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Impact of Design Failure and Precision in Design Risk Identification

The Impact of Design failure and precision in Design Risk Identification and Design Risk Management in Construction Industry, India

Abstract

Realisation of a construction project is credited to various teams involved in the project. In each phase a sound decision-making effort of the team leads to the success of the project. While adverse consequences of a decision directs to failure of the project. To manage the outcome of the project, possible occurrences and impact of the project construe as risks. Every project necessitates a good project management for timely delivery, cost effective and efficient workflow. The intent of Risk Management is to identify, decrease and evade risks and its consequences. It is essential to detect and monitor risk at each stage that has significant impact on the project. At the outset, risk management should improvise the performance of the project.

The study begins with understanding the project cycle of a construction project, the research questions are targeted at the design phase and design process of the project and directing towards sustainable solution and identifying if those parameters optimise the design process. Further, the research moves to understand the risks associated with the conceptual and design phase. It also recognizes the roles of project actors, who govern and monitor the project. The extreme potential impact on design phase were identified in projects worldwide and in Indian scenario. Observing these projects, the comparisons were drawn that accredited to the literature gap and risk management practice.

Furthermore, the goal of the dissertation is understood through interviews and survey, which was targeted at designers, engineers, client, contractor, and consultant and project manager involved in construction projects. The observations from the interview and responses from the survey were carefully considered, classified and analysed to learn the turnout of threats and risks in a project lifecycle. And especially how design risks can be turned into opportunities for improvement.

Acknowledgment

At the outset, I take this opportunity to thank Professor William Swan for guiding me to bring out this dissertation work successfully and for all his support. I extend my gratitude to all professors for their guidance and encouragement. I take pride in acknowledging with thanks to the University of Salford for having given this opportunity to carry out my work.

My thanks to all others who have in some way or the other helped in the completion of this dissertation report.

Contents

Abstract

Acknowledgment

1.     PREFACE

1.1.  AIM

1.2.  OBJECTIVES

1.3.  RESEARCH QUESTIONS

1.4.  JUSTIFICATION

1.5.  DISSERTATION STRUCTURE

2.     CONSTRUCTION PROJECT

2.1.  PROJECT LIFE CYCLE

2.2.  DESIGN PHASE

2.3.  SUSTAINABILITY AS DESIGN PARAMETER

2.4.  RISK MANAGEMENT

2.5. DESIGN RISK ASSESSMENT

2.6.  THE DESIGN TEAM

3.     LITERATURE REVIEW

3.1.  WORLDWIDE PROJECTS

3.2.  PROJECTS IN INDIA

3.3.  LITERATURE GAP

3.4.  INFERENCE

4.     RESEARCH STRATEGY

4.1.  SCOPE OF RESEARCH

4.2.  LIMITATIONS

4.3.  APPROACH

4.4.  DATA COLLECTION APPROACH

4.5.  QUESTIONNAIRE STRATEGY

4.6.  ETHICAL CONSIDERATION

5.     DATA ANALYSIS AND DISCUSSION

5.1 DATA COLLECTION

5.2 DATA ANALYSIS

5.3 DISCUSSION

Responsibilities for Risk Management in the Design Process

Integrated Architecture – Sustainability as design parameter

Barriers and Opportunities

6.1 CONCLUSION

6.2 RECOMMENDATION

 

1.     PREFACE

1.1.  AIM

The research seeks to identify the effects of technical risk involved during the Design development phase and analyse sustainability as a design parameter of a construction project also to recognize the responsibility that designers and project administrators hold.

1.2.  OBJECTIVES

  • To elusively comprehend a list of high-profile projects, which has been subjected to design failure and assess the risks and events that are enticed along with it.
  • Evaluate the design team and draw recommendations that Architects and the client can consider to progress the performance and execution of the design and construction of the project.
  • To review the need for improvement in design risk management and analyze sustainable concepts to improve design process and construction practice.

