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Jepson, J, Kirytopoulos, K 2016, 'Investigating the usage of risk management tools and techniques in the construction industry: a literature perspective', in R Ruiz & R Alvarez-Valdes (eds), Proceedings of the 15th International Conference on Project Management and Scheduling, Universitat de València, 73-176. 

Abstract:

Selecting the appropriate tools and techniques for managing risks is a core step in the risk management process and plays an important role in the efficiency as well as the effectiveness of the outcomes. The professional organisations have prepared a series of mature best practices and standards including: the IEC/ISO 31010, the SA/SNZ HB 89:2013 and the PMI Practice Standard Project Risk Management. All these include lists of potential tools and techniques that can be used in practice. 

The research question addressed in this paper is whether the use of risk management tools and techniques in construction industry, as seen through scholar publications, is aligned with the standards. 

Towards addressing the research question, a rigorous literature review based on extensive analysis of article abstracts was undertaken covering journals of the last decade (March 2004-March 2015), and conference papers of the last five years (March 2010-March 2015). In order to keep an unbiased basis for the sample selection, the authors used the Science Direct data base and through a series of keyword searches and exclusions came up with 104 relevant journal abstracts and 40 conference abstracts that were analysed. The analysis was executed through a qualitative interpretation process.

The study indicated a very different range of tools discussed in the literature than that indicated by the standards. Much of the literature, as expected for scholar publications, was focused on developing new tools to assist in risk assessment. However, it is interesting that these new approaches were not building upon established tools and techniques presented in the examined standards, raising concerns on the coherence of the new techniques development process. 

The most commonly referred tools and techniques, covering more than 70% of the research agenda were related to Multi Criteria Decision Analysis (e.g. Analytical Hierarchy Process), Fuzzy Logic and Monte Carlo Simulation. Other techniques mentioned were the Bayesian Networks, Check-lists, Fault Tree Analysis, Event Tree Analysis, Cost Benefit Analysis, Analytical Network Process and Data Envelopment Analysis (DEA). Of equal importance is the finding that almost half of the tools and techniques mentioned in standards do not appear in any of the papers examined.

 

The initial assumption of misalignment seems to be validated and an interesting research agenda is deployed because of this outcome. Suggested reasons for the misalignment that need to be explored through empirical research may include that a) academics tend to be “creative” in order to be at the forefront of research but this may have an impact on the applicability of ideas in practice or b) relevant standards have fallen behind on including the modern trends. In addition, the misalignment identified in this paper raises concerns on whether both standards and academic publications capture the reality of the profession in the construction industry and thus an in-depth research is required to find out what tools and techniques project managers actually apply when assessing risk in their projects.

 

Keywords – risk management, construction industry, tools and techniques.

 

Jepson, J, Kirytopoulos, K 2016, 'Investigating the usage of risk management tools and techniques in the construction industry: a literature perspective', in R Ruiz & R Alvarez-Valdes (eds), Proceedings of the 15th International Conference on Project Management and Scheduling, Universitat de València, 73-176.