Risk factors affecting the construction projects in the developing countries

Bahamid, R. A.; Doh, Shu Ing; Al-Sharaf, M A.

doi:10.1088/1755-1315/244/1/012040

Cited by 17 publications

(14 citation statements)

References 36 publications

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“…Changing orders during construction and contracts awarded to the lowest bidder were ranked as the first and second most significant risks to construction projects in Saudi Arabia that caused project cost overruns, which were client-related risks. This result is supported by previous research conducted by [52,54].…”

Section: Ranking Of Riskssupporting

confidence: 91%

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Risk Factors That Lead to Time and Cost Overruns of Building Projects in Saudi Arabia

2022

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Rapid transformation across all sectors through Saudi Arabia’s vision 2030 initiatives led to an increase in construction activities. However, the construction industry has been already facing huge cost and time overruns, affecting all stakeholders. The aim of this study is to identify and explore the influential risk factors that lead to completion delays and cost overruns of government-funded building construction projects in Saudi Arabia, all of which have been subjected to a traditional type of procurement method (Standard Public Works Contract). The literature examined in this study identified a total of 83 risk factors, which have been grouped into nine categories. A questionnaire-based survey was conducted to determine the participants’ perspectives on the degree of probability of occurrence (P) of each risk and its potential impact on a project in terms of time (IT) and cost (IC). The questionnaire survey was distributed to 200 experts and professionals associated with Saudi building construction projects, which were grouped into four categories: clients, designers, consultants, and contractors. Fifty-five acceptable questionnaires were returned and analysed. The relative importance index (RII), and Risk Importance (RI) were used to identify the most influential risk factors, and an agreement test was conducted. The results of the survey revealed that the most significant risks factors contributing to the delay of building construction projects’ completion are contractor’s financial difficulties, owner’s delay in making progress payments for completed works, contracts awarded to the lowest bidder, change orders during construction, ineffective project planning and scheduling by the contractor, shortage of manpower, and contractor’s poor site management and supervision. In addition, change orders during construction and contracts awarded to the lowest bidder are the most significant risks factors of exceeding budgets. Based on the results, it is concluded that for achieving sustainable development, client, contractor, and labour-related risks must be effectively managed.

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Section: Ranking Of Riskssupporting

confidence: 91%

“…The most significant causes of cost overruns were fluctuations and increases in material price. Appendix A shows that various risk factors associated with construction projects from 17 studies [2,4,14,17,44,51,52,[52][53][54][55][56][57][58][59][60][61][62][63][64][65].…”

Section: Risk Factors Leading To Cost and Time Overrunsmentioning

confidence: 99%

Risk Factors That Lead to Time and Cost Overruns of Building Projects in Saudi Arabia

2022

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“…In order to best position it to satisfy customers' expectations, the growth of the construction industry requires an understanding of risk management procedures [32]. The industry has a bad reputation for risk management since it is burdened with several uncertainties as a result of expert assessment's subjective opinion, resulting in projects missing their cost and schedule objectives [27,33,34]. To ensure that both project customers and contractors receive value for money, project managers must use sound risk management procedures [13].…”

Section: Literature Reviewmentioning

confidence: 99%

“…Yemen's construction industry continues to be a critical component of the country's development process and an income source for all organizations and individuals, including the construction sector, which has a significant influence on domestic earnings and average employee wages [21,23]. Yemen, similar to other developing nations, faces grave hazards in the building business [5,18,[24][25][26][27].…”

