Risk Typology in the Hungarian construction industry

Abstract

Purpose Risk management is a decisive part of project and corporate management. The first process of risk management is to frame a risk typology which needs a uniform risk approach and terminology. We assume that economic actors detect exogenous (external) and endogenous (internal) processes and related risks differently. These dissimilarities and differences generate heterogeneous risk approach and terminology in construction risk management literature and in practice, too.

Methodology As a part of a long-run research project, an enquiry on the literature and on the Hungarian construction industry was made, to identify the differences and dissimilarities between theory and practice and to frame a relevant risk typology for construction projects. Deep interviews with some of the key actors of the industry and with different actors of construction projects such as lenders, insurers and investors were made. After sealing of interviews, we also made an online survey in the Hungarian construction industry in order to assess the way the stakeholders of the industry think about different risks and how these risks are evaluated.

Findings We could collect information about the risk perception, explanations, the accuracy of risk assessments, risk management experiences and techniques and tools of different actors and about the relations of construction companies, identifying different patterns, typologies, practices and learning processes.

Practical implications In this study we present a heterogeneous risk approach and terminology of different actors based on our research, with an attempt to make a risk typology which is adequate for project risk management processes in construction risk management.