Integrated Risk Management Process for Building Projects

The objective of this paper is to provide an integrated risk analysis method for building projects which tracks the probabilities of the occurrences of harmful events perceived by the owners from the conceptual phase to the end of the project. The risk management framework is built on traditional risk modeling bases and integrated with financial aspects. This extension of the original concepts defines the project goal by the minimum requirements to be achieved, then objectively identifies risk factors with measurable financial variables. The contribution to the current body of knowledge is threefold. On the one hand, from a project management point of view, the emphasis on the definition of project objectives shifted towards meeting financial goals by integrating relationships of financial minimum expectations at the model level. On the other hand, from a financial aspect, the opportunity of continuous monitoring and reassessment for risk management processes is created. Finally, based on this framework an automatized risk management process can be implemented, which will indicate if adverse processes start in the life of the project and action plans need to be launched. The automated procedure for risk analysis based on the integrated concept delivers a more effective practical tool to reduce project risks, and opens new research areas in construction project management.