Construction projects always carry some level of risk. And it’s of utmost importance that these risk factors are identified and managed through proper and professional risk management services. To do that, construction companies will require skills, careful planning, and the ability to make quick, sound decisions. If the potential risk becomes a reality, they can become hindrances between the project and its success. Containing the risks and completing the project successfully will lead to higher profits, stronger relationships with clients and enable you to grow and expand your business.
Here are the four most common risks involved in construction projects that you and your company should be extra careful about.
Suppose you don’t have enough labor on-site to carry on the tasks to complete the project, or the available workforce or equipment causes productivity issues. In that case, you will risk new projects and potentially will fail to complete them. Without the required workforce to do good work the proper way, the project will suffer from delays, leading to the project not being completed on time.
To cover for this risk, you hire sufficient human resources, but the equipment you are using isn’t of excellent quality and breaks down the midway; this will cause a massive decrease in the productivity of the project since the work won’t be able to start again, till the machinery is fixed.
It should be the top priority of every construction company to keep their workers safe. Site conditions shift rapidly, and any unexpected health or safety hazard can occur, which might pose new risks and threats to the project’s success. Accidents and lead to fatal injuries or even cause the death of your employees. When working on every project, the company goal should be to deliver the project on time to your client, yes, and that every worker goes home safely to their families.
Other than harming the employees, any accident and injury will cause a pause in the productivity of the work being done, which will damage the work momentum. If it keeps happening, the project will have to be inevitably delayed.
Using the services of a subcontractor can be extremely risky because if you are unfamiliar with a subcontractor and they end up having poor working productivity, in the end, it’s your project that will suffer. A default subcontractor that isn’t able to meet its obligations can completely ruin your profit and reputation.
This is something out of the company’s hands because the change in the orders of the project can happen due to multiple reasons. This is an inevitable part of construction and is a significant risk factor if not appropriately managed. A change order is an addition to the original construction contract or the project’s requirements, which the owners, the general contractor, can initiate, or even the subcontractors. This usually requires doing more work for reasons like errors in the original model used to begin the construction. This risks an increase in the project costs, which can lead to delays in hitting contract deadlines, interrupting the workflows, and not completing the project on time. Managing change orders take preparations, proper understanding, and lots of communication with all parties involved.