DEVELOPMENT OF CONTRACTORS’ MITIGATION PRACTICES TOWARDS RISKS OUT OF CONTRACTORS’ CONTROL IN CONSTRUCTION INDUSTRY

Abstract

Research has shown that public construction projects in Saudi Arabia have exhibited poor performance for the past three decades. Recent studies have identified that contractors are not the main party that cause risks as owners, designers, and other parties have the major share of causing risks in the industry. The traditional risk management practices have been ineffective at helping contractors deliver projects on time and within budget while meeting quality expectations. The aim of this study is to develop a risk mitigation model for the contractors to mitigate risks out of contractors’ control (caused by other parties). The developed model is validated through identifying contractors’ perceptions who work in public construction projects in Saudi of the new approach through conducting a questionnaire survey. The developed model focuses on increasing accountability of project parties through mitigating parties’ activities and risks, measuring the activities and risks deviations (time and cost), and identifying sources of deviations. Transparency is utilized in the model through sharing weekly updates of the activities and risks combined with updated information of performance measurements of all project parties. The analysis of the study results showed that project risks will be minimized and performance of projects can be increased if contractors shift their focus using the new model from only managing their own activities and risks to managing all project parties’ activities and risks.