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Risk Management Design

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Risk Management System

A risk management design plays a significant role as it allows professionals in construction to identify potential risks and generate possible solutions. The management design aids in minimizing the impact of the predicted risk that in return improves the quality of the construction process. The project manager uses clear and straight-forward concepts to analyze ways of identifying and dealing with uncertainties. Some of the common risks in construction are disputes, poor site conditions, low profit, pressure due to limited time to complete the projects, and safety. The risks require the project manager to implement a management design to reduce any of the potential risks to the company. The current level of risk management affects the type of design that is most critical at Ad Hoc.

The design is on a construction company at the risk maturity level 1, termed as Ad Hock. The Ad Hock level means that the company in question is unaware of risk management’s most details. The company lacks a fundamental approach to potential uncertainties that may occur during the implementation of any project. Most construction operations are the same, making it challenging to solve past problems as similar mistakes are repeated in every project. The analyst makes no attempts to prepare a management design but tries to solve the problem after risking the organization. The Ad Hoc stage requires the project manager to lay a robust risk management design to move to the fourth level of maturity. The company records most losses during the Ad Hoc stage as it takes no precautions to prevent problems from happening. The goal of the risk management design in question is to design an approach to uncertainties that will shift the organization from Ad Hock to maturity level 3 within a short time. The design’s long-term aim is to get to risk maturity 4 to improve the overall level of production (Szymański, 2017). The company will have higher visibility to most uncertainties using the tools at risk maturity levels 3 and 4.

Risk Management Design

The risk management system is based on risk avoidance, where the project manager accesses the situation to take preventive measures. The risk management design is divided into three main parts to ensure that it achieves and maintains the risk maturity level 4. The first part focuses on shifting the organization from Ad Hoc to level 2 and clearly stating the objectives. The management will involve external experts who have adequate risk management experience and explain their objectives for guidance. The project manager will identify a prototype team from the experts before offering training and support to them. The manager will select the team based on the objective of the organization and a particular project. The training will improve their competence and integrity when communicating to the client to maintain its positive reputation (Xia et al., 2018). The manager will further inform the plan’s vision and its long-term benefits to the company to the entire organization. The communication should be hierarchical by informing the senior management before the rest of the employees. The briefing presented to the organization must have details regarding the project, such as the RMRP number and subcontractors on board. The design will require the construction company to select a senior management sponsor to back up the implementation process. At this point, the team must create awareness and seek the project’s approval to increase the success levels. Evaluation metrics will be applied to understand the success levels in using the design at level 2. The project details will be put in the database to ease the input and output process to manage the potential risks (Cakmak & Tezel, 2019).

The second section of the design addresses the common problems faced at level 2 and shift to risk maturity 3. The company faces several challenges in stage 2 as it strives to implement the essentials after ad Hoc, which calls for reinforcement. The project should allocate adequate resources to ensure effective implementation of the management procedures such as training and the assessment tools. The management should select critical projects to show that the suggested design works and aids in reducing the effect of the risk to the business. During the second level of risk maturity, the management should involve other employees in the organization to participate in the training sessions. The team selects more assessment tools to increase the visibility rate to uncertainties, which improves the risk management design. The company formulates specific policies that guide the use of the proposed risk management approach to different projects. The project managers will have a role to ensure that the design is implemented in all projects as part of the newly formulated policies. The next stage is to enter the metrics into the database for risk process, identification, and possible cost in management. The project managers can formulate a checklist based on the type of the operation and risks to manage to give an experience to the company.

The third part of the risk management design is to move the risk maturity level from three to four and maintain it at that point. The most likely challenge in level 3 is the loss of momentum, which needs the design to allow effective learning. The risk management team should formulate solutions based on experiences from past projects. The team can invest in new tools and methodologies to improve the effectiveness of the model. The stage calls for all people’s massive involvement to ensure that the design becomes part of the company. The involvement expands the competency of the employees and project partners to predict possible risks in a project. The design ensures that the construction team does not just wait for problems to occur to get a solution. The design allows the project team to enter details on the database and interpret them to identify possible future gaps in the construction process. Regular re-launches of the proposed measures are essential to reduce potential loss of momentum. The organization must promote regular training to ensure that all internal stakeholders understand the design’s depth and significance.

The last part of the design includes tools that aid in maintaining the risk maturity at level four. The risk management design will be part of the company as the senior leaders will ensure that all project managers execute each step. The experts will review the terms and sponsors to ensure that all standards of the design are met. The design will be flexible; thus, the management must continuously review it and invest in new tools and personnel. The project manager should also involve the clients in the risk management process.

Justification of the Design

The first stage in the system’s justification is to analyze the project by entering the client’s detail into the database. The details will be filled as; site area, facilities, the purpose of the project, factors required to construct the building, and client’s terms. The approximated size of the site 14,500 meters-squared in docklands in London. The client allows pre-let, meaning that the organization will work with potential tenants to include their construction preferences. The project’s goal is to offer office spaces and parking spaces in the basement for five-hundred cars. The risk management system requires that the project manager enters all the details in the database and gives the right command to get the most relevant response. The system predicts the potential risks that may impact the project negatively and suggest some applicable preventive measures. The system is based on risk avoidance; thus, the organization and client must invest in the measures before the project commences.

Database> Design System
Input Data Output> Potential risk
Site size 14,500m2 14,450 m2
Location Docklands, London Unpredictable site conditions
Basement car parking 500 cars 500 cars
Site accessibility By Road Inability to meet the set deadline
Accessibility restriction By railways line Inconveniences when transporting raw materials and workers
Number of stories <4 stories Safety hazard to construction workers
Site Occupancy rate <75% Low definition of the building scope
Usable floor size 30,000 Space shortage
Preferred procurement route Design and build The unexpected increase in materials
Scheme stage >Feasibility Stage four (4/4)

The system has identified potential risks based on the data entered into the system and the client’s preferences. The project manager will use the experts’ team, part of the risk management design, to assess each risk and provide the most suitable preventive measures. The expertise will take each potential risk through the analysis design to understand the vulnerability and exploitation. The attacker’s gain or gain refers to any external factors contributing to the risks, such as the railway that restrict access to the site. The first potential risk is unpredictable site conditions such as terrain and neighboring environment. The suggested solution to reduce the unpredictable site condition’s impact is to preview the area before the task. The Task project manager and a team of experts will access the site to identify external factors that may threaten workers’ safety (Burkov et al., 2018). The inaccessibility of the site due to the railway line will be solved by evaluating a different transport mode. The company opts to use the three different means of transport for the raw materials and the workers. The client will also increase the finance to cater to workers’ transport and raw materials to the site. The workers’ safety hazards will be solved by providing gears and continuously evaluating the building to avoid accidents. The organization must provide safety gear and ensure that all workers are on them during work. The system automatically reviews the competence of the project manager through an online test. The test is part of the system that focuses on predicting the probability of facing management problems in implementing the project.

The risk management team will enter the suggested solutions to the database’s implementation and command for analysis. The system will give feedback on the extent to which each solution will reduce the impact of potential risk. The results from the system for this particular project indicate that the project has all the risk avoidance measures put in place to improve the quality of work. The last stage of the justification process is to analyze how the final project matches the outlined client’s expectations.

Demonstration of the Working of the System

Outcome Analysis System
Outcome Expected Outcome Actual Outcome Metrics-Score out of 10
Property handover to tenants in 52 weeks 51weeks. 2 days 10
Total design and construction cost 40 million 45 million 8.5
External aesthetics Striking architectural Modern features from the exterior to interior design 9.5
Functional performance High flexibility and adaptability in regards to tenants Built based on tenants preferences, thus high flexibility and adaptability 9.0
Environmental considerations Produce Carbon dioxide below the government’s targets Produced 0.14 Carbon during the construction operations, which is way below the government’s limit 9.5
Overall metrics Score 9.3


Recommendations on the Future Improvements

The risk management system effectively avoids the effects of potential risk with significant consideration of future operations. The system applies to most projects as the database has different commands that allow the project team to make predictions. The system requires the client to give all the details about the project to make the most useful prediction. The risk management team uses the system to understand the most probable risks regarding the project’s nature and expectations from the client. The system further gives suggestions for applicable measures to reduce the impact of the risks. Construction is a risky business that requires a robust management system to avoid making losses. The risk management system gives the project manager the allowance to include the tenant’s preference in the design, especially the rooms’ size. The system also allows the organization to estimate a realistic financial quote to avoid complications with the subcontractors. The risk management design considers future operations that come with technology as it allows a high level of flexibility. In conclusion, the risk management system is working, as evident by the positive results attained from the project’s analysis and implementation in question. The project’s actual outcome meets the client’s expectations with an overall metric score of 9.3.


Burkov, V., Burkova, I., Barkhi, R., & Berlinov, M. (2018). Qualitative Risk Assessments in Project Management in Construction Industry. In MATEC Web of Conferences (Vol. 251, p. 06027). EDP Sciences.

Cakmak, P. I., & Tezel, E. (2019). A guide for risk management in construction projects: Present knowledge and future directions. In Risk management in construction projects. IntechOpen.

Szymański, P. (2017). Risk management in construction projects. Procedia Engineering208, 174-182.

Xia, N., Zou, P. X., Griffin, M. A., Wang, X., & Zhong, R. (2018). Towards integrating construction risk management and stakeholder management: A systematic literature review and future research agendas. International Journal of Project Management36(5), 701-715.

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