RICS RISK ChECKS

1. Risk Management in
Construction
Course Code : AUMCM704
MBA CPM
Semester 4
2018-19

2. Risk Checklist of a Building Project
Module - 2 Risk Assessment and
Approaches
► A checklist is a list of item, event, factors before
proceeding towards further activity.
► Similarly, probable risk factors and events are arranged
and consolidated in form of a checklist.
► For different projects, customized checklist should be
prepared pertaining to the characteristics of that project.

3. The following list is indicative for Building project:
Module - 2 Risk Assessment and
Approaches
1. Project scope
2. Design and specifications
(D&S)
3. Quality
4. Time overrun
5. Cost overrun
6. Leadership
7. Organisational network
8. Resource mobilisation &
utilisation
9. New technology
10. Contractual conditions
11. Force Majeure
12. Political, regulatory and
social conditions
13. Financial and economical
condition
14. Safety health &
environment
15. Funding failure risks
16. IT Department

4. 1. Checklist for Project Scope risk
Module - 2 Risk Assessment and
Approaches
Project
Scope
Risk
High
Complexity?
Project
Charter?
Possibility of
Change in
Scope?
Ill Defined
project
Efficient
Control
System?
Analysis of
Change
required?

5. 2. Checklist for Design and Specification risk
Module - 2 Risk Assessment and
Approaches
D&S
Risk
Adequate
design
information?
New
construction
technology?
Realistic
specification
s?
Design
changes?
Design and
practical
difficulties?
Non
standard
materials?
Poor GFC?
Conformance
to
national/local
specifications
?

6. 3. Checklist for Quality risk
Module - 2 Risk Assessment and
Approaches
Quality
Risk
Quality
assurance
plan?
Soil
investigation
?
Method
statement?
Quality
materials?
Trained
manpower?
Laboratory
for testing?
Impossible
quality
specification
?
Bad quality
control?
Reworks?

7. 4. Checklist for Time Overrun risk
Module - 2 Risk Assessment and
Approaches
Time
Overrun
Risk
Accurate
activity
Duration?
Unrealistic
schedules?
Incomplete
WBS?
No formal
sequencing
plan?
Allocation of
resources?
Assessment
of project
time, cost,
resources
Time
Overrun
Risk
Incomplete
quality
implementation
plan?
No database?
Ineffective
control system?
Inflexible project
plans?
Unsatisfactory
review
meetings?
Untimely
corrective
action?

8. 5. Checklist for Cost Overrun risk
Module - 2 Risk Assessment and
Approaches
Cost
Overrun
Risk
Inaccurate
cost
estimates
Inadequate
cost
planning &
control
No extra
work control
No analysis
of constant
change in
market
Incomplete
project
closure

9. LEADERSHIP
RISK
Sickness &
absenteeism
Unsafe working
conditions
Lack of co-
ordination
Poor liaison Information barriers
Internal conflicts
Lack of team
consensus over
project plans
Limited powers of PM Lack of senior management support
Poor relations Poor Communication
No project vision No team building
Poor motivation of participants Indecisiveness
High turnover of critical team
members
Unreasonable stakeholders
expectation
6. Checklist for Leadership
risk
Module - 2 Risk Assessment and
Approaches

10. ORGANISATIONAL RISK
Wrong selection of
project
management
No database
Unrealistic project
plans
Poor quality
control
Unsatisfactory
meetings
Untimely
corrective actions
Inappropriate
organisation
network
Poor task
allocation
Lack of competent
staff
No project
manual/documents
etc.
Complex project
for available
resources
Inadequate
communication
7. Checklist for Organisational risk
Module - 2 Risk Assessment and
Approaches

11. Module - 2 Risk Assessment and
Approaches
8. Checklist for Resource mobilisation & utilisation
risk
Resource Mobilisation & Utilisation Risk
Inadequate
resources,
Low
productivity
Low quality,
damage during
construction
due to
negligence
Non
availability of
resources,
sub-
contractors,
Special
requirements
Transportation
delays,
accidents,
wastage, theft
and fraud
Lack of safety,
hygiene
measures,
local
requirements

12. Module - 2 Risk Assessment and
Approaches
9. Checklist for Technology risk
Technology
Risk
Inadequate
information
of new
technology
Non-
replacement
of old
technology
Non-
availability of
competent
professionals
Lack of
managerial
skills

13. Module - 2 Risk Assessment and
Approaches
10. Checklist for Contractual risk
Contractual Risk
• Non-standard, inconsistent conditions
• Insufficient time to prepare bid tenders
• Delay in site possession
• Errors or omissions in BOQ
• Payments problem
• Extra work variations
• Unrealistic tendered amount
• No credit worthiness of contractor
• High cost of legal decisions
• Insufficient insurance and surety
• Incorrect documentation of claims and disputes
• Un-familiarity with local laws

14. Module - 2 Risk Assessment and
Approaches
11. Checklist for Force Majeure risk
Earthquakes Floods
Landslides
Ecological disaster,
Epidemics
Force Majeure
Risk
(Act of God)

15. Module - 2 Risk Assessment and
Approaches
12. Checklist for Political, Regulatory and Social risk
Political
Risk
Changes in
government
Policies &
Regulations
Rules & Laws
Revolution & Civil
disorder
Criminal law & law
of tort
Regulatory
Risk
Pollution &
waste treatment
Local regulations,
Licenses &
permits
Constraint on
labour heads
Import-export
restrictions and
procedures
JV rule &
Inconsistency in
regulations in
country
Social
Risk
Crime and
insecurity
Bribes and
corruption
Religious and
cultural conflicts

16. Module - 2 Risk Assessment and
Approaches
13. Checklist for Financial & economic risks
Financial
and
Economic
Risks
Investment risk,
inflation,
escalation of
prices
Exchange rate
fluctuation, local
and national
taxes
Inadequate
sources and
availability of
funds, cash flow
problems
Effect of time
and cost
overruns,
demand
scenario
Default
stakeholders
and suppliers &
changing market
conditions

17. Module - 2 Risk Assessment and
Approaches
14. Checklist for Safety, Health and Environmental risks
HSE
Risks
Unsafe working
conditions, non-
conformance to
statutory
requirements for
workers safety
Inadequate
healthcare and
environment
protection
Absence of safety
audits, security, fire
fighting
Disaster
management,
accidents/strike/work
stoppage and
workers’ perception

18. Funding
Failure
Risks
• Investors not comfortable with project viability
• Failure to arrange partners equity in time.
• High interest rate & Adverse investment climate
• Revenue shortfall & debt servicing risks
• Partners conflict, non-availability of finance from
lending institutions in time
Module - 2 Risk Assessment and
Approaches
15. Checklist for Funding failure risks

19. Communication and Network
Failure Risks
Loss of data due to network breakdown
No backup of data available
IT support not competent enough
Internet servers breakdown
Non compatible software
Ineffective Information Management System
No antivirus software
Module - 2 Risk Assessment and
Approaches
16. Checklist for Communication and Network Failure
Risks

20. Module - 2 Risk Assessment and
Approaches
An infra project such as Expressway encounter
following risks: