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
Purpose: 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. Design/methodology/approach: 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. Findings: 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. Originality/value: 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: | strategy, partnership, interview, methodology, operation phase, revenue, running cost, vulnerability, effectiveness, compensation, infrastructure project, questionnaire, practitioner, sustainable development, risk management, performance evaluation, fuzzy synthetic evaluation, exposure, risk mitigation |
| Subjects: | health safety and environment, practitioner, infrastructure and transport systems, decision-making and optimization, environmental hazards, financial risk, economic analysis, risk assessment, financial and cost management, performance management, project delivery, data collection methods, performance measurement, partnership management, public and environmental health, management, dispute resolution, research methods |
| Topics: | Risk Management, Health and Safety, Cost Management, Legal Issues, Sustainability, Stakeholder Management, Engineering Principles, Business Strategy, Research Practice, Project Management, Quality Management, Roles and Professions |
| Descriptive scope: | 5 PCTEA |
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