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Risk management in road construction: The case of Sri Lanka

    B.A.K.S Perera Affiliation

Abstract

Risk is an unavoidable phenomenon in construction projects. Proper risk allocation in construction contracts has therefore come to assume prominence because risk identification and risk allocation have a clear bearing on risk handling decisions. The proper management of risks requires that they be identified and allocated in a well‐defined manner. This can only be achieved if contracting parties comprehend their risk responsibilities, risk event conditions, and risk handling capabilities. This research aims at identifying the risk responsibilities of contractual parties in order to improve their risk handling strategies with regard to Sri Lankan road projects. Semi‐structured interviews were used for the primary data collection. This was complemented with documentary evidence. The results show that road construction projects in Sri Lanka are exposed to many risk sources while most risks are borne by parties who were assigned with risks via contract clauses. However, parties not allocated with risks too happened to bear the consequences of such risks. Therefore, it is concluded that there is no one best way to respond to a risk and that different risk handling strategies should be adopted in order to deal effectively with risks.


Santruka


Rizika ‐ neišvengiamas statybu projektu reiškinys. Todel svarbus tapo tinkamas rizikos paskirstymas statybu rangos sutartyse, nes rizikos nustatymas ir rizikos paskirstymas daro akivaizdžia itaka rizikos valdymo sprendimams. Norint gerai valdyti rizika, reikia ja nustatyti ir tinkamai paskirstyti. Tai imanoma tik tuomet, jei sutarties šalys supranta savo atsakomybe už rizika, rizikos atveju salygas ir rizikos valdymo galimybes. Šiame tyrime, siekiant pagerinti sutarties šaliu rizikos valdymo strategijas, meginama nustatyti, kokia atsakomybe už rizika prisiima sutarties šalys pagal Šri Lankos keliu tiesimo projektus. Pirminiai duomenys surinkti iš pusiau struktūriniu interviu. Jie papildyti dokumentiniais irodymais. Iš rezultatu aiškeja, kad keliu tiesimo projektai Šri Lankoje imlūs daugybei rizikos šaltiniu, o daugeli rizikos rūšiu prisiima šalys, kurioms rizika priskiria sutarties nuostatos. Tačiau šalys, kurioms rizika nera priskirta, kartais irgi patiria tokios rizikos pasekmiu. Todel daroma išvada, kad nera vieno geriausio būdo reaguoti i rizika ir kad reikia taikyti ivairias rizikos valdymo strategijas, siekiant efektyviai spresti rizikos situacijas.


First Publish Online: 18 Oct 2010

Keyword : Risk allocation, Risk handling, Risk identifi cation, Road construction projects, Contractual parties

How to Cite
Perera, B. (2009). Risk management in road construction: The case of Sri Lanka. International Journal of Strategic Property Management, 13(2), 87-102. https://doi.org/10.3846/1648-715X.2009.13.87-102
Published in Issue
Jun 30, 2009
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