22: Project execution affected by weather as well as climatic conditions
From the above figure, it is found that 40% of the respondents involved in the survey
are agreed that the project execution affected by weather as well as climatic conditions. It is
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found that 4% of them are neutral, 20% of them are disagree, 28% are strongly agree and 8%
of the respondents are strongly disagree.
Most of the respondents concluded that the completion project is completed late due
to weather as well as climatic conditions of the project plan. Sometimes, the contractors are
putting blame on the project clients due to unreasonable schedules and therefore they say to
the client if it is possible to provide more time for the delays as well as caused by the rains
occurred. The construction manager should identify the regions throughout out the time it is
constructing the project plan such as weather conditions which are occurred. The risks of this
project are to be known and the weather events are not occurred. Most of the respondents
agreed that weather disruptions provide direct time on the completion time of construction
project through the bad weather conditions. Some of the events are caused damage to the
completed structures which cause delay in the scheduled project time could take days and
weeks to repair it.
18. How far do you agree that the risk management is done by adequate design and
construction documentations for use of the contractor?
Options No of
respondents
Total
respondents
Percentage of
responses
Strongly disagree 1 25 4%
Disagree 6 25 24%
Neutral 4 25 16%
Agree 11 25 44%
Strongly agree 3 25 12%
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
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found that 4% of them are neutral, 20% of them are disagree, 28% are strongly agree and 8%
of the respondents are strongly disagree.
Most of the respondents concluded that the completion project is completed late due
to weather as well as climatic conditions of the project plan. Sometimes, the contractors are
putting blame on the project clients due to unreasonable schedules and therefore they say to
the client if it is possible to provide more time for the delays as well as caused by the rains
occurred. The construction manager should identify the regions throughout out the time it is
constructing the project plan such as weather conditions which are occurred. The risks of this
project are to be known and the weather events are not occurred. Most of the respondents
agreed that weather disruptions provide direct time on the completion time of construction
project through the bad weather conditions. Some of the events are caused damage to the
completed structures which cause delay in the scheduled project time could take days and
weeks to repair it.
18. How far do you agree that the risk management is done by adequate design and
construction documentations for use of the contractor?
Options No of
respondents
Total
respondents
Percentage of
responses
Strongly disagree 1 25 4%
Disagree 6 25 24%
Neutral 4 25 16%
Agree 11 25 44%
Strongly agree 3 25 12%
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Table 4.23: Risk management is done by adequate design and construction
documentations
Figure 4.23: Risk management is done by adequate design and construction
documentations
From the above figure, it is found that 44% of the respondents involved in the survey
are agreed that the risk management is done by adequate design and construction
documentations for use of the contractor. It is found that 16% of them are neutral, 24% of
them are disagree, 12% are strongly agree and 4% of the respondents are strongly disagree.
The construction project is based on proper design as well as construction documents
which required proper risk management plan. Management of the risks into the construction
project is identified as key significant management processes to attain the project objectives
to total the work based on time, health and safety plus quality. There is also required to have
environmental sustainability. A tight project schedule is to be maintained for influencing the
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
Table 4.23: Risk management is done by adequate design and construction
documentations
Figure 4.23: Risk management is done by adequate design and construction
documentations
From the above figure, it is found that 44% of the respondents involved in the survey
are agreed that the risk management is done by adequate design and construction
documentations for use of the contractor. It is found that 16% of them are neutral, 24% of
them are disagree, 12% are strongly agree and 4% of the respondents are strongly disagree.
The construction project is based on proper design as well as construction documents
which required proper risk management plan. Management of the risks into the construction
project is identified as key significant management processes to attain the project objectives
to total the work based on time, health and safety plus quality. There is also required to have
environmental sustainability. A tight project schedule is to be maintained for influencing the
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INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
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project objectives. Design variations are required as an aspect for meeting with the project
objectives. There is risk in design when the construction project is not able to meet with
difficulty to capture as well as specify the requirements of the project users. It is also hard to
estimation time plus resources desirable for design completion. In this case, risk management
plan is required which helps to analyze an in-depth knowledge of the risk sources can
influence on risk identification into the construction design phase.
19. How far do you agree that risk allocation is done based on level of the technological
sophistication considered in the construction project?
Options No of
respondents
Total
respondents
Percentage of
responses
Strongly disagree 1 25 4%
Disagree 5 25 20%
Neutral 5 25 20%
Agree 8 25 32%
Strongly agree 6 25 24%
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
project objectives. Design variations are required as an aspect for meeting with the project
objectives. There is risk in design when the construction project is not able to meet with
difficulty to capture as well as specify the requirements of the project users. It is also hard to
estimation time plus resources desirable for design completion. In this case, risk management
plan is required which helps to analyze an in-depth knowledge of the risk sources can
influence on risk identification into the construction design phase.
19. How far do you agree that risk allocation is done based on level of the technological
sophistication considered in the construction project?
Options No of
respondents
Total
respondents
Percentage of
responses
Strongly disagree 1 25 4%
Disagree 5 25 20%
Neutral 5 25 20%
Agree 8 25 32%
Strongly agree 6 25 24%
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Table 4.24: Risk allocation is done based on level of the technological sophistication
Figure 4.24: Risk allocation is done based on level of the technological sophistication
From the above figure, it is found that 32% of the respondents involved in the survey
are agreed that the risk allocation is done based on level of the technological sophistication
considered in the construction project. It is found that 20% of them are neutral, 20% of them
are disagree, 24% are strongly agree and 4% of the respondents are strongly disagree.
Into the construction project, technical experts are required those can allocate the
technology development resources at the time of construction work. There is required to have
technological sophistication into the project plan for characterizing the initial state of the
construction work along with circumstances of the sites where the building work is being
performed. There is identification of reference plus alternative scenarios which can perform
remediation project objectives. Information technology is necessary into the risk management
so that the contract documents are used as an instrument for handling the risks and allocating
the risks to different agencies throughout the contracts between the construction managers.
The risk applications by means of information technology can enhance the risks at the time of
integrated with the workflow processes as well as business software.
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
Table 4.24: Risk allocation is done based on level of the technological sophistication
Figure 4.24: Risk allocation is done based on level of the technological sophistication
From the above figure, it is found that 32% of the respondents involved in the survey
are agreed that the risk allocation is done based on level of the technological sophistication
considered in the construction project. It is found that 20% of them are neutral, 20% of them
are disagree, 24% are strongly agree and 4% of the respondents are strongly disagree.
Into the construction project, technical experts are required those can allocate the
technology development resources at the time of construction work. There is required to have
technological sophistication into the project plan for characterizing the initial state of the
construction work along with circumstances of the sites where the building work is being
performed. There is identification of reference plus alternative scenarios which can perform
remediation project objectives. Information technology is necessary into the risk management
so that the contract documents are used as an instrument for handling the risks and allocating
the risks to different agencies throughout the contracts between the construction managers.
The risk applications by means of information technology can enhance the risks at the time of
integrated with the workflow processes as well as business software.
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20. How far do you agree that the project is allocated to right resources based on their
construction skills and knowledge?
Options No of
respondents
Total
respondents
Percentage of
responses
Strongly disagree 0 25 0%
Disagree 5 25 20%
Neutral 4 25 16%
Agree 10 25 40%
Strongly agree 6 25 24%
Table 4.25: Project is allocated to right resources
Figure 4.25: Project is allocated to right resources
From the above figure, it is found that 40% of the respondents involved in the survey
are agreed that the project is allocated to right resources based on their construction skills and
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
20. How far do you agree that the project is allocated to right resources based on their
construction skills and knowledge?
Options No of
respondents
Total
respondents
Percentage of
responses
Strongly disagree 0 25 0%
Disagree 5 25 20%
Neutral 4 25 16%
Agree 10 25 40%
Strongly agree 6 25 24%
Table 4.25: Project is allocated to right resources
Figure 4.25: Project is allocated to right resources
From the above figure, it is found that 40% of the respondents involved in the survey
are agreed that the project is allocated to right resources based on their construction skills and
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INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
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knowledge. It is found that 16% of them are neutral, 20% of them are disagree, 24% are
strongly agree and 0% of the respondents are strongly disagree.
Most of the respondents agreed that the construction project work is to be allocated to
the right resources. The resource allocation and resource management is termed as scheduling
of the project activities where resource allocation is a proper tool to allocate each of the
construction activities with proper project activities. Resource allocation is helped to select
best possible resources for the project as well as manage them through entire work. Most of
the construction companies are used of resource management for estimating as well as
allocating the project related resources. It is estimated that proper allocation of the project
resource will lead to increase efficient usage of the resources across the construction
company for maximizing the construction utility. Excel spreadsheets are used in this
construction project for managing the project resources. The construction manager can
analyze how changes to the project scope, timeline as well as budget are affected the delivery
time of the project.
4.3 Regression Analysis
In order highlight the relationship between the dependent and independent factors
associated with each hypothesis are as follows:
Hypothesis 1: Time and cost overrun into the construction projects are risk factors
into the organization.
The regression model of the hypothesis can be stated as follows:
Dependent variable of hypothesis = A + B* independent variable of hypothesis
Where, A= Intercept of the Model
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
knowledge. It is found that 16% of them are neutral, 20% of them are disagree, 24% are
strongly agree and 0% of the respondents are strongly disagree.
Most of the respondents agreed that the construction project work is to be allocated to
the right resources. The resource allocation and resource management is termed as scheduling
of the project activities where resource allocation is a proper tool to allocate each of the
construction activities with proper project activities. Resource allocation is helped to select
best possible resources for the project as well as manage them through entire work. Most of
the construction companies are used of resource management for estimating as well as
allocating the project related resources. It is estimated that proper allocation of the project
resource will lead to increase efficient usage of the resources across the construction
company for maximizing the construction utility. Excel spreadsheets are used in this
construction project for managing the project resources. The construction manager can
analyze how changes to the project scope, timeline as well as budget are affected the delivery
time of the project.
4.3 Regression Analysis
In order highlight the relationship between the dependent and independent factors
associated with each hypothesis are as follows:
Hypothesis 1: Time and cost overrun into the construction projects are risk factors
into the organization.
The regression model of the hypothesis can be stated as follows:
Dependent variable of hypothesis = A + B* independent variable of hypothesis
Where, A= Intercept of the Model
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And B= Coefficient of “relationship between time and cost overrun into the construction
projects”.
The details of the regression analysis conducted on the above mentioned model has here
being presented in the table below:
Regression Statistics
Multiple R 0.797254
R Square 0.635613
Adjusted R Square 0.416981
Standard Error 0.763557
Observations 25
Table 4.26: Summary output of regression analysis conducted for hypothesis 1
ANOVA
df SS MS F Significance F
Regression 9 15.25472 1.694969 2.907228 0.032855
Residual 15 8.745282 0.583019
Total 24 24
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
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And B= Coefficient of “relationship between time and cost overrun into the construction
projects”.
The details of the regression analysis conducted on the above mentioned model has here
being presented in the table below:
Regression Statistics
Multiple R 0.797254
R Square 0.635613
Adjusted R Square 0.416981
Standard Error 0.763557
Observations 25
Table 4.26: Summary output of regression analysis conducted for hypothesis 1
ANOVA
df SS MS F Significance F
Regression 9 15.25472 1.694969 2.907228 0.032855
Residual 15 8.745282 0.583019
Total 24 24
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Table 4.27: ANOVA table of regression analysis conducted for hypothesis 1
Coefficients Standard Error t Stat P-value
Intercept 1.279932 0.679888
1.88256
2 0.079304
Risk management processes 0.535072 0.228299
2.34373
4 0.033281
Health and safety risk 0.063329 0.26498
0.23899
7 0.814342
Influence on risk management -0.15565 0.363245 -0.42849 0.674385
Risk allocation 0.72909 0.218008
3.34432
8 0.004437
Cost and time parameters 0.289283 0.272421
1.06189
6 0.305081
Optimal risk allocation -0.19149 0.205921 -0.92991 0.367145
Stakeholder communication -0.39909 0.27561 -1.44802 0.168192
Collaboration and trust 0.223623 0.248339
0.90047
3 0.382099
Communication of
construction risks -0.5424 0.358159 -1.5144 0.150708
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
Table 4.27: ANOVA table of regression analysis conducted for hypothesis 1
Coefficients Standard Error t Stat P-value
Intercept 1.279932 0.679888
1.88256
2 0.079304
Risk management processes 0.535072 0.228299
2.34373
4 0.033281
Health and safety risk 0.063329 0.26498
0.23899
7 0.814342
Influence on risk management -0.15565 0.363245 -0.42849 0.674385
Risk allocation 0.72909 0.218008
3.34432
8 0.004437
Cost and time parameters 0.289283 0.272421
1.06189
6 0.305081
Optimal risk allocation -0.19149 0.205921 -0.92991 0.367145
Stakeholder communication -0.39909 0.27561 -1.44802 0.168192
Collaboration and trust 0.223623 0.248339
0.90047
3 0.382099
Communication of
construction risks -0.5424 0.358159 -1.5144 0.150708
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Table 4.28: Coefficient table of regression analysis conducted for hypothesis 1
The null and alternative hypothesis associated with hypothesis 1 are as follows:
Null hypothesis (H0): Time and cost overrun into the construction projects are not
risk factors into the organization.
Alternative hypothesis (H1): Time and cost overrun into the construction projects are
risk factors into the organization.
