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Analysis & Management of Risk Construction Projects: (BUIL0039)

The document outlines a course on analyzing and managing risk in construction projects. It discusses that all construction projects carry risk that cannot be ignored, only managed. The course aims to introduce models for risk analysis and management and develop skills in rational decision making under uncertainty. Key risks discussed include those from design, construction, health and safety, environment, and across project stages. The document provides the course content, assessment, and contact information.

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45 views42 pages

Analysis & Management of Risk Construction Projects: (BUIL0039)

The document outlines a course on analyzing and managing risk in construction projects. It discusses that all construction projects carry risk that cannot be ignored, only managed. The course aims to introduce models for risk analysis and management and develop skills in rational decision making under uncertainty. Key risks discussed include those from design, construction, health and safety, environment, and across project stages. The document provides the course content, assessment, and contact information.

Uploaded by

อพัชชา บํารุงไทย
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Analysis & Management of Risk

in
Construction Projects
(BUIL0039)
Risk Management

“No construction project is risk free.

Risk can be managed, minimised,


shared, transferred, or accepted.

It cannot be ignored.“

Risk management - The commercial imperative


… Sir Michael Latham 1994
Learning Objective
Outline of the module.
Principle of risk analysis.
Principle of risk management.
Application to civil engineering
construction projects.
Aims of the Course
To introduce a range of models for the
analysis and management of risk.
To use economic and management
principles to develop an understanding of
risk and uncertainty.
To develop a conceptual framework for
rational decision-making in the uncertain
environment of the construction industry.
To develop skills in analysis and decision-
making in the context of above.
Outcomes
 Be able to evaluate design and implement
appropriate risk management procedures in the
construction industry.
 Be able to conduct a critical appraisal of
probabilistic financial and management
information.
 Be able to deploy a range of methods or risk
analysis as appropriate.
 Be able to evaluate risk associated with planing
design, construction, health and safety and
environmental impact.
 Be able to reflect on and appraise leading edge
practice and the available literature in this field.
Contents
 Risks and uncertainties in projects
 Understanding probabilities
 Risk attitude
 Risk at various stages of a project
 Contractual risk
 Measuring risk exposure
 Risk in the content of health and safety
 Environmental considerations
 International projects
 Case study
 Good practice
Lecture Programme
Week Topics
1 Introduction and overview;
Characteristics of civil engineering projects
2 Risk identification;
Risk and uncertainties in construction projects
3 Risk assessment; Risk measurement and attitude;
Risk assessment techniques
4 Risk analysis, quantification and evaluation;
Applications of the analytical results
5 Quantitative risk analysis and evaluation;
Applications of probability
6 Risks in construction project,;
Risk at various stages of a project
7 Risk control and management;
Residual risk; Case studies
8 Roles in risk management;
Health and safety in construction; Risk analysis and management in international projects
9 Risk analysis and management with environmental impact;
Risk assessment of contaminated land; Case study
10 Risk assessment of existing civil infrastructure;
Structural reliability and optimised maintenance.
11 Revision and/or students presentation
References
 Risk Analysis in Project Management: An
Introduction, J. Raftery, E & F N Spon
(Chapman and Hall), London, 1993.
 Risk Management and Construction,
Flanagan and Norman, Blackwell Scientific,
1999.
 Risk Management and Procurement in
Construction, J. Uff, (ed), King’s College,
London, 1995.
 Appraisal, Risk and Uncertainty, N Smith,
Thomas Telford, 2003.
Course Assessment
Assignment 1:
 ONE piece of work testing analytical
understanding of risk
 Weighting 50%
 Minimum pass mark 50%
Assignment 2:
 Timed
 Weighting 50%
 Minimum pass mark 50%
How to Contact
Hua-Peng CHEN, BEng, MSc, PhD, CEng, FICE
Professor of Civil Engineering
Senior Civil Engineering Consultant of Southern
Testing (UK)

Office: P350 Pembroke Building


Phone: 01634 883031
Email: h.chen@greenwich.ac.uk
Consultation time: appointment by email
Civil Engineering Construction Projects

