Development of a client-based risk management methodology for the early design stage of construction processes

Abstract

Purpose – The risk factors associated with clients have a major impact on the successful delivery of a project from early design to the construction and operation stages. Risk management studies conducted so far have not succeeded in providing an effective risk assessment methodology for clients in analysing and managing the risk factors that cause both project delays and cost overruns. So, the purpose of this paper is to provide a methodology for a client-based risk management model. Design/methodology/approach – A conceptual framework is designed by integrating the findings from a literature review and a construction industry survey in the Kingdom of Saudi Arabia. The framework includes the risk identification, risk analysis and mitigation strategy, which are the key components of the model. The model of the framework is developed by integrating the analytical hierarchy process (AHP) and Monte Carlo simulation (MCS) underpinned within an @Risk program. Findings – A case study is used to demonstrate the proposed methodology; the results found that the model helps to analyse and quantify the impact of risk factors, and also to assist in taking a suitable risk mitigation strategy, particularly at the early design stage in the construction process. Practical implications – The model is applicable to both public and private clients when they need to know the possible project duration in a new construction project, and to take some proactive actions to avoid the adverse effect of client risk factors at the early stage of the project. Originality/value – The model is expected to help in understanding the nature, and analysing the influence, of client risk factors that cause project delays and cost overruns. The development of the methodology for managing the client-based risk in construction processes at the early design stage is the key value of the study.