Analyzing Cost Risk Indicators for Enhancing Construction Project Delivery Performance

Abstract

Risk factors are an inherent component of construction projects, and sometimes, it is difficult to completely eliminate these risks without proper management. This research focused on investigating cost-related risk indicators influencing the performance of construction projects in insurgency-affected areas such as Maiduguri. The assessment employed the Relative Importance Index (RII) and Exploratory Factor Analysis (EFA) to gauge the likelihood of these risks. Data was collected via a questionnaire from construction professionals, including clients, consultants, contractors, and subcontractors. The results analyzed through statistical software revealed that key drivers of cost-related risks were safety and environmental factors, physical threats, disasters, force majeure events, and economic risk factors. The top five most probable risks included costs related to insurgency damages, financial limitations due to insurgency, oversights caused by the insurgency, price increases due to attacks, and labour shortages. Conversely, risks related to cash flow issues and project cost estimation errors were less common. The findings suggest that professionals who consider these specific risk factors when devising risk management strategies can enhance the accuracy of their risk assessments and cost projections.