Everyday you read about a construction project that is failing or has failed, and you wonder why? How did management not foresee the impact of their actions? When did management know it was in trouble and why did they not react sooner to correct the project issues? What will it now cost to complete the work and how long will it take?
These failures could have and should have been eliminated by developing a mitigation strategy prior to it becoming an issue during project execution. Typically we find dysfunctional management practices in place which allows the project management team to circumvent a risk management process causes most, if not all, project schedule and cost overruns. The deficiency in risk management application, not properly identifying and developing mitigation strategies cause scope creep, the number one reason for project failure.
Unlike those highly publicized failed projects, our construction projects are different – right! On our projects, we always have a good reason why our project didn’t finish ahead of schedule and under budget: the design was incomplete, project contractors and suppliers didn’t focus on the project requirements and were ill informed as to their own management responsibilities, the scope of the work changed, and finally our client was difficult to work with. Excuses.
There are a number of risk factors that could lead to project failure or have a less then positive result on our project, and wither your project ends up on the front page of your local newspaper, or worse on your boss desk, depends on the amplitude of the failure.
Successful projects can be obtained if one is willing to engage in the management risk prior to the execution of project activities. A risk management process must be implemented on all construction projects.
This text was developed to help the construction project team in the identification of construction project risk and aid in the development of risk mitigation strategies. The information presented in this text is a start for project risk management understanding. All project management teams, including the owner, must be engaged in the risk management process - this is the reason for this text.