Assessment of risk awareness in medium-sized and large construction organizations in Kuwait

Abstract

The construction business is extremely risky, and risks are faced in every project. Risk awareness has a significant influence on organizational strategy, and it can be argued that adequate risk awareness is critical for minimizing business risk. Despite the need for adequately understanding and managing business risk, it has been found that the level of risk awareness within the construction industry remains insufficient. In Kuwait, there is a lack of research studies that examine construction risk and risk management practices. This study represents an attempt to understand risk awareness within large- and medium-sized construction organizations in Kuwait. The study used an online survey that was sent to construction organizations registered under Category 1 in the Central Agency for Public Tenders (CAPT) in Kuwait. The findings of the survey revealed that owner-related factors, financial and economic risk, design risk and project complexity, subcontractor unavailability, labor unavailability, and political and government instability are the main concerns/risks faced. It is believed that the findings of this research could support efforts by construction organizations to eliminate such concerns and suggest other risks that may be overlooked by the studied organizations. The research findings indicated that 42% of the organizations rely on previous experience to manage risk and that only 25% of the organizations implement risk management processes, while 17% manage risk intuitively, and 16% by other approaches. Accordingly, it is critical to promote the systematic implementation of a risk management process in Kuwaiti construction organizations by revealing the advantages promised by such a process and providing a comprehensive understanding of risk attitude. Achieving this goal would aid the realization of the 2035 development vision of Kuwait, since most of the development projects within this vision involve international construction organizations, which may be advanced in the risk management field and thus be interested in understanding the level of risk awareness of their target market in Kuwait.