1.3.  RESEARCH QUESTIONS

1.     What factors contributed to historical design failure?

2.     What are the Design Risks involved?

3.     How does sustainable design parameters integrated with design process help achieve better risk management?

4.     What is the role of a designer and what are his duties in investigating the design, and risk assessment?

1.4.  JUSTIFICATION

The ultimate and definitive goal of any construction project in the industry is to deliver the project on time, as per scheduled time frame of the project without compromising on the quality of the project. The role of project management is to ensure that the project runs efficiently without any setbacks. However, it’s only possible to achieve these objectives with proper Risk Management Identification and Assessment in construction projects. Therefore, this study is highly significant in understanding the lucrative design process and all the stakeholders involved in the process. The findings of this research will be useful to sensibly confront and overcome all the Design related challenges in the construction industry. The study will enable readers to get a distinctive understanding of the design process that is involved in the construction industry and all the probable errors and omission that may occur during the cycle. The Design process is subjected to changes and revisions due various factors and stakeholders involved in the project, the reader will be able to foresee the uncertainties involved in the project through the presented case studies and analysis and therefore will gain knowledge to prepare a desirable time frame and schedule a construction project.

In theory and several other cases, the value of the project is realized with the augments of risk management method. The hypothesis is grounded on the statistical risk factor that leads to delay in execution and accomplishment of the construction project. It may also shoot the cost of the project, decrease the quality of the project, and impinge the repute of the company. The damage could be worse than injuries, sometimes resulting in mortalities and loss of assets. Nevertheless, all of these negative percussions can be overturned and managed if the risks are aptly identified and assessed. This also means that supervising the project at administrative and technical level, will enable a quick completion of the project, thereby reducing the project cost, in turn, and improve the quality of the project. Ultimately, this builds a good reputation for the construction companies. This also decreases chances of injuries, fatalities, and minimize property damage. Thus, the goal of risk management is improved and adds value to the construction project.

1.5.  DISSERTATION STRUCTURE

Figure 1 Overview dissertation content

In order get an overview of the dissertation for the reader, the structure of the dissertation is presented below, making the research study more accessible to the reader.

The first chapter gives an insight into the research study, explaining the aim, objective and validate the reason and purpose of this study.

The study begins with defining the theories of a building project in chapter 2. This chapter pursues to present the life cycle of the project and expose the risks associated with the construction project. It continues to explain the significance of design phase of the project life cycle, the role of the design team and elucidating the importance of risk management in the initial stages of the project.

In the next chapter, building projects are observed with two instances of the project from around the world (Norconsult, Norway and one Canada tower, Canada), and observations of projects from India are also realized. The literature review is analyzed along with the research gap in design risk management, between Indian projects and extensive projects from global context are perceived and stated.

Chapter 4 complements the knowledge presented in the previous sections and states the motive and approach to the design study. Further, this chapter discusses the data collection method and research approach, it presents the scope and limitations of the study. This chapter also includes the questionnaire strategy.

Chapter 5 presents  the analysis and study of the situation in the construction industry describing the considerations for the design team. The analysis are based on the responses from the participants of the survey. The participants of the survey are all actors involved in the construction project. This chapter discusses the experience feedback,  review from risk management team and decision making in the conceptual design phase.

In the final chapter, the results are concluded, and the recommendation is drawn.  It is then realized that the information, suggestions and observation are based on the projects designed, the design team improving the work with risk management process within the company.

Figure 2 Outline of Dissertation

2.     CONSTRUCTION PROJECT

2.1.  PROJECT LIFE CYCLE

Project life cycle is a term coined as a project management tool to enhance the performance of a project. This term is used in every sector, regardless of the field of the business. It is used to track the business workflow from the inception to the termination of the project. Similarly, the concept of project life cycle in a construction project is to systemize the timeline of the project. However, the scope of each projects various with each sector and diverges within the industry.  Although it is possible, that there can be cases when the phases vary within the industry depending on the nature of the project (Smith et al., 2006). Therefore, it becomes complicated to establish a single narrative or shared description for a project life cycle.

The conclusion of various form of project life cycle was defined in the literature as an outcome of the review of several project typologies (Smith et al., 2006). However, according to (Smith et al., 2006), the construction project can be fragmented into eight phases from the inception of the project idea, feasibility, conceptual stage, planning, execution, termination to service life of the project. Pinto and Prescott (1988) presented a simpler concept of project life cycle which involved only four stages of project monitoring phase. Westland (2006) defined a similar model for Project life cycle which compresses the project stages into initiation, design phase, production/execution and termination of the project as principal steps.

A similar concept was defined by Ward and Chapman (1995) that stated four stages of project life cycle from initiation, designing phase, construction phase and closure of the project. Further, the same authors in later publications identified that these four project stages when additionally divided into several phases and steps, risk identification, assessment, and response became easier and more efficient. Risk management process became potentially accurate with several fragments of project stages Ward and Chapman (2003). Subsequently, when the project stages were fragmented, it became less relatable, and the scope of the project varied with every approach. The project life cycle needed adjustments and alterations to substantiate every project structure. This resulted as every project is exclusive and a single framework would not define every project requirement. Hence, the concept modeled by Chapman and Ward (2003) should be depended as a basic structure, and further additions and modifications are done according to the project scope.

In deduction, the finest model to formulate the project life cycle that would facilitate the research study was to understand a typical construction project. Every project commences with an idea, which developed into concepts and then to execution stage and then finally closure. However, the phases occasionally overlap, and the scope changes with each step and with each predestined purpose of the project. The following (Figure.) concept of four stages of project life cycle is treated as the basis for analysis in the research study (Westland 2006).

Figure 3 Project Life cycle

 

 

2.2.  DESIGN PHASE

As presented above, the model developed by Westland (2006), the second stage of the project life cycle is the Design phase. Once the project brief is well drafted, and the scope of the project is defined in the first stage, the second phase begins with appointing the design team, defining their roles according to their competencies. The priority of any construction project is to identify the needs and requirement of the stakeholder and for the design team to initiate the initial design concepts, which contributes to the fact of identifying the potential risk that may arise with the project. (Westland, 2006). This allows the design team to choose an optimized design solution.

Figure 4 Design Methodology presented by Engstrom and Lierud (2006)

As elucidated in the design phase of the project life cycle, the conceptual stage should also include site investigation, construction feasibility and cost factor to understand the neighborhood context regarding environmental and local body regulations to avoid delays in executions due to site conditions and from the regulatory organization. These aspects become vital during the preliminary design stage, once the design team addresses the possible setbacks and adhere to the guideline while satisfying the brief of the stakeholder the design concept is developed. It is vital to arbitrate the potential risk factors that are associated at this stage of planning.

Once the brief is drafted, and the site analysis is conducted the design team proceeds with the final conceptual design that proves to be broadcast less potential risks. Freezing the  design concept, the design team moves forward with the design process. Further, the team begins to draft the preliminary plans and develop detailed plans that are construction ready. The plans would be coordinated with various consultants including the structural, electrical and all specific set of engineers. Ultimately, the design team has a clear view of the design process.

This is relatively a longer phase in the planning stage and involves utmost critical decision making and testing of the conceptual idea. The design team initially run several concepts that are functionally feasible and is possibly the best design for the brief. The design options are evaluated, and the final solution is selected. This design stage is highly curial, the decisions taken in this phase impact the next phase of construction and consequently the service life of the building. This phase of design process determines the possible outcome and turnout of events in the following stages, requiring the design team to spend a quality amount of time to evaluate and precede the best conceptual solution for the project. Thus, defining the brief and understanding the needs of the project contributes to developing the best design solution and in the process identifying the risk associated enhances each phase of the project and the project in totality.

2.3.  SUSTAINABILITY AS DESIGN PARAMETER

The design phase of a construction project is crucial and holds definitive decision making while being so, does the design team have an objective for sustainable goals? The research question aimed to identify sustainability as a design parameter and if the concept would optimize the design process. The idea of sustainability can differ in perspective of the designer, client and the project manager within a construction project. The research aims to review the sustainability concept carried out in the design process, reflecting instances that can avoid risk involved or improvise in risk management planning and response. A sustainable model that enables to create a context that can define design process and construction management.

Figure 5 Integrating design process and sustainable parameter – Research perspective

Understanding sustainability before recognizing its design optimization ability is obligatory; the objective of every sustainable plan is a global change. Sustainability in construction sector works towards the same goal to achieve clean energy source in operation and production, ultimately towards creating a better environment for the future generations. It is possible to create a successful project through sustainable methods than through conventional construction methods. Sustainability on deeper interpretations and broader insight can be categorized into three fragments that balance the economy, social and ecological progress. This was termed to be the ‘triple bottom-line’ with three parts that complement the concept of sustainability (Hacking and Guthrie, 2008).

