ABSTRACT

This paper presents a risk assessment model for construction projects.
There are a number of problems in the construction industry in India that are
attributed to various factors. The focus of the present research is to identify
factors that influence the smooth completion of a project and develop a risk
assessment model. The experience and successful in the construction industry nowadays depends not only on the traditional civil engineering programs. Project management, over the last 25-30 years, has developed
into a methodological and systematic way of dealing with all aspects of construction projects. The wide range of topics that are now representing the domain of construction management is more than emphasis on scheduling, cost control and resource management. They include,
but are not limited to, engineering project management concepts, quality management system, environmental management system and techniques for analysis the potential success factors.
A questionnaire was prepared on the basic of a literature review and was
filled by contractors, project management experts, having more than 20 years of
experience in the construction field in India.
This paper presents
the results of a study carried out to identify some of the core issues in construction management which are mentioned above as a skeleton of integrated project management system for construction industry, and highlights the significance of studying
several techniques to explain the strength and weakness for this knowledge area. It is planned that this study will continued to model the integrated project management system and develop an expert system
for purpose of education and training to better equip middle and top level managers in the construction industry with the state-of-the-art tools, techniques and methodologies of project
management.

 

Keywords:
Project, management, quality, risk,
integrated system, construction
industry.

 

INTRODUCTION

Significant changes in the global economy have
resulted in increased business opportunities for architectural , engineering,
and construction (A/E/C) firms throughout the world. Making the decision to
expand operation in a new market, it is important for A/E/C firms to analyze
the risks, benefits, and future market potential of the target country(Hastak
et al.1994; Nielsen 1997; Sloan and Weisberg 1997; Tucker 1997;Wang et al.1998)
Projects management
is critical to the organization success of any field. It is group of activities result in new or changed products, services, environments, processes and organizations. Projects increase sales, reduce costs, improve quality and customer satisfaction, enhance the work environment, and result in many other benefits.

As organizations have recognized the criticality of projects to their success, project
management has become
a focal point of improvement efforts.
More and more organizations have embraced project management as a key strategy
for remaining competitive in today’s highly competitive business environment. Project management centers, training
programs, and organizations change programs to improve project management practices are increasingly common parts of strategic
plans to improve organizational effectiveness.

Some organizations are just getting started with project management. Others have reached a level of maturity
whereby project management has become a way of life. In the leading
organizations, project
management is aligned with and integrated into the company’s business goals and objectives. No longer, the individual responsibility of the project manager, top management is taking more responsibility for driving the company’s project management strategies.

 

 

LITERATURE REVIEW

 

Project management definition

There are more than one definition for project management,it is the application of collection of tools and techniques to direct the use of divers resources toward the accomplishment of a unique,
complex, one-time task within time, cost and quality constraints. Each task requires a particular
mix of these tools and techniques structured to fit

The task environment and lifecycle of the task (Oisen, 1971). In the other hand, the British Standard for project management defined
project management as “the
planning, monitoring and control
of all aspects of a project
and the motivation of all those involved in it to achieve the project objectives on time and to the specified cost, quality and performance” (BS6079, 1996). The UK association of project management (APM) also defines
the project management in the UK Body of Knowledge (BOK) as
“the planning, organization, monitoring and control of all aspect of a project and the motivation
of all involved to achieve the project objective safely and within agreed time, cost and performance criteria. The project manager is the single point of responsibility for achieve this” (APM, 1993). Other definitions have been offered, “the project management is a human activity
that achieves a clear objective
against time scale” (Reiss, 1993). Turner suggests that project management could be described as “the art and science of converting vision into reality” (Turner, 1996).

 

Principles of traditional project management

The thinking
within the principles of management usually associated with the management of people. The management of people includes defining what the business unit will do, planning for the number and type of staff who will do it, organizing the staff, monitoring their performance of the tasks assigned
them, and finally
bringing a close to their

efforts.
Those same principles also apply to projects. Robert and Rudd define the Project Management as a method and a set of techniques based on the accepted principles of management used for planning, estimating, and controlling work activities to reach a desired end result on time-within budget and according to specification. Figure-1 shows these process phases of a project
(Robert and Rudd, 2003).