An analysis of the findings of the regression method indicates that the value of the
Significant F, for this particular hypothesis, is 0.032855. In this case the value of the
Significant F, as obtained through regression analysis, is found to be less than 0.05, the null
hypothesis has to be rejected essentially. Now, the value of the Significant F factor for this
hypothesis is much less than 0.05: hence the null hypothesize sated in the section above
has to be rejected. Thus, it can be said that it has been proved that the statement “Time and
cost overrun into the construction projects are risk factors into the organization.” holds true.
Hypothesis 2: Construction delays as recurring problems in construction industry are
affecting the project success.
The regression model of the hypothesis can be stated as follows:
Dependent variable of hypothesis = A + B* independent variable of hypothesis
Where, A= Intercept of the Model
And B= Coefficient of “relationship between construction delays and project success”.
The details of the regression analysis conducted on the above mentioned model has
here being presented in the table below:
SUMMARY OUTPUT
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
Table 4.28: Coefficient table of regression analysis conducted for hypothesis 1
The null and alternative hypothesis associated with hypothesis 1 are as follows:
Null hypothesis (H0): Time and cost overrun into the construction projects are not
risk factors into the organization.
Alternative hypothesis (H1): Time and cost overrun into the construction projects are
risk factors into the organization.
An analysis of the findings of the regression method indicates that the value of the
Significant F, for this particular hypothesis, is 0.032855. In this case the value of the
Significant F, as obtained through regression analysis, is found to be less than 0.05, the null
hypothesis has to be rejected essentially. Now, the value of the Significant F factor for this
hypothesis is much less than 0.05: hence the null hypothesize sated in the section above
has to be rejected. Thus, it can be said that it has been proved that the statement “Time and
cost overrun into the construction projects are risk factors into the organization.” holds true.
Hypothesis 2: Construction delays as recurring problems in construction industry are
affecting the project success.
The regression model of the hypothesis can be stated as follows:
Dependent variable of hypothesis = A + B* independent variable of hypothesis
Where, A= Intercept of the Model
And B= Coefficient of “relationship between construction delays and project success”.
The details of the regression analysis conducted on the above mentioned model has
here being presented in the table below:
SUMMARY OUTPUT
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Regression Statistics
Multiple R 0.946583
R Square 0.89602
Adjusted R Square 0.833632
Standard Error 0.538034
Observations 25
Table 4.29: Summary output of regression analysis conducted for hypothesis 2
ANOVA
df SS MS F Significance F
Regression 9 37.41778 4.157532 14.36202 7.4E-06
Residual 15 4.342216 0.289481
Total 24 41.76
Table 4.30: ANOVA table of regression analysis conducted for hypothesis 2
Coefficients Standard Error t Stat P-value
Intercept -0.59558 0.493831 -1.20603 0.246483
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
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Regression Statistics
Multiple R 0.946583
R Square 0.89602
Adjusted R Square 0.833632
Standard Error 0.538034
Observations 25
Table 4.29: Summary output of regression analysis conducted for hypothesis 2
ANOVA
df SS MS F Significance F
Regression 9 37.41778 4.157532 14.36202 7.4E-06
Residual 15 4.342216 0.289481
Total 24 41.76
Table 4.30: ANOVA table of regression analysis conducted for hypothesis 2
Coefficients Standard Error t Stat P-value
Intercept -0.59558 0.493831 -1.20603 0.246483
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Location and site conditions of
construction project -0.07483 0.232979 -0.3212 0.752487
Design documents 0.570954 0.175605 3.251361 0.005368
Quality standards 0.104461 0.271827 0.384293 0.706154
Formal organization structure -0.02827 0.224995 -0.12566 0.901673
Technical skills and experience in
construction project 0.123233 0.202525 0.608484 0.55197
Weather and climate conditions -0.12029 0.143063 -0.8408 0.413665
Design and construction
documentation -0.4743 0.256201 -1.85128 0.083918
Risk allocation on technological
sophistication 0.142015 0.189468 0.749542 0.465125
Allocation of risks in construction
project 0.864668 0.26227 3.29686 0.00489
Table 4.31: Coefficient table of regression analysis conducted for hypothesis 2
The null and alternative hypotheses associated with hypothesis 2 are as follows:
Null hypothesis (H0): Construction delays as recurring problems in construction industry are
not affecting the project success.
Alternative hypothesis (H1): Construction delays as recurring problems in construction
industry are affecting the project success.
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
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Location and site conditions of
construction project -0.07483 0.232979 -0.3212 0.752487
Design documents 0.570954 0.175605 3.251361 0.005368
Quality standards 0.104461 0.271827 0.384293 0.706154
Formal organization structure -0.02827 0.224995 -0.12566 0.901673
Technical skills and experience in
construction project 0.123233 0.202525 0.608484 0.55197
Weather and climate conditions -0.12029 0.143063 -0.8408 0.413665
Design and construction
documentation -0.4743 0.256201 -1.85128 0.083918
Risk allocation on technological
sophistication 0.142015 0.189468 0.749542 0.465125
Allocation of risks in construction
project 0.864668 0.26227 3.29686 0.00489
Table 4.31: Coefficient table of regression analysis conducted for hypothesis 2
The null and alternative hypotheses associated with hypothesis 2 are as follows:
Null hypothesis (H0): Construction delays as recurring problems in construction industry are
not affecting the project success.
Alternative hypothesis (H1): Construction delays as recurring problems in construction
industry are affecting the project success.
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An analysis of the findings of the regression method indicates that the value of the Significant
F, for this particular hypothesis, is 7.4E-06. In this case the value of the Significant F, as
obtained through regression analysis, is found to be less than 0.05, the null hypothesis has to
be rejected essentially. Now, the value of the Significant F factor for this hypothesis is less
than 0.05: hence the null hypothesize sated in the section above has to be rejected. Thus, it
can be said that it has been proved that the statement “Construction delays as recurring
problems in construction industry are affecting the project success.” holds true.
4.4 Summary
It is concluded that there is identification of the risk allocation methods which are
required into the construction projects so that there is prevention of higher threats among the
construction team members. The risks which are included into the construction projects are
included labors shortage, increase into the cost of the materials, poor management of the
project work as well as improper management at the site of construction projects. From the
study, it is concluded that risk allocation methods are required to treat in addition to prevent
from the risks. The risk allocation methods are included to perform the risk assessment
processes so that there is proper communication among the major project stakeholders. It
helps to overcome with the project risks which can influence on performance of the
construction project negatively. The risk allocation model can analyze aspects which are
associated with identification, assessment and analyzing the risks into the construction
industry of New Zealand. Into the selected industry, optimal risk allocation is such a process
which helps to manage the project and help to reduce the cost of construction. It also helps to
carry out the construction work at lower costs. Risk management also helps to facilitate the
flow of information to take proper decisions which are related to the project work. From the
entire data analysis findings, it is found that into the construction project, times as well as
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
An analysis of the findings of the regression method indicates that the value of the Significant
F, for this particular hypothesis, is 7.4E-06. In this case the value of the Significant F, as
obtained through regression analysis, is found to be less than 0.05, the null hypothesis has to
be rejected essentially. Now, the value of the Significant F factor for this hypothesis is less
than 0.05: hence the null hypothesize sated in the section above has to be rejected. Thus, it
can be said that it has been proved that the statement “Construction delays as recurring
problems in construction industry are affecting the project success.” holds true.
