Risk Management on a Constriction Site: 5 Steps

Aerial view of construction site

Civil engineering projects often require a great deal of construction work, which can create hazardous conditions for employees. Construction risk management is the act of identifying these possible problems before the project begins and taking steps to prevent such issues from occurring in the first place. In addition to issues with safety, risk management also works to prevent potential issues with financial concerns, scheduling delays, problems with management, contract disputes, or other possible challenges. Construction projects require a great deal of logistical details—ranging from securing heavy equipment to providing proper employee training—and the slightest administrative obstacle can cause delays for an entire construction project. Workplace safety is especially important for construction sites, which must adhere to a strict set of codes.

Construction sites are especially vulnerable to unforeseen problems, as each construction project comes with its own unique set of logistical concerns. It is also important to note that the larger and more complex construction projects must undergo a more thorough risk assessment, since these projects often require more planning, resources, and employees, in addition to numerous other factors.

The Risk Management Process is Comprised of 5 Steps:

1. Identification

The first phase of risk management is to evaluate the construction site so as to identify any possible problems with the construction project. Due to the number of possible risks found on a construction site, this is often the most important phase of risk management. Such risks are often not easily identifiable, so it is very important that administrators in charge of risk management take the time to properly assess the construction site, which involves the following areas:

- Quality - The quality of a construction site refers to various levels of administrative oversight, including the application process, obtaining the proper permits, implementing quality control, and conducting the necessary tests before construction begins. Risk assessment must take these factors into consideration, since poor oversight can cause numerous failures on a construction site.

- Personnel Risks - Have the construction workers received proper training? Is there any type of disagreement or conflict between team members? The amount of quality and corporation between construction workers should be taken into consideration.

- Financial - The costs of a construction project must be thoroughly mapped out so as to prevent the risk of financial loss or other type of costly failures. Any changes occurring during the construction project may cause financial loss, so it is important to identify any possible financial risks before starting the project in question.

- Scheduling - Scheduling delays can be very costly, so it is important to take any possible scheduling delays into consideration when starting a new project.

2. Assessment

Once management identifies the risks, the next step is to determine the probability of such issues actually occurring. The potential damage that could result from these problems should also be taken into consideration during the assessment phase of risk management. Risks must be assessed based on any available data related to the project. If no such data is available, the chances for possible accidents and other problems must be determined. Assessment must also be made on how any type of problem might affect other details on the construction site.

3. Evaluate

Have you properly identified and assessed the various risks? The next step is to prioritize each type of risk and potential for danger. This is done by identifying the levels of risk in relation to cost, time, and other types of investments. Each preventive measure taken throughout the risk management process should be made based on order of importance and possible risk levels.

4. Mitigate

The mitigation phase of risk management deals with determining the specific costs associated with reducing risks on a construction project. The involvement and amount of effort needed for each situation will vary, since different types of risks require various preventative measures.

5. Monitor

Construction sites must be monitored throughout the duration of each project, since unforeseen issues may still arise that were not found during the risk management process. This includes making construction and building inspections, which can often reveal a construction defect or other type of problem. Each construction project has a unique set of details, so managers cannot be completely sure of every single possible outcome.

Due to the many factors involved with each construction project, it is important to be prepared for any possible issue. These issues may involve construction worker safety, premises liability, building envelopes, construction materials, heavy equipment, or construction defects, in addition to numerous other details. Risk management is one of the most important parts of a construction project, whether it is a civil engineering project, industrial building site, residential building, or other type of area.