Controlling risks, Other Management

Assignment Help:

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.


Related Discussions:- Controlling risks

Government relations, Government Relations This is a sub function of co...

Government Relations This is a sub function of corporate communication more frequently called public affairs. Depending on your organizations, the importance of government re

Short-term decision-making problem, A company manufactures and sells a sing...

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

Reasons for mergers and acquisitons, There are numerous reasons for a compa...

There are numerous reasons for a company to peruse M and A. Some of them are listed below: The M and A are undertaken to achieve specific financial, business and strategic

Relation to facilities planning and design, Question 1: (i) What are t...

Question 1: (i) What are the determinant scarce resources a facilities planner and designer needs to consider before starting a proper feasibility study for the initial se

Executing the agreement , Executing the agreement  A successful negotia...

Executing the agreement  A successful negotiation leads to the signing of a contract by the parties after incorporating all the mutual agreements reached during negotiations. E

Stock verification - library management, STOCK VERIFICATION: Stock ver...

STOCK VERIFICATION: Stock verification implies the physical check up of the articles on record. This is a common practice in all  organisations whether private companies or go

Social costs of msw management, Q. Does FCA acquire into account the enviro...

Q. Does FCA acquire into account the environmental, health, and social costs of msw management? Ans. No. FCA do not account for these types of expenses. Noise, for instanc

Investment management, You are a manager in the investment industry, whose ...

You are a manager in the investment industry, whose role is to provide investment portfolio advice and managementto a client, who is your investorprincipal. You should identify t

What are the main styles of negotiation, Question 1: What are the alter...

Question 1: What are the alternative ways in which a decision can be made that affects the parties involved? In what ways will negotiation be seen as a tactical contest?

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd