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1 Risk Analysis of the International Construction Project By: Paul Stanford Kupakuwana Cost Engineering Vol. 51/No. 9 September 2009 ABSTRACT This analysis used a case study methodology to analyse the issues surrounding the partial collapse of the roof of a building housing the headquarters of the Standards Association of Zimbabwe (SAZ). In particular, it examined the prior roles played by the team of construction professionals. The analysis revealed that the SAZs traditional construction project was generally characterized by high risk. There was a clear indication of the failure of a contractor and architects in preventing and/or mitigating potential construction problems as alleged by the plaintiff. It was reasonable to conclude that between them the defects should have been detected earlier and rectified in good time before the partial roof failure. It appeared justified for the plaintiff to have brought a negligence claim against both the contractor and the architects. The risk analysis facilitated, through its multi-dimensional approach to a critical examination of a construction problem, the identification of an effective risk management strategy for future construction projects. It further served to emphasize the point that clients are becoming more demanding, more discerning, and less willing to accept risk without recompense. Clients do not want surprise, and are more likely to engage in litigation when things go wrong. KEY WORDS:Arbitration, claims, construction, contracts, litigation, project and risk The structural design of the reinforced concrete elements was done by consulting engineers Knight Piesold (KP). Quantity surveying services were provided by Hawkins, Leshnick make the CM a member of a collaborative project team; centralize responsibility for construction under a single contract; obtain a bonded guaranteed 5 maximum price; produce a more manageable, predictable project; save time and money; and reduce risk for the client, the architect and the CM. CM at Risk, a more professional approach to construction, is taking its place along with design-build, bridging and the more traditional process of design-bid-build as an established method of project delivery. The AE can review the CMs approach to the work, making helpful recommendations. The CM is allowed to take bids or proposals from subcontractors during completion of contract documents, prior to the guaranteed maximum price (GMP), which reduces the CMs risk and provides useful input to design. The procedure is more methodical, manageable, predictable and less risky for all. The procurement of construction is also more business-like. Each trade contractor has a fair shot at being the low bidder without fear of bid shopping. Each must deliver the best to get the projec. Competition in the community is more equitable: all subcontractors have a fair shot at the work . A contingency within the GMP covers unexpected but justifiable costs, and a contingency above the GMP allows for client changes. As long as the subcontractors are within the GMP they are reimbursed to the CM, so the CM represents the client in negotiating inevitable changes with subcontractors. There can be similar problems where each party in a project is separately insured. For this reason a move towards project insurance is recommended. The traditional approach reinforces adversarial attitudes, and even provides incentives for people to overlook or conceal risks in an attempt to avoid or transfer responsibility. A contingency within the GMP covers unexpected but justifiable costs, and a contingency above the GMP allows for client changes. As long as the subcontractors are within the GMP they are reimbursed to the CM, so the CM represents the client in negotiating inevitable changes with subcontractors. There can be similar problems where each party in a project is separately insured. For this reason a move towards project insurance is recommended. The traditional approach reinforces adversarial attitudes, and even provides incentives for people to overlook or conceal risks in an attempt to avoid or transfer responsibility. 6 It was reasonable to assume that between them the defects should have been detected earlier and rectified in good time before the partial roof failure. It did appear justified for the plaintiff to have brought a negligence claim against both the contractor and the architects. In many projects clients do not understand the importance of their role in facilitating cooperation and coordination; the design is prepared without discussion between designers, manufacturers, suppliers and contractors. This means that the designer can not take advantage of suppliers or contractors knowledge of build ability or maintenance requirements and the impact these have on sustainability, the total cost of ownership or health and safety . This risk analysis was able to facilitate, through its multi-dimensional approach to a critical examination of a construction problem, the identification of an effective risk management strategy for future const
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