Risk and Opportunity Management for Project Selection in the Road Construction Industry

Abstract

Road Construction projects failing to meet deadlines or budget costs puts burden on the construction company. The consequence may be economically unprofitable projects that significantly weaken the company's financial performance. To avoid unnecessary use of resources, the companies must identify and filter out unprofitable projects as early as possible. This paper lays out a process for use with road construction companies to improve their ability to choose profitable projects. The focus is on active management of risk and opportunity in the pre‐selection phase. The research is based on a case study at a road construction company. We interviewed key personnel to understand their main needs. We validated the proposed solution through a survey of nine employees at the same company. Our research resulted in a new method targeted to guide construction companies through the project selection process. The developed process flow illustrates the sequence and interaction of the different process stages. The risk and opportunity process is complemented with a check list, a risk and opportunity register, and the associated risk and opportunity matrix.