Construction Project Manager and Risk Management

Abstract

Management of risk constitutes one of the most critical managerial activities in a project, and project managers often are required to design and implement a risk management strategy meticulously. The fundamental principle underlying each business venture is to generate value for all stakeholders. The rationale underlying the design and implementation of a risk management framework is to provide the administration with a means to cope with the randomness linked with the risks and opportunities. Project managers identify, analyze, and determine the risks and uncertainties associated with a particular business venture and provide a detailed report to the company’s top management. An integrated risk management framework can prove to be a powerful management instrument which special abilities. The fundamental data collecting instrument was a carefully designed open questionnaire that was meticulously designed to procure the respondents’ views about an environmentally conscious sustainable management strategy and thereby analyze the role of a project manager in environmental risk management.

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Introduction

The organization of the Document

The documentation of the research is divided into five separate chapters. The first chapter provides an introduction to the research topic. It presents background information that allows the reader of the document to understand what context this research has been carried out. The second chapter explicitly records and describes the aims and objectives of the investigation. It then exemplifies the way the study was carried out. It then explains the research design concepts, enabling the readers to understand why it was chosen. The third chapter provides A comprehensive literature review on the research topic. The fourth chapter presents the actual findings of the research work and carries out an analysis of the results. In the fifth and final chapter, a conclusion based on the research findings is drawn.

Risk Management in a Project

Project Management is the utilization of knowledge, expertise, instruments, and methods to various processes in a project to realize the demands and expectations of all stakeholders involved in the project. The project risk management framework deals with multiple activities such as identification, analysis, and mitigation concerning the risks associated with a particular project. It often involves optimization of performance variables to offset the off-putting influences of adverse occurrences. (Loosemore, Dainty and Lingard 2003).

There are several different definitions of risk provided by experts in various fields. The British Standard Institute’s BS 6079 standard explicates risk as “the uncertainty inherent in plans and the possibility of something happening that can affect the prospects of achieving business or project goals”. (Thirumurty & Sekar 2007) The origin of the word ‘risk’ dates back to the 17th century. Initially, it was known as a Spanish sailor’s expression meaning ‘encountering some form of danger or running into a rock.’ The term is often characterized as randomness in business performance variables regarding the unpredictability of environmental or organizational factors that have some influence on the business’ performance. Thus it may be said that upshots of the randomness and the degree of exposure to such elements is the actual risk involved in a project. Generally, it is the probability of occurrence of some event that may impact the targets or goals of a project venture. This includes the likelihood of loss or gain or deviation from a predetermined or anticipated outcome due to the randomness of following a particular action path. Therefore, it is evident that ‘risk’ has two essential components: the possibility or chance of some event happening and the results, consequences, and derivatives of such circumstances if it occurs. (Loosemore, Dainty and Lingard 2003)

Management of risk constitutes one of the most critical managerial activities in a project, and project managers often are required to design and implement a risk management strategy meticulously. Such activities are fundamental to accomplishing desired business and task-related performance results and valuable procurement of products. The basic principle underlying each business venture is to generate value for all stakeholders. If an experience fails to add value to the business’s portfolio, it is often rejected or terminated. However, to achieve some positives from a project, business Owners have to deal with a certain degree of uncertainty. This uncertainty or randomness includes both risks and opportunities that have the latency to either erode or enhance the positives. The rationale underlying the design and implementation of a risk management framework is to provide the administration with a means to cope with the randomness linked with the risks and opportunities. (Sioros 2000) Project managers identify, analyze, and determine the risks and uncertainties associated with a specific business venture and provide a detailed report to the company’s top management. The fate of that particular project rests upon the extent of the administration’s willingness to take risks to continue value addition. An integrated risk management framework can prove to be a powerful management instrument which special abilities. However, the successful adoption of such a management tool entails proper improvement and training of the employees in managerial positions across all levels within the organization, including the top-level administration. Nevertheless, such management tools require the precision of human judgment, as faulty decisions can cause errors and inaccuracies which may be fatal to the prospects of any organization. (La Londe, Bernard and Masters 2007)

The Construction Industry

The construction sector is one of the most significant contributors to the competitiveness and richness of any economy. A contemporary, productive infrastructural environment is a principal driver of productiveness. The construction sector has a pivotal role in providing a shape to the built infrastructure inventive and economical manner. Enterprises across the economy bank on the yields of built Infrastructure like roadways, railway networks, powerhouses, and telecommunication networks will continue to be competitive, and private investors regard the worth of the built infrastructure as critical features in analyzing their location options. The efficiency also relies on the productivity and the characteristics of the built infrastructural settings. The suppleness, mobility, and value of the employees and the efficiency of corporations count on the accessibility of correctly configured and located infrastructural facilities. The blueprint, assembly, and operation of the built infrastructural background have other noteworthy economic impacts, such as the rate at which resources and assets are utilized. (Loosemore, Dainty and Lingard 2003)

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Nearly 50 percent of the United Kingdom’s carbon emissions, water expenditure, approximately 33 percent of landfill waste, and 25 percent of all raw materials exploited in the economy are attributable to infrastructural buildings. Waste materials coming from the construction industry, which amounts to more than 100 million tonnes a year, are significantly larger than that produced by the households. (Lambert, Stock and Ellram 2008) In the form of one of the UK’s foremost industrial sectors, accountable for more than 8 percent of the GDP and providing employment for in excess of 2 million individuals, the construction sector has a remarkable influence on the sustainability of the economy of United Kingdom as it has an effect on most facets of lifestyle of the mass population, the environment as well as global economy. (Regester 2005)The Stern Report presented to the government drew attention to the significance of initiating early measures to offset the adverse effects of climate change and the U.K. Government is reflecting on a Climate Change Bill that would obligate the United Kingdom industrial sector to ever more rigorous carbon budgets. Thus, it is important that the construction industry, a major industrial sector in the economy, responds to this new-fangled reality. Through its impact on the built infrastructural environment, the construction industry assumes a fundamental role in the endeavour to foster sustainable enhancement and development in the economy.

Risks in the Construction Industry

The construction industry as a whole has been evolving developing and changing to a large extent in the last few decades. It is an industry which is largely driven by private investment. Consequently, the influence these investors bear on the industry is redoubtable. The industry is faced with a high level of examination by sponsors, analysts and consultant and other stakeholders and experts. It is expected to return high-quality service in all areas ranging from operational management to risk management. To uphold its competitiveness in the market, businesses operating in the construction industry have to allocate calculated and apposite resources and need to craft out an evermore operational strategy. The industry is susceptible to several other business risks that time and again correspond to a greater degree of exposure than that which is conventionally insurable. For instance, there are dogmatic, legislative, professional, environmental, contractual, human resources related, competitive, strategic, operational, reputation, client oriented, and political, economical and technological risks. (Pacione 2007)

A construction project supply chain can be constituted by several companies, contractors and subcontractors, material and apparatus providers, engineering and research outfits in addition to specialized consulting firms etc. It is extremely fragmented and incorporates various small and medium range providers, contractors and subcontractors. Time and again materials need to be brought in from overseas and consequently the supply chain takes a global form and becomes tougher to administer. In addition, construction business ventures require a high degree of synchronization amongst several entities, which possess conflicting interests. A construction industry supply chain could also consist of several such networks (for different materials and products) and entail risks at a variety of nodes. Even as risk management becomes one of the most decisive activities in the construction project management process, extant industry applications engage risk management apparatus like risk registers, risk management spreadsheets, consultation sessions etc. Consequently, a lot of risks go unrevealed and implementing an accurate risk management strategy becomes unattainable. Again, as a result of the short-term project approach of construction companies and return on investment factors, construction businesses are reluctant to utilize tools such as Decision Support Systems to enhance risk management systems. Numerous industry professionals ascertain that the short-term frame of mind is due to the fact that each project is dissimilar in nature. Although every individual project is singular in a broader sense, the framework of the supply chain, various practices adopted in construction ventures, and production materials remain common to nearly all projects. For illustrating the case in point, consider the following. (Pickett 2005) Every building construction process necessitates activities such as sit preparation, masonry effort, tiling etc. and construction materials such as bricks, cement, sand etc. These comparison relations of different construction ventures presents the opportunity for the implementation of an integrated framework which can be exploited for risk management activities in the construction supply chains across several projects. Subsequent to a construction company’s signing the deal to embark on a certain project, the difficulty of managing the supply chain risk because of unpredictable occurrences arises and proves to be a dual challenge. It needs to be dealt with carefully at different tactical and operational echelons. The first predicament is that of preventive risk management wherein the contractor needs to determine a variety of methods so as to formulate the supply chain in a vigorous and risk durable manner. The whole process involves identification of risk events with their sources, prioritizing risks, and devising ways in which probability of occurrence of such events can be minimized. The second problem is of interceptive risk management, where the contractor has to take a decision on the best action that should be taken subsequent to a risk event in order to contain the loss.

Other than the traditional risks, hazards and dangers on construction sites, new risks carry on evolving in the United Kingdom construction sector. Environmental problems may crop up if new building initiative on Brownfield lands causes harms to the environment. The concern of corporate exploitation of human resources evidently comes into view for contractor agencies as new labour legislations are reflected on. Private Finance Initiative (PFI) projects engulf new legal responsibilities for those stakeholders engaged in ‘build and operate’ construction ventures. The likely resurgence of the nuclear power industry in the United Kingdom as a result of energy deficiencies, and the construction projects in the region of decommissioning nuclear powerhouses, has the potential to create and generate new prospects as well as risks. (Loosemore, Dainty and Lingard 2003)

Risks and the Environment

The United Kingdom construction industry has emerged as a major cause for concern with respect to environmental issues. Construction businesses in this sector are accountable for a large number of pollution incidents which is significantly more than most other industrial sectors in the U.K. While other sectors have exhibited a decrease of such incidents, the construction industry witnessed a rise of 20% in the time period between 1996 and 1999. (Lummus, Vokurka and Alber 2008) One of the most prominent explanations behind the sector’s failure to lessen pollution outputs is the apparently limited business impact it has. However, some companies have become conscious of the actual costs of pollution incidents. Data about pollution costs across the entire project life cycle and not merely the construction phase can prove to be valuable information for companies while determining the best approaches to handle risks and cope with cost impacts. Environmental risks also incorporate the risks linked with the impacts of the external environment (such as meteorological conditions) on the processes constituting the project life cycle in addition to environmental regulations which may influence positioning and location, construction approaches, and working methods of the project.

