Risk Management

Question 1

What are the key points highlighted in the RICS guidance note on risk management?

Answer 1

The document highlights the following key areas:

• proactive risk identification
• collaborative communication
• contractual clarity
• compliance with legal standards

Question 2

What is a risk in construction?

Answer 2

In construction, a risk is any uncertain event or condition that could impact project objectives, leading to potential delays, cost overruns, or quality issues.

Question 3

What are the risk mitigation strategies?

Answer 3

risk avoidance,
risk reduction,
risk transfer,
risk sharing,
risk retention.

Question 4

What were the key points from the Arcadis CPD session on risk management?

Answer 4

• The learning outcome from this webinar was learning how best to manage client expectations and how to mitigate potential risk on construction projects.
• It also highlighted the importance of the risk register when managing the contingency allocation.

Question 5

How did you handle the risk workshop on the HTA project?

Answer 5

• I held a workshop with the project team to gather any potential risks that the project and ensured they were captured within the risk register.
• I then ensured that it was agreed between all parties which risks each would take ownership of so everyone was aware of their responsibilities.
• I also ensured that future meetings were put in place in order to review and update the risk register accordingly.

Question 6

What were some of the risks captured during the risk workshop and how did you propose to handle them on the HTA project?

Answer 6

• Risk to the programme of not having ownership of the building in time before construction.
• Site Conditions and the impact of not having the enabling works package completed prior to the main works construction.
• Supply Chain Disruptions with delays or shortages in materials and equipment can affect project timelines in Q3 of 2021.

Question 7

What is the purpose of the risk register?

Answer 7

• The risk register in construction projects serves to systematically identify, assess, and manage potential risks.
• It provides a structured document for tracking and mitigating risks throughout the project lifecycle, aiding in proactive decision-making and ensuring the project’s successful delivery by minimizing adverse impacts.

Question 8

Why only at stage 2 did you compile a risk register? how did you determine the 10% allowance during the early design stages on project X?

Answer 8

• During the early design stages, risk was allowed for with a contingency allowance as a overall percentage of the cost estimate.
• Contingency is a sum included within the estimate to cover unknown expenses or unmitigated risks during a project.
• As the design develops a risk register can be compiled with probability and cost impact assigned to each item which can then form the total project contingency.

Question 9

What was the impact on the Russia/Ukraine war on Project X and how did you tackle managing this?

Answer 9

• With the project already procured and a contract sum agreed the main concern was any supply chain disruption with getting materials on site.
• When the news became apparent we immediately put in a meeting with the contractor to discuss if they could see any risks within the supply chain that would impact the programme.
• The contractor explained that they could not foresee any risks however we chose to monitor this until project completion.

Question 10

What does NRM1 say about managing risk and contingencies?

Answer 10

It is recommended that separate allowances be made for each of the following:

• Design development risks:
• an allowance for use during the design process to provide for the risks associated with design development, changes in estimating data
• Construction risks:
  an allowance for use during the construction process to provide for the risks associated with site conditions
• Employer change risks:
  an allowance for use during both the design process and the
  construction process to provide for the risks of client driven changes.
• Employer other risks:
  an allowance for other client risks (e.g. early handover, postponement, acceleration, availability of funds, liquidated damages).