What is Risk?
Underground Investigation and Risk Management Part 1
When embarking on a
project in any capacity
(owner, contractor or designer)
what are the most
important issues that keep you up at
night? The answer is cost, scheduling,
performance and safety. These items,
directly or indirectly, are tied to money.
When the construction cost goes
beyond the original estimate, parties
involved in the project face financial
loss. This could extend to the point
that the owner of the project does not
get the minimum expected return on
the investment. A project that goes
beyond the planned schedule naturally
translates to financial impact for the
project either as higher construction
costs (more time on site) or delayed
returned profit (delayed completion of
the project). Any issue with the performance
of the project (e.g. the building
cracks) also results in financial loss
either in the form of lawsuits/claims
TECHNICAL
or costly post construction repairs and
sometimes liquidated damages.
What about safety? Safety and
the subjects related to protection of
life have their own special place and
should be addressed first without the
burden of finances. That being said, the
financial losses resulting from safety
issues cannot be over-emphasized.
Any construction project has a
target for cost, schedule, safety and
performance. Companies try to achieve
By Masoud Manzari, P.Eng. and Mark Tigchelaar, P.Eng., GeoSolv Design/Build
In the construction industry, risk management has always been a major priority, but what truly is risk management, and how can it
be better mitigated? There are many stages in the systematic approach and philosophy when it comes to risk management in the
construction industry. The high risk related to construction affects all of those involved in a project; while operational analysis and
management of construction-related risks remain an enormous task for many in industry. This three-part series aims to demystify
the topic of risk management and how to better manage it in the field of construction.
PHOTO: THE CANADIAN PRESS
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