Risk analysis in fixed-price design–build construction projects

Öztaş, Ahmet; Ökmen, Önder

doi:10.1016/j.buildenv.2003.08.018

Cited by 62 publications

(19 citation statements)

References 19 publications

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“…It is no surprise then that risk, simply defined here as the measure of exposure to financial loss, or gain (Akintoye 2000), has been heavily cited as one of the main causes of failure to meet cost targets on construction projects (Skitmore and Ng 2003, Öztas 2004, Okmen and Öztas 2010.…”

Section: Risk and Uncertaintymentioning

confidence: 99%

Rethinking construction cost overruns: cognition, learning and estimation

Ahiaga-Dagbui

Smith

2014

Journal of Financial Management of Property and Construction

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Purpose – Drawing on mainstream arguments in the literature, the paper presents a coherent and holistic view on the causes of cost overruns, and the dynamics between cognitive dispositions, learning and estimation. A cost prediction model has also been developed using data mining for estimating final cost of projects. The paper aims to discuss these issues. Design/methodology/approach – A mixed-method approach was adopted: a qualitative exploration of the causes of cost overrun followed by an empirical development of a final cost model using artificial neural networks. Findings – A conceptual model to distinguish between the often conflated causes of underestimation and cost overruns on large publicly funded projects. The empirical model developed in this paper achieved an average absolute percentage error of 3.67 percent with 87 percent of the model predictions within a range of ±5 percent of the actual final cost. Practical implications – The model developed can be converted to a desktop package for quick cost predictions and the generation of various alternative solutions for a construction project in a sort of what-if analysis for the purposes of comparison. The use of the model could also greatly reduce the time and resources spent on estimation. Originality/value – A thorough discussion on the dynamics between cognitive dispositions, learning and cost estimation has been presented. It also presents a conceptual model for understanding two often conflated issues of cost overrun and under-estimation.

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Section: Risk and Uncertaintymentioning

confidence: 99%

Rethinking construction cost overruns: cognition, learning and estimation

Ahiaga-Dagbui

Smith

2014

Journal of Financial Management of Property and Construction

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“…Attarzadeh and Chua analyzed the risks of long-term PPP BOT-structured projects as well, with the NPV being target variable, by applying the Monte Carlo simulation as the simulation methodology [52]. Öztaş and Ökmen applied Monte Carlo simulations in the modeling of time and cost risks [53].…”

Section: Using Monte Carlo For Simulation In Construction Projectsmentioning

confidence: 99%

The building blocks of risk theory and methodology

Kovács¹,

Koppány²,

Szabó³

2015

Computational Methods and Experimental Measurements XVII

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The study aims to present a brief summary of the results of a methodological research carried out within the GOP project "Research and development of risk evaluation services in the construction industry". The first part of the study elaborates the literature of risk management process, the logical framework of the development, the concepts of risk and uncertainty, and the measurement and quantification of risks. The second part presents the interpretation of risks and risk analysis techniques used by us. The most important building block of our model is the stochastic network analysis and the Monte Carlo simulation which can generate the distributions of the durations and costs of projects, the two essential characteristics of construction projects. Our method can be mainly used for the collection and aggregation of the knowledge about the existing risks, as well as for analyzing the risks at enterprises, however, it's also suitable for building up of hard statistical data.

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“…This causes CPM and Repetitive Scheduling to misidentify the critical paths and project durations [20]. Construction projects are under the influence of uncertainties related to the risk-factors such as weather conditions, design faults, scope changes, site conditions, and soil properties [21][22][23][24]. Furthermore, all of the possible risk-factors in a construction project might be schedule risks because somehow they are related to the schedule directly or indirectly.…”

Section: Introductionmentioning

confidence: 99%

Evaluating Schedule Uncertainty in Unit-Based Repetitive Building Projects

Ökmen¹

2013

Journal of Construction Engineering and Project Management

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Risk analysis in fixed-price design–build construction projects

Cited by 62 publications

References 19 publications

Rethinking construction cost overruns: cognition, learning and estimation

Rethinking construction cost overruns: cognition, learning and estimation

The building blocks of risk theory and methodology

Evaluating Schedule Uncertainty in Unit-Based Repetitive Building Projects

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