 

Figure-1. Process
phases of a project
(Robert and Rudd, 2003)

 

Concepts in project management

New conceptual
direction in project management was developed during 1990s. Project management began to mature in virtually all types of organizations, including those firms that were project-driven, those that were non-project- driven, and hybrids. Knowledge concerning the benefits project management offered now permeated all levels of management. Firman mentioned, “There
is a
need to fundamentally change the project management philosophy of the industry. Rather than each party maintaining a project

management system, there needs to be a single,
integrated project-based system” (Firman, 2002). Figure-2 shows the main knowledge areas that be considered by
project manager. These areas include identification process such as scope management, implementation processes as time, cost, quality, resources and communication management. Beside these areas there are other processes as project management, risk management and integration management can be considered as leadership processes.

 

 

Figure-2. Project  management knowledge areas.

 

METHODOLOGY

The focus of this survey was experienced project managers,
site engineers and quality control engineers in the Middle East construction industry. The questionnaire list developed depending on the requirements of ISO 9000:2000
and ISO 1006:2003. First form distributed on sample of 20 questionnaires to determine and measure the reasonability of questions
and if they are easy to answered by questionnaires. The average number
 of years that the questionnaires had held their position
was more than 7 years. The questionnaire was divided into two sections. The first asked about the effect
of the risk around each element QMS and PMS on the project
cost, the second was for assessment
the occurrence of risks probability
for each element.

 

 For risk effect
around the element, the questionnaire was designed
to gauge the degree of risk effect
on project cost. The respondents were asked to indicate their response by noting any number from 1-10, with 1 being least effect and 5 very effect.
For probability of occurrence, the participants were asked to respond
by noting a number from 1-10, with 1 low probability and 5 high probability. Table-1 shows the quality requirements and project management functions used for purpose of this study.

 

Table-1. Quality requirement and project management functions.

 

SYSTEM
ELEMENTS

1

Quality system

9

Time related process

2

Management responsibility

10

Cost related process

3

Resources management

11

Resources related process

4

Product realization

12

Personnel related process

5

Measurement, analysis and development

13

Communication related process

6

Strategic process

14

Risk related process

7

Independency management process

15

Purchasing related process

8

Scope related

 

 

 

The weight for each element and specific weight obtained as
below (Ibrahim, 2006):

Weight of element = effect x probability
……………….. (1) Specific weight of an element = weight of the element / total

Then we calculate
the standard deviation to understand the type of dispersion and how the data is far from
its
mean as in equation (4):

2

weight of all elements 
 ……………………………………………….. (2)

Dispersion of data collected was studied in order

Standard deviation
(s ) =

å f (x – m )

N

.
…………(4)

to understand measure; first, the type of data distribution relative to central tendency. If data are widely dispersed, the central location is less representative of data as  a whole than it would be for data more closely centered around the mean. Secondly, to determine
the extreme values that should be excluded from data set and to recalculate the mean for data set. Third,
to compare dispersions of various samples, wide spread of value away

( f ) = frequency of observation, x = observation, µ = mean of

observation, N= number of observation

 

Standard
score also studied to explain exactly how much each value in data set far from mean in term of units of standard deviation that lie above or below the mean as in equation (5):

from the center is undesirable or presents an unacceptable risk, it is needed to recognize and avoid distributions with the greatest
dispersion (Levin, 1981). According to Levin,

(x – m )

Standard
score =

s

….…………………………. (5)

the four equation
for range of data, standard
deviation, standard score, and coefficient of variation are explained below.

At first the range was measured for understanding the dispersion of data as in equation (3):

Range = value of highest observation – value of lowest observation    …………………………………………
 (3)

 

Figure-3. Normal distribution curve.

 

Nevertheless, standard deviation still absolute measure of dispersion that expresses variation in the same units as the original data. So for compare two set of data or more we can not use only the standard deviation and mean , we need a relative measure that give indication for the magnitude deviation relative to the mean of data set. The coefficient of variation is one such relative measure of dispersion. It relates the standard deviation as a percentage
of the mean as in equation (6):

s

RESULTS AND DISCUSIONS

The characteristics of the data collected for effect of risks around the project management processes on the project cost are explained in Table-2. Mean, standard deviation and coefficient of variation was obtained for each element.

Coefficient of variation =

m

…………………
………. (6)

 

 

Table-2. Project management processes, effects on project cost and probability of occurrence.

 

 
Project management processes

 

Effect on project cost

 

 

Probability of occurrence

Mean
(µ)
%

Stand.
Dev. (?)

Coeff. of variation

Mean
(µ)
%

Stand. Dev. (?)