4.4 Summary
It is concluded that there is identification of the risk allocation methods which are
required into the construction projects so that there is prevention of higher threats among the
construction team members. The risks which are included into the construction projects are
included labors shortage, increase into the cost of the materials, poor management of the
project work as well as improper management at the site of construction projects. From the
study, it is concluded that risk allocation methods are required to treat in addition to prevent
from the risks. The risk allocation methods are included to perform the risk assessment
processes so that there is proper communication among the major project stakeholders. It
helps to overcome with the project risks which can influence on performance of the
construction project negatively. The risk allocation model can analyze aspects which are
associated with identification, assessment and analyzing the risks into the construction
industry of New Zealand. Into the selected industry, optimal risk allocation is such a process
which helps to manage the project and help to reduce the cost of construction. It also helps to
carry out the construction work at lower costs. Risk management also helps to facilitate the
flow of information to take proper decisions which are related to the project work. From the
entire data analysis findings, it is found that into the construction project, times as well as
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cost overrun in the project are the risk factors which are common to cause issues provide
influence on project successful rate.
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
cost overrun in the project are the risk factors which are common to cause issues provide
influence on project successful rate.
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Chapter 5: Discussion
From the analyzed data, it is discussed that into the construction project, there is
necessary to have proper investigation of optimization of the risk allocation. For each of the
construction project activities, there is required to engage the project team members into the
construction related work. Most of the respondents those are concerned into the construction
project are female those have age group between 30-39 years. The junior construction
engineer is concerned into the construction project those are provided their skills and
knowledge regarding optimization of the risk allocation. The respondents have experience of
2 years. Most of the respondents have knowledge and skills regarding how to deal with the
risks into the construction project plan. Each of the risks which are identified in this thesis
paper are required to be allocated with the project resources so that it is considered as best
way to manage as well as measure the project risks. Among all the construction project risks,
safety and health risk is a main concern for the employees involved into the construction
related work. In this research work, there is identification of some risk factors which are
caused due to time as well as cost overrun. Construction delays are occurred as it is a problem
into the industry affect success rate of the construction project.
As per the data findings, it is seen that one of the main step for managing the project
risks raised into the construction industry is allocation of risks. It is seen that due to presence
of the construction risks into the industry, it is not probable for the construction participants
to remove the risks related with this project work. In this particular case, there are various
parties those are concerned into the construction projects require to transfer shares of the
projected construction risks from other parties. The risk allocation is decisions of the project
parties which are necessary to stand consequences of the construction risks into the project.
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
Chapter 5: Discussion
From the analyzed data, it is discussed that into the construction project, there is
necessary to have proper investigation of optimization of the risk allocation. For each of the
construction project activities, there is required to engage the project team members into the
construction related work. Most of the respondents those are concerned into the construction
project are female those have age group between 30-39 years. The junior construction
engineer is concerned into the construction project those are provided their skills and
knowledge regarding optimization of the risk allocation. The respondents have experience of
2 years. Most of the respondents have knowledge and skills regarding how to deal with the
risks into the construction project plan. Each of the risks which are identified in this thesis
paper are required to be allocated with the project resources so that it is considered as best
way to manage as well as measure the project risks. Among all the construction project risks,
safety and health risk is a main concern for the employees involved into the construction
related work. In this research work, there is identification of some risk factors which are
caused due to time as well as cost overrun. Construction delays are occurred as it is a problem
into the industry affect success rate of the construction project.
As per the data findings, it is seen that one of the main step for managing the project
risks raised into the construction industry is allocation of risks. It is seen that due to presence
of the construction risks into the industry, it is not probable for the construction participants
to remove the risks related with this project work. In this particular case, there are various
parties those are concerned into the construction projects require to transfer shares of the
projected construction risks from other parties. The risk allocation is decisions of the project
parties which are necessary to stand consequences of the construction risks into the project.
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INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
In this project context, it is highlighted that there is allocation of the risks into the
construction industry is contracts. There is existence of the risk allocation frameworks into
the building companies as behavior of the research participants as well as accomplishment of
the construction project. The cost is also endure into the construction development is based
on patterns of risk allocation existing into the building projects among different stakeholders
plus biased allocations in the long run project work. There is maximization of the project
profits which can cause the construction projects to be successful.
It is discussed that none of the construction project is considered as risk free. The
risks are shared among the contracting parties so that none of the parties are to be harmed.
Into the risk allocation area among the construction contract parties, the research is to be
performed as well as work is conducted on continuous basis. The risk allocation among the
parties to the construction contract agreement is employed with cooperation with the project
team members. The construction related decisions are to be taken into account with
requirements of the parties concerned into the construction related project work. It is opined
that the projects into the construction industry are being subject to the risks as contrasted to
other industries. The project participants are allocated the project risks where the project
owner is tend to shift the risks from the subcontractor to the primary contractor. The risks are
not allocated and re-allocated to party as it is best way to manage effectively. The risk
allocation can provide with a higher influence which affect the schedule, cost as well as
organizational performance. Improper allocation of risks has lead to relationships among the
contracting participants as well as increase into the project cost. The main objective of this
dissertation paper is shedding light on existing practices of the risk allocation into the
construction industry.
The main goal of this document is to provide construction industry with an aim of the
decision making mechanism which can provide with alternative way to current practices for
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
In this project context, it is highlighted that there is allocation of the risks into the
construction industry is contracts. There is existence of the risk allocation frameworks into
the building companies as behavior of the research participants as well as accomplishment of
the construction project. The cost is also endure into the construction development is based
on patterns of risk allocation existing into the building projects among different stakeholders
plus biased allocations in the long run project work. There is maximization of the project
profits which can cause the construction projects to be successful.
It is discussed that none of the construction project is considered as risk free. The
risks are shared among the contracting parties so that none of the parties are to be harmed.
Into the risk allocation area among the construction contract parties, the research is to be
performed as well as work is conducted on continuous basis. The risk allocation among the
parties to the construction contract agreement is employed with cooperation with the project
team members. The construction related decisions are to be taken into account with
requirements of the parties concerned into the construction related project work. It is opined
that the projects into the construction industry are being subject to the risks as contrasted to
other industries. The project participants are allocated the project risks where the project
owner is tend to shift the risks from the subcontractor to the primary contractor. The risks are
not allocated and re-allocated to party as it is best way to manage effectively. The risk
allocation can provide with a higher influence which affect the schedule, cost as well as
organizational performance. Improper allocation of risks has lead to relationships among the
contracting participants as well as increase into the project cost. The main objective of this
dissertation paper is shedding light on existing practices of the risk allocation into the
construction industry.