Section: Introductionmentioning

confidence: 99%

The Current Risk Management Practices and Knowledge in the Construction Industry

et al. 2022

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Construction is a critical sector of any economy in terms of value production, labor, and contributing to the gross national product. Managing risk is a relatively young area in Yemen’s construction sector, but it is gaining traction as building activity and competition rise. Construction firms mitigate risk by using a variety of risk management methods. Therefore, there is a need to assess these procedures in order to detect shortcomings. This research aims to establish the existing risk management strategies used in Yemeni building projects. Survey questionnaires were used to collect data. Respondents were drawn from Yemeni construction businesses. Risk management is not executed systematically, intentionally, or continuously, and most firms’ risk management procedures are reactive, semipermanent, informal, and unstructured, with no or few dedicated resources to address risks. This strategy is inconsistent with generally accepted risk management principles. Nonetheless, the findings suggest a general understanding of risk management and a willingness to learn from previous errors. The study of the findings suggests that risk identification approaches such as judgment and historical data are employed for risk analysis, and that the industry typically attempts to avoid or transfer risks in Yemeni building projects. The results shed light on the shortcomings of Yemen’s project management practices. To guarantee that construction projects obtain maximum value for money, project managers of big construction businesses in Yemen need a strong understanding of and training in globally accepted systematic risk management procedures. Finally, this study can help future stakeholders determine how to work together to manage risk.

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“…Available literature has focused on the risk management in construction projects (Wang, Dulami and Agar, 2004;Banaitiene and Banaitis, 2012;Kasapoğlu, 2018;Bahamid, Doh and Al-Sharaf, 2019), risk assessment and prioritisation techniques (Qin, Mo and Jing, 2016;Zhao, Hwang and Gao, 2016; Zou and Couani, 2012;Gurgun, Arditi and Casals Vilar, 2016;Qin, Mo and Jing, 2016;Zhao, Hwang and Gao, 2016 Table 1. continued Tong et al, 2018;Yuan et al, 2018;Ribas et al, 2019;Guan, Abbasi and Ryan, 2020;Qazi, et al, 2021), managing risks in green building (Zou and Couani, 2012), risks in green building projects (Durmus-Pedini and Ashuri, 2010; Xiang and Shu, 2018), impact of green building (Gurgun, Arditi and Casals Vilar, 2016), risk perception (Wu et al, 2019b).…”

Section: Literature Reviewmentioning

confidence: 99%

Risks of Implementing Sustainable Construction Practices in the Nigerian Building Industry

Okoye

Okolie

Odesola

2022

CEB

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This study assessed the risks level associated with implementation of sustainable construction practices through a questionnaire survey distributed to 256 building professionals in Nigeria. It identified 47 risk factors with different likelihood of occurrence and magnitude of impacts. A quantitative risk analysis result based on mean value method and risk prioritisation number showed that the three top-ranked risk factors with highest likelihood of occurrence were unavailability of sustainable materials and equipment, more complex and unfamiliar construction techniques and processes, and high initial sustainable construction costs; whereas the three top-ranked risk factors with highest magnitude of impacts were high initial sustainable construction costs, poor and inefficient communication among project participants, and high cost of sustainable materials and equipment. The criticality index result identified 23 critical risk factors which mostly related to knowledge and awareness, cost, regulatory framework, building materials and socioeconomic issues. However, the Wilcoxon Signed-rank test result indicated that there is significant difference (z = -3.207, p<0.001) between the likelihood of occurrence and magnitude of impacts of the risks factors associated with implementation of sustainable construction practices in Nigeria of which the effect was moderate (r = 0.468). Furthermore, the study revealed that there is no significance difference in the risk level of the risk factors associated with implementation of sustainable construction practices based on the respondents’ roles (p>0.05). The study, therefore, recommended for training of construction practitioners in the multi-risk management approaches and increasing awareness through education on sustainable construction concept for building industry stakeholders. It further recommended for developing of new sustainable and affordable building materials through research institutes like Nigerian Building and Road Research Institute (NBRRI) with appropriate regulatory and policy frameworks for successful sustainable building projects.

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Risk factors affecting the construction projects in the developing countries

Cited by 17 publications

References 36 publications

Risk Factors That Lead to Time and Cost Overruns of Building Projects in Saudi Arabia

Risk Factors That Lead to Time and Cost Overruns of Building Projects in Saudi Arabia

The Current Risk Management Practices and Knowledge in the Construction Industry

Risks of Implementing Sustainable Construction Practices in the Nigerian Building Industry

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