Figure 6 The triple bottom-line of sustainable development (adapted from Lützkendorf and

Lorenz, 2005)

The context of sustainability in the construction sector is quite complex and a vast subject of discussion; it begins with the optimised use of resources to zero energy consumption building. The research will become uncertain unless defining the concept in the design process is not compromised. It’s entirely possible that the designers, client and the project manager face barriers to implement sustainable practice in construction management. Besides this, there is a common misinterpretation of sustainable building and design process to green building concept. There are few significant differences, the idea of green building is to focus on environmental issues while sustainable objectives are socioeconomic, and it focuses on optimization of the construction practice. It then becomes necessary to differentiate sustainable building and sustainable construction practice. The latter is about the process from the beginning of design stage progressing towards the closure of the project and also the service life of the building. While sustainable building considers only the finished product. The sustainable process of construction and management considers the triple bottom line throughout the project. The benefits and the drawbacks that can be expected during the progression of the project are illustrated in the image below.

Figure 6 The triple bottom-line of sustainable practice applied on construction works (adapted from Foliente et al., 2007)

 

The knowledge transfer of sustainable construction practice from theory to practice is far-fetched; the research will aim to find projects that have improvised the performance with sustainable goals. The (Figure.) elucidates the interlink of the construction practice to the sustainable concept. Understanding this matrix would expand the knowledge of risk management and an efficient risk response planning can be formulated. In the following section, risk management process will be discussed concerning mainstream construction practice.

2.4.  RISK MANAGEMENT

Figure 7 Risk Management structure

Every project will accompany certain risks along with it; it is essential that these risks are identified ahead of the occurrence to avoid negative impact and diminish the performance of the entire project. It is also important to identify risk at each stage of project life cycle. Several problems that arise in later stages of project life cycle are caused due to threats that were unnoticed or unmanaged in the previous phase (Chapman and Ward 2003). This particular reason is the need for identifying risks that are involved in initial stages of the project. Accurate analysis conducted in the beginning stage of the project will serve great benefit in the project, which necessitates that risk management must be carried out in every phase of the project from initiation to closure of the project (Raz et al. 2002). Although the study made by Lyons and Skitmore (2002) indicated that Risk Management was widely used in two particular phases of the project. The planning and the construction phase of the project life cycle where the phases that extensively used risk management. This was quite contradictory to Elkington and Sallman (2002) findings that proved the initial designing and concept development stage is the critical phase in the risk management.

Similarly, Westland (2006) identified that the initial and concept phase should concentrate on risk identification. In the initiation stage, the team conducts a feasibility study and draft the project brief, at this stage a thorough understanding of the project protocol is analyzed and reviewed. Following which the team formulates the conceptual plans for the project, at this phase, several solutions are identified, and a study is conducted to analyze the possible risk that is associated with the design solutions. Further, in the preliminary planning stage, a risk plan is drafted to correlate the potential risk associated with the plans designed for the project. This requires the participation of all the stakeholders, everyone linked to the project must contribute to draft the risk plan that identifies the potential risk. To prepare for such an event, the risk plan should also outline a response plan that is assigned to each risk and that action is taken in case the particular problem arises. Developing a risk plan and response at this stage is highly significant, mitigating risks in planning phase would prove to be cost effective if the risks are not identified until the execution phase, the risk might become advanced and taking action would be expensive (Westland 2006).

According to Westland (2006), risk assessment should be conducted during the review of each phase of project life cycle. Each project begins with a high level of uncertainties and as the project proceeds the ambiguity is expected to decline along with the project. Problems that arise at any stage require the team to visit the origin and necessitates visiting the previous phase in the project cycle. In this process, the team shifts the concentration to the problem, and the project faces a setback while the new assumptions are discussed to develop a response. So, while moving back and forth in the project cycle trying to fix the problem the design and the concept alter. Therefore, the decisions that were made at a certain point in the project would have to be amended or modified to create a response to the problem that has occurred; this will instigate a series of change in the plan.

Many times, risk monitoring and control are only performed in the execution phase of the project life cycle, in order to manage the construction process more efficiently and track the timeline of the project to handle the risk and take necessary action. However, every construction project requires such practice of risk monitoring and control in every phase of the project beginning with inception and from the point in time the risk was identified. Westland (2006) suggests, this risk management process documented is critical at the closure of the project. When the project is terminated, the objectives and the deliverables of the project is evaluated, the stakeholders associated with the project have a clear picture of the project and the risk that were identified and managed. Further, if the participants identify any unmanaged risk in the project, there is a good chance the consequence and the response for the unmanaged risk can be discussed. Also, this record proves to be a basis and subject of warning for the future projects.

