SSRG International Journal of Civil Engineering - (ICETM-2017) - Special Issue - March 2017

ISSN: 2348 – 8352 www.internationaljournalssrg.org Page 1

Risk management in highway construction

using risk priority matrix and SPSS software

K.Abhinaya1 PG student, Construction engineering and management,

Sona college of technology,

Salem-636005,Tamilnadu

S.Priscil Nidhu2

Assistant Proffesor,

Sona college of technology,

Salem- 636005,Tamilnadu

Abstract - Risk events associated with road

construction and highway construction projects

have a major impact on issues related to cost, time

and quality of project delivery. Unexpected risk

events result in either positive and negative

outcomes often causing deviations from project

plans particularly prone to risk. Despite the

extensive research on risk management in the

construction industry and there is limited literature

dealing specifically with project risk in developing

countries, especially within the Asian context. It is

against this background that our study investigates

the use and awareness of risk assessment and

management processes with respect to cost

efficiency, time and quality of highway and road

construction projects. Our paper highlights the

risks associated with highway construction projects

with forty eight risks are identified through detailed

literature review. A questionnaire is then developed

to solicit opinion of the construction professionals

as to the probability and impact of those risks in

addition to their proper allocation. In person

surveys were completed and implemented in the

analysis. Statistical Package for the Social

Sciences (SPSS) software was used for analysis of

various risk factors from Questionnaires survey

data for preventive measures or mitigation

techniques for various risks on construction site.

The responses provided both quantitative and

qualitative data from several highway construction

projects completed in the past. Statistical

dependency correlation analyses are showed that

the use of risk assessment in the reported projects

has improved quality of project and construction

management.

Key words: Risk Management; Highway

Construction; SPSS; Risk priority matrix.

I. INTRODUCTION

Risk management is the systematic process of

identifying, responding and analyzing to project

risk. It includes maximizing the consequences and

probability of positive events and minimizing the

consequences and probability of adverse events to

project objectives.

Risk is generally a choice in an environment

rather than a fate. It is uncertainty inherent in

possibility and plans of something happening that

can affect prospects of achieving, business and

project goals. The money spend fund shipments

overseas was the example of risk business in the

early days of travel. Each activity we do involve

risk, only the amount of risk varies.

1.1. Definition of Risk

The situation where there exists no knowledge

of its outcomes.

An exposure to the change of injury or loss;

dangerous or a hazard chance, to run risks.

Every risk is proportional to the expected losses

which caused by a risky event and to the

probability of this event.

1.2. Concept of risk and risk management

Multi-faucet concept is called as risk. In the

context of construction industry risk could be the

likelihood of the occurrence of a definite event or

factors which occur during the whole construction

process to determine the project a lack of

predictability about structure outcome or

consequences in a decision and planning situation,

uncertainty risk associated with estimates of

outcomes-there is a chance that results could be

better than expected.

1.3. Risk exposure

The following are the several factors risk

exposure.

• Team size: the higher probability of a problem

arising. For example, communications can be

more difficult when the number of participants

increases. The number of interactions among

people increases and they require greater

coordination.

• History: new projects are riskier because the

processes have not been refined. More times a

SSRG International Journal of Civil Engineering - (ICETM-2017) - Special Issue - March 2017

ISSN: 2348 – 8352 www.internationaljournalssrg.org Page 1

project of a similar nature has been done,

greater the likelihood of success.

• Staff expertise and experience: if the staff lacks

direct knowledge and experience of the

subject, people will struggle to learn as they go

along, time and possibly introducing errors

happened when robbing the project.

• Complexity: the more sophisticated a project,

there is a greater the opportunity of a mistake

and problem.

• Management stability: management stability

implies when unity of direction, which in turn

means reaching the goals. The management

irritability can lead to insufficient use of

resources.

• Time compression: if a schedule is highly

compressed mean the risks are magnified.

Having more times means greater flexibility

and the opportunity to prevent and mitigate the

impact of errors.

• Resource availability: the more resources that are

available when the greater the ability to

respond to problem as they arise. Plentiful

resource, of course, does not guarantee

protection from risk; however they do provide

the means to respond to it.

1.4. Sources of Risk in Construction Projects

• Misunderstanding of contract terms and

conditions

• Design changes and errors

• Poorly co-ordinate work

• Poor estimates

• Poorly defined roles and responsibilities

• Unskilled staff

• Natural hazards

• Political and legal problems

1.5. Advantages of Risk Management

• Less uncertainty

• Achievement of objectives

• Reliability

• Reduction of capital cost

• Creation of value

1.6. Limitations of Risk Management

• If risks are improperly prioritized and

assessed, time can be waste in dealing

with risk of losses that not likely to occur

• Spending too much time managing and

assessing unlikely risks can divert

resources that could be more profitably.

• Unlikely events to occur, but if the risk is

unlikely enough to occur, it may be better

to simply retain the risk & deal with the

result if the loss does in fact occur.