The main goal of this document is to provide construction industry with an aim of the
decision making mechanism which can provide with alternative way to current practices for
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allocation of the project risks. Lack of the risk allocation method is ranked with effective risk
allocation way ranks as top identified construction project barriers. There is improvement of
project efficiency by reducing negative impacts of current practices for the risk allocation
based on cost, schedule as well as entire project performance. It is discussed that most of the
respondents are agreed with the fact that the project implementation is to be performed base
on cost, functions as well as project schedule. Design in addition to construction related
decisions are to be taken focused on cost implications. The construction project work should
complete in scheduled timeframe as well as cost. There is identification of the construction
related risks which are carried out so that uncertainties are occurred because of critical nature
of the work. When the project related risks are not identified on time, then it is not possible to
identify the accurate completion time of the project. Health as well as safety is a concern for
the human as it is required accurate management control. The construction industry is
required to invest more into health as well as safety as there is an increase in profitability of
organization lead to increase in productivity rate, boost into employee’s morality plus
reduction of employee attritions.
On the risk management, there is higher influence on the project actor. Most of the
construction project actors are perceived risks as the negative project events. Into the
construction project, the consultants are passive actors when it is coming to project risk
management. The decision makers are taking decisions regarding the construction project for
determine most risky of the project work. The risk allocation method is included to carry out
the risk assessment processes plus communicate with the main stakeholders. The researcher
has identified a risk allocation framework to conclude behavior of each allocated persons in
addition to also determine the development growth of the construction project work. Into the
construction project work, quality control is identified as main concern as defects in addition
to failures are caused in the project in the building work. Increase cost as well as project
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
allocation of the project risks. Lack of the risk allocation method is ranked with effective risk
allocation way ranks as top identified construction project barriers. There is improvement of
project efficiency by reducing negative impacts of current practices for the risk allocation
based on cost, schedule as well as entire project performance. It is discussed that most of the
respondents are agreed with the fact that the project implementation is to be performed base
on cost, functions as well as project schedule. Design in addition to construction related
decisions are to be taken focused on cost implications. The construction project work should
complete in scheduled timeframe as well as cost. There is identification of the construction
related risks which are carried out so that uncertainties are occurred because of critical nature
of the work. When the project related risks are not identified on time, then it is not possible to
identify the accurate completion time of the project. Health as well as safety is a concern for
the human as it is required accurate management control. The construction industry is
required to invest more into health as well as safety as there is an increase in profitability of
organization lead to increase in productivity rate, boost into employee’s morality plus
reduction of employee attritions.
On the risk management, there is higher influence on the project actor. Most of the
construction project actors are perceived risks as the negative project events. Into the
construction project, the consultants are passive actors when it is coming to project risk
management. The decision makers are taking decisions regarding the construction project for
determine most risky of the project work. The risk allocation method is included to carry out
the risk assessment processes plus communicate with the main stakeholders. The researcher
has identified a risk allocation framework to conclude behavior of each allocated persons in
addition to also determine the development growth of the construction project work. Into the
construction project work, quality control is identified as main concern as defects in addition
to failures are caused in the project in the building work. Increase cost as well as project
95
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
delay is a result when the quality of the construction materials is failed. Due to failure into
quality of the construction equipments as well as machines, there is deviation of project cost
which can lead to increase in project delays. Into the construction project, there is optimal
risk allocation which is required such that it can diminish the construction related charge plus
successful production operations at the moment of building work.
The project team members those are involved into the project have lack of
communication so that they are not able to interact with each others. In this way, lack of
communication can cause unnecessary delays into the project work. Interaction into the
construction project is an issue as there are numerous individuals those can converse with
others all through accomplishment as well as assessment. Poor communication is replicated
into over communication to the project team members. Effective message is ease the
information sharing amongst the workers of company as well as sustainability or involvement
of profitable successes. As per most of the respondents those are involved into the
construction project work, there is required to have higher collaboration and trust factors
which can lead to the completion of construction project. Collaboration is permitted the
project team members to perform the construction related work so that there is achieving of
the organizational goals. Therefore, collaboration as well as trust can help the project
employees to perform the project work more effectively.
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
delay is a result when the quality of the construction materials is failed. Due to failure into
quality of the construction equipments as well as machines, there is deviation of project cost
which can lead to increase in project delays. Into the construction project, there is optimal
risk allocation which is required such that it can diminish the construction related charge plus
successful production operations at the moment of building work.
The project team members those are involved into the project have lack of
communication so that they are not able to interact with each others. In this way, lack of
communication can cause unnecessary delays into the project work. Interaction into the
construction project is an issue as there are numerous individuals those can converse with
others all through accomplishment as well as assessment. Poor communication is replicated
into over communication to the project team members. Effective message is ease the
information sharing amongst the workers of company as well as sustainability or involvement
of profitable successes. As per most of the respondents those are involved into the
construction project work, there is required to have higher collaboration and trust factors
which can lead to the completion of construction project. Collaboration is permitted the
project team members to perform the construction related work so that there is achieving of
the organizational goals. Therefore, collaboration as well as trust can help the project
employees to perform the project work more effectively.
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PROJECTS
Chapter 6: Conclusion and Recommendations
6.1 Conclusion
From the entire research study, it is concluded that there is requisite to evaluate the
risk allocation in addition to risk optimization into the construction industry. It is found that
due to incidence of construction risks, it is not probable for the project stakeholders to
involve in the construction industry so that there is elimination as well as overcome of the
associated project risks. The literature study is involved with the risk management theories
plus concepts so that there is appropriate examination of the risk allocation methods help to
allocate the resources to the construction project activities. Details regarding the risk
management concepts are discussed so that there is enhancement of knowledge of readers to
better understand and investigate the project related risks. In this particular paper, there is
mentioning of various types of construction risks such as logistical risks, design risks,
technical risks, health and safety risks, management risks as well as socio-political risks.
There are also financial as well as schedule risks.
It is concluded that resource allocation will help in overcoming the risk taking place
within the construction project. Mainly, there is identification of two risk allocation methods
such as quantitative risk allocation method and qualitative risk allocation method. At the
earlier stage of the project work, there is identification of the risks, risk controlling plus risk
allocation and in this case risk mitigation strategy is used for risk elimination after there is
proper analyzing of the risks. The risk allocation process will work based on the requirements
of construction project and aims at providing better solution towards the risks. The optimal
risk allocation is required which helps to manage project lifecycle and operate the project at
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
Chapter 6: Conclusion and Recommendations
6.1 Conclusion
From the entire research study, it is concluded that there is requisite to evaluate the
risk allocation in addition to risk optimization into the construction industry. It is found that
due to incidence of construction risks, it is not probable for the project stakeholders to
involve in the construction industry so that there is elimination as well as overcome of the
associated project risks. The literature study is involved with the risk management theories
plus concepts so that there is appropriate examination of the risk allocation methods help to
allocate the resources to the construction project activities. Details regarding the risk
management concepts are discussed so that there is enhancement of knowledge of readers to
better understand and investigate the project related risks. In this particular paper, there is
mentioning of various types of construction risks such as logistical risks, design risks,
technical risks, health and safety risks, management risks as well as socio-political risks.
