Towards a Better Modelling and Assessment of Construction Risk: Insights from a Literature Review

This paper reviews the literature of construction risk modelling and assessment. It also reviews the real practice of risk assessment. The review resulted in significant results, summarised as follows. There has been a major shift in risk perception from an estimation variance into a project attribute. Although the Probability–Impact risk model is prevailing, substantial efforts are being put to improving it reflecting the increasing complexity of construction projects. The literature lacks a comprehensive assessment approach capable of capturing risk impact on different project objectives. Obtaining a realistic project risk level demands an effective mechanism for aggregating individual risk assessments. The various assessment tools suffer from low take-up; professionals typically rely on their experience. It is concluded that a simple analytical tool that uses risk cost as a common scale and utilises professional experience could be a viable option to facilitate closing the gap between theory and practice of risk assessment.

A DST-based Approach for Construction Project Risk Analysis

Despite its huge potential in risk analysis, the Dempster–Shafer Theory of Evidence (DST) has not received enough attention in construction management. This paper presents a DST-based approach for structuring personal experience and professional judgment when assessing construction project risk. DST was innovatively used to tackle the problem of lacking sufficient information through enabling analysts to provide incomplete assessments. Risk cost is used as a common scale for measuring risk impact on the various project objectives, and the Evidential Reasoning algorithm is suggested as a novel alternative for aggregating individual assessments. A spreadsheet-based decision support system (DSS) was devised to facilitate the proposed approach. Four case studies were conducted to examine the approach's viability. Senior managers in four British construction companies tried the DSS and gave very promising feedback. The paper concludes that the proposed methodology may contribute to bridging the gap between theory and practice of construction risk assessment.