The project should draw a single definition for risk for each project that is initiated; this brings vivid objective of the project and the risk associated along with it. Everyone involved with the project should also be aware of this plan, risk management process. Risk management process involves risk identification, risk assessment and formulating risk response. There are several technique and tool to assess. These risk assessment tools are discussed in detail in the later section of the study. Risk management process begins when the risk plan is drafted and complete.

However, the project participants must understand that the Risk Management process is not individual responsibility of the party but a rather combined effort of all the members involved in the project. And, each of the project actors must be aware of the extent of the risks involved or identified and must develop themselves to handle the risks. The acceptability of the risk is to prepare a response plan. The risks can be accepted, avoided, reduced or transferred to a particular individual or a team. On wider spectrum of approach to a recognised risk is to decide:

  • If the risk is to be accepted, or
  • to reduce the impact of the risk; or
  • to avoid the risk; or
  • to assign the risk to another project actor;

Projects initiated in under developed countries, involving unique form and design or even unusual location, the probability of the risk involved is high. Lack of experience with the project actors can build severe risks to the execution of the project. This lack of experience and inadequate work force to handle the risk put emphasis on analytical review and testing of the design solution with designing software. This would cultivate a structured method to identify the risks and prepare the team to handle the risk. It is also essential that the risk identifier are associated with the clients or the contractors or with the designers, this would help understand the direction of response to be formulated. However, they must strengthen the methodology to identify the risk and uncertain events and develop a basis on which design strategy is grounded.

On the adverse situation, considering if case the project foes through a lawsuit, the proceedings are never in the favour of the project. The project will not obtain sufficient recompenses for an unsuccessful project. It is never a smart technique to ignore the risks involved and rely in the cynical belief on legal cases.

As illustrated in the (fig 7), Risk Management process, and the first step of the process is to identify the risks involved throughout the project lifecycle, and secondly the process involves risk analysis and exploring litigation associated with to project to recognise if the risks can be accepted, avoided, reduced or transferred to a particular participant.  Risk management contract, drafted in the beginning of the project initialisation should state the procedures, methods and condition for transfer of risk. The risk response team can utilise the advantage of compensation,

These benefits are always a combination of risk funding and insurance coverage. In this way the exposure of impact of the risk is highly monitored. A risk management manual with list of risk and assigning the roles and responsibilities of project participants in case of occurrence with proposals for risk response and review will closely monitor the process. The manual should also include the criteria for transfer of risks and assign project actors. However, at the end of each phase of the project, the identified risk must be reviewed and analysed for other chain reaction or occurrence of new risks. This process will efficiently manage the company’s risk and the manual will record the events for future clarification and as a case study for other projects handles looking for reference to monitor risks.

Figure 7 Risk Management Activities

The literature review and the survey aimed to identify if the project failed despite the implementation of risk management. It is common for the project to have suffered regarding monetary funds in case of risk occurrence. The project participants even though specialized in their field of practice, most of them do not have knowledge in risk management. It is necessary that fair knowledge of risk management should be transferred to the team of the construction project.

However, the roles and responsibilities of each project actors are limited to their area of expertise.  And, their knowledge should be used as an advantage to draft or carry out risk management. The success of a risk management process lies in the collaboration of the project participants and methodological identification of probable threats. Although risk management is significant in all the phases of the project, it is not followed. It is most often found that risk management is ignored in the program or project initiation stage of the project, but ironically it is the most significant at this juncture. The purpose of the project could liquefy without proper risk management. Identifying the risks in the initial stage has the advantage to develop response plan to avoid or mitigate the risks. The collaboration of the risk between project actors is important, and also the communication between procurement, purchase and material dealer is important for timely delivery to the site.

The risk management team should be ethically bound and have open communication to discuss the performance of each team and exchange feedback. The team should have mutual respect for each other and express active involvement in risk management process. It is important, that the members of the team trust and take unbiased decision for attaining effective risk management.

