Risk Management in the Florida Construction Industry

Abstract

Construction is a highly risk-prone industry with not a very good track record of coping with risks. The participants in the industry, as a result, have been enduring the agonizing outcomes of failure in the form of unusual delays in project completion, with cost overruns and many times sometimes failing to meet quality standards and operational requirements. Thus, an effective analysis and management of construction associated risks remain a big challenge to the industry practitioners. This paper, via questionnaire survey and in-depth interviews, evaluates the current practices of risk analysis and management adopted by the general contractors in the Florida construction industry and presents the comparison with four other States that are considered to have highly a profitable and modern construction industry. The results reveal that in the Florida construction industry, risk analysis and management techniques are rarely used by the general contractors due to a lack of knowledge coupled with doubts on the suitability of these techniques for the construction industry. It is recommended that formal and informal training of general contractors and construction managers is essential to implement such techniques in Florida. This will lead to improved profitability, reduced conflicts and on time and within budget project completions.