There are also financial as well as schedule risks.
It is concluded that resource allocation will help in overcoming the risk taking place
within the construction project. Mainly, there is identification of two risk allocation methods
such as quantitative risk allocation method and qualitative risk allocation method. At the
earlier stage of the project work, there is identification of the risks, risk controlling plus risk
allocation and in this case risk mitigation strategy is used for risk elimination after there is
proper analyzing of the risks. The risk allocation process will work based on the requirements
of construction project and aims at providing better solution towards the risks. The optimal
risk allocation is required which helps to manage project lifecycle and operate the project at
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lower project costs. Collaboration in addition to trust is considered as key significant
component which can create a positive relation with the project stakeholders.
6.2 Linking with the objectives
Following are the list of the research objectives which are to be taken into
consideration and those objectives are to be linked with the research findings such as:
Linking with objective 1: To study significant factors causing time and cost overrun
into the construction projects
It is found that most of the construction projects are exposed of both cost as well as
time overruns. The factors which are source cost overruns are increasing into the price of
materials, construction delays, supplying of the raw materials, cost fluctuations and poor
economical condition of the company. The project management principles are playing a key
important role to complete the construction project for managing the raw materials, budget as
well as techniques used for conducting work into the construction project. When the
construction manager does a bad planning, then it also causes poor technical performance
with not enough procedures of procurement management. The project schedule is not updated
on timely basis and there is lack of management experience from the project contractors.
Cost overrun is considered as severe issue by the construction industry in New
Zealand. A total of 25 samples are considered to be valid as well as analyzed by means of
regression analysis method on the factors of the construction risks which are caused can
cause time as well as cost overrun. In the construction project, resource allocation is required
to mitigate the risks by allocating each of risk activities with right skilled and experienced
resources. The risk management is taken as significant factor in the construction development
work. It is easier to manage cost as well as budget and also link with the construction project
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
lower project costs. Collaboration in addition to trust is considered as key significant
component which can create a positive relation with the project stakeholders.
6.2 Linking with the objectives
Following are the list of the research objectives which are to be taken into
consideration and those objectives are to be linked with the research findings such as:
Linking with objective 1: To study significant factors causing time and cost overrun
into the construction projects
It is found that most of the construction projects are exposed of both cost as well as
time overruns. The factors which are source cost overruns are increasing into the price of
materials, construction delays, supplying of the raw materials, cost fluctuations and poor
economical condition of the company. The project management principles are playing a key
important role to complete the construction project for managing the raw materials, budget as
well as techniques used for conducting work into the construction project. When the
construction manager does a bad planning, then it also causes poor technical performance
with not enough procedures of procurement management. The project schedule is not updated
on timely basis and there is lack of management experience from the project contractors.
Cost overrun is considered as severe issue by the construction industry in New
Zealand. A total of 25 samples are considered to be valid as well as analyzed by means of
regression analysis method on the factors of the construction risks which are caused can
cause time as well as cost overrun. In the construction project, resource allocation is required
to mitigate the risks by allocating each of risk activities with right skilled and experienced
resources. The risk management is taken as significant factor in the construction development
work. It is easier to manage cost as well as budget and also link with the construction project
98
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
for completion of work in scheduled timeframe. Risk allocation is based on separation of the
project activities linked with losses plus gains taking place in the project.
Linking with objective 2: To analyse of construction delays as recurring problems in
construction industry affect the project success
From the data analysis findings, it is analyzed that time as well as cost performance of
the construction project can provide a huge impact on the construction employees as well as
employer. Most of the construction projects are experiencing a time overruns. It is being
contributed to expensive to all the business parties. There are various types of construction
delays which are provided an impact on the cost as well as time overrun such as logistical,
external, design, technical, health and safety, management, schedule and financial risks. The
delayed construction projects are concluded with additional delays and it can affect on the
ongoing project work and some of them are not started because of pending projects those
completion date is elongated. Delays which are occurred in the construction projects are
simple and also complex. Delays into the construction project is considered as recurring
issues as it has unfavourable effect on achievement of project based on three main factors
such as cost, time and quality.
Construction delays are measured as expensive to the project parties as it is concerned
into the project and result into entire desertion and difficult to perform the financial
feasibility. It leads to slow growth into the construction industry. The construction industry
has various risks with uncertainties in both internal as well as external factors influence on
construction processes. Construction delays are reduced available economical resources,
limits growth of the construction productivity plus reduction of economical competitiveness.
The construction delays are contractor related based in client as well as consultant related.
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
for completion of work in scheduled timeframe. Risk allocation is based on separation of the
project activities linked with losses plus gains taking place in the project.
Linking with objective 2: To analyse of construction delays as recurring problems in
construction industry affect the project success
From the data analysis findings, it is analyzed that time as well as cost performance of
the construction project can provide a huge impact on the construction employees as well as
employer. Most of the construction projects are experiencing a time overruns. It is being
contributed to expensive to all the business parties. There are various types of construction
delays which are provided an impact on the cost as well as time overrun such as logistical,
external, design, technical, health and safety, management, schedule and financial risks. The
delayed construction projects are concluded with additional delays and it can affect on the
ongoing project work and some of them are not started because of pending projects those
completion date is elongated. Delays which are occurred in the construction projects are
simple and also complex. Delays into the construction project is considered as recurring
issues as it has unfavourable effect on achievement of project based on three main factors
such as cost, time and quality.
Construction delays are measured as expensive to the project parties as it is concerned
into the project and result into entire desertion and difficult to perform the financial
feasibility. It leads to slow growth into the construction industry. The construction industry
has various risks with uncertainties in both internal as well as external factors influence on
construction processes. Construction delays are reduced available economical resources,
limits growth of the construction productivity plus reduction of economical competitiveness.
The construction delays are contractor related based in client as well as consultant related.
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INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
There is high impact of delays on the construction project due to loss of stakeholder interest,
wastage of the money plus time as well as declination of the business reputations.
Linking with objective 3: To study of risk allocation methods and mechanisms into
the construction projects
From the findings of data analysis, it is found that the construction project is involved
with the construction risks and there are no such possibilities to reduce the risks which are
associated with the project. All are to be done for regulating the risk linked to various parties
and manage identified construction risks. The construction projects have higher level of
experience of the risks because of complex plus dynamic working environments. It has huge
impact on cost as well a time. The proposed risk allocation methods are based on proper party
into the construction project which are undertaking risk impact and response plus manage the
factors of risks.