II. LITERATURE REVIEW

2.1 Historical data

Sharmila Mane and Dr. S.S. Pimplikar (2012)

listed the various risk faced in BOT projects into

three types as Financial Risk, Political Risk and

Technical Risk. Avoidance, Transference,

Mitigation and Acceptance are the Risk response

strategies followed in India. Delays in approval,

Change in Law, Cost overrun, Land acquisition and

compensation, Enforceability of contracts,

Construction schedule, financial closing, Tariff

adjustment and Environmental risk are the critical

risks in BOT projects. Maintaining good

relationship with government authorities help to

avoid the risk of delay in approval, obtaining

government’s guarantees via adjusting tariff or

extending concession period help to avoid the risk

due to change in law, choosing quality and trust

worthy consultants with knowledge of how to

handle everyday construction issues help to avoid

risk of delay in construction schedule, etc.,

Yukiya Sato, Keiichi Kitazume and Kazuaki

Miyamoto (2005) discussed about the risk faced by

road projects at different project stage.

Questionnaire is done and from the results some

conclusions regarding cost and period is arrived.

2.2 Case based approach

Lusa Persia et al (2016) focused on the

management of road infrastructure safety to a set of

procedures that support a road authority in decision

making related to the improvement of safety on a

road network. For this data will be collected from

infrastructure projects categorizing the risks into

various groups. The modified from can be used for

the whole life cycle of the project.

Sarvari, Valipur, Yahaya and Noor (2014)

studied the risk assessment in malaysian PPP

project. The study consists of risk identification,

assessment in infrastructure projects. The major

risk factors have been identified and collected by

comprehensive literature reviews. After consulting

SSRG International Journal of Civil Engineering - (ICETM-2017) - Special Issue - March 2017

ISSN: 2348 – 8352 www.internationaljournalssrg.org Page 1

it with experts (in PPP contracts) these factors are

categorized and ranked. The data for analysis was

obtained from face to face interview and

questionnaire survey. Based on the survey results,

risk index was calculated by probability and impact

value.

V.R Ganapathy, S.K Subramaniam, A.B

Mohamad Diah (2008) have explained the picture

of perfect road construction site is the one that

utilizes conventional vertical road signs and a

flagman to optimize the traffic flow with minimum

hazel to the public. Some former research was

carried by the Department of occupational Safety

and Health. This paper highlights on hazardous

zones in a certain road construction.

2.3 Tools and software

David Ndiang ui Wambui, Dr. Kepha Ombui,

Dr. Assumptah Kagiri (2015) have explained how

to analyse risk factors affecting completion of road

construction Projects with the help of SPSS

software.Statistical techniques were applied to risk

variables and the research is done to check which

variables in the set form coherent subsets that are

relatively independent to one another.Also studied

the significance of the risk, whether to choose it for

study purpose or not by doing component analysis.

2.4 Probability impact matrix

Tzavi, Aaron J. Shenhar and Dov Dvir (2002)

have analyzed about risk management tools and

techniques which have been developed to improve

project success. They found that the risk

management practices are not widely used and also

found that risk management practices were more

applicable to higher risk projects. They found some

differences according levels of technological

uncertainty. They took interviews for data

collection and did SWOT analysis, Probabilistic

risk analysis and methodic trade-off analysis. The

assessment were measured along four dimensions

such as meeting functional specification, meeting

technical specifications, meeting schedule and

meeting planned budget. They suggest that all risk

management practices are positively correlated

with meeting budget goals in the high uncertainty

group, while for the low risk group the correlation

is weaker and less likely to be statistical significant.

Ibrahim Mahamid (2013) discuss about the

common risks affecting time overrun in road

construction projects beyond their normal

operation. Here study is done for around 45 firms

and several risk factors found related to project

management and the contractors also have views

on factors that have not been identified previously

such as low equipment efficiency , high

competitions in bids and the political situation.

2.5 Hierarchical risk breakdown structure

Mohamed F. Diab, Khaled Nassar (2012)

explained about the need of risk assessment to

improve highway construction projects. A survey

questionnaire was developed to collect the

quantitative and qualitative data and 660

professionals were chosen for sample and received

responses from 246 people and arrived with 31 risk

drivers which are categorized under five broad

categories such as project scope , right of way,

utility conflicts, A/E services and project

construction management. Hypothesis testing was

done for these risk drivers and risks which affect

cost and schedule growth of construction project

were identified. Raj V. Ponnaluri (2012) discusses

about India’s quickly changing transportation

scenario, especially road traffic crash concerns.

Their objectives of work were concerned. Exposure

risks are calculated from vehicles and their accident

percentage are noted. Finally calculate crash risk at

police-regulated locations was 40% less than at

traffic signals.

III. SCOPE AND OBJECTIVES

• To identify the various risk factors in

construction of highway construction

projects.

• To analyze the sources of risk factors arising in

the highway projects.

• Using the literature survey the questionnaire is

prepared.

• The survey will be conducted to the

construction industries through questionnaire.