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When considering the environment from an all-inclusive perspective, it may be undoubtedly said that it has a profound influence on every organization existing in society. The risks pertaining to the general environment can be broadly fragmented into two different categories. The first category relates to the physical environment whereas the second component falls under the political, social and economic bracket. From the physical outlook environmental risk encompass meteorological factors such as the weather, wind speeds, atmospheric conditions and other naturally occurring phenomenon such as floods, landslides and earthquakes. These can have a momentous influence on the construction approach and has an effect on all the processes involved in a construction project. For example, incessant rain may bring about some change in indoor and outdoor working schedules; high wind speeds may cause changes in plans concerning steelwork structure construction, low temperatures may hinder concreting jobs and other natural phenomenon may bring about deviation from plans. It is obvious that such physical environmental risks cannot be controlled. However, risk that crop up can be and should be identified beforehand, and provisions should be kept so that the adverse effects can be mitigated. For example, the provision for rearrangement of susceptible operations should be there in the initial project plan if by any chance it is hindered by unfavourable meteorological factors. (Lummus and Vokurka, 2009).

From the political, social and economic point of view, the environment can be controlled to some extent but not completely. The central government is capable of controlling happenings in the U.K economic arena. However, it does not have the power to completely manipulate the world economic markets. For example, in the global oil and petroleum markets, the U.K government cannot stipulate the cost of oil per barrel for North Sea oil, on the spot markets. The rapidity of change, which is at an all time high, characterises the political, social and the economic environment. Such an environment pertaining to the state of affairs in the U.K political and economic arena is controlled by the government. However, several industries, corporations and businesses are susceptible to the government environmental policies.

The environment has emerged as a central issue in the decision-making process of businesses across the globe. Environmental factors are proving to more and more intricate and interconnected. Conventional methods of dealing with environmental concerns by means of a reactive, ad-hoc, end-of-pipe approaches are evidently falling short of their purposes. With competition intensifying every minute in the expanding international oligopolies, environmental legislations and policies are stipulating fresh standards for the industries in every expanse across the earth. In such a context, at present, first-rate environmental compliance does not remain a mere legal or ethical responsibility. It makes good sense from the business’ point of view as well. Lessening pollution incidents leads to increased productivity and the exploitation of lesser resources. Enhanced health and safety provisions bring about a more efficient workforce. Providing products that value the environmental principles facilitates expansion of markets and drive up sales curves. In a nutshell, businesses prove to be more competitive once they embark on valuable environmental management practices. (Sev 2009)

Research methodology 

Aim of the research initiative

The rationale underlying the embarking on this research initiative is to carry out an investigation into the role, functions and responsibilities of a project manager in an effective framework of environmental risk management in light of the issues confronted by the United Kingdom construction industry.

Objectives Desired To Be Fulfilled

There were certain objectives which were decided upon during the conceptualization phase of this research initiative that were to be met in course of execution of the research work. These objectives are thus documented as below:

  1. To recapitulate the conceptions and ideology underlying Risk Management Processes with reference to the project life cycle.
  2. To summarise the ideas and the philosophy of environmental management.
  3. To look into the roles, functions and responsibilities of the project manager in the framework provided by an environmental risk management system.
  4. To examine the application of risk management principles to environment issues in the United Kingdom’s construction arena.
  5. To recognize, classify and evaluate the environmental risk factors within the remit / control of a project manager in the construction industry.
  6. To develop a comprehensive, sustainable and futuristic project management strategy for environmental risk management.

Research Design

This particular research material makes use of the survey technique with a carefully designed questionnaire as the data collection instrument supplemented by a draft environmental policy to carry out a qualitative assessment of the responses.

The primary fieldwork carried out was a survey conducted across the various sections of the construction industry. The research field work timeline spanned 4 months across which the extensive survey was carried out. The fundamental data collecting instrument was a carefully designed open questionnaire which was meticulously designed to procure the views of the respondents about an environmentally conscious sustainable management strategy and thereby analysing the role of a project manager in the process of environmental risk management.

The questionnaire was divided into 12 different sections. The first section gathered background information on the respondents profile and specifically inquired about whether the opinions expressed were personal or represented the standpoint of an organization. In case the views expressed were from an organizational point of view, the information about the profile of the organization was collected or else demographic information about the respondent was collected. This was done to keep a provision for later analysis of demographic or profile oriented analysis of the information collected.

However, the scope of the present analysis was limited to the evaluation of the responses to the remaining 11 sections. These sections were divided on basis of components of a sustainable strategy for the construction industry. Each sections contained questions relating to a specific component of the sustainable strategy for an efficient environment management system which would be capable of dealing with most types of commonly occurring environmental risks.

The survey questionnaire was categorized into the following sections:

  1. Questions relating to Background Information of Respondents;
  2. General Questions;
  3. Questions relating to the issue of Procurement;
  4. Questions relating to the issue of Design;
  5. Questions relating to the issue of People;
  6. Questions relating to the issue of Regulations;
  7. Questions relating to the issue of Climate Change;
  8. Questions relating to the issue of Water;
  9. Questions relating to the issue of Biodiversity;
  10. Questions relating to the issue of Waste management;
  11. Questions relating to the issue of Material management; and
  12. Views on Innovation.

The questionnaire required the respondents to go through 16 questions divided among each of the 11 chapters derived from the components of a sustainable strategy; an initial section containing five general questions was designed which dealt with more broad-spectrum issues with regards to the draft sustainable strategy. These general inquires were to facilitate a comprehensive discussion relating to the issues concerned with the design of a sustainable strategy capable of dealing with most environmental hazards; the later sections containing specific questions about the particular components of a sustainable environmental strategy were more closely focused to facilitate the evaluation of advancements in these particularly critical areas.

Qualitative Research

Qualitative research is a broad expression for exploratory methodologies characterised as ethnographic, naturalistic, anthropological, field, or participant observer research. It highlights the importance of taking a look at variables in light of the inherent backgrounds in which they are to be found. Interaction amongst the variables is significant in this regard. Comprehensive information is collected by means of open ended queries that present direct references. The researcher, questionnaire designer or the interviewer constitutes a very fundamental component of the investigation process. This approach diverges from those adopted in quantitative research techniques which make efforts to collect data by objective routines to facilitate analysis and present information on the issues of relations, comparisons, and forecasts and makes an attempt to do away with the role of the investigator from the process of investigation. (Banyard 2005)

The primary objective of a qualitative research is to understand the people’s perception of a particular issue. Qualitative researches focus on a holistic description. In the process of conducting qualitative researches, the researchers aspire to procure an overall or complete picture. A holistic description of proceedings, incidents, and philosophies taking place in its inherent background is frequently required to facilitate precise situational decisions. This is at variance as compared to quantitative research approaches in which carefully chosen, pre-defined variables are examined. Corroboration is an important aspect of Qualitative research approaches. The rationale underlying corroboration is not to validate whether the people’s opinion are accurate or factual representation of a particular situation but somewhat to make sure that the research discoveries truthfully echo the people’s viewpoint, irrespective of what they are. The intention of the corroboration process is to help the researchers enhance their understanding of the likelihood that their judgments will be perceived as plausible or worthy of contemplation by others. (Creswell 2003)

One specifically important process concerned with corroboration is that of triangulation. There exist various forms of triangulation. One form entails the convergence of compound data sources. A different form is methodological triangulation, which entails the convergence of the information from compound data gathering sources. A third triangulation from is presented by investigator triangulation, wherein several researchers are engaged in a particular research initiative. Interrelated with investigator triangulation is another form of corroboration dubbed as researcher-participant corroboration, which is also known as cross-examination. Other processes can also be employed to enhance understanding and / or the reliability of an examination. These involve research or inquiry appraisal, peer examination, and the looking out for negative cases which might invalidate interpretations when tested against those cases. (Yin 2003)

Maintaining the Validity of Qualitative Research

There must be some amount of conscious effort made by the research team to uphold the validity of a qualitative research initiative. In the following paragraphs some important issues in this regard are discussed.

The researcher should be an ardent listener. The subject(s) of qualitative research initiatives present most of the research input. It is the responsibility of the researcher to appropriately understand the reactions of the subject(s). (Creswell 2003).

Information must be recorded correctly. All documented information should be meticulously preserved in the shape of comprehensive notes or electronic documentations. These accounts should also be generated in the course of instead of subsequent to the data gathering process.

The documenting work should be embarked on at an early stage. It is often recommended that the investigator should make a rough summary of process of the study prior to even going into the field to gather data and information. This facilitates a documentation to be made easily when required. The investigator can thus be more equipped to focus the data collection phase on that particular information that will correspond to the precisely identified requirements of the initiative. (Banyard 2005).

The primary data should always be included in the final report of the research. The enclosure of primary data in the final report facilitates the person who reads the report to exactly make out the foundations on which the researcher’s interpretations and conclusions were based. In a nutshell, it is a better practice to incorporate surplus details rather than presenting scanty and incomplete information. In addition, all data gathered in course of the research must also be enclosed in the final report. The investigator should not omit fragments of information from the final document merely because she / he fails to understand that data. In such events, the person who reads the report should be permitted to draw his/her own conclusions about the issues.

The investigator should be careful not to waste too much time in an endeavour to keep her / his thoughts and individual responses out of the study. If there is importance in the researcher’s thoughts and if they are pertinent to the relevant topics, these viewpoints should be divulged. (Creswell 2003).

Feedback on the development process should be obtained. The investigator should permit others to evaluate the research document subsequent to the completion of developmental process. Professional peers and research subjects should also be involved in this process to make sure that information is accounted correctly and comprehensively.

The researcher should attempt to strike a balance. He / she should make a conscious effort to accomplish equilibrium between apparent significance and actual implications of issues. Frequently, the information divulges a disparity in estimated and actual areas of study implications.