2.4.1. WHAT IS DESIGN RISK?

Different projects bring different risks to consider, although, among various types of risks in the projects, the typical construction risks can be distinguished with the groups and classification according to the allocation in individual project phases. Conceptual design phase – the risk can be related to incorrectly selected alternatives for final solutions, lack of information or data transfer with wrongly estimated objectives of the project, system of organization process, utilization of gained experience and knowledge management, bad decision making and risk identification and environmental risk. Detailed design phase – risks can occur in wrong estimated or incomplete drawings, difficulties in dealing specification and standards concerning existing conditions and client’s requirements, prediction of possible changes in design during the construction phase, weak or lack of knowledge about technical conditions. Design risk in construction project includes unfinished and inadequately defined design scope which fails to comprehend and reflect the needs and requirements of the user.

Design risks in construction project comprise of incomplete and poorly defined design scope resulting from inability to comprehensively articulate own and users’ needs and requirements, unavailability of information and incomplete design information; i.e. delay in supplying information required by contractors, innovative application, new technology, level of detail required and accuracy, appropriateness of specification, design errors and frequent changes resulting in variations, claims and cost escalations, interaction of design and constructability, sophisticated designs and shapes presenting ‘buildability’ / ‘constructability’ problems, non-standardisation of details, non-standardisation of suppliers, quality control exercised such as inspections and approvals and finally the risk of late confirmation and approval of design. Other risks that fall under this category are errors or omissions and additions in bills of quantities, insufficient time to prepare bid tenders, inadequate contract documentation and poor communication with the parties involved in the project delivery, delay in retrieving and sending information to the other parties and among the staff and labourers in the same organisation that will cause delay in decision making, often due to conflicts in multi-stakeholders’ interests or bureaucratic processes, poor design and shop drawings, accessibility to the site, damage to materials or manufactured items during transportation or storage, damage during construction due to negligence of any party, vandalism, accident, etc., and price escalation on materials and equipment. The construction risks will emerge most probably by reason of unrealistic expectations, for example, requiring the project to be constructed too quickly and defects-free, yet at minimal costs.

2.4.2. IMPACT OF DESIGN RISK

The conceptual design phase has a high impact on the success of the project, concerning time management and efficiency of design progress. In this phase of the project lifecycle of a construction project, fundamental problems are solved and involve good decision-making process that has a positive impact on the project. The efficiency of the project depends on the experience of the project participants, their knowledge, and awareness on risk management. The environment of the work place, good communication system and efficient thinking process builds up an exceptional system to manage the project.

Although it is important that the project participants have sound knowledge and experience in risk management, it is, however, essential not to be grounded on one old solution and the project members should progressively look for a better solution and endlessly improve the design process which significantly perceives the design strategy and design solution. These issues concede reduction of the risk involved in the conceptual stage of design process. It also improves the potential to identify critical events at the initial stage of the building project.

The purpose and the role of the conceptual design phase are now understood, and it is a turnstile to the project development.  The most significant decisions and risk identifications are carried out at this stage. The reason as mentioned above is the purpose to develop the research study. The research will shed light on the significance and influence of effective risk management in the design process of construction projects.

S.NO CATEGORIES – DESIGN RISK LIKELIHOOD IMPACT
1 Defective Design and design errors 4 5
2 Quality of work 2 4
3 Design omissions 2 4
4 Delays in design 4 4
5 Lack of scope of work 2 3
6 Changes in design 3 3
7 New stakeholder request changes 2 4
     8 Appropriateness of specification 2 4
9 Unsuitable design solution 2 4
10 Failure to carry out work in accordance with the contract 3 3
11 Constructability 3 5
12 Cost Escalation 4 5

*Likelihood of occurrence in the order of 1 to rare and 5 to very frequent.

**Impact of risk in the order of 1 to very low and 5 to very high.

Table 2.1 Design risk categories

The calculation of risk score is carried out by determining the potential risk and the probability of its occurrence. The table as mentioned above elucidates the risk rating. The impact matrix illustrates a risk score against the potential likelihood of risk event in each category, in this case, the detailed analysis is limited to design risk category. The table identifies each design category to the probability of occurrences and the impact of the risk if encountered.

This risk matrix yields to a priority check according to the ratings, once the risk events are evaluated, it will be followed by a qualitative analysis which then leads to a quantitative investigation, sometimes it directly leads to risk response plan.

Risk factors are categories into several groups on the basis of source of occurrence and the significance of the impact.  The fundamental categories of risk are as follows, Design risk (Table. 2.1) are the risks that are encountered in the initial and also forms the basis for prediction of potential threats. Other risks that are not described in the study are external risks that are affected by external stakeholder, new tax impositions, legal uses. Organizational and project management risks that are associated with poor scheduling, quality of work, environmental issues and conflicts within team members. Construction risks are most often accredited to contractors, which are usually attributed to the overrun of expenses, inability to adapt to technological changes. The study aims to determine the risks events that are responsible for delays and failure of projects. It is quite certain, from the above table, that design risks with high impact will have an adverse effect on the project.

2.4.3. DESIGN RISK IN CONSTRUCTION MANAGEMENT

Any potential risk in the design phase of a project is design risk, risks that occur in the conceptual stage or detailed design. Identifying the risks in early stages will reduce the intensity of the risk, lessen the impact of possible failure and diminish the chances for the design to fail. This allows for a careful and methodological investigation concerning the design concept and detail. Design decisions are taken in consideration with engineers from various disciplines and are coordinated to reflect functionality and cost efficiency.

This is the reason that design phase of a construction project is crucial since it involves all decision-making events in the conceptual stage; these events have a substantial impact on the expenses of the project (CIDA, 1995). It is in this conceptual design phase, in which the highest degree of any form of probable uncertainties in the project is likely to be encountered in this phase (Flanagan and Norman, 1993). Besides that, risk management process should perform an important role in identifying the risk and have a contingency plan to reduce the impact of risks into the other phases of project life cycle. As discussed, a risk management process is a technique to handle risks that are involved in the project, and its purpose is to mitigate the risks that arise during the project life cycle. (Toakley, 1989). As proposed by Dr. Kerzner (2003)

A risk management approach must be primarily established in the earliest stage of the project and the risk identified should consistently be addressed throughout the project life cycle. The identification of risks at the previous stage of the project is vital because it ensures the limitations of the project are addressed, and the enables to calculate the approximate expense of the project. Besides this factor, it also enables to focus on two critical project management processes on controlling and assigning risk factors (Perry and Hayes, 1986). According to Abrahamson, (1973) A well-sustained project management procedure should include the following prerequisites:

•    A detailed description of the project including associated risks

•    Clarity on risk responsibility born by each participant (Designer, client, contractor, and consultant)

•    Adequate knowledge and experience to handle risks in the project

•    Accountability to manage risks and to keep motivated to continue the project

•    Responsibility and authority held by each participant involved in the project

2.5. DESIGN RISK ASSESSMENT

Construction Company most often use risk assessment that are usually quantitative analysis.

As mentioned in the earlier section on impact of design risk, Table 2.1 illustrates the likelihood of occurrence to impact of the risk. This assessment can be plotted as a risk matrix of probability of occurrence to the impact of the risk. The construction company predefines the mitigation or response plan to make sure the risk is reduced or quickly addressed.

Figure 9 Uncertainty in building project, adopted from smith (2006)

Over the years, several models and techniques were developed to identify and manage risks involved in building projects. Prasanta Kumar Dey (2002) presented a concept model of decision tree analysis and AHP (Analytical hierarchy process). Other probability models and techniques like Monte Carlo simulation, probability and impact and Fuzzy set theory required highly quantitative inputs from the projects, information which are generally not readily available at the time of preliminary planning stage, it was also found its application of the technique was limited to the real time projects. Fault tree model was used to assess the probability of risk, effort made by Thomas et al (2006).  Abdelgawad et al (2010) explored resource management using combination of techniques like Fuzzy failure mode effect analysis (FMEA) and Fuzzy analytical hierarchy process (AHP). The analytical techniques and review models created was to support the risk management and project management team by creating a connection between possibility of potential risk occurrence, the impact of the risks, possibility to foresee and detect the severity of the events which facilitated to reduce the effect on the project. Eybpoosh (2011) relieved a model to study the relationship with risk factors using Structural equation model.  This model (SEM) became responsible for identifying risks in a project and ultimately to develop a substitute and an enhanced approach to risk in the earliest stage of the project. Tamosaitiene et al (2013) developed a technique called TOPIS- F which has similar ideology of Fuzzy theory model which assess risks involved in construction project. The TOPIS-F model was created chiefly to compare multiple projects and its risk associated with it. However each model was developed to create a compatible solution or technique to manage a construction project, various project manager use different techniques.