• The result will be analyzed from the

questionnaire.

• The risk will be solved using the software like

SPSS.

• The result and discussion about the risk factors

solving in the construction projects.

IV. METHODOLOGY

The methodology adopted in this project is

given below:

Study of literature related to Time and

Financial Management risks.

Preparation of questionnaire.

Site visit to major construction

project.

Questionnaire survey and personal

interviews with Site-Engineers,

Supervisor and managers.

Analyzing the questionnaire.

SSRG International Journal of Civil Engineering - (ICETM-2017) - Special Issue - March 2017

ISSN: 2348 – 8352 www.internationaljournalssrg.org Page 1

Factor analysis of data obtained from

site and identifies the root cause.

Remedial measures are to be

suggested and the present data is to be

recorded for future reference.

Conclusions, recommendations and

suggestions for future study.

V. ANALYSIS AND RESULTS

Risk Priority Matrix is done with the help of

likelihood and impact results obtained from the

samples collected through questionnaire, which

was prepared based on the risk factors obtained

from several literature reviews. A risk priority

matrix is easier to make, since most of the

information can be easily extracted from the

questionnaire. It is made in the form of a simple

table where the risk factors are grouped based on

their likelihood and impact made by the risk

factors.From the likelihood and impact levels of the

risk factors, consequences are understood, risk is

prioritized and risk priority matrix is created. Risk

priority matrix provides the quick view of the risks

and the priority with which each of these risks

needs to be managed to overcome its impact. Risk

Priority matrix can be created in Excel or in table

format to assess the risk factors.

Table 5.1 Scale used to identify factor’s severity

and frequency of occurrence

Figure 5.1 The risk map

The map is classified into three zones:

Green zone: risks in this zone are low

level, and can be ignored.

Yellow zone: risks in this zone are of

moderate importance, and should be

controlled.

Red zone: risks in this zone are of critical

importance, and a close attention should

be paid.

The questionnaire was sent out to a total of 41

contracting firms asking their contribution in

identifying the risk map for the 45 factors in terms

of severity and frequency of occurrence. The

contractors were randomly selected from available

list in PCU including 50 contractors. Only a total of

34 completed questionnaires were returned

representing a response rate of 83%. Most of the

participating contractors have more than 10 years

of experience in road construction.

5.1 Denotes sample risk priority matrix

Table 2 illustrates the risk map for factors under

project group. Six factors are considered under this

group. The results indicate that three factors are

located in the yellow zone, namely: inconvenient

site access, disturbance to public activities, and

limited construction area. The other three factors

are located in the green zone, they are: poor terrain

condition, poor soil drillability, and poor soil

suitability.

Table 5.2 Risk map for factor under project

group

5.2 Result using Excel software

The analysis of 45 factors considered in a

survey indicates that 8 factors are located in the

green zone (low frequency, low severity), 30

factors are in the yellow zone, and 7 factors in the

red zone (high frequency, high severity) in the risk

map. The most critical factors are: payment delays

by the owner, the political situation, the

segmentation of the West Bank, the financial status

of the contractor, poor communication between the

construction parties, lack of equipment efficiency

and high competition in bids.

SSRG International Journal of Civil Engineering - (ICETM-2017) - Special Issue - March 2017

ISSN: 2348 – 8352 www.internationaljournalssrg.org Page 1

5.3 Statistical. Package for the Social Sciences

SPSS Statistics is a software package used

for statistical analysis. Long produced by SPSS

Inc., it was acquired by IBM in 2009. The current

versions (2015) are officially named IBM SPSS

Statistics. Companion products in the same family

are used for survey authoring and deployment

(IBM SPSS Data Collection), data mining (IBM

SPSS Modeler), text analytics, and collaboration

and deployment (batch and automated scoring

services).

The figures below shows the example for

analysis of results, the analysis was done using

SPSS software in which the Response Percentage

for risk factor was obtained.

Figure 5.2 Risk in project group

From fig no 5.2, it can be interpreted that 32%

respondents strongly agreed that improper project

group causes risk in highway project. While 25%

respondents agreed that improper project group has

very high impact on construction of project.

Other risks are analyzed and got the maximum risk.

The risks are

Managerial group

Consultant group

Financial group

External group

Construction labours group

VI. CONCLUSION AND

RECOMMENDATIONS

Risk management in highway construction of

any project is very important and it should be

prioritize by every

construction project. The success of every project

mostly is determined by the ability of the

construction team to minimize the risk factors and

the implementation of the project should be proper.

For a project to be successful the

following recommendations are hereby presented:

Adequate planning should be provided

before the commencement of project

construction.

Safety, rules and regulations in

construction site should fully be

maintained from the initial to final stage

of construction.

Durable and quality materials for

construction should be supply and use

properly.

Efficient and Economical use of all the

available resources should be adopted by

all associates of construction team.

Effective communications and

corporations between all members of

construction team should be adopted.

Well trained and experienced workmen

should be employed where necessary.

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