The risk allocation methods which are used in the construction project are risk
assessment model and contract clause method. The risk assessment model is used to deal with
the risks and analyze aspect of risk identification, assessment of risk, location of construction
site and analyze the construction related risks. By means of this risk allocation method, it
becomes easier to identify factors of construction risks associated with the building project in
New Zealand. Contract clause method is used by allocating the risks among the participants
involved in the project. This particular method is used to identify the risks efficiently as it can
meet with requirement of contract based on the construction project.
6.3 Recommendations
The research study indicated that improper allocation of project risks in contracts is a
key significant reason to increase the entire project related cost. Improvement into the
construction process is resulted in significant amount of cost savings for construction
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
There is high impact of delays on the construction project due to loss of stakeholder interest,
wastage of the money plus time as well as declination of the business reputations.
Linking with objective 3: To study of risk allocation methods and mechanisms into
the construction projects
From the findings of data analysis, it is found that the construction project is involved
with the construction risks and there are no such possibilities to reduce the risks which are
associated with the project. All are to be done for regulating the risk linked to various parties
and manage identified construction risks. The construction projects have higher level of
experience of the risks because of complex plus dynamic working environments. It has huge
impact on cost as well a time. The proposed risk allocation methods are based on proper party
into the construction project which are undertaking risk impact and response plus manage the
factors of risks.
The risk allocation methods which are used in the construction project are risk
assessment model and contract clause method. The risk assessment model is used to deal with
the risks and analyze aspect of risk identification, assessment of risk, location of construction
site and analyze the construction related risks. By means of this risk allocation method, it
becomes easier to identify factors of construction risks associated with the building project in
New Zealand. Contract clause method is used by allocating the risks among the participants
involved in the project. This particular method is used to identify the risks efficiently as it can
meet with requirement of contract based on the construction project.
6.3 Recommendations
The research study indicated that improper allocation of project risks in contracts is a
key significant reason to increase the entire project related cost. Improvement into the
construction process is resulted in significant amount of cost savings for construction
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industry. The significant findings of this research study are that there is an existence of trust
relationship among the project stakeholders which is required for efficient risk allocation
methods. The research study indicated that there is higher level of trust which is needed to
reduce risk amount associated and eliminate clauses from outset. Following are the list of the
recommendations which are suggested to reach a better risk allocation process for making a
trust relationship among the contracting parties such as:
Negotiation phase: This phase is required at starting of the contract which should
exist and is required to build trust relationship among the contracting parties. Management of
risk in negotiation is not about elimination of risks but risk management which helps the
parties to find optimal solutions. Into the construction project, there should require managing
the risk in project negotiations with effective pre-planning.
Risk reward system: In the construction project, there should require an existing risk
reward system which would share benefits if the risks are not occurred throughout the project
lifecycle. Most of the investors of construction project are used risk and reward system for
comparing expected returns of investment with total amount of construction risks they are
undertaking to earn the returns. The risk/reward calculation is done by dividing the net profit
by price of the maximum risk.
6.4 Limitation of the study
The research study is only limited to the construction projects of New Zealand while
there are other construction projects that should be considered for this exacting research
study. The time of this research study was limited for particular time while it is not allowed
any contribution of larger size of sample for getting better data analysis results. The financial
budget was a constraint of this study which leads to limit quality of this research study.
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
industry. The significant findings of this research study are that there is an existence of trust
relationship among the project stakeholders which is required for efficient risk allocation
methods. The research study indicated that there is higher level of trust which is needed to
reduce risk amount associated and eliminate clauses from outset. Following are the list of the
recommendations which are suggested to reach a better risk allocation process for making a
trust relationship among the contracting parties such as:
Negotiation phase: This phase is required at starting of the contract which should
exist and is required to build trust relationship among the contracting parties. Management of
risk in negotiation is not about elimination of risks but risk management which helps the
parties to find optimal solutions. Into the construction project, there should require managing
the risk in project negotiations with effective pre-planning.
Risk reward system: In the construction project, there should require an existing risk
reward system which would share benefits if the risks are not occurred throughout the project
lifecycle. Most of the investors of construction project are used risk and reward system for
comparing expected returns of investment with total amount of construction risks they are
undertaking to earn the returns. The risk/reward calculation is done by dividing the net profit
by price of the maximum risk.
6.4 Limitation of the study
The research study is only limited to the construction projects of New Zealand while
there are other construction projects that should be considered for this exacting research
study. The time of this research study was limited for particular time while it is not allowed
any contribution of larger size of sample for getting better data analysis results. The financial
budget was a constraint of this study which leads to limit quality of this research study.
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PROJECTS
6.5 Further scope of the study
There is future study related to the research topic based on studying development of
the risk management framework adopted by the contractors as well as investors. In the future,
there is review of experience of contractor in planning as well as controlling which can
influence time overrun of the construction projects. Effective site management is required for
getting better experience of contractor. There is development of hierarchical success model to
identify critical success factors.
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
6.5 Further scope of the study
There is future study related to the research topic based on studying development of
the risk management framework adopted by the contractors as well as investors. In the future,
there is review of experience of contractor in planning as well as controlling which can
influence time overrun of the construction projects. Effective site management is required for
getting better experience of contractor. There is development of hierarchical success model to
identify critical success factors.
102
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
References
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PROJECTS
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McGraw-Hill Education.
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497-503.
Nasirzadeh, F., Khanzadi, M., &Rezaie, M. (2014). Dynamic modeling of the quantitative
risk allocation in construction projects. International Journal of Project
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Pfaff, B. (2016). Financial risk modelling and portfolio optimization with R. John Wiley &
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Qiang, M., Wen, Q., Jiang, H., & Yuan, S. (2015). Factors governing construction project
delivery selection: A content analysis. International Journal of Project
Management, 33(8), 1780-1794.
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&Hänninen, O. (2015). Evaluation of register study feasibility using maternal
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the International Society for Environmental Epidemiology (ISEE). Rome: The
Publisher is Environmental Health Perspectives (Abstract Number: P1-302| ID:
4140).
Seaman, C. D., Apostolova, M., Yabes, J., Comer, D. M., &Ragni, M. V. (2017). Prevalence
and Risk Factors Associated With Hypertension in Hemophilia: Cross-Sectional
Analysis of a National Discharge Register. Clinical and Applied
Thrombosis/Hemostasis, 23(7), 871-875.
Serpella, A. F., Ferrada, X., Howard, R., & Rubio, L. (2014). Risk management in
construction projects: a knowledge-based approach. Procedia-Social and Behavioral
Sciences, 119, 653-662.
Silverman, D. ed., (2016). Qualitative research. Sage.
