Perceptions of owners in German construction projects: congruence with project risk theory

Abstract

The construction industry is a major user of formal project risk management practices, yet risk is often dealt with inadequately, which is a contributory factor to poor performance. Conceptual developments propose a holistic view of risk incorporating threats and opportunities and the management of uncertainty. To optimize a risk management process there needs to be a reflection of this holistic view in management practice. A key project participant is the owner and understanding the perceptions of project risk of construction owners is an important step in assessing the degree to which practices reflect theory. Semi‐structured interviews were conducted with 10 practitioners in German construction owner organizations to explore their perceptions of project risk. The results showed no common definition of project risk and a general belief that risk equated to threat. Some owners did manage opportunities and saw a link between threats and opportunities, yet this practice seemed more the result of experience than an awareness that it was an integral part of a theoretical risk management framework. Most owners perceived risk to encompass uncertainty and the sources of uncertainty perceived as most important were those linked to a longer timescale, such as the ability to let out buildings.