A Guide to Risk Assessment in Construction | Construction and AEC Project management software Raptorpm

A Guide to Risk Assessment in Construction

Construction sites have inherent risks, no matter whether it is a multi-story building or a house renovation. Too often a realized risk can cause personal injury. Or, a serious risk not well managed can wipe out a whole company. Construction risk assessment and management is essential to successfully completing each building project.

Defining risk

A risk is an event that may or may not happen. Risk is the uncertainty of an outcome that can cause construction project issues. No matter what the project, there is a certain amount of unavoidable risk. Risks are not hazards but they are events. Risks can refer to behavior, processes and procedures, and events. You need to decide what level of risk is acceptable in terms of value to the business.

Risks can include events that have:

• only negative variances or results – referred to the as pure risk
• both negative and positive variances (eg. where there is a risk of loss or gain) – referred to as speculative risk
• only positive variances and the possibility of gain – these may not always be identified as risks.

Construction is a risky business. It is not possible to avoid all risks. Instead, you must meet relevant legislation to manage, monitor, minimize and mitigate risks. For this, you need easy to follow processes that help your organization and staff make the right decisions. So, you must complete a risk assessment to calculate the risks.

Managing construction risks 

Managing risks is an important element of all construction projects. It involves completing a risk assessment of all work sites. It is important to assign each risk to the right people to take responsibility. There must be good processes and procedures in place to track and report on major risks.

here are four main aspects to managing construction risks: