Abstract
Risk management (RM) is acknowledged as a key activity in project management in the pursuit to deliver successful construction projects. However, these projects are associated with various risks, which often jeopardise project performance, especially among small and medium construction enterprises (SMEs). Risk management practices (RMPs) have been developed, in order to curtail project risks. Nevertheless, there is no consensus on the practices that constitute RM for SME projects. Therefore, the main purpose of this research is to determine the RMPs that can be tailored for construction SMEs to manage risk in their projects, in order to achieve project success. An extensive review of relevant literature on RMPs was conducted and used to develop a structured questionnaire posted to construction SMEs who were conveniently sampled in the Gauteng province of South Africa. The empirical findings established nine RMPs that were reliable and valid for managing risk in projects undertaken by construction SMEs, namely organizational environment; defining project objectives; resource requirements; risk measurement; risk identification; risk assessment; communication approach and evaluation; risk response and action planning, as well as monitoring and review. It is important to note that the study was not conducted across South Africa; hence, the findings cannot be generalized. Despite the delimitation, the researchers recommend that these practices are for risk management in construction projects undertaken by SMEs in South Africa.
Highlights
The construction industry (CI) is one of the largest employers globally
The researchers recommend that these practices are for risk management in construction projects undertaken by small and medium construction enterprises (SMEs) in South Africa
The empirical investigation inferred that 10 and not nine practices are reliable and valid to be used by construction SMEs
Summary
The construction industry (CI) is one of the largest employers globally. It employs approximately 7% of the global work force or 180 million people and it is predicted to account for approximately 13% of the Global Domestic Product (GDP) by 2020 (Nieuwenkamp, 2016). The complexity of its activities and the risk environment lead to poor project performance, especially among small and medium construction enterprises (SMEs), whose contribution to the economy is substantial. This contribution has been recognised in many countries (Mutezo, 2013: 157; Abor & Quartey, 2010: 223; Ellegaard, 2008: 428) and especially in African countries such as South Africa and Nigeria, where they contribute 51% and 57% to national GDP (Kalane, 2015: 15). The South African government utilizes SMEs to attain three main objectives, namely poverty alleviation, job creation opportunities, Renault, Agumba & Ansary An exploratory factor analysis
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