Over our length of service to the industry Barnes Webster are well able to identify risk based on their own experience. The adaptation of a risk management approach, which is based solely in past experience and dependant on judgement, may work reasonably well in a stable low risk environment. It is unlikely to be effective where there is change since this requires the extrapolation of past experience, which could be misleading.
All construction projects are prototypes to some extent and imply change. The change in the construction industry itself suggests that it is unlikely to be sufficient on its own. A structural approach is required; such structure must not replace experience and expertise, rather bring benefits, which assist to:
- Clarify objects
- Identify the nature of uncertainties
- Introduce effective communication systems
- Improve decision-making
- Introduce only effective control measures
- Protect project objectives
- Provide knowledge of risk history
Bullet points are a convenient way of providing a structure for identifying risk to completion of the project.
Effective risk management however requires a multi-disciplinary approach. It remains true that the interplay of different and often conflicting requirements and pressures, that there is never one simple solution to the management of a particular risk. Inevitably risk management requires examination of engineering, legal and insurance related solutions. As a contractor we need to be involved at tendering stage to assess the risks identified to allow us to adopt the appropriate pricing strategy. In addition we will identify risks that have not been expressly identified in the contract documentation and judge whether these risks are considered legal to be carried out.
Such appreciation is vital since it will affect the pricing strategy necessary to win the bid against our competitors who may be oblivious to our risk apportionment. If the risks have been identified then they can be monitored during the project life cycle. In some cases the risk may not materialise and estimates and contingences may be revised.
Barnes Webster is committed to working with our Clients closely in regard to all aspects of risk management.