scholarly journals Identifying Political Risk Management Strategies in International Construction Projects

2018 ◽  
Vol 2018 ◽  
pp. 1-11 ◽  
Author(s):  
Tengyuan Chang ◽  
Bon-Gang Hwang ◽  
Xiaopeng Deng ◽  
Xianbo Zhao
Keyword(s):  
Risk Management ◽  
Construction Projects ◽  
Management Strategies ◽  
Political Risk ◽  
Implementation Phase ◽  
Construction Enterprises ◽  
International Construction ◽  
Political Risks ◽  
Risk Management Strategies ◽  
International Experts

International construction projects are plagued with political risk, and international construction enterprises (ICEs) must manage this risk to survive. However, little attention has been devoted to political risk management strategies in international construction projects. To fill this research gap, a total of 27 possible strategies were identified through a comprehensive literature review and validated by a pilot survey with 10 international experts. Appraisals of these 27 strategies by relevant professionals were collected using questionnaires, 155 of which were returned. Exploratory factor analysis was conducted to explore the interrelationships among these 27 strategies. The results show that all of the 27 strategies are important for political risk management in international construction projects. Moreover, these 27 strategies were clustered into six components, namely, (1) making correct decisions, (2) conducting favorable negotiations, (3) completing full preparations, (4) shaping a good environment, (5) reducing unnecessary mistakes, and (6) obtaining a reasonable response. The 6 components can be regarded as 6 typical management techniques that contribute to political risk management in the preproject phase, project implementation phase, and postevent phases. The findings may help practitioners gain an in-depth understanding of political risk management strategies in international construction projects and provide a useful reference for ICEs to manage political risks when venturing outside their home countries.

scholarly journals Political Risk Paths in International Construction Projects: Case Study from Chinese Construction Enterprises

2018 ◽  
Vol 2018 ◽  
pp. 1-11 ◽  
Author(s):  
Tengyuan Chang ◽  
Xiaopeng Deng ◽  
Bon-Gang Hwang ◽  
Xiaojing Zhao
Keyword(s):  
Construction Projects ◽  
Political Risk ◽  
Global Market ◽  
The Political ◽  
Construction Enterprises ◽  
International Construction ◽  
Political Risks ◽  
International Environment ◽  
Negative Effect ◽  
Low Exposure

International construction enterprises (ICEs) have been plagued with political risks in the global market. To ensure the success of political risk management, it is necessary to comprehend the political risks in international construction projects. This study aims at exploring the political risk paths in international construction projects. The preliminary political risk factors and paths were proposed from the literature review. A survey questionnaire was developed to collect political risk cases faced by Chinese construction enterprises (CCEs) performing international construction projects, and 264 valid cases were received and analyzed for this study. Adopting the confirmatory factor analysis (CFA) method, 6 macrofactors (“sociopolitical stability” (A), “legal and regulatory” (B), “social safety” (C), “economy performance” (D), “attitude towards foreigners” (E), and “international environment” (F)) and 2 microfactors (“low exposure” (G) and “capability of enterprises” (H)) were identified. Moreover, the results of path analysis illustrated that 7 factors (A, B, C, D, E, G, and H) had the significant direct negative effect on “risk consequences” and 3 factors (A, D, and F) had the indirect negative effect on “risk consequences.” The findings from this study help practitioners gain an in-depth understanding of political risks in international construction projects and provide a useful reference for ICEs to manage political risks when venturing outside their home countries.

scholarly journals HOW MULTINATIONAL CORPORATIONS USE LOBBYING AND ADVOCACY TO MITIGATE POLITICAL RISKS

2018 ◽  
Vol 3 (Special) ◽  
pp. 18-26
Author(s):  
Violeta Iftinchi ◽  
Gheorghe Hurduzeu
Keyword(s):  
Multinational Corporations ◽  
Political Violence ◽  
Management Strategies ◽  
Political Risk ◽  
International Organisations ◽  
Government Officials ◽  
Government Action ◽  
Political Risks ◽  
Regulatory Changes ◽  
Risk Management Strategies

In their international activities multinational corporations (MNCs) face various risks. Political risk is one of them. Expropriations, transfer and convertibility restrictions, breach of contracts, acts of terrorism, domestic political violence or other adverse regulatory changes and/or negative government action represent forms of political risks. Incorporating political risk in their risk management strategies becomes a necessity for MNCs in their search for profits and new markets. This article presents how MNCs use lobbying and advocacy as means to engage with governments and politicians in the country of origin (home country), in the country where a MNC has operations (host country) or at international level (by creating ties with international organisations) in order to mitigate political risks. The case of Repsol and its investment in Argentina is used to demonstrate the application of such tools. The article presents two limitations that might determine the success or failure of MNCs’ lobbying and advocacy activities: governments' unpredictable views towards MNCs and reputational risks. The article has also identified a main difficulty in identifying and examining MNCs way of using lobbying and advocacy to engage with government officials and politicians. This difficulty comes from the informal character of such contacts which makes lobbying and advocacy almost impossible to identify.

Risk Management Strategies in Construction Organizations

2021 ◽  
Vol 15 (1) ◽  
pp. 406-413
Author(s):  
Shabbab Ajami Alhammadi ◽  
Bassam A. Tayeh ◽  
Wesam S. Alaloul ◽  
Tareq J. Salem
Keyword(s):  
Risk Management ◽  
Construction Industry ◽  
Construction Projects ◽  
Gaza Strip ◽  
Management Strategies ◽  
Validity And Reliability ◽  
International Agencies ◽  
Construction Organizations ◽  
Risk Management Strategies ◽  
The Gaza Strip

Background: Construction projects are among the riskiest businesses due to the number of factors involved that are difficult to control; hence, the popularity of risk management as part of the decision-making process in construction organizations is increasing. Despite the advancements, there are various risks involved that lead to project failure. Aim: Thus, this study aims to assess the risk management strategies in construction organizations in the Gaza Strip, Palestine. Methods: Seventy questionnaires were distributed after subjecting them to pretesting and pilot study that confirmed the validity and reliability of the questions. The target respondents included engineers and consultants from the construction organizations, Ministry of Works and Housing, and international agencies. The questionnaire was retrieved with a 65.71% response rate. Results: Results indicated that the most popular method of risk factor determination in the Gaza Strip is the “checklist” (RII=84%). For tools/methods of risk analysis, relying on experience in the direct assessment is the most prominent, with an RII of 78%. For the methods of avoiding risk before the project implementation, dependence on experience in the work for preparing and planning was ranked highest (having RII of 81.6%). Finally, follow-up on the implementation to avoid rework, with an RII of 77.6%, was ranked highest among other factors of avoiding risk during the construction projects implementation. Conclusion: This study highlights the key risk management strategies that will be beneficial for the construction industry stakeholders to resolve the unwanted risk failures in the construction industry.

Risk assessment in commercial real estate development

2019 ◽  
Vol 37 (5) ◽  
pp. 427-444 ◽  
Author(s):  
Malka Thilini ◽  
Nishani Champika Wickramaarachchi
Keyword(s):  
Risk Factors ◽  
Risk Assessment ◽  
Risk Management ◽  
Social Economic ◽  
Management Strategies ◽  
Political Risk ◽  
Assessment Criteria ◽  
Commercial Development ◽  
Content Type ◽  
Risk Management Strategies

Purpose The purpose of this paper is to analyze the commercial property development risk factors from the entrepreneur’s point of view against social, economic, environmental, technological and political risk assessment criteria. After that, this study aims to assess the risk factors based on the analytical network process (ANP) model and to prioritize the key risk factors to identify which risk factor is highly affected to the commercial development process. Design/methodology/approach The data were collected through face-to-face interviews using a structured questionnaire. The analysis of the risk factors involved the ANP model using super decision software. Findings The results revealed that there are five major risk factors such as environmental, social, economic, technological and political risk, and 32 sub-risk factors. According to the super matrix calculation, the synthesized values for three projects were 0.0704, 0.0532 and 0.0431, respectively. It was identified that Ward City was 0.0704, indicating that it is comparatively less risky and, hence, can be categorized as the best development and considering the sub-risk factors; the results show that the highly affected risk factors for the development are: the council approval process, climate changes and natural disaster, and the least affected risk factors are confidence to the market, lifecycle value, investment return and currency conversion factor. Practical implications The paper includes implications for the development of commercial properties, risk and risk assessment criteria to make risk management strategies and policy implementation. Originality/value The research findings are helpful in improving risk management strategies in the country, and policy formulation should focus on the above identified three risk factors in order to mitigate the risk in every stage and to achieve sustainable project development while increasing the satisfaction of long-term investment goals.

STRATEGIES TO IMPROVE RISK MANAGEMENT IN CONSTRUCTION INDUSTRIES

2021 ◽  
Vol 8 (1) ◽  
Author(s):  
Yisakor Solomon Ferede ◽  
WELLINGTON DIDIBHUKU THWALA ◽  
NOKULUNGA XOLILE MASHWAMA
Keyword(s):  
Risk Management ◽  
Construction Industry ◽  
Construction Projects ◽  
Management Strategies ◽  
Parametric Modelling ◽  
Building Information Modelling ◽  
Defensive Strategies ◽  
Risk Management Strategies ◽  
Building Information ◽  
Response Percentage

In today’s world of construction, management of risks is no more about defensive strategies where the management system only protects the business. Modern-day risk management strategies should protect the business from risks, and in addition, should improve the values of the construction industry. The risk management strategies covered in this work, for the Ethiopian construction industry include Building Information Modelling (BIM), BIM-Knowledge Risk Management Strategy (BKRMS), and Statistical Parametric Modelling (SPM). This work presents the analysis and discussion of the data obtained from structured questionnaires gathered from contractors, managers, civil engineers, architects, supervisors of construction projects, and contracts in Ethiopia. The questionnaire was administered to achieve the aim of our research and descriptive, empirical, factor, and reliability statistics were used to analyze the questionnaire on the Statistical Package for Social Science (SPSS). Out of the 120 questionnaires sent out, 110 responses were received and used for analysis to represent an 83.0% response percentage. BIM accounted for 41.4% of the total variance explained in the exploratory factor analysis, BKRMS accounted for 11.8% of the variance and SPM accounted for 9.9% of the variance. The findings obtained from this work confirm that these strategies block risks at the three major phases of construction projects: design, construction, and operational phases.

scholarly journals Turkish Insurance Companies’ Risk Management Strategies and Structures: A Survey Study

2020 ◽  
Vol 12 (8) ◽  
pp. 12
Author(s):  
Suna Ozyuksel ◽  
Murat Gezgin
Keyword(s):  
Risk Management ◽  
Insurance Industry ◽  
Management Strategies ◽  
Cyber Attacks ◽  
Survey Study ◽  
Insurance Companies ◽  
Insurance Sector ◽  
Political Risks ◽  
Risk Management Strategies ◽  
Set Up

Insurance industry is one of the cornerstones of both the financial system and the economy as it undertakes global risks and minimizes losses. The compensation of major losses by insurance companies means rapid recovery and resumption for investors. The insurance sector is very important for the development of the country's economy as it contributes premium volume and its support to investors as for compensation of the losses. However, the insurance sector faces a great deal of risks. Therefore, it is of importance for insurance companies to have a robust risk management system to constitute a basis for the growth of economy. Risk management enables insurance companies to identify measuring and analyzing risks, safeguard their assets, minimize potential risks and take them under control. The aim of this study is the evaluation of the risks assumed by insurance companies in Turkey and their risk management perspectives to struggle such major risks through a survey. This survey makes an evaluation about how insurance companies’ risk management departments are structured, risks that insurance companies foresee, their strategies to deal with such risks. Among the important findings of the survey; Top 10 risks for insurance companies are: “interest rate and foreign exchange rate fluctuation, political risks, economic slowdown, economic crisis, regulations, cyber-attacks, incompliance with the applicable legislation, increasing competition, digitalization/insurtech, business continuity interruption” and the second finding is Turkish insurance industry’s risk management set-up has a robust structure even though it has a small share in global insurance market and Turkish financial sector.