Coeff. of variation

Strategic process

 

 

 

 

 

 

 

Independency management

 

 

 

 

 

 

 

 

Scope related

 

 

 

 

 

 

 

Time related

 

 

 

 

 

 

 

 

Cost related

 

 

 

 

 

 

 

Resources related

 

 

 

 

 

 

 

Personnel related

 

 

 

 

 

 

 

Communication related

 

 

 

 

 

 

 

Risk related

 

 

 

 

 

 

 

Purchasing related

 

 

 

 

 

 

 

 

The characteristics of the data collected for effect of risks around the quality management processes on the project cost are explained in Table-3. Mean, standard deviation and coefficient of variation was obtained for each element. The risk around product realization process was the most factors

The most elements that the questioners hesitated around there effect value were product realization process.

 

 

 

 

Table-3.
Quality management processes,
effect on project cost and Probability
of occurrence.

 

 
Quality management
processes

 

Effect on project cost

 

Probability of occurrence

Mean
(µ)
%

Stand. Dev. (?)

Coeff. of variation

 

Mean
(µ)
%

Stand. Dev.
(?)

Coeff. of variation

Quality system

 

 

 

 

 

 

 

 

Management responsibility

 

 

 

 

 

 

Resources management

 

 

 

 

 

 

 

Product realization

 

 

 

 

 

 

Measurement, analysis and
development

 

 

 

 

 

 

 

 

 

 

 

For each source of risk related
to processes within   integrated
quality management system, the weight simply calculated by multiplying the effect of each process risks by the probability of it. Table-4 lists the fifteen sources of risks with their effect assessment and probability of occurrence (column
1 and 2,
respectively). The gross
weight obtained for each element in column 3
then by divided each weight by the sum of all gross
weight for all element (sum of column 3), the specific weight would be determined as percent.

 

Table-4. Integrated management system, specific weight of
elements.

 

 
 
SYSTEM ELEMENTS

Column
1

Column
2

Column
3

Column
4

Effect on project cost
%

Probability
of occurrence
%

 
Gross weight Col. 1
x Col. 2

Specific
weight
%

1

Quality system

 

 

 

 

2

Management responsibility

 

 

 

 

3

Resources management

 

 

 

 

4

Product realization

 

 

 

 

5

Measurement,  analysis  and development

 

 

 

 

6

Strategic process

 

 

 

 

7

Independency management

 

 

 

 

8

Scope related

 

 

 

 

9

Time related

 

 

 

 

10

Cost related

 

 

 

 

11

Resources related

 

 

 

 

12

Personnel related

 

 

 

 

13

Comm. related

 

 

 

 

14

Risk related

 

 

 

 

15

Purchasing related

 

 

 

 

Total:

 

 

 

CONCLUSIONS

?      The results of this
study confirm that project and
quality management processes are an important aspect of the civil engineering and construction industry. Further, it has statistically demonstrated that the project management functions-time related process, cost related process and product realization are the most important articles in the integrated management system.

?      The current quality guides have not concentrate on the expected risks around the requirements. It mentioned only the benefits and don’t provide the solution for prevent, minimize
or release the risk effects.

?      Rapid changes in construction technology are contributing to a major complication in process management of the traditional construction projects. This construction change supported by the information technology (IT) need to change the engineering professions toward develops the management skill and support it with same tools of IT.

?      This study explain the relative
importance for each element within integrated management system as first step, this will follow by develop the research vertically by study the risk factors in detail and horizontally by adding the environmental requirements to the system. For using IT tools, expert system will developed in next step for achieve the analysis of data collected for the project and to provide promote detail prediction reports for the situation of project.

 

 

REFERENCES

Ahmed,O.J. and
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Vol129, Issue No.5, pp. 492-500.

Al-Bahar,J.F. and
Crandall, K.C. (1990). Systematic risk management approach for construction
project. Journal of Construction Engineering and Management,Vol.116.IssueNo.3,
pp.533– 546.

 

Hafiz Ibrahim.
2006. The Integration of value management and risk management applied to cost prediction. PhD Thesis.
Al-Technology University, Iraq.

 

Harold Kerzner.
2001. Strategic planning for project management using project management maturity model. John
Wiley and Sons.

 

Jennifer
Lynn Firman. 2002. Investigating the use of PMASP-BASED project-specific websites as a project management tool in the A/E/C industry.
M.Sc. Thesis. Virginia Polytechnic
Institute and State University, USA.

 

Oisen RP. 1971. Can project
management be defined?
Project Management Quarterly. 2(1): 12-14.

 

Reiss B. 1993. Project
Management Demystified. E and FN Spon, London.