Writing of the documents should be don e carefully and accurately. Erroneous grammar, misspelled terms, statement discrepancy etc. endanger the legitimacy of an otherwise well conducted study. (Yin 2003)

Questionnaire as a Data-Gathering Instrument

A questionnaire is a way of bringing out the thoughts, beliefs, perceptions, experiences, or viewpoints of some section of individuals. As a data gathering tool, it could be either structured or unstructured. A questionnaire is most commonly an extremely brief, predetermined assortment of questions created to procure detailed information to correspond to a specific requirement for the research information concerning a relevant subject. The research information is procured from the respondents usually from an associated and correlated interest sphere. The lexical definition of a questionnaire provides a more comprehensible definition wherein it is stated that “A questionnaire is a written or printed form used in gathering information on some subject or subjects consisting of a list of questions to be submitted to one or more persons”. (Oklahoma 1997)

There are a number of advantages as well as disadvantages to the use of questionnaires as a data collection tool. Some of them are listed below.

Advantages:

  • The costs and time associated with providing training to interviewers and sending them to an interview site is done away with by the use questionnaires.
  • All responders are provided with the same set of questions written in precisely the same way. Thus, questionnaires are capable of producing more comparable data as compared to the information procured by means of an interview.
  • If the queries are structured properly and the circumstances under which they are responded to be controlled, then the questionnaire can be standardized. (Banyard 2005)

Disadvantages:

  • Respondent’s impetus is hard to evaluate, thus impacting the validity of the responses received.
  • Except for a random sampling of returns being obtained, the completed and returned questionnaires may signify predisposed samples. (Creswell 2003)

Research Philosophy- Deduction and Induction

From the perspective of logic, two broad approaches to analysis are known as the deductive and inductive approaches.

Research types
Figure 1. Research types

Deductive logic functions from the more general perspective to the more specific perspective. Occasionally, this is unofficially called a “top-down” method. The process is initiated by conceptualizing a theory in relation to the subject of interest. The focus is then narrowed down into further detailed hypotheses which can be tested. The analysis process is furthermore specifically focused when observations are recorded and information is gathered in relation to the hypotheses. This eventually results in the capacity to assess the hypotheses with the application of the specific data gathered which is a corroboration process of the original theory.

Deductive approach
Figure 2. Deductive approach

Inductive way of thinking functions exactly the opposite way, traversing from a more specific perspective to wide ranging generalizations and conjectures. Unofficially, it is occasionally referred to as a “bottom up” technique. The inductive process of analysis is started off with detailed observations and measurement, and following that pattern detection and the process of looking for regularities is carried out. Subsequent to this some tentative hypotheses is formulated which can be investigated into, and to conclude some generalized conclusion or conjectures are drawn up. (Yin 2003)

Inductive approach
Figure 3. Inductive approach

The two separate methods of analysis have a very dissimilar approaches associated with them in the process of carrying out the research work. Inductive logic, by its very inherent nature, adapts to a more open-ended and investigative approach, particularly at the commencement of research activities. Deductive analysis demonstrates a narrower temperament and is associated with examination of the validity of or corroboration of the hypotheses. Although a certain investigation may appear to be entirely deductive in nature (for example, a trial designed to examine the hypothesized impacts of some treatment or intervention on some consequences), majority of the social research initiatives employ both inductive and deductive reasoning techniques at some stage in the research timeline. In fact, it is plainly evident that the two graphs presented above and be merged into a singular graph to indicate a cyclic process- one that repetitively cycles from theoretical perceptions down to recorded observations and back up once more to generalized theories. Even experiment carried out in a very controlled environment, the investigators may detect patterns and regularities in the data and information that guide them to come up with fresh and innovative theories (Creswell 2003).

Dissimilar approaches
Figure 4. Dissimilar approaches

Proponents of the inductive theory suggest that social facts are ways of acting, believing and sensing, external to the individual. They are present in their own right, and possess the capability to apply control measures over individuals. As socially observable facts have a separate existence, they can and need to be dealt in a way as if they are entities, and scrutinized in a way comparable to a naturally occurring phenomenon. In addition, to examine society in its actual form, the sociologists must do away with their own suppositions and prejudices and subsequently record observations with regards to the exterior temperament of the event

In case of the deductive approach it is important to take notice of the fact that theories are interpreted as exploratory and tentative surmises generated by the human perception without restraint in an effort to prevail over difficulties experienced by earlier theories, and to provide an satisfactory explanation of the behaviour of a number of issues of the world. Social science steps forward by using the trial and error methodologies, by using inferences and repudiations. Only the established theories continue to exist. Critical rationalists also insist on two prerequisites for the successful implementation of the strategy. Firstly, for a theory to be considered as a scientific conjecture, it must be capable of, as a minimum theoretically, to repudiate it. Secondly, the more confirmable a hypothesis is the more it complies with scientific principles. (Yin 2003)

Literature review

Concepts of risk management

Focusing on any kind of risk is a fundamental activity if a high-quality performance is desired irrespective of management domains be it a large corporation, a specific project or a simple work package. The significance of risk management is accepted by majority of the field professionals. However, only a handful of them adopt proper techniques for the same and others mostly fall back on intuition or experience. It is important that one notes that risk management is not the same as insurance and nor does is encompass the approaches to deal with all risks which a business faces. In actuality, it lies somewhere between the two extremes. It is an approach which aims to recognize and enumerate the risks a business is faced with to facilitate the formulation of a cognitive solution to deal with the consequences of the risks. A risk management system needs to be realistic, sensible and economical. It entails rational thinking, meticulous analysis, prudent judgement making capability, apt use of experience and eagerness to implement a well-organized technique to the cope with the critical attributes of the business venture in which the risks arise. Risk management is a field which facilitates the acceptance of the likelihood that potential occurrences may come with some adverse effects. (Woodhead, 2008)

Risk Management is an indispensable component in construction project planning process as well. In the case of a risk incident cropping up in the course of project operations, the necessary measures are initiated by project managers bringing their individual experience and expertise into application. However, proficiency and experience gained in prior endeavours is immensely valuable in recognizing and coping with risks incidents in a new venture, such information mainly exists in the Project Managers’ minds and is hardly ever documented in the form of reusable information.

The construction sector is often inundated by risk occurrences in many forms. However, in most cases these risk incidents are not managed sufficiently, ensuing unsatisfactory performance with amplified costs and time losses. Construction projects are starting to become gradually more intricate and dynamic in their temperaments and the initiation of fresh procurement techniques implies that a lot of contractors need to reorganize their approach to the methods through which risks are dealt with in their assignments and operations. Risk is the outcome of the relations of uncertainty and the extent of prospective loss or gain. Risk is also amplified merely by employing the services of a contractor to carry out stipulated tasks as a result of the unavoidable loss of employee faithfulness and lack of control over sub-contractor operations. Construction projects also entail risks attributable to the multifaceted character and uncertainties intrinsic to the nature of construction methods adopted. The process of procurement too characterizes a considerable risk, perhaps the most critical ones, to which most organizations are exposed. (Hutt & Speh 2001)

Overview of risk management

A typical risk management framework designed to deal with risk occurrences in a project comprises of some specific activities such as risk identification, risk analysis and determination of risk response. The fundamental rationale underlying the design of such a framework is to optimize the performance variable is a positive manner so as to offset the adverse effects of the risk incidents.

Project Risk Management
Figure 5. Project Risk Management

The processes demonstrated in the above figure work together with each other. Each process may require the efforts of one or more individuals or teams depending upon the requirements of the particular project. Typically, each process is operational at least once within the different phases of the project. The identification and quantification processes are on some occasions treated as a singular activity and combined processes are frequently referred to as risk analysis, evaluation or assessment. Risk response development is also known as response planning or risk mitigation technique in some cases. Response development and risk control is often treated as a single activity and the combined process is dubbed as risk management. (Holmes 2002)

Key processes in the project risk management framework

Risk management is generally comprised of the following four blocks of activities:

  1. Risk Identification – This refers to the act of determining the risk occurrences that could possibly have an effect on the project operations and documenting the attributes of each risk.
  2. Risk Quantification – This refers to the process of appraising the nature of the risks and the interactions amongst various risks to evaluate the scope of the project outcomes.
  3. Risk Response Development – This process involves determining and developing measures to capitalize on opportunities and offset the adverse affects of the threats.
  4. Risk Response Control – This refers to the act of monitoring the implementation and responding to alterations in the risk situations during the operational phase of the project. (Hutter & Power 2005)

Risk Identification

This process involves the recognition of risk incidents which could possibly influence the project outcome variables and documenting the attributes of each identified risks. The identification process is not an activity which takes place just the once but is embarked on at regular intervals during the life cycle of the project. The activity encompasses both internal and external threats. Internal threats and risks issues which falls under the control of the project workforce and can be influenced by the project team. Examples of internal issues may be consigning workforce assignment and determining cost estimates. External risks permeate beyond the reach of the project team and it is unlikely that they would be able to control or influence such issues. Examples of such risks include physical environmental conditions or market turmoil. The term ‘risk’ engulfs only the possibility of impairment or loss. However, in practice, project risk identification processes deal with both identification of positive opportunities as well as negative outcomes of threats and vulnerabilities. (Koontz and Weihrich 1994)

The risks identification process makes use of several sub-processes to determine the risk. Project managers may make use of one or more options amongst the following approaches to effectively identify the threats and opportunities. The risk identification team may make use of:

  • Brainstorming;
  • Workshops;
  • Interviews;
  • Questionnaire surveys;
  • Feedback reports of identical projects;
  • Expertise of specialists and consultants; and
  • Previous experience. (Lummus and Vokurka 2009)

Risk Quantification

This process involves appraising the nature of the risks and the interactions of the various risk incidents in order to evaluate their effects on the prospective project outcome variables. It principally focuses on determining the specific risks which necessitate counterbalancing measures. It is further obscured by several issue inclusive of, but not limited to issues like:

  • Opportunities and threats may interact in unforeseen manners;
  • A particular risk occurrence ensuing difficulties on multiple fronts;
  • Conflicting interests of different stakeholders;
  • Faulty mathematical instruments can generate misguiding results.

There are a variety of tools used by project managers to quantify risks. Some of them are described below.

