Risk-based decision making in construction: a case of planning and risk assessment of construction alternatives

The two critical issues that must be dealt with at the pre-construction stage of any project are: determining the set of alternative construction activities and methods needed for doing the work; and drawing the necessary plans for carrying out them. These two issues are normally resolved according to decisions made by the construction experts based on previous experience. The decisions can have significant consequences on the project cost and time, both estimated and actual. In addition, estimated and actual costs will be affected by the nature of the project and the risks involved. The complexity associated with the decisions may increase as the number of alternative methods available to do that work increases. If each activity in the project can be executed using only two or three alternatives, the possible combinations of alternatives for carrying out the whole work can be very large. This work described in this paper discusses the use of a risk based simulation model to support decision making of construction planning through evaluation of the performance of different possible construction alternatives for the construction process of building pit taking into account the influence of process related risks. The model is used to assess the performance of many construction alternatives simultaneously taking into account the sequence of the activities, possible construction methods as well as potential risks. Preliminary findings indicate that construction experts perceive potential benefits from the model in that it supports decision making by providing an overview of the performance of a number of alternatives available for a particular construction process. Additionally the use of the model is expected to provide more reliable assessment of the risk associated with different alternatives.