Sources of risks in construction project development: An exploratory study

Determining which risks are likely to affect a project and documenting the characteristics of each, constitute a fundamental step in project risk management processes. By identifying and prioritising potential risk sources at the outset of a project development, pitfalls could be avoided thereby eliminating or minimising the consequences of adverse events. This paper presents the results of preliminary investigations aimed at identifying and categorising risk elements in construction project development, and exploring strategies for eliminating or minimising the identified risk sources. The exploratory survey method was used, which involved semi-structured interviews with a convenience sample of 35 consultants and contractors operating in the civil, environmental, mining, oil and gas sectors In Western Australia. The qualitative data obtained from the interviews were subjected to content analyses. Results show that sources of risks in construction project development could be broadly categorised into controllable (mainly due to acts or omissions of internal stakeholders - client, consultants, main- and sub-contractors, and suppliers) and uncontrollable sources (arising from socio-cultural, macro and micro economic and global dynamics, legislative/statutory/political controls, force majeure and environmental constraints). Potential risk elements under each source are identified and prioritised in relation to their levels of significance. Effective strategies for efficient risk response development are also identified and prioritised.