  • Expected Monetary Value- The expected monetary value it is the product of two factors – Risk Event Probability and Risk Event Value. The risk event probability is an approximation of the likelihood of the risk event occurrence whereas the risk event value is the approximation of the incurred loss if the risk crops up. The expected monetary value is normally employed in the form of an input to further analysis structures for the reason that risk incidents can take place singularly or in groups, in tandem or separately. (Lummus and Vokurka 2009)
  • Statistical averages – Statistical averages are brought into application in order to compute a variety of overall project outlays from the approximation for singular job items. The domain values of the total project estimates is employed while quantifying the relative risks of different project budgets or tender prices.
  • Simulation – This involves the use of a model or prototype of a system to evaluate the actions or performance of the system. The most wide used form of simulation technique on a project is the schedule simulation employing the project network as the representation of the project. Majority of the simulation systems are derived from some form of Monte Carlo analysis. This approach, emanating from general management techniques, “performs” the project operations several times to present a statistical distribution of computed outcomes. Schedule simulation is a better alternative for large, dynamic and intricate ventures for the reason that mathematical tools such as CPM and PERT do not give an explanation for path convergence and consequently end up underestimating project durations. (Andersen 2007)
  • Decision Trees – This is pictorial portrayal of important interactions amongst the decisions and probable events as perceived by the decision maker.

Risk Response Development

This process involves determining and developing measures to capitalize on opportunities and offset the adverse affects of the threats. Responses to the threats typically fall into the following classifications:

  • Avoidance – removing a particular threat, generally by treating the problem from the roots. It should be noted that no project manager or management teams can do away with all forms of risks. However, certain risk incidents can often be removed.
  • Mitigation – lessening the expected monetary value of a particular risk incident by curtailing the probability of risk occurrence, or ensuring a drop in the risk event value or both.
  • Acceptance – allowing the consequences of the risk to take effect. Acceptance may be either active or passive. (Banyard, 2005)

Some tools and approaches for risk response development are described below.

  • Procurement – Obtaining products in the form of goods, services or both from external sources is frequently a viable response to certain forms of risk events. For instance, risks pertaining to the usage of a certain technology may be moderated by associating with an enterprise that has experience in dealing with such kind of technology. However, procurement engages in an exchange of one risk in turn for the other. Like in the case of moderating cost risks by means of a fixed price contract might increase the probability of schedule risks in case the seller is not capable of performing satisfactorily. Likewise, transferring technological risks to a service provider may bring about undesirably high tender outlays. (Cook, DeBree and Feroleto, 2007).
  • Contingency Planning – This entails determining and identifying the counterbalancing measures to be acted upon in the event of risks occurring.
  • Alternative strategies – Risks and threats can be sometimes avoided be deviating from the original plan of action. For instance, putting more effort in the design phase might decrease the extent of alterations during the operational or construction stages of the project.
  • Insurance – Such arrangements such as bonds are obtainable in order to cope with some types of risk incidents. The nature and costs of coverage may differ in various application areas. (Hall, 2006)

Risk Response and Control

Risk response and control ensues the proper implementation of the risk management strategy so as to act in response to the risk incidents during the entire timeline of the project. In the event of an alteration taking place the fundamental cycle of identify, quantify and respond is reiterated. It should be understood that any amount of meticulous and careful analysis is not capable of accounting for all risk events and thus cannot be considered full proof. Consequently, monitoring the phase execution and iterating the risk management cycle is essential.

Some approaches adopted for essential risk response control are:

  • Workarounds – These are unplanned reactions to adverse risk incidents. The term unplanned in this context simply means that a course of action was not explicitly defined at a prior stage during risk planning.
  • Additional risk response development – In case a specific risk event was not foreseen, or if the impact of the risk incident is greater than that which was anticipated, the original risk management strategy may fail to work adequately. Thus it is sometimes essential to go over risk response development procedure and possibly risk quantification procedure once again. (Crouhy, 2000)

General Forms of Risks

There are various approaches to categorizing risks involved in a business venture. As explained by means of the following figure, the process of categorizing risks is undertaken primarily by recognizing and determining the type, impact and consequences of the risk.

Risk classification
Figure 6. Risk classification

Practically all efforts involved in the act of classifying risks pertain to the portfolio theory, which takes into account factors like dealings involving stocks, equities, and gilts. These risks are fragmented into market risks which account for the temperament of the markets and specific risks which relate to the risks pertinent to the operations of a particular business outfit.

From the perspective of analyzing the impact of the risks, it may be said that the risks impact the environment at the broadest level, influencing the markets and the industry next, spilling over to impact the operations of a certain company and finally, at the most specified level, has an effect on the project as a whole or on individuals involved in the project. (Dempster, 2002)

Impact of risk
Figure 7. Impact of risk

In view of the consequences of the risk events, the pertinent issues with regards to the effects of the risks are mulled over. Most project managers incline towards falling back on expert opinion, proficiency, and experience along with some accessible data and information if available. There are many cases of risks in which no consistent data are obtainable. However, instead of overlooking these factors, a strategy has to be chalked out keeping in line with the overall risk management policy. In the following figure, a basic approach to the analysis of a situation or a particular risk incident is presented. The table facilitates evaluating the risk impacts in a structured manner.

Basic approach to the analysis of a situation
Figure 8. Basic approach to the analysis of a situation

Frequently identified risks in the construction industry

There are some typical risks identified by project managers or risk management teams involved in a construction project. These individuals or teams chalk out policies and strategies to deal with such risk events prior to the commencement of the operations of the project. Some of these risks are described in the following paragraphs.

Delivery Risks: an operational risk

This risk pertains to the delivery mechanisms involved in a project. This particular risk factor incorporates issues and problems concerned with actual engineering issues, procurement, development and construction, and overall operation of the projects by also taking account of non-conventional techniques.

Interface risks arise when several contractors work on various components of the project. The management of the interfaces in such cases becomes difficult in the design stage since more quantity of work needs to be executed as per design-build delivery techniques. (Frenkel, 2005).

Technology Risks

This specific type of risk incorporates issues, factors or problems relating to the technologies adopted to facilitate the execution processes and operational implementations of technology in the project.

Engineering risks at present involve issues pertaining to the exploration and production necessities which are incessantly thrusting on the deepwater envelope. A major risk deliberation entails reflecting on the fact that the meteorological-ocean data current and waves is a practical observation and thus is subject to change with altered and updated information being available every year.

Financial Risks

These risks call for policies and strategies to overcome financial concerns cropping up in the course of execution of the project. This particular risk factor incorporates issues and problems in relation to the financing of the venture including the execution timeline, operations, or equity financing.

Customer credit risk is a new financial issue ensuing from the large-scaled influx of small capital independents and the establishment of several Limited Liability Corporations with the lack of a substantial amount of real assets.

A significant financial threat is presented by Joint venture risks. Projects often have the need for many stakeholders engaging in a joint venture in order to distribute the financial risks accordingly. Under such a pretext conflict of interests may arise which aggravates the financial sharing risks. However, these risks are often overlooked while in the process of establishing a joint venture (Gallati, 2003).

Procurement Risks

This specific risk factor is relates to procurement or contracting activities for the effective execution and operations of a business venture. This incorporates issues or difficulties with regard to contractual or procurement techniques, systems, and procedures employed in the execution and operation of the business venture.

Material risks prove to be a significant procurement risk factor. The exorbitant expenditure budgets force the project team to procure the cheapest materials which meet the norms and standards of the industry.

Execution management approaches that are non-compliant with stakeholder expectations and established industry standards pose the threat to diminish design-build profits and consequently end up aggravating the impacts of the risk within the execution phase as by that time several key players are often over-committed. (Gordon, 2008)

Political Risks

This specific risk factor takes account of all kinds of public policies and legislation introduced by the political authorities at the local, state or national level, which might prove to be hindrances to the project. It also incorporates analysis of the political state of affairs in the region.

Security risks are crucial political risk factors which play an important part in decisions about project locations and sites. The threats of evermore sophisticated militancy and terrorism loom large and can sometimes prove disastrous for some projects.

Environmental Risk

This particular risk factor takes account of environmental issues, concerns, legislations and impacts relating to the project and analyses its implications for the execution and operation of the project.

Weather risks involve metrological factors such as storms and floods and their impact on project operations and execution.

Green risks which relate to environment conscious building methodologies and use of resources have emerged as a major concern particularly in developed and developing economies.

Social Risks

This specific risk factor deals with the various issues pertaining to the social and cultural aspects of the society within which the project is located.

People risks stem from altering social relationship and forced cultural transformations of linear construction ventures and have a subverting impact on the long-term operability of the project.

The right of way risk issues have emerged as a critical social risk factor and cause interruptions by means of issues such as aboriginal populace undergoing broader egalitarian approaches and assertion of rights to shape up social enhancements. Such issues consequently drive up the costs for projects.

Economic Risks

This risk factor incorporates issues and difficulties in relation to the macroeconomic impact of the project in terms of the community and region within which the project is located.

An important consideration in this case is the insurance risks which ensue from several rigorous capital restrictions in the international reinsurance markets which hamper the access to project insurance.

Payment risks are also a crucial economic risk consideration. Across both developing as well as underdeveloped economies, projects receive funding from private entities through subsidies that necessitate payment for transported articles of trade. This brings about a risky influence on the economy in addition to a culture shift from the viewpoint of having to recompense for something which was regarded as a right. (Gordon, 2008)

Dangers and risks

The terms ‘Danger’ and ‘Risk’ are not one and the same. However, they may be interdependent. The danger is a condition that represents a hazardous situation in terms of human health, the natural ecological unit, the built area, or the environment all in all. In contrast, risk is the possibility of the incidence of one or more than one detrimental harms that are brought about by dangerous circumstances having an adverse impact on mankind and/or on the ecosystem. In reality, the potential damages which may transpire in the construction project as a consequence of the uncertain circumstances are most diverse in nature, for example, individual loss, casualties, aggression, infirmity, irrational anxieties, mishaps, conflagration, social segregation of citizens, emblematic self-exclusion, etc. The impacts of the risks linked to those damages are not confined simply to the inhabiting populace of the project location, but also extends to the inhabitants of the neighbouring areas, the city and to some extent the entire country. Various construction projects can be exposed to risk occurrences that are manifestly opposed by the inhabitants, the neighbouring population, and can be detrimental to the city in which the project is located as well as the general environment. There are numerous danger conditions in construction and building projects like the conditions of the electrical systems which in turn is linked to other factors like planned escape routes in case of fire breakout and placement of fire extinguishers. Complications are further increased if the occupants of the project location are not trained in fire combat. The damages take a more significant shape in case the likelihood of occurrence of the undesirable and excruciating event (the risk event) is very high like in the case of a fire breakout. The probability of other damages occurrences as a result of various risk event depend on the magnitude of impact of the risk incident, wherein the severity of the extent of the damages can vary from insignificant to intolerable ones.

