Afzal, F; Yunfei, S; Sajid, M and Afzal, F (2020) Integrated priority decision index for risk assessment in chaos: Cost overruns in transport projects. Engineering, Construction and Architectural Management, 27(4), pp. 825-849. ISSN 0969-9988
Abstract
Purpose: Cost overrun is inherent to project chaos, which is one of the key drivers of project failure. The purpose of this paper is to explore the critical elements of complexity-risk interdependency for cost-chaos in the construction management domain by utilizing a multi-criteria decision model. Design/methodology/approach: A total of 12 complexity and 60 risk attributes are initially identified from the literature and using expert’s judgements. For the development of a structured hierarchy of key complexity and risk drivers, a real-time Delphi process is adopted for recording and evaluating the responses from experts. Afterwards, a pair-wise comparison using analytical network processing is performed to measure complexity-risk interdependencies against cost alternatives. Findings: The findings of the integrated priority decision index (IPDI) suggest that uncertainties related to contingency and escalation costs are the main sources of cost overrun in project drift, along with the key elements such as “the use of innovative technology,” “multiple contracts,” “low advance payment,” “change in design,” “unclear specifications” and “the lack of experience” appear to be more significant to chaos in complexity-risk interdependency network. Research limitations/implications: This study did not address the uncertainty and vulnerability exit in the judgment process, therefore, this framework can be extended using fuzzy logic to better evaluate the significance of cost-chaos drivers. Practical implications: These results may assist the management of cost overrun to avoid chaos in a project. The proposed model can be applied within project risk management practices to make better-informed technical decisions in the early phases of the project life cycle where uncertainty is high. Originality/value: This research addresses the importance of cost overruns as a source of project chaos in dynamic systems where projects reach the edge of chaos and progress stops. A new IPDI index contributes toward evaluating the severity of complexity and risk and their interdependencies which create cost-chaos in infrastructure transport projects.
| Item Type: | Article |
|---|---|
| Uncontrolled Keywords: | analytical network processing; complexity-risk interdependency; cost overruns; infrastructure transport projects; project chaos |
| Index terms: | risk assessment, judgment, project failure, fuzzy logic, project risk management, life cycle, cost overrun, vulnerability, methodology, complexity, specification |
| Subjects: | contractual condition, financial risk, research methods, environmental hazards, systems engineering, value management, dispute resolution, project completion, data science, financial and cost management |
| Topics: | Cost Management, Project Management, Research Practice, Engineering Principles, Sustainability, Legal Issues, Digital Applications, Contract Administration |
| Descriptive scope: | 4 PCTA |
N.B. Descriptive scope is a count of how many of the five facets of empirical research are indicated by the words used in title, abstract and keywords. It is not intended as a judgement on the research; merely a count of the kind of word we would expect to indicate Phenomenon, Concepts, Theoretical framing, Empirical techniques, Analytical techniques. If all five are present, then a code of “5 PCTEA” will indicate this. If you feel the coding for this record is questionable, we welcome discussion around the terms we matched or the way we categorized them. The facet you would expect may not be coded, or a facet may be coded inappropriately. This can also bear on a larger question, of which facets should be treated as defining in construction management research. Please get in touch, and we will look at it. More details here