Jiang, W; Jiang, J; Martek, I and Jiang, W (2025) Critical risk management strategies for the operation of public-private partnerships: A vulnerability perspective of infrastructure projects. Engineering, Construction and Architectural Management, 32(7), pp. 4771-4795. ISSN 0969-9988
Abstract
The success of public–private partnership (PPP) projects is highly correlated to the successful management of risks encountered during the operation phase. PPP projects are especially exposed to risk due to the long operation period over which revenues need to be generated to recoup substantial initial investment and operational running costs. Despite the critical impact of risk exposure, limited research has been specifically undertaken on the matter of operational risk management. This study seeks to address this oversight by identifying and evaluating operational risk management strategies for PPPs. Vulnerability theory is the theoretical lens used, with context drawn from Chinese PPP projects. Based on the data collected from expert interviews and questionnaires, 28 operational risk management strategies are identified. A fuzzy synthetic method is employed to analyze the effectiveness of the 28 strategies. The findings reveal that providing an exit mechanism clause into the contract, establishing a comprehensive performance evaluation mechanism and developing a clear compensation mechanism are the top three effective strategies. This study also reveals that risk mitigation approaches that reduce vulnerability prove more effective than attempts to reduce external threats. Specifically, strategies aimed at managing contract, political, technical and financial risk are the most effective. The findings of this study extend current knowledge regarding the risk management of PPP projects. They also offer a reference by which practitioners may select effective operational risk management pathways and thereby, galvanize the sustainable development of PPPs.
| Item Type: | Article |
|---|---|
| Uncontrolled Keywords: | fuzzy synthetic evaluation; operational risk management; PPP; strategies; vulnerability |
| Index terms: | revenue, sustainable development, strategy, fuzzy synthetic evaluation, interview, performance evaluation, risk mitigation, exposure, operation phase, practitioner, questionnaire, vulnerability, partnership, compensation, infrastructure project, effectiveness, running cost, risk management |
| Subjects: | dispute resolution, risk assessment, data collection methods, project delivery, financial and cost management, performance measurement, management, performance management, public and environmental health, infrastructure and transport systems, partnership management, practitioner, economic analysis, health safety and environment, financial risk, decision-making and optimization, environmental hazards |
| Topics: | Stakeholder Management, Roles and Professions, Research Practice, Business Strategy, Cost Management, Sustainability, Risk Management, Engineering Principles, Project Management, Health and Safety, Quality Management, Legal Issues |
| Descriptive scope: | 4 PCEA |
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