Environmental risk management in the construction sector

Construction business ventures and initiatives are, in most cases, linked to a broad range of environmental encroachments. For that reason, identical to cases in other industrialized sectors, the standards of sustainable development ought to be implemented in the course of any construction project execution and operations. From the organizational point of view, an approach towards realizing such an objective is by designing and adopting an effective environmental management system (EMS).

Many experts are of the view that the nearly all environmental risks may be classified into conventional and contemporary categories. The “conventional risks” are associated with poverty and lack of efficient public policies, like: fundamental sanitary provisions, potable water supply frameworks, metropolitan cleanness, public health issues, etc. The “contemporary risks” are those which are linked to developmental factors, wherein the dangers to the ecological system are the outcome of it, for instance, pollution in the water and the soil caused by industrial wastes, extensive farming activities, and air pollution, among others. As for the case of the construction projects it may be said that the most of the environmental risk factor is hemmed in the conventional risk category though there are some operations which impact the ecosystem in a manner such that they may be categorized under the contemporary risks bracket.

The construction sector plays a significant role in shaping up the competitiveness and affluence of the economy of a nation. A contemporary, resourceful infrastructure is a crucial driver of productiveness in any economy, and the construction sector makes a momentous contribution to developing the built infrastructure in a pioneering and lucrative manner. All companies across the economy, regardless of which sector it operates in, rely on the efficiency of the built infrastructure such as road network, railway system, powerhouses, and telecommunication networks to uphold their competitive nature, and all investors in any sector regarding the eminence of the built infrastructure as one of the foremost decisive factors when reflecting on project placement decisions. The productivity of the economy also banks on the competence and temperament of the built infrastructure. The suppleness, portability, and productiveness of the human resources and the efficiency of the firms count on the accessibility of correctly configured and placed operational facilities.

The planning, implementation and execution of the built atmosphere have other significant economic implications, for instance, it can be said without doubt that there is a tremendous effect on the rate at which the resources are consumed. Constructions are accountable for approximately 50 percent of the United Kingdom’s carbon emission figures, 48 percent of the nation’s water consumption rate, nearly one third of landfill waste production and consumption of about a quarter of all raw materials existent across the economy. By means of its influence on the built infrastructure in the United Kingdom, the construction industry plays a fundamental role in the effort to foster sustainable progress.

It is tough for one to dispute the requirement or the rationales underlying using environment friendly construction methodologies. The advantages of sustainable building techniques are becoming more evident with every new project or development initiative. Energy economy, improved indoor atmosphere, water conservation, ecological preservation, waste production minimization and land reusability are merely a few examples of such benefits. Nevertheless, each project team must realize that only good intent alone is not capable of clearing their firms of the basic environmental accountability. Implementation of a good business strategy, which is compliant with environmental standards, is also necessary for sustainable development. Lessening pollution levels increases the performance output and implies the consumption of leaner resource bases. Improved health and safety provision lifts the morale of the entire workforce. Delivering products that value the environmental standards facilitates expansion of markets and drive up sales curves. In a nutshell, businesses prove to be more competitive once they embark on valuable environmental management practices.

In this paragraph only a handful account of events through which environmental accountability becomes evident on contemporary green project sites is presented. Just from the perceptible dust produced in the course of a demolition process which may be full of a wide range of pollutant types, such as, silica and naturally occurring asbestos, can present and grave threat to the surrounding atmosphere. In the course of ordinary as well as large scale construction jobs and dirt work dangerous gasses like carbon monoxide, carbon dioxide, methane and nitrous oxide can be released from the fuel filled in trucks which operate at the site, movable asphalt facilities and several other onsite construction machineries. Repeatedly, during the recent past, legal actions have been taken against contractors in cases of third-party vulnerability relating to dust articles that includes asbestos fibres from excavation initiatives and silica dust generated on account of demolition jobs of partially occupied premises. Difficulties often surface because of carbon-monoxide vapours in interior repair operations when exhaust from generators and other such machinery are not effectively ventilated. Certainly, the scale of exposure differs conditional on the nature and placement of the project site, and waste and by-product release from construction initiatives are vastly surpassed by those levels evident in manufacturing projects. Nevertheless, the risk exposure very much exists, in conjunction with the prospective third-party accountability. Several distressing environmental court cases are initiated on account of unanticipated risks. New environmental matters are bound to materialize in the upcoming times in consequence of inventive or recycled goods and raw materials processes in green construction initiatives (Gordon, 2008)ю

ISO 14001: A standard for Environmental Management Systems

In the midst of the intense growth of the global economy, public consciousness of divergences existent between the environmental initiatives of various countries prompted the conceptualization of a global standard for ecological sensitivity. ISO 14000, in a nutshell, is the comprehensive guideline for efficiently managing the environmental issues in a business outfit instituted by the International Organization for Standardization (ISO). The drive for the instantiation of ISO 14000 can be principally accredited to the rising public concern about the environment. Such pressures lead to several nations, in the course of the past few years, adopting environmental regulatory controls that toned down the public grievances. (Islām & Burhenne-Guilmin, 2002)

ISO 14000 is not just a solitary standard, and is rather a set of benchmarks and guidelines, all of which deal with some facets of environmental management. The most important issues attended to include:

  • Organization or Process Standards
  • Environmental Management Systems (EMS)
  • Environmental Auditing
  • Environmental Performance Evaluation
  • Product-Oriented Standards
  • Environmental Labelling
  • Life-Cycle Assessment
  • Environmental Aspects in Products
  • ISO 14001
  • EMS (Islām & Burhenne-Guilmin, 2002)

The most important standard for the general ISO 14000 initiative is the ISO 14001, “Environmental Management Systems—Specification with Guidance for Use.” (Islām & Burhenne-Guilmin, 2002) This standard provides the necessary auditable factors essential to accomplish the ISO certification of an Environmental Management System (EMS). ISO 14000 is a globally acknowledged standard. Thus far, there have been nearly 20,000 business organizations across the globe that have on their own accord instituted an EMS and have procured ISO 14001 certifications. (Islām & Burhenne-Guilmin, 2002)

Fieldwork and analysis

The research work

The primary fieldwork carried out was a survey conducted across the various sections of the construction industry. The research field work timeline spanned 4 months across which the extensive survey was carried out. The fundamental data collecting instrument was a carefully designed questionnaire which was carefully designed to procure the views of the respondents about an environmentally conscious sustainable management strategy and thereby analysing the role of a project manager in the process of environmental risk management.

The questionnaire was divided into 12 different sections. The first section gathered background information on the respondents profile and specifically inquired about whether the opinions expressed were personal or represented the standpoint of an organization. In case the views expressed were from an organizational point of view, the information about the profile of the organization was collected or else demographic information about the respondent was collected. This was done to keep a provision for later analysis of demographic or profile oriented analysis of the information collected.

Organisation type of respondents
Figure 9. Organisation type of respondents

However, the scope of the present analysis was limited to the evaluation of the responses to the remaining 11 sections. These sections were divided on basis of components of a sustainable strategy for the construction industry. Each sections contained questions relating to a specific component of the sustainable strategy for an efficient environment management system which would be capable of dealing with most types of commonly occurring environmental risks.

The survey questionnaire was categorized into the following sections:

  1. Questions relating to Background Information of Respondents;
  2. General Questions;
  3. Questions relating to the issue of Procurement;
  4. Questions relating to the issue of Design;
  5. Questions relating to the issue of People;
  6. Questions relating to the issue of Regulations;
  7. Questions relating to the issue of Climate Change;
  8. Questions relating to the issue of Water;
  9. Questions relating to the issue of Biodiversity;
  10. Questions relating to the issue of Waste management;
  11. Questions relating to the issue of Material management; and
  12. Views on Innovation.

The questionnaire required the respondents to go through questions divided among each of the 11 chapters derived from the components of a sustainable strategy; an initial section containing general questions was designed which dealt with more broad-spectrum issues with regards to the draft sustainable strategy. These general inquires were to facilitate a comprehensive discussion relating to the issues concerned with the design of a sustainable strategy capable of dealing with most environmental hazards; the later sections containing specific questions about the particular components of a sustainable environmental strategy were more closely focused to facilitate the evaluation of advancements in these particularly critical areas.

The analysis presented in this document is in a systematically organized manner. For each section the questions are explicitly mentioned and subsequent to that a comprehensive analysis of the responses to the specific questions is presented.

The questionnaires were distributed across 220 companies along with an outline of the draft sustainable strategy operating in the construction sector and the documents were provided to people holding authoritative positions in those companies. The documents including the draft strategy and the questionnaire were also available for download from the internet to maximise individual responses. This process was supplemented by a chain of 25 workshops, carried out across the United Kingdom to make sure that the elements of the draft strategy was clear to the respondents and that the views of as many as possible were collected.

A total of 32 individuals’ responses were received. Out of the 252 questionnaires distributed 157 responses were received. However, only 149 responses were considered for analysis as some of the responses were improper. The effective response rate for the survey stood at a 59.12 percent which is a much higher rate as compared to other previous studies carried out in this field.

Analysis of responses

General Questions

Q. Do you believe that the treatment of the critical subject matters and secondary themes at a broader level in the draft strategy document is acceptable? If not, then which issues or sub topics require further attention?

Analysis: A general consensus was observed in the responses in view of the fact that the critical issues in the outlined strategy were appropriately recognized, although some respondents mentioned the need for further attention on other key aspects. Some responders also specified a requirement to synchronize the environmental attention by building a sharper focus on the social and economic features of sustainability. Some also mentioned an unambiguous statement must be provided by the project managers with the visualization of developing construction initiatives in a manner which endorses the formation and preservation of sustainable communities; and that the workforce involved in construction projects were required to work in unison with managers and authorities to make sure they adopted a holistic approach towards shaping up sustainable communities. Further opinions divulged that the project managers should design a sustainable framework to harmonize economic, social and ecological deliberations. Responses revealed that an effective strategy, adopted by managers at a project level or by authorities at the organizational level, must explicitly document preferred performance outcomes in the short, medium and long term and bring goals and measures in line with specific industry circumstances.