Road
Road

Telecommunication Tunnel
Civil Engineering Projects
Buildings
Bridges and roads
Rail
Tunnels
Airports
Dams
Water treatment
Pipes
London's new City Hall
- 'glass egg'
London's Millennium Bridge
M8 Motorway Bridge Strengthening -
Structural
Rail Maintenance & Renewal -
Transport
Jubilee Line Underground London -
Transport Tunnelling
Chek Lap Kok Airport, Hong Kong –
Transport, Environmental
Three Gorges Dam, China
- Water
Hendon Sewage Treatment Works
- Environmental
THE PROJECT LIFE CYCLE
Identification
Demolition of need
RISKS

•ENVIRONMENT
•HEALTH & SAFETY
•FINANCE Planning
Operate & RISKS
•QUALITY Maintain

Construction Design
Hazard & Risk Management
Identification of hazards
Elimination and control of risks
Avoiding accidents and injuries
Avoiding occupational ill health
It is also about:
 Avoiding abortive work
 Avoiding financial loss
 Professional responsibilities
 Complying with statutory obligations
 Avoiding fines and prison sentences
Manage Human Resource
Manage Construction Plant
Manage Materials
Hazard & Risk Management
“Designers create many of the risks,
Contractors can mostly only manage the
risks, while the workers have to endure
them.
Clients must learn more about their
responsibilities and think about the risks.
Construction professionals are involved at
all stages. We need to work together to
ensure consistently high standards.”
John Barber MA LLB CEng FICE MHKIE FCIArb
Barrister to ICE
Characteristics of Construction Industry

National Importance:
Difficult to define (DIY etc)
Annual turnover varies widely
About £80,000m to £100,000m per year
Employs about 6 to 8% of national
workforce
Major Health & Safety and Environment
issues
Projects

 Mostly unique
 Long duration
 Outside
 Price often fixed by competitive tender
Companies
 Clients - Government, Industrial,
Commercial
 Designers - Consultant Engineers & Architects
 Contractors - Civil Engineering, Building, General
 Specialists - Earthworks, Demolition, Steelwork
 Size - 90% employ less than 20 people
Small firms carry out approx. 30% work
Large firms usually multi-disciplinary
 Materials - Manufacture, Supplier
 Project Management - Quantity surveying etc.
The UK Construction Industry is
rapidly moving towards :-
 Design & Build ( & Operate ) Contracts
 Use of specialist sub-contractors
 Main Contractor acting in a management
role
 ‘Fast Track’ construction

Risk in Construction courses have to


reflect this changing model.
History of a Project
Construction is the last phase of a series of
interrelated activities

1 Idea - the establishment of a need


2 Feasibility study
Market forecast
Investigations of various possibilities
Planning
3 Comparison of alternatives – economic
appraisal
Contract Methods (1)
4 Recommendation of specific project
5 Site Investigation
6 Detailed Design
7 Contract preparation - Conditions
- Roles & Responsibilities
- Risk Allocation
8 Invitations to Tender
9 Approval of Tender
10 Construction
Alternative Contract Methods
4 Recommendation of specific project
5 Site Investigation
6 Detailed Design
7 Contract preparation - Conditions
Design & - Roles & Responsibilities
Construct - Risk Allocation
8 Invitations to Tender Alternative
Design
9 Approval of Tender
10 Construction
Pre Construction Phase
 1 Contractor receives invitation to tender
 2 Preparation of tender
- Site location, access etc
- Ground Conditions
- Method of working - plant, labour
& materials
- RISK ASSESSMENT
 3 Obtain costs from suppliers
 4 Additional costs - Overheads,
supervision and financing
 5 Submit tender to Client or Engineer
Construction Phase
6 Detailed programme of work
7 Health & Safety and Environment plan
8 Construction
- site accommodation, services, hoardings etc
- site clearance, bulk excavation
- excavate and construct foundations
- construct frame / walls
- cladding, roof, weatherproof
- internal finishes, external services
Design & Build Management
Client

Contractor
(Tender)

Design Consultant Sub Contractor


( Drawings & Specification) (Price & Programme)

Contractor
(Site Management)

Sub Contactor
(Construction)
Clients of Construction Industry
A simplified view
of the people
involved in the
traditional
approach to
contracting for a
commercial
building
The process and
the people
Cash Flow Sequence of Project
Risk on Construction Project
Consequences of Risk

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