Controlling risks, Other Management

Controlling Risks

Risk management is not just providing for uncertainties - it is management of risks considering the combination of the probability (extent to which the risk event is likely to occur) and its consequence (severity of the outcome of the event). The two principles in risk management are:

  • Principle of control: This suggests that the party which has the better ability to control a risk should be given the risk.
  • Principle of capability: This suggests that risk should be transferred to the party which is most capable to absorb it.

The two principles are not mutually exclusive and both principles should be equitably applied in allocating risks in a construction contract document.

Two other characteristics of risk management are that:

  • It begins in the project conception stage and continues throughout the execution of the project.
  • It results from the combined efforts of both owner and contractor.

Projects involving substantial construction are most prone to risks and demand relatively the most elaborate attention to risk control. Handling of risk  in  construction  contracts  varies  considerably.  This  depends  on  the nature and location of the work, the owner and contractor involved and the prevailing contracting climate. Each of these varies over time and there are may be other outside influences also such as banks, governments and the insurance market.

Posted Date: 9/28/2012 2:40:27 AM | Location : United States







Related Discussions:- Controlling risks, Assignment Help, Ask Question on Controlling risks, Get Answer, Expert's Help, Controlling risks Discussions

Write discussion on Controlling risks
Your posts are moderated
Related Questions
QUESTION 1 (a) What are the four (4) Ps of the Marketing Mix? (b) Give brief description of each of the above in relation to the internet. (c) Describe how the Internet h

FORMAT   In the Unisist reference manual 'a (machine readable) bibliographic record is defined as a collection of information which pertains to a single document and which is s

We can conclude that contracting does have many benefits which are mentioned below:  ?  Division of labour.  ?  Synergy of expertise.  ?  Sharing of risks.  To avoid

Subject Access to OPAC   The typical OPAC interaction process requires the matching or crude translation of user vocabulary to system vocabulary. It became apparent that the am

INFORMATION CENTRES  AND DATABASES:   A, organisation selects, acquires, stores, organises a--retrieves specific documents to meet users' requirements, (ii) announces, abstr

Question 1 Explain the steps in developing pattern for built-up neckline and cowl neckline along with  diagrams Question 2 What is pegged skirt? Explain the method of develo

QUESTION a) Describe cost benefit analysis as used to appraise large public sector investments b) Compare as well contrast cost benefit analysis with investment appraisal

A company manufactures and sells a single product. The variable cost of the product is Rs 2.50 per unit and all production each month is sold at a price of Rs 3.70 per unit. A pote

QUESTION The significance of work design is underscored by an organisation's dependence on human efforts to accomplish its goals 1 Contrast the meaning of the terms job enla

Cataloguing Work: The objective of the catalogue is to provide nodes tool that give information about all documents available in a library. The catalogue  must be designed to