Q. For most parts the draft strategy concentrates largely on environmental targets. Is that the proper approach which project managers should adopt while designing and implementing sustainable strategies?

Analysis: 37% of the responses remarked that an actually sustainable construction industry requires not only focus on just ecological aspects, but also incorporate the social and economic facets of sustainability as well as these factors too have an important contribution to the general environment. Various responses mentioned that the project managers should adopt an approach which acknowledged the significance of a comprehensive view of sustainability, whereby environmental sustainability fostered and improved the social and economic aspects of business. Suggestions were received to categorize strategies into social, economic and environmental strata, to present a comprehensive plan of truly sustainable practices in the construction industry.

28% of answers to this specific question decided that it was correct to concentrate on environmental objectives for a number of reasons: environmental sustainability factors might be uncomplicatedly identified and implemented as measured against social sustainability dimensions. Moreover, the broader economic and social advantages of sustainable construction practices are less tangible to stakeholders and several non-environmental sustainability dimensions in relation to the construction industry were already attended to in other strategies.

Some of respondents were of the opinion that an effective strategy should encompass fewer, more unambiguously prescribed objectives, with a description of the current circumstances. Some mentioned that the environmental objectives need to be detailed and to the point in and project managers should pay attention to such facts while designing management policies.

A mere10% of respondents divulged on the subject of proper implementation of the policies, recommending that adopting a practical approach was indispensable and that risk management policies should be implemented in an economical way by the project management authorities. A sustainable strategy needed to reflect on delivery aspects and importance should be given to development processes, control, regulation and best practices should be highlighted in order to allow clients to help in the strategy implementation process. Performance assessment and the aptitude to rework goals and objective were also suggested by some as a crucial factor.

Q: Does the construction industry have views on the implementation of construction and planning benchmarks consistent throughout the economy to foster the sustainability of development processes?

Analysis: There was a general consensus reached from the responses received that construction and planning benchmarks acted as an indispensable driver towards shaping up a sustainable built infrastructural environment in the United Kingdom. Some put forward the opinion that the central administration should also get involved and present fiscal inducements to property proprietors and constructors to function, preserve and enhance their build environments. A significant concern surfaced from the responses relating to the instantiation of various local standards throughout the nation, implemented by means of the planning policy, which was confounding and drove up the outlay of construction projects. Nationwide standards, in lieu of local benchmarking, were a much more desired fashion of moving in the forward direction. Some of the respondents suggested that project managers should embark on strategies that take into consideration the connection between benchmarks, guidelines and various other Government directives. The strategy needs to provide a framework which would help developers and contractors to form a clear picture of planning criterion. The framework has to explicitly lay out the countrywide minimum needs and what is expected in addition to these minimum necessities for each designated location. Many suggested that improved mandatory construction and planning benchmarks would provide a fair playing field wherein superior quality development tenders would be promoted. Intervallic review of the benchmarking standards necessitated a predetermined scheduling would facilitate the developers to carry out the essential research and embark on an efficient product development process. Some respondents were also of the opinion that “Inter-operability” between the various components of the construction process should be plainly visible and project managers should pay heed to such facts. A sophisticated guideline should be laid out by project manager while designing strategies which would facilitate the implementation of the same. This guideline should point out clearly the functions and responsibilities of every component at all phases of the construction initiative. However, some respondents argued that the planning management should not be employed to encourage sustainability. For example, putting in specifications of a building’s possible carbon emission levels would necessitate momentous investment initiatives prior to planning approval and consequently would add to development expenses.

Q: If you correspond to a division of the construction sector, what measures could your organization employ in order to enhance specific aspects of sustainability which could help in dealing with environmental risks and dangers?

Analysis: Around 30% of respondents asserted that they would possibly embark on explicitly defined obligations to enhance the sustainability of the construction industry so as to deal with environmental risks more effectively. Several professional outfits were prepared to accept regulations corresponding to membership standards, encouragement of prospective ideas and sharing of information amongst each other, instituting professional benchmarks and commitment to the delivery of research. Various organizations took explicit pledges relative to procedures, efficiency of extant products and the sustainable conceptualization of new products. Some of the respondents also assured that they were ready to make specific commitments but needed time to consider an absolute strategy ahead of suggesting comprehensive ideas.

Q: How can an effective sustainable strategy be upgraded to remain relevant in the future?

Analysis: Majority of the respondents felt the need for a strategy to be monitored and rejuvenated periodically so that it remained relevant in the future and that a strong liaison amongst governmental bodies and the industry stakeholders should be development and upheld in upcoming times. Some responses seemed to propose that advancement should be audited separately and a variety of organizations and individuals were eager to be affianced in prospective reviews. Opinions on the regularity of review initiatives varied from continuous / organic review mechanisms to a major overhaul once in a span of seven years time. However, the average time period between two review initiatives as suggested by the respondents was calculated as 2-3 years.

Procurement

Q: What specific measures could the construction industry adopt to successfully implement sustainable environment management strategies and acquire project tenders in a more sustainable manner?

Analysis: A significantly large section of the respondents asserted that the procurement was a subject for contemplation for clients. Some respondents even went up to the extent of saying that the construction industry had a negligible role to play in this issue. Nevertheless, several responses indicated that respondents perceived that the effective delivery of the Egan integration agenda could be a major contribution the construction industry could make. Some responders believed that the central Government could offer leadership in this context with some recommending that public funding should be made conditional on effective integration and based on the whole life costing of the projects and sustainable procuring of goods and raw materials. Some responses pointed out the intricacy of explicitly describing either sustainability or whole life outlays or value of the involved projects. Some also held a view that there should be two discernible strategies – one pertaining to new build and the other in relation to refurbishment/renovation work. Several respondents greeted the inclusion of the concept in relation to offsite construction processes and perceived this as a critical means through which more sustainable construction mechanisms could be adopted and effective output could be delivered. However, a thorough evaluation of the responses revealed that apprehensions were articulated with regards to the timber target in light of the non-existent goals relating to other materials. The significance of whole life costing was highlighted in terms of the industry’s prospects through the responses. Quite a few responses drew attention to the focusing on preliminary costs as being a major obstruction to the shaping up of a sustainable industry. There were recommendations that companies operating in the construction industry should work in conjunction with central Government to institute a few obligatory / standardized overtures regarding the Whole Life Costing (WLC). Some also justified a greater need of Corporate Social Responsibility (CSR) / environmental awareness / environmental risk management in procurement related decision making processes. The requirement of making sure that the construction industry and its consumers possessed the necessary skills to comprehend sustainability properly in the procurement context materialized in some responses.

Design

Q: In the draft strategy it was suggested that all projects with a projected expense estimates beyond £1 million should make use of the Design Quality Indicators and Building Research Establishment Environmental Assessment Method (BREEAM) or equivalents and attain an ‘excellent’ rating in such evaluation initiatives. Is such a proposal stretching, realizable and practical? If not, then kindly suggest an alternative. Which organizations should be accountable for the realisation of such proposals?

Analysis: There were a wide range of responses for this particular question and no apparent consensus was evident in relation to this proposal. Some believed that the proposal was unsatisfactorily challenging and some others regarded it as unattainable. Many respondents raised questions about the appropriateness of the proposal, with several respondents stating that it was at time quite tough for rural constructions to procure an “Excellent” rating in the BREEAM evaluation. Some also brought out the problem of transparency of the BREEAM rating and how its effectiveness could be evaluated in view of the fact that the appraisal initiative was supposed to be confidential between the purchaser and the evaluator. Others believed that BREEAM did not take account of social aspects. Apprehensions were also expressed in relation to whether a classification based on the £1m threshold was suitable for every type of construction initiative.

Q: In the previously proposed actions which one do you regard to be a priority from the business’s perspective and why? What are the obstacles faced in implementing such measures and how can they be prevailed over? What role should the project manager assume in implementing such measures?

Analysis: In relation to this particular question respondents considered it inappropriate for managers to make priorities their centre of attention in view of the fact that measures for a sustainable risk management initiative required effort across a broad spectrum. Some of the others professed a solitary dedicated course of action. Some respondents raised the issue of problems arising in relation to evaluation of design quality. The three most significant priorities acknowledged by the respondents were: supply chain involvement or integration at an early stage of the project; requirement for better Design Quality Indicators (DQIs) and BREEAM and other such evaluation initiatives; and necessity of client involvement to provide an impetus to the process. There was practically no discussion about how contractors may foster the implementation initiatives like those of DQIs more efficiently even when issue being more clients oriented. There was a significant part for the state-owned outfits as client and capacity for employing enhanced regulations to encourage the adoption and implementation of BREEAM benchmarks. A few respondents believed that the supply chain activities and the functioning of integrated groups should be heeded to a greater extent instead of the client / designer connection. The progressing concentration on preliminary expenses instead of whole life costs was perceived as decisive factor. In the publicly owned front, the division between capital spending and operational financial plans characterised the subject matter. Shortage of knowledge sharing mechanisms amongst professional in the field could give rise to incomplete and confusing recommendations and guidance.

People

Q: If you concur that the proposed decisive measures and deliverables encompassed by the People Agenda in the draft strategy covers the central priority issues to deliver sustainability and reduce risk events for the construction industry, what precise work streams and objectives would facilitate the delivery of such commitments?

Analysis: Majority of the respondents, including responses from Construction Skills, decided that the proposed critical measures and objectives laid down in the draft strategy sufficiently covered the primary priority issues. However, no substantial discussion was observed during the analysis of the responses particularly on the objectives. Some of the respondents explicitly avowed their accord while some of the others believed that they were unsatisfactorily challenging. Rejoinders were obtained from a wide variety of outfits such as Construction Skills, professional institutes, trade organizations, large scale companies and colleges, in addition to a blend of several other organizations. A small amount of common threads could be recognized. Some respondents presented views relating to the capacity of the People agenda in the draft strategy and the significance of engaging consumers, broader communities and the common public in development and planning initiatives. A number of respondents asserted that the issues dealt with by the People agenda concentrated excessively on trade competencies and could be more beneficial if the requirements of experts and designers in the field and broader restoration issues were heeded to a larger extent. The function of the professional establishments was viewed as a significant factor by some. Security of the workforce in the work environment and that of the common people living in adjacent areas of the project site also emerged as an important issue when contending with risk and danger incidents.

Q: Do you concur that the work streams and objective and risk identification and mitigation processes should be peer reviewed by industry professionals and consultants, prioritised, and that specific course of actions should be determined to carry the superlative ideas forward?

Analysis: This question seemed to attract overwhelming approval. Majority respondents specifically mentioned names of certain bodies that may be engaged in a peer review initiative– e.g. the Academy of Sustainable Communities and various other industry specialists.

Regulations

Q: In this section kindly provide information on particular sections of legislative issues which may be obstructing your capacity to implement more sustainable practices in your business operations and executions.

Analysis: Under this issue majority of the respondents seemed to support enhanced and simplistic regulatory controls. Quite a few responses emphasised on the significance of more valuable planning and Construction Control and enforcement mechanisms that facilitate the effective delivery of change, attain clarity, certify compliance and result in enhanced industry standards. Some of the respondents regarded the UK waste management policies to be excessively multifarious, especially for the SMEs, and that it is essential to achieve superior clarity in the characterisation of waste handling processes and existent licensing procedures, recycling and reprocessing issues. Some respondents believed that there was a constructive responsibility for regulations to outline and boost standards, while producing a phase of certainty within which the industry could become accustomed to its procedures and create products compliant with the new paradigms. Some also asserted that regulations should be balanced by other efforts like financial inducements to promote innovation. Some of the respondents were of the opinion that framing a sustainable strategy compliant with environmental standards was an occasion for project manager to develop a plan of action to transform things and carry the best values forward. Several contributors to the industry, foundations and trade organizations were dedicated to this transformation. They expected Governmental leadership to stipulate a framework for alterations to which the industry could commit easily.

Climate Change

Q: What are there measures that should be taken to aid the construction industry to confront the issue of climate change?

Analysis: Even though a broad range of recommendations were presented by the respondents to this particular question, the most of the responses (approximately 75%) revolved around just a few fundamental themes. Several responses affirmed that the present stock of constructions (predominantly domestic, but there were some indications towards non-domestic construction as well) required to be enhanced and needed remodelling work. However, there were only a few proposals with regards to how this initiative is to be realized. The spotlight was on recuperating energy efficient effectiveness of such constructions, instead of being on adaptation. Nearly 7% of the respondents insisted on the institution of climate change alteration goals and objectives. Respondents advocated the endorsement of certain specific technologies, for example, the generation of energy from renewable sources; use of environment friendly ‘green’ products, in some cases with higher thermal mass; or modernisations to make construction initiatives more flexible to prospective climate change. A number of respondents pointed out the importance of simple and unambiguous descriptions on certain issues such as Zero Carbon and carbon neutrality by the authorities. Several responses recommended the instantiation of a benchmark for carbon counting. Other issues which received the attention of the respondents were: a necessity to deal with embodied energy in carbon footprints; a requirement of paying attention to non-domestic construction initiatives; restructuring the planning process; funding more research initiatives; and infrastructural contemplation.

Water

Q: In relation to water management what are the issues that need to be covered by a comprehensive sustainable strategy? What are the goals, objectives and milestones that you would suggest?

Analysis: Approximately 20% of the respondents believed that Sustainable Drainage Systems (SUDS) was capable of make a vital contribution to surface water management initiatives. Nearly 50 percent of those who talked about SUDS unequivocally supported discussions on the prospective development and enhancement of SUDS. A small number of respondents (7%) pointed at issues on the subject of the long term imbursement and maintenance expenses needed for effective operations of SUDS. A variety of other indications concerning SUDS were also propped up, counting the recommendation that its operations should not be confined to the urban precincts. Rain and grey water gathering and processing mechanisms were endorsed by nearly 10% of the rejoinders, some of which preferred overtly defined objectives for their implementation. Only a few of responses affirmed that the Government should promote conscientious use of water resources more efficiently. Some of the respondents were also in favour of water metering, the initiations of reduced flow and measures to deal with leakages in the water distribution channels.

Biodiversity

Q: In this section kindly state what you consider would be helpful for project managers working in the construction industry to uphold the principles of maintaining and improving biodiversity in construction initiatives.

Analysis: Almost one thirds of the replies to this question mentioned the significance of functions of the planning mechanism in guarantying that project managers reflected on the issue of biodiversity while embarking on new development initiatives. They affirmed that managers may be benefited from the better utilization of the Planning Gain Supplement – or of Supplementary Planning Guidance – in putting green infrastructure efforts into practice. Just more than a quarter of those who responded highlighted the role of the project managers under the context of necessity of creating an awareness about biodiversity aspects and the importance of education and training across the supply chain to enhance understanding of how each project or initiative could add to biodiversity and the shaping up of public green areas. Some respondents also suggested that project managers should develop a strategy that should recognize the significance of a green built infrastructure in conveying a wide variety of social, ecological and economic gains. Rarefying storm water overflow by means of the utilization of green roofs and green expanses was, for example, viewed as a significant constituent of sustainable societies. To comprehend its full potential, deliberations concerning the green built infrastructure were required to be taken into consideration in development initiatives right from the beginning of the project.

Waste

Q: Are the objectives, goals and schemes for waste management in the draft strategy practical, attainable and adequately motivated over the time frames visualized? If not, then kindly recommend other options and exemplify who should be accountable for their execution.

Analysis: The respondents put forward a wide variety of judgments concerning the viability of the objectives and goals proposed in the draft strategy in relation to waste management. A significant number of respondents regarded them to be apposite and attainable objectives while only a few judged them as unachievable. However, the extent of support varied across specific targets. The idea of zero net waste attracted a strong level of interest from the respondents. Nevertheless, respondents recommended that additional analysis was needed to produce a practical exemplification and a realizable target. Some of the responses raised questions about the aptness of an “offset” objective while others mentioned that a more dependable supply of reprocessed content material would be required to make this objective viable. A few respondents also recommended the fragmentation of the objectives on a sectored basis. Some expressed apprehension concerning the realization absolute zero and whether or not would it present environmental advantages if it meant the transportation of waste material over long distances. Numerous suggestions were received with regards to the actions required to facilitate the realization of such targets, e.g. a precise and detailed objective for the designers; the requirement for supplementary waste infrastructure facility; inducements to industry to empower technologies and processes instead of investing elsewhere.

Materials

Q: Do you concur that the objectives and goals proposed in the draft strategy for materials will be able to bring about enhanced resource competence with subdued ecological and societal impacts, and are adequately ambitious? If not, then kindly put forward other substitutes which you think would be effective.

Analysis: Majority of the respondents considered the goals and objectives were rational, even though some expressed apprehensions about timeline targets. Some raised questions about whether the objectives and goals set would provide an impetus to enhancement efforts in performance. Some responses cited that if the objectives were actually put into practice, a framework should be established to track performance variables, considering the continuing research work on sustainability of materials. Phased implementation initiatives and short-term landmarks were also recommended as an approach of making the objectives more attainable and effectual. Some also suggested inducements for manufacturers, contractors and developers to promote a superior market demand for more sustainable goods and materials. Other recommendations included: a milestone for reprocessed content; more extensive utilization of Life Cycle Evaluations; and the necessity to subsidise SMEs.

Innovation

There were no questions specifically in relation to innovation. However, quite a lot of comments were made by respondents regarding Innovation and these are summed up below:

Support for R&D or Knowledge Transfer: Some respondents believed that sustainable construction may not provide direct impetus for transformation within the construction industry as its fiscal advantages may be more long-term or latent. Certainty to a larger extent on funding channels for developers and consumers would facilitate sustainable product development.

Innovation Measurement: Respondents believed that some amount of work was required to explain “innovation active” in the background of the construction sector and there was need to instantiate ambitious benchmarks and milestones acknowledged and accepted by the entire industry.

Learning from overseas: Many respondents asserted that the UK construction industry could largely benefit from better awareness of overseas procedures.

Regulation and standards: Some respondents also suggested that Construction Regulations should aspire to be more outcome-oriented and non-authoritarian to facilitate innovative practices.

Conclusion and recommendation

Conclusion

Project managers working across the Construction vertical need to develop advanced risk-management skills in order to bid for long-term success in the industry. When considering the environment through an all-inclusive perspective, it may be undoubtedly said that it has a profound influence on every organization existing in the society. The risks pertaining to the general environment can be broadly fragmented into two different categories. The first category relates to the physical environment whereas the second component falls under the political, social and economic bracket. From the physical outlook environmental risk encompass meteorological factors such as the weather, wind speeds, atmospheric conditions, and other naturally occurring phenomena such as floods, landslides, and earthquakes. These can have a momentous influence on the construction approach and has an effect on all the processes involved in a construction project. It is obvious that such physical environmental risks cannot be controlled. However, risks that crops up can be and should be identified beforehand, and provisions should be kept so that the adverse effects can be mitigated. On the other hand, from the political, social, and economic point of view, the environment can be controlled to some extent but not completely. The central government is capable of controlling happenings in the U.K economic arena. However, it does not have the power to completely manipulate the world economic markets. The rapidity of change, which is at an all-time high, characterizes the political, social, and economic environment. Such an environment pertaining to the state of affairs in the U.K political and economic arena is controlled by the government. However, several industries, corporations, and businesses are susceptible to government environmental policies.

Less conventional environmental risk elements such as weather, expenditure on materials, labor availability, project finances, cash flow, worker protection, subcontractor performance, and regulatory approvals cannot be controlled but all the same, have to be effectively managed. The construction industry undergoes transformations frequently and repeatedly exposes project managers and the operational activities of a project to fresh risk-management challenges. One alteration that commenced in the 1990s was the enhanced focus on sustainability and respect for environmental regulations and green values, and many businesses in the construction industries have not completely risen up to the occasion. Frequently disregarded is the daily risk of expensive regulatory enforcement measures or lawsuits due to not complying with project site environmental requirements. Project clients, particularly in state and publicly subsidised projects, have started insisting on healthy environmental history as a precondition for tender submission for construction companies aspiring to procure projects.

