Investigation of project risk management practices in the construction industry in Ghana.

Abstract

The construction industry is one of the most dynamic, risky, and challenging businesses. The number of risks present invariably goes beyond those found in other industries. The research was conducted with the aim of developing an effective risk management guide for building construction projects in the Central and Greater Accra regions of Ghana. Purposive sampling technique was used to select ninety (90) participants that were made up of clients, contractors and consultants of on-going projects for the study. Three instruments (Observation, Questionnaire and Interview) were used to illicit information from the participants. Twenty-five risks were identified and categorized into ten main categories. For each of these risks, relevant mitigation strategies were also proposed. Findings of the research revealed that Economic, Financial and political risks have the greatest influence on construction projects in the Central and the Greater Accra Regions of Ghana. Moreover, there is a serious lack of risk management knowledge and expertise among all the three key categories of actors. The conclusion drawn from the evaluation of risk management strategies was that due to high volatility of the economic situation of the country, reactive risk management is practiced more than proactive risk management. Moreover, employment of contingency theory for managing situations has been stated to be unique for each particular situation and therefore the situation should be defined in order to refer to a more specific concept. The study recommended among other things that utilization of contingency plan needs to be made more explicit in the theory. A thorough feasibility studies should be undertaken before any project is done. Key words: Client, Contractor, Consultant, Construction Risk, Contingency theory. University of Education,Winneba http://ir.uew.edu.gh