Risk Assessment in Construction: The impact of experience and corporate learning in decision-making of contractors
Proper management of risk by contractors is essential from the viewpoint of the long-termability to survive in a highly competitive bidding environment. An understanding of thevarious elements of the risk assessment process is critical for contractors and their impact onthe bid/no-bid and the mark-up decisions. The paper examines allocation of constructionversus business risk and the quantification of risk involved at the bidding stage of projects.The research found that contractors are aware of the impact of different types of procurementsystems on their risk exposure. The fact that contractors carry an additional business riskunder the design and construction procurement method is a further important fmding of thisresearch. This additional business risk can be as high as 50% of the total risk for design andconstruct projects. Specific individual characteristics of the contractors surveyed play asignificant role affecting the size of the project risk contingency, which tends to fall asknowledge and experience of contractors improves.It was also found that contractors have varying expectations of profit, depending on companycharacteristics. These expectations vary with economic condition and need to obtain thecontractor's work.
Year of publication: |
2002
|
---|---|
Authors: | Bajaj Deepak |
Other Persons: | Mills, Anthony (contributor) |
Publisher: |
Australian Institute of Quantity Surveyors |
Saved in:
freely available
Saved in favorites
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