Role of Project Managers and the Companies

Project managers are generally entrusted with the responsibilities of designing strategies to manage the environmental risks in order to circumvent regulatory penalties, court cases and the long-term risks linked to negative environmental records. By developing a sustainable strategy managers can even turn obligatory regulatory compliance initiatives into a competitive advantage.

A top level corporate dedication to regulatory compliance is also essential in this regard. Businesses lacking a comprehensive corporate policy to deal with environmental standards compliance exhibit a wide range of discrepancies with regards to the extent of compliance among different projects which is detrimental to the entire business. Overlooking environmental compliance on just one phase of a project can be an incredibly expensive oversight as it may lead to several complications in a later phase of the project in addition to legal difficulties. Business environmental strategies should result in a standardized approach for unswerving compliance across all project sites. If there is a dearth of this top-level corporate dedication, there is little or practically no impetus for project site personnel to adhere to environmentally friendly practices which may be disastrous over the long term.

Project managers should also institute a strong accountability mechanism. These systems need to make certain that the environmental conformity strategy is implemented across all project sites. Effectual accountability systems must begin by documenting realistic performance-related expectations, exemplifying comprehensible functions and responsibilities, and instituting a standardized approach to evaluate and report on performance levels. The responsibility should continue to be effective at all times in order to facilitate a proper reporting mechanism to the upper management with regards to performance feedback which should be aligned with corporate expectations.

A small number of organizations have an established political framework that promotes efficient internal self-monitoring and an impartial reporting mechanism. Covert politics that may not be apparently perceptible can time and again impinge on internal compliance reporting systems and can possibly bring about uncertainty in relation to the precision of the evaluation results. This destabilizes the basis of the accountability mechanism. The most effective accountability evaluation results can be attained when the evaluation is carried out by an external entity having no political stake in the evaluated organization. Project managers need to be convincingly certain that compliance performance information is being correctly reported in order to facilitate suitable responses which need to be communicated to the project teams. When project managers on a regular basis provide feedback to the workforce founded on realistic performance variables in sync with corporate expectations, it generally leads to remarkable performance enhancements. With efficient accountability mechanisms in position, the workforce is naturally encouraged to enroll for the training initiatives in order to gain knowledge and develop skills that are necessary to meet or exceed corporate expectations. Subsequent to this organizations are required to make arrangements so that the appropriate training is made available to those who require it. The most typical reaction of companies after they get into compliance-related difficulties is to force underperforming employees to focus on training initiatives as a damage control measure. This method hardly ever produces the desired consequences and does not treat the problem at its root, which is frequently a lack of unambiguous and plainly understandable performance objectives and effectual corporate accountability.

Project managers should also make sure that a standardized compliance guidance system is implemented effectively across all levels of the company. A consistent system should effectively communicate corporate expectations, explicitly describe functions and responsibilities and provide the fundamental information and instruments required to develop and uphold project compliance. Instantiating such a mechanism is not that complicated, in view of the fact that nearly all environmental regulations are rooted in governmental policies, with only slight modifications for state or local ones.

A further measure that a company can implement is to engage itself in environmental excellence initiatives and lift the minimum compliance to a standard level that gives the company a competitive edge in the markets. These initiatives typically necessitate the development and implementation of a sustainable environmental management system (EMS). However, putting an EMS into practice effectively, can sometimes be burdensome and entails an extremely high degree of corporate dedication.

Risk Evaluation

In conjunction with the proper scientific evaluation of the possibility and scope of adverse effects on the environment, the implications of a recognized risk factor is required to be founded as a base for effective decision-making. To make sure that the yields of a risk assessment process effectively facilitate the decision-making process some questions should firstly be answer. Some of the important questions are:

  • What are the ways in which the environment may be impacted?
  • What level of damage can these impacts cause to the environment?
  • What is the probability of these impacts arising in reality?
  • How often and under which condition could these impacts become apparent?
  • How reliable are the outcomes of the risk assessment process?
  • What are the crucial data gaps and can these shortcomings be reduced?
  • Are additional iterations to the risk assessment process essential?

Appraising the implications of a risk also entails recognizing the broader significance of the difficulties on account of the risk event from the social, political and economic perspective. Subsequent to such assessments being carried out in relation to a risk’s tolerability, judgments can be made on the subject of how to mitigate or deal with the risk.

For most operative scenarios it is possible that more than one threat would be uncovered. For every individual threat condition, the evaluation likelihood of the impacts and the scale of those impacts acquiesce gives an estimation of the risk event. Both factors are expected to be semi-quantitative and consequently each of the elements will in some measure characterize decisions on the strength of the information and experience available.

A simplistic matrix can present a reliable foundation for the decision-making process. It should certainly be made use of with prudence, acknowledging the simplified consideration that it will usually correspond to. The likelihood and impacts are described in keeping with the paradigms pertinent to the state of affairs; the confines of risk tolerability (and permissibility, where applicable) specified on the matrix can be customized to the features having an effect on the implications of the risk. Particular conditions are mapped onto the matrix to facilitate an organized and dependable denotation of their acceptability or permissibility.

Figure 7.1 Estimation of risk from consideration of magnitude, consequences and probabilities
Increasing acceptability Consequences
Severe Moderate Mild Negligible
Probability
High high high medium/low near zero
Medium high medium low near zero
Low high/medium medium/low low near zero
Negligible high/medium/low medium/low low near zero

Statutory and Policy Requirements

A broad spectrum of benchmarks for pollution control are present in the United Kingdom including emission standards, ecological quality standards, exposure criterions, process or functioning standards and product benchmarks. Evidently if such standards are legally obligatory and a risk evaluation process reveals that a planned activity may probably violate them, the risk is deemed to be objectionable and actions to deal with it to bring it within an acceptable range needs to be taken. There is a sizeable quantity of statute laws and several policy goals that may have an effect on the implications of a certain risk event. Conditions not encompassed by legislation, or where the course of action is to look for environmental enhancements beyond those desired by decrees, objectives should be laid down by means of an extensive socio-economic examination in conjunction with proficient judgement, bearing in mind the societal demands which heavily influence policy or political pronouncements.

Value Judgements

Determining what amounts to undesirable impairment to the environment is a complicated undertaking and eventually hinges on what standards the society consigns to environmental ideals. Some are of the opinion that responsibility for preservation of the environment is the primary idea behind such initiatives. Upholding the integrity of the environment, at local as well as universal scales, is without a doubt central to the preservation of an ecosystem which supplies the resources and surroundings essential for the survival and growth of the human race. The conservation of biodiversity in itself has attracted a substantial amount of contemplation in the past few years and numerous points of view have been expressed endorsing such ideas. Some habitations and certain genus are regarded to be of significantly high value with regards to environmental conservation, as a consequence of value judgements prepared by reason of uncommonness, beauty, fragility and so forth. The UK administration has embarked on priorities and policies in terms of biodiversity preservation through the UK Biodiversity Action Plan. These are strengthened by national edicts realizing the ideas of the EC Wild Birds Directive and the EC Habitats Directive.

Social Aspects of Risk

The tolerability of a risk incident can be drastically shaped by a wide variety of psycho-social and political issues. These may incorporate certain individual risk discernments and viewpoints, cultural and traditional philosophy, issues of conviction and integrity about risk proponents and supervisors, and issues relating to equity in risk sharing. Even as risk management judgments should be rooted in the best systematic data obtainable, these features should also be taken account of when assessing the implications of a risk event. A vital step is the development of a productive channel of communication linking stakeholders influenced by or interested in risk events.

Economic Considerations

Economic variables can have a profound influence on the deciding process in an event and could possibly have an effect on the adequacy of a certain selection. A case in point could be a settlement’s flood defence mechanism. There are building and repair overheads related to every flood safeguarding systems. There may perhaps also be overheads with regards to harm to the ecosystem by habitation removal or adaptation. While it may well in theory be possible to assemble a flood defence system that defends against a flood event occurring once in fifty years, the building and preservation expenses of such a plan are expected to be very high. In this regard, an Environment Agency could, consequently, give consideration to a proposal to save from harm against a more recurrent, nevertheless a less damaging occurrence, for example, flood event occurring once in ten years. While the building and preservation expenses of such a proposal would be substantially lower, the expenditure with regards to harm to possessions on account of more rigorous but less recurrent flood events could possibly be more significant than the monetary savings in building and preservation overheads.

The most suitable option is probably the one which demonstrates the possibility of the maximum excess of gains over expenses, where the advantages are those build up from security (e.g. the impairment or loss of belongings, materials, harvests, individual health conditions and environmental resources that is circumvented) and the expenses are those social and individual expenditures on the control variables, comprised by that of building, preservation and environmental harm. This should incorporate both those advantages and expenses that can be expressed in terms of monetary value and those that cannot (or for which strong fiscal appraisal are not easily obtainable). Those considerations which cannot be easily quantified in economic terms are required to be evaluated by making use of physical and qualitative measures. Because economic values can more easily be allocated to some impacts in comparison to others, substantial amount of consideration is essential to make sure that any decision-making process or activity involves sufficient contemplation in relation to all items which cannot be assigned economic or monetary worth but may be perceived as significant factor, proportionate to the monetised components.

The Changing Environment and Changing Baselines

Baselines across which different risk assessment conditions can be evaluated are expected to undergo substantial alterations in course of time. Shifting baselines may be the consequence of a varied assortment of issues including, for instance, climate change, continuing urbanisation, demographic alterations, and transformation in social approaches towards risk tolerability and progress made on the technological front which are readily available in order to deal with risk occurrences. This can give rise to a fresh group of provisos against which extant risks and administration initiative should be evaluated and transformed if required. It may be said without doubt that the prospect of such amendments can have an effect on risk implications and should at all time be meticulously taken into account.

Final Verdict

The environmental concerns for the United Kingdom construction industry have emerged as a signification cause for contemplation in the recent past. From the research work conducted in course of presenting this dissertation it has been observed that environmental risks not only pose a threat to the surrounding project environment bust also threatens to inflict disasters upon the business itself. In this regard, project managers need to play an important role by developing effective and sustainable strategies to offset the environmental threats and lead the industry into a new era of a greener, healthier and better construction practices.

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