Identifying micro variables contributing to political risks in international construction projects

2018 ◽  
Vol 25 (3) ◽  
pp. 317-334 ◽  
Author(s):  
Xiaopeng Deng ◽  
Sui Pheng Low ◽  
Xianbo Zhao ◽  
Tengyuan Chang
Keyword(s):  
Construction Projects ◽  
Rank Correlation ◽  
Content Type ◽  
Construction Enterprises ◽  
International Construction ◽  
Political Risks ◽  
Significant Disagreement ◽  
Micro Level ◽  
Individual Variables ◽  
The Impact

Purpose The purpose of this paper is to explore the micro-level variables contributing to political risks in international construction projects. Design/methodology/approach A total of 25 micro-level variables were identified from the literature review, and a questionnaire survey was performed with 138 professionals from both academia and industry. Then, the Spearman rank correlation was used to test whether there was agreement on ranking between the two respondent groups. Furthermore, the 25 variables were grouped into six underlying factors through the exploratory factor analysis. Findings The results indicated that the most critical variables were “project desirability to the host country,” “relationship with governments,” “misconduct of contractors,” “public opposition to the project,” “experiential knowledge of political risks” and “advantageous conditions of contract.” In addition, the opinions within each group were consistent and there was no significant disagreement on the rankings of variables between academics and practitioners. However, the academic and practitioner groups held different opinions on some individual variables. The impact direction of the variables was associated with confusion among the respondents. Originality/value The findings presented in this paper can help international construction enterprises effectively manage political risks in international construction projects.

The management of risk in a dryland environment

2011 ◽  
pp. 13-21
Author(s):  
D.I. Gray ◽  
J.I. Reid ◽  
D.J. Horne
Keyword(s):  
Risk Management ◽  
Service Providers ◽  
Management Strategies ◽  
Subterranean Clover ◽  
Farming Systems ◽  
Market Risk ◽  
Farm Size ◽  
Forage Crops ◽  
Risk Management Strategies ◽  
Upside Risk

A group of 24 Hawke's Bay hill country farmers are working with service providers to improve the resilience of their farming systems. An important step in the process was to undertake an inventory of their risk management strategies. Farmers were interviewed about their farming systems and risk management strategies and the data was analysed using descriptive statistics. There was considerable variation in the strategies adopted by the farmers to cope with a dryland environment. Importantly, these strategies had to cope with three types of drought and also upside risk (better than expected conditions), and so flexibility was critical. Infra-structure was important in managing a dryland environment. Farmers chose between increased scale (increasing farm size) and geographic dispersion (owning a second property in another location) through to intensification (investing in subdivision, drainage, capital fertiliser, new pasture species). The study identified that there may be scope for further investment in infra-structural elements such as drainage, deeper rooting alternative pasture species and water harvesting, along with improved management of subterranean clover to improve flexibility. Many of the farmers used forage crops and idling capacity (reduced stocking rate) to improve flexibility; others argued that maintaining pasture quality and managing upside risk was a better strategy in a dryland environment. Supplementary feed was an important strategy for some farmers, but its use was limited by contour and machinery constraints. A surprisingly large proportion of farmers run breeding cows, a policy that is much less flexible than trading stock. However, several farmers had improved their flexibility by running a high proportion of trading cattle and buffer mobs of ewe hoggets and trade lambs. To manage market risk, the majority of farmers are selling a large proportion of their lambs prime. Similarly, cattle are either sold prime or store onto the grass market when prices are at a premium. However, market risk associated with the purchase of supplements and grazing was poorly managed.

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