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CONSTRUCTION
At
MOHAMED HASSAN.M
(Reg.No.MA90551)
Under the guidance of
CERTIFICATE
WITH
RESPECT
TO
CONSTRUCTION
ON RISK
COMPANY
DECLARATION
Bonafide student of
PLACE : Chennai
Signature
DATE :
HASSAN.M)
(MOHAMED
ACKNOWLEDGEMENT
First and the foