RESEARCH PROPOSAL PRESENTED

BY

ALI ABUBAKAR AUDU

13/32138/U/4

ON THE PROPOSED TOPIC

IMPACT OF RISK FACTORS ON BUILDING CONSTRUCTION

PROJECTS (A CASE STUDY OF BAUCHI STATE).

DEPARTMENT OF QUANTITY SURVEY

FACULTY OF ENVIRONMENTAL TECHNOLOGY

ABUBAKAR TAFAWA BALEWA UNIVERSITY, BAUCHI

August, 2018

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INTRODUCTION

BACKGROUND OF STUDY

The pace of change in the construction industry has imposed additional

demands on construction project management. Risk management is a vital project
management planning and control tool for reducing uncertainty and improving
decision-making. Risk cannot be avoided but must be recognized, assessed and
managed.

The research reported upon in this research is focused upon assessing key
risk factors affecting g construction project cost in Nigeria. The research is to
assess the risk factors affecting construction project performance from stakeholder
perspective and at a project level. Construction organization's efficiency and
effectiveness largely depends on how managers scan the external project
environment, identify the critical factors and adapt their organizations accordingly
(Baloi 2002).

The development of infrastructure is one of the most important activities

that can boost up the business of various industries, thereby increasing the gross
domestic product (GDP) of the country. Construction projects are always unique
and risks raises from a number of different sources. Risk factors is inherent in
every construction project from small to larger project running millions to billions
of naira and it is impossible for all risk to be avoided (Abba, 2008). Risk is present
in all projects irrespective of their size or sector. No project is totally free from
risks. If risks are not properly analyzed and strategies are not trained to deal with
them, the project is likely to lead to failures. Risk is an uncertain event or set of

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circumstances that could occur, have an effect on the achievement of the project
objectives.

A risk is the probability of incurring misfortune or loss while, a risk factor is

a factor such as a habit or an environmental condition that pre disposes an
individual to develop a particular diseases (Collins English Dictionary and
Thesaurus, 2006). It has also been stressed that construction is a risk-prone
industry, with a poor track record of coping with risks, as a result of which clients
have been enduring the agonizing outcomes of failure in the form of unnecessary
delays in project completion, cost overrun and sometimes failing to meet quality
standards and operational requirements (Wakjira, 2011).

Risk management may be described as “a systematic way of looking at areas

of risk and consciously determining how each should be treated. It is a
management tool that aims at identifying sources of risk and uncertainty,
determining their likely hood of occurrence, their impact, and developing
appropriate management responses” (Uher, 2003). A systematic process of risk
management has been divided into risk classification, risk identification, risk
analysis and risk response, where risk response has been further divided into four
actions, i.e. retention, reduction, transfer and avoidance (Berkeley et al., 1991;
Flanagan and Norman, 1993).

An effective risk management method can help to understand not only what
kinds of risks are faced, but also how to manage these risks in different phases of a
project. Owing to its increasing importance, risk management has been recognized
as a necessity in most industries today, and a set of techniques have been
developed to control the influences brought by potential risks (Schuyler, 2001;
Baker and Reid, 2005). Compared with many other industries, the construction

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industry is subject to more risks due to the unique features of construction
activities, such as long period, complicated processes, abominable environment,
financial intensity and dynamic organization structures (Flanagan and Norman,
1993; Akintoye and MacLeod, 1997; Smith, 2003).

As part of a much larger project aiming to articulate and manage risks

associated with building construction projects, this project seeks to identify the
potential risks factors on building construction projects from the perspectives of
stakeholders and reviewing of relevant literature. It has already been recognized
that a clear understanding of the risks born by each stakeholder leads to better risk
allocation. The objective of this study is to identify risk factors associated with
construction projects and find an appropriate approach to categorized them by
reviewing the relevant literature. It is of particular interest to rank the risk factors
based on their relative significance index score value for their negative impact on
project completion from the construction stakeholder perspectives.

This study is based on the assumption that by identifying the factors both
internal and external factors, determining which risk are likely to affect the project,
documenting the characteristics of each will enable the participants to better handle
risk factors. This will consequently affect the performance of the project by
maximizing the result of positive events and minimizing the consequence of the
adverse effect.

STATEMENT OF THE PROBLEM

Hence, taking effective risk management techniques to manage risks

associated with variable construction activities has never been more important for
the successful delivery of a project. Previous research has mainly focused on

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examining the impacts of risks on one aspect of project strategies with respect to
cost (Chen et al., 2000), time (Shen, 1997) and safety (Tam et al., 2004).

Even in Nigeria there were other researches which were conducted by so

many researchers like (Aminu A.B.2013), (Ibrahim et al. 2014), (Luka et al.
2014), (O. T Bironke 2017) in Nigeria related to several aspects of risk in
construction projects but they didn't consider all categories of risk factors
associated with construction rather some of the aspects or categories. Further,
above discussed facts also related that, the consideration of the impact of risk
factors on building projects is enormously significant.

Research AIM

The aim of the study is to evaluate the impact of risk factors on building
construction projects with a view to improving the risk management practices in
building construction project.

OBJECTIVES OF STUDY

1) To identify risk factors associated with building construction projects and find
an appropriate approach to categorise them by reviewing the relevant literature.

2) To rank the categorised risk factors (RF) based on their relative importance
index (RII) values for their negative impact on project completion from the
construction parties’ perspective.

3) To evaluate the practitioners perception of categories’ relative weight (C.R.W)

and allocation of responsibility using interviews.

4) To suggest possible ways that improve risk management practices on building

construction projects.

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RESEARCH QUESTION

Based on the purpose of this study, the following research questions have been
formulated in the following pattern:

1. What are the likely risk factors on affecting building projects ?

2. What are the possible ways to rank those risk factors identify?

3. What is the percentage of relative weight and share of responsibility among

stakeholders in Building construction?

4. What do you think is the possible solution to mitigate those risk factors?

SIGNIFICANCE OF THE STUDY

The need for this study is to understand the importance of risk management
because its execution is very less in the construction industry compared to other
industries due to lack of knowledge. The track record of the construction industry
is very poor in terms of coping up with risks in projects.

SCOPE AND LIMITATIONS

 The scope of this research is limited to the impact of risk factors on building
construction project and proffering solutions on how to reduce improve risk
management in Bauchi state.
 The study is limited and to restrict to Bauchi state focusing on some
randomly selected contracting and consulting films within the state.
 Target respondents for this study are the principal actors in the construction
industry namely: the Client, the Consultant and the Contractor.

METHODOLOGY/ DATA ANALYSIS

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 The study will be carry out in Nigeria using Bauchi State as a case study.
Information for the study will be obtain from key stakeholders in the construction
industry. The number of questionnaire to be administer will be determine using a
mathematical formular presented by Kish 1965 as the research proceed. Both
quantitative and qualitative technique will be employ in this research and the
questionnaire will scrutinize by experts in the field which will be use for data
collection.

The data obtain shall be analyze using several methods and equations,
which include general statistics, one way Anova, Pearson product moment
correlation coefficient, and relative important index and result will be presented
using histogram and pie chart. All tests and analysis will be done using SPSS
software.

CONCLUSION/RECOMMENDATIONS

Based on the result of the analyzed data, a conclusion will be drawn as to

how risk factors impact on building construction project and suggestion will be
made on possible ways to improve risk management practices on building
construction projects in Bauchi State.

Appropriate recommendations will be made on how risk factors will be

mitigated on building construction project so that to have an effective management
of risks including potential opportunities and threats to project objectives.

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