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INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
Appendix
Survey Questionnaires
Topic: Investigation of Optimization of Risk Allocation in Construction Projects
1. Gender
Male
Female
2. Age group
25-29 years
30-39 years
40-49 years
Above 50 years
3. Please mention your position
Junior construction engineer
Junior designer
Junior legal assistant
Junior property developer
4. Experience in the construction industry
1 year
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
Appendix
Survey Questionnaires
Topic: Investigation of Optimization of Risk Allocation in Construction Projects
1. Gender
Male
Female
2. Age group
25-29 years
30-39 years
40-49 years
Above 50 years
3. Please mention your position
Junior construction engineer
Junior designer
Junior legal assistant
Junior property developer
4. Experience in the construction industry
1 year
107
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
2 years
3 years
Above 3 years
5. Are you knowledgeable in the risk management used in the construction project?
Yes
No
6. How far do you agree that the construction project implementation is done based on
cost, functionality and time?
Strongly disagree
Disagree
Neutral
Agree
Strongly agree
7. How far do you agree that risk identification is main risk management processes
carried out I the construction project?
Strongly disagree
Disagree
Neutral
Agree
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
2 years
3 years
Above 3 years
5. Are you knowledgeable in the risk management used in the construction project?
Yes
No
6. How far do you agree that the construction project implementation is done based on
cost, functionality and time?
Strongly disagree
Disagree
Neutral
Agree
Strongly agree
7. How far do you agree that risk identification is main risk management processes
carried out I the construction project?
Strongly disagree
Disagree
Neutral
Agree
108
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
Strongly agree
8. How far do you agree that health and safety is the main concern in the construction
project?
Strongly disagree
Disagree
Neutral
Agree
Strongly agree
9. How far do you agree that there is high influence of project actor on the risk
management?
Strongly disagree
Disagree
Neutral
Agree
Strongly agree
10. How far do you agree that risk allocation is required in the construction project?
Strongly disagree
Disagree
Neutral
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
Strongly agree
8. How far do you agree that health and safety is the main concern in the construction
project?
Strongly disagree
Disagree
Neutral
Agree
Strongly agree
9. How far do you agree that there is high influence of project actor on the risk
management?
Strongly disagree
Disagree
Neutral
Agree
Strongly agree
10. How far do you agree that risk allocation is required in the construction project?
Strongly disagree
Disagree
Neutral
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INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
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Agree
Strongly agree
11. How far do you agree that there is deviation in the construction project in terms of
cost and time parameters?
Strongly disagree
Disagree
Neutral
Agree
Strongly agree
12. How far do you agree that optimal risk allocation is one of the procedure help to
reduce construction cost?
Strongly disagree
Disagree
Neutral
Agree
Strongly agree
13. How far do you agree that stakeholders require communicating with others to
overcome with communication challenges?
Strongly disagree
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
Agree
Strongly agree
11. How far do you agree that there is deviation in the construction project in terms of
cost and time parameters?
Strongly disagree
Disagree
Neutral
Agree
Strongly agree
12. How far do you agree that optimal risk allocation is one of the procedure help to
reduce construction cost?
Strongly disagree
Disagree
Neutral
Agree
Strongly agree
13. How far do you agree that stakeholders require communicating with others to
overcome with communication challenges?
Strongly disagree
110
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
Disagree
Neutral
Agree
Strongly agree
14. How far do you agree that ccollaboration and trust create key significance positive
relations with the project client?
Strongly disagree
Disagree
Neutral
Agree
Strongly agree
15. How far do you agree that clients are required communicating with identified risks
and opportunities in procurement phase?
Strongly disagree
Disagree
Neutral
Agree
Strongly agree
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
Disagree
Neutral
Agree
Strongly agree
14. How far do you agree that ccollaboration and trust create key significance positive
relations with the project client?
Strongly disagree
Disagree
Neutral
Agree
Strongly agree
15. How far do you agree that clients are required communicating with identified risks
and opportunities in procurement phase?
Strongly disagree
Disagree
Neutral
Agree
Strongly agree
111
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
16. How far do you agree that design and build is the procurement approach employed
for the construction project?
Strongly disagree
Disagree
Neutral
Agree
Strongly agree
17. How far do you agree that location and site conditions can affect the construction
project?
Strongly disagree
Disagree
Neutral
Agree
Strongly agree
18. How far do you agree that there is significant requirement for the client to get the
design documents approved on time?
Strongly disagree
Disagree
Neutral
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
16. How far do you agree that design and build is the procurement approach employed
for the construction project?
Strongly disagree
Disagree
Neutral
Agree
Strongly agree
17. How far do you agree that location and site conditions can affect the construction
project?
Strongly disagree
Disagree
Neutral
Agree
Strongly agree
18. How far do you agree that there is significant requirement for the client to get the
design documents approved on time?
Strongly disagree
Disagree
Neutral
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INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
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Agree
Strongly agree
19. How far do you agree that the construction work should adhere to quality
standards?
Strongly disagree
Disagree
Neutral
Agree
Strongly agree
20. How far do you agree that a formal organization structure required for resolution of
disputes in the project?
Strongly disagree
Disagree
Neutral
Agree
Strongly agree
21. How far do you agree that contractor require technical skills and experience to work
in the construction project?
Strongly disagree
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
Agree
Strongly agree
19. How far do you agree that the construction work should adhere to quality
standards?
Strongly disagree
Disagree
Neutral
Agree
Strongly agree
20. How far do you agree that a formal organization structure required for resolution of
disputes in the project?
Strongly disagree
Disagree
Neutral
Agree
Strongly agree
21. How far do you agree that contractor require technical skills and experience to work
in the construction project?
Strongly disagree
113
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
Disagree
Neutral
Agree
Strongly agree
22. How far do you agree that the project execution affected by weather as well as
climatic conditions?
Strongly disagree
Disagree
Neutral
Agree
Strongly agree
23. How far do you agree that the risk management is done by adequate design and
construction documentations for use of the contractor?
Strongly disagree
Disagree
Neutral
Agree
Strongly agree
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
Disagree
Neutral
Agree
Strongly agree
22. How far do you agree that the project execution affected by weather as well as
climatic conditions?
Strongly disagree
Disagree
Neutral
Agree
Strongly agree
23. How far do you agree that the risk management is done by adequate design and
construction documentations for use of the contractor?
Strongly disagree
Disagree
Neutral
Agree
Strongly agree
114
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
24. How far do you agree that risk allocation is done based on level of the technological
sophistication considered in the construction project?
Strongly disagree
Disagree
Neutral
Agree
Strongly agree
25. How far do you agree that the project is allocated to right resources based on their
construction skills and knowledge?
Strongly disagree
Disagree
Neutral
Agree
Strongly agree
INVESTIGATION OF OPTIMIZATION OF RISK ALLOCATION IN CONSTRUCTION
PROJECTS
24. How far do you agree that risk allocation is done based on level of the technological
sophistication considered in the construction project?
Strongly disagree
Disagree
Neutral
Agree
Strongly agree
25. How far do you agree that the project is allocated to right resources based on their
construction skills and knowledge?
Strongly disagree
Disagree
Neutral
Agree
Strongly agree
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