Analysis of risk occurrence in projects executed by small and medium sized contracting firms

Abstract

The performance of small and medium sized construction firms has attracted research attention in recent times because of the impact on sustainable economic growth. This study examined this category of firms as their performances in building project delivery are impacted by specific risk factors. The purpose is to provide empirical evidence that could enhance the choice of appropriate risk management approaches and improve the performance metrics of the projects executed by the firms. Primary data were obtained through a structured questionnaire targeted at 100 firms which is about 40% proportional sample of 245 registered small and medium contractors in Lagos state, Nigeria, as at 2016. A total of 53 questionnaires completed by; 17 engineers, 12 quantity surveyors, 10 architect, eight 8 builders and 2 project managers provided valid responses for the analysis. Quantitative data collected were analysed using mean ranking, factor analysis, and t-test. While the results show; mistakes, changes in scope of project, price fluctuation, importing and customs and security risk factors, as the most frequently occurring variables, they nonetheless indicate no significant difference in the ranking of the occurrence of the factors by the operators of both small and medium sized contracting firms. Although findings are limited to occurrence indices of the factors, risk impact models based on severity indices of the individual variables on project performance executed by this category of contractors can be developed based on the empirical findings. The study also highlights implications for risk assessment and choice of appropriate management techniques that could help in improving the performance metrics of the projects executed by small and medium sized category of contracting firms.