Abstract
Construction industries are exposed to wide array of risks, such as financial, design, and contractual ones, which might have a direct impact on their performance toward achieving the desired objectives. Risk Management is a proactive decision-making process used to minimize and manage the risks in the most efficient and appropriate manner. However, most construction firms in Malaysia do not apply formal risk management in their projects. Thus, this study aims to identify the actual process of risk management that is being applied in the construction projects and to determine the effects of risk management implementation on the performance of the construction projects in terms of time and cost. The data were obtained from four case studies in Kuala Lumpur, Malaysia, through semistructured interviews. It was found that the implementation of risk management process in Malaysian construction industry is still at a low level, mainly due to the fact that most of the construction employees involved in risk management are not fully aware of the available risk management techniques that can be applied in construction projects.
Highlights
According to Smith et al [1], risk is an unforeseen event that occurs during the process of construction projects
Risk in construction industry has been the object of attention because of time and cost overruns associated with construction projects [4]
The first case study is about the construction of one additional block which consists of 11 storeys including an auditorium and other facilities in the Faculty of Built Environment, University of Malaya
Summary
According to Smith et al [1], risk is an unforeseen event that occurs during the process of construction projects. The construction industry is wellknown for being full of projects that were completed with significant cost overruns [5]. The risks that occur in construction projects will usually lead to inability to achieve the desired project objectives. Cost overruns, and reduction of quality of projects are the common negative effects of risk inherent to construction projects. Failure to manage such risks might further result in financial loss, damage of reputation, and loss of future business. A systematic risk management must be implemented to deal with the risk associated with construction projects
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