Factors Affecting Risk Management in Developing Countries

1.INTRODUCTION Risks are present in all parts of the construction work regardless of size, resources, funds etc. Since each construction project is unique and dynamic, the construction performance presumes several uncertainties about the complexity of the construction project (Chandra, 2015). Risk management suggests that risks should be distributed to minimize their harm since they cannot be completely eliminated, which would have been the easiest option (Szymański, 2017). To amplify the profitability perimeters of construction contracts, it is wise to assess and evaluate the possible positive risk factors(Chandra, 2015). Identifying, classifying and assessing potential risk factors that may affect the functioning of projects is prudent. Therefore, the focus of this research is to identify the harmful characteristics of factors encountered along with the risk management of the progress of a project. A handful of researchers looked at the risk management procedure in a specific project phase, such as conceptual and feasible phase, construction phase and design phase, rather than from the point of view of the project life circle (Rostami & Oduoza, 2017). Recognizing external and internal risks of construction projects is imperative in order to properly record unpredictable incidents of construction projects. Various risk recognition and further risk assessment processes reduce the pessimistic influence of risks and expand efficiency and productivity in business (Motiar Rahman & Kumaraswamy, 2002). Consequently, to articulate and manage key risks related to construction projects, this paper introduces the results of a thorough review of the literature and seeks to draw attention to the major factors affecting risk management in developing countries. 2.LITERATURE REVIEW Projects and organizations are full of unpredictable situations in our daily life (Olsson, 2007) representing an obvious problem for the construction business (Vallabh Vidyanagar). The topic of construction risk management has been the subject of several research works. Some of the earliest researchers to structure construction risk tests was Chapman and Cooper (C. Chapman & Cooper, 1983). Their research resulted in a risk engineering approach that led to many useful risk management tooling techniques (Jarkas & Haupt, 2015). Risk management as defined is a risk recognition and assessment procedure, then applying methods to minimize it to a reasonable extent (Tohidi, 2011). After Edward and Bowen (Bowen, 1998)research on construction risk management issued in the early years of 1960-1970 to notice shortages and inconsistencies in understanding and conducting towards construction risks. The results suggest that social, financial, economic and political risk factors deserve more attention as far as research is concerned compared to other factors such as occupational health and safety and quality assurance. (Al-Bahar & Crandall, 1990) conducted research and categorized risk factors in construction in 6 classes, one of which was financial risk. Financial risk suggests that a construction company may fail to meet its financial targets, so it is a potential for financial instability that could lead to severe loss and uncertainty about its extent. The past / earlier author identified that inflation, improper cost plan, industry recession, cash flow availability could increase financial risks 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(Edwards & Bowen, 1998; El-Sayegh, 2008). (Ameyaw & Chan, 2015) recognized laws and regulations as a risk management factor in construction. Legal and regulatory risks are risks that the production targets of construction firms will be enforceable as they cannot meet the country's legal and regulatory standards. 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(Assaf & Al-Hejji, 2006; Barlish, De Marco, & Thaheem, 2013) observes that a delay in the construction project could result if this factor is not addressed. (Tadayon, Jaafar, & Nasri, 2012)in the Iranian Construction Risk Identification Assessment, notes that frequent changes in statutory regulations affect risk management in construction. (Zou, Zhang, & Wang, 2007) after conducting a survey in Chinese construction states that it takes a long time to obtain legal and regulatory approval, hence it is essential for project members to maintain good relations with government officials. (Szymański, 2017) identifies natural and environmental risks as a threat to construction risk management, the previous / earlier author noted that natural risks are environmental risks and cannot be anticipated. Natural risks are a natural phenomenon that sometimes has a negative impact on people or the environment, examples of such are classified as meteorological and geological phenomena, under these two we have earthquakes, floods, landslides, wildfires, cyclone storms, etc. Air pollution, spread of diseases, land degradation, water pollution, natural disasters are a threat in Nigerian constructions(Akinbile, Ofuyatano, Oni, & Agboola, 2018). (San Santoso, Ogunlana, & Minato, 2003) conducted a survey in Jakarta and recognized design issues as a factor affecting construction risk management. Design risk is the likelihood of a design being unsuccessful to meet a project's requirements. Included are designs that are unsound, inefficient, unstable or just not attaining customer standards(R. J. Chapman, 2001). Design is a stage which forms the backbone of the project(Szymański, 2017). Szymanski further states that at the design stage we have risks such as improper designer selection, the risk of overestimating the cost of the project. Giving design to unqualified planners and defective designs is a threat to risk management, states (Enshassi, Mohamed, & Abu Mosa, 2008)after conducting a survey in Palestine. (Wiguna & Scott, 2005) identified the owner's design change as one of the factors affecting the risk management of Indonesian construction. (Z. Wu, Nisar, Kapletia, & Prabhakar, 2017). Further research on the project success of the Chinese construction industry identified inadequate program scheduling, inadequate site information, as factors affecting risk management in construction. Both(Sharaf & Abdelwahab, 2015)and(Mhatre, Thakkar, & Maiti, 2017) noted that design drawing errors are a serious threat to a project,(Mhatre et al., 2017) further identified poor construction plan, inappropriate design, and poor engineering as design risk factors. After reviewing the literature on factors affecting risk management, the researcher identifies political risks as one of the major factors affecting risk management in construction(Matthee, 2011). The earlier / past researcher defines political risks as the risk that an investment's profit might suffer as a result of changes in policies or instability in the country. (Goh & Abdul-Rahman, 2013) Country economic instability, risk of inflation, risk of recession in industry and disagreements among funding parties, etc., are highly impacting factors identified by the previous / former author. (Sharaf & Abdelwahab, 2015)State that political changes, frequent change of government, protests for change of government and disputes between political parties are also factors to be recognized. Furthermore (Deng, Low, Li, & Zhao, 2014)and(Famiyeh, Amoatey, Adaku, & Agbenohevi, 2017) emphasize that the major risks at the top due to political differences and economy are currency infatuation, changes in tax rates, changes in security officials, workers strikes and fire risk. After a survey in Ghana (Famiyeh et al., 2017) identified government pressure, inspectors, government bureaucracy to obtain license conflicts as major factors affecting risk management under political risks. (Enshassi et al., 2008) conducted a survey in Palestine and found that frequent border closures as a political factor affect construction progress. The findings revealed that safety risk falls under risk management factors(Hallowell & Gambatese, 2009). (Aminbakhsh, Gunduz, & Sonmez, 2013). Safety risks are defined as the likelihood that a person or machines under construction may be harmed if they are a person who may suffer adverse health effects if they are exposed to a certain hazard. (Hwang, Zhao, & Toh, 2014) also identified safety and health as a factor affecting construction risk management. More so after categorizing risks into major classes Safety and health were among them (Ghosh & Jintanapakanont, 2004), justifying how serious an issue this factor is following a survey in Malaysia (Goh & Abdul-Rahman, 2013)accidents were recognized as a major threat in Malaysian constructions. Older researcher on Palestine noted that workers were working in dangerous areas, putting their lives at great risk(Famiyeh et al., 2017) states that inadequate safety equipment for workers also put employees at enormous risk. Old