Risk assessment in the risk management process is the second step,

After the identification of potential risks and sources, the required information and data are collected to analyze. Cooper et al. (2005) describe that risk analysis is the list of risks which have the highest impact on the project. However, risk assessment and risk analysis are considered as two different processes of risk management, but Smith et al. (2006) has described both the process as one unit and carried out as the single stage in risk management process.  The risk is analyzed by categorizing into two methods, Quantitative and qualitative analysis.

The qualitative analysis is when the risks are categorized into the likelihood of occurrence to the impact of the risk if encountered (Table 2.1).  This method is applicable when the risks can be scaled from high to low level of impact. While, the quantitative approach is used to identify the possibility of the impacts of potential risks. The quantitative approach is estimated numerically (winch,2002)

However, Lichtenstein (1996) observed that the organizations are comfortable in using a qualitative method for analysis than using quantitative approach. It was sensed; this method better described the nature of the risks than in quantitative approach.  (Cooper et al. 2005).

There are several methods to conduct both the analysis and each method use distinctive assumptions, and it gets quite tricky to choose the best method or appropriate approach for of analysis. Each project would require unique or specific requirement to base the analysis. Therefore, the method for analysis should be chosen according to the available information on the project scope and specific requirements.

Nonetheless, Lichtenstein, (1996) describe that the assessment of the analysis should yield reliable information regardless of the chosen method. Perry (1986) defines the methods selected for the analysis are often associated with experience, knowledge, and expertise. And the selection technique also depended on the availability of software and computer technology in the past decade. Further Lichtenstein (1996) explained aspects that influence the choice of selection, and most often it depends on the organization to develop the critical assessment.

In a study conducted by Lichtenstein in 1996, several aspects were identified, and the most significant ones are listed below. The cost of using the risk assessment method,

  • Adapting to the need of the organization,
  • Straightforward and simplicity in application of the method,
  • Adequacy to monitor risks,
  • Simple interface for easy understanding,
  • Unambiguous values and results,
  • Reliability and validity of the model.

Below is a brief description of various risk analysis methods. All of these methods are used in the construction industry (Azari, 2010) below are few techniques that were primarily encountered in the due course of the research.

1.     Project evalution and review technique (PERT)

2.     Fuzzy Theory – Fuzzy failure mode effect analysis (FMEA)

3.     Fuzzy analytical heirarchy process (AHP).

4.     Probablity and Impact (PI)

5.     Likelihood occurrence of risk (LR)

6.     Monte Carlo Simulation (MCS)

7.     Analytical hierarchy process (AHP)

Figure 10 Design risk assessment techniques

Furthermore, besides the above mentioned techniques, Bayesian belief network (BNN) model were used by other researchers including techniques like Analytical neutral network (ANN), for risk assessment. According to the graphical data, it is clear that researchers refer few techniques over the others. The popular model used are Analytical hierarchy process, Monte Carlo Simulation, Likelihood occurrence of risk these techniques have proven to have served profitable in assessing the risk involved in the construction project. Of the three techniques, the Fuzzy theory models have close patronage of users, however AHP techniques proves to be more effective since this model has a schematic and systematic approach to risk assessment in the project by providing a hierarchical line. While techniques like Monte Carlo and Probability and Impact model required detailed inputs to assess the project at the initial stage, however it was difficult to formulate every information needed from the construction project to determine the risk factor. The construction project required a technique that could monitor and assess the project at every stage. Therefore, it became a necessity to develop a model that is revised for each project or a specific task. In conclusion, Risk assessment techniques and model should be concise and simple in application. This would encourage several project handlers and professionals to practice the procedure.

Risk identification and handling in a construction project is a problem, which ought to be meticulously considered and monitored throughout the project life cycle. However, the assessment of risk carried out in the conceptual stage of design process will reduce the impact on all the phases of the project. The responsibility of managing the risk lies with the project manager and site manager to communicate, to predict, to anticipate and transfer knowledge of risk management. It is the most crucial task to collaborate with all the project members and through all the phase of the project life cycle.

2.6.  THE DESIGN TEAM

Figure 11 Design errors based on people, organization and people (Lopez et al, 2010)



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