| Abstract | Many governments have started to procure major public constructions by authorizing
the private sector to finance, develop, construct & complete, operate & maintain, earn revenue
for a allowed period, and then transfer to the host government at no cost since 1980s. This
approach is called Privately-Financed (PF) project procurement throughout the study. The
literature introduces this approach in different forms of definitions. Both the developing and
the developed countries use this method since there are much advantages and benefits.
However, the private sector, through the project sponsor/concession companies has to bear
higher risks than in a normal project. In the context of PF project procurement, the project,
events, and sources are highly uncertain due to size, complexity, and location. Though the
situation seems to be that, the project sponsors, who are mainly civil engineering design and/or
construction firms, rarely apply Construction Risk Management (CRM) during the feasibility
study period, before making bid/no-bid decision. There are reasons responsible for that.
This research was done .to develop a 'CRM Methodology' and a computer-based 'RiskManagement Decision-Support (RMDS) System'. The CRM Methodology shows a procedure
to manage project risk, events risks, and risk sources. The RMDS System supports through the
provision of automated mechanism facilities to identify, analyze and evaluate, analyze the
decisions, and make the decisions throughout the application of CRM Methodology during the
development phase mainly. And it shows a way to measure the total project risk and events
risks through a combination of qualitative and quantitative aspects. Both the Methodology and
the System concern quantitative and qualitative aspects of project risks in a comprehensive
manner. The Methodology and the System can be used during construction & completion and
operation & maintenance phases too to a considerable extent. Probability analysis, range
estimates, sensitivity analysis, cash flow analysis, influence diagramming technique, analytical
hierarchy process, and multiple-criterion decision-making were used as the techniques to
develop the RMDS system. Expert Choice Professional decision support software and Excel
97 spreadsheets were used as tools to develop the RMDS system.
The RMDS System supports the risk manager, decision analyst, and decision-maker
effectively and efficiently, and in a comprehensive manner to make the bid/no-bid decision
mainly at the development phase of a PF Transportation (PFT) project. It supports at four
stages i.e. at the risk identification, risk analysis & evaluation, risk response decision analysis,
and risk response decision-making. It evaluates the total risk exposure and total risk-concerned
mean value of a PFT project and total risk exposures and total risk-concerned mean values of
each events of a PFT project through an automated mechanism of the RMDS System when the
base estimates of events/sources and their range estimates and probabilities of range estimates
are inserted. And then, risk analysis and risk response decision analysis can be done. It is
recommended that project sponsor/concession companies use this CRM Methodology and
RMDS System through the development phase to identify risk events, sources, and
consequences, analyze and evaluate total risk exposures and total risk-concerned mean values
to the project and events, and analyze the decisions made on risk events and sources, and make
the final decisions on risk events and sources and finally bid/no-bid decision. The RMDS
System is recommended to be used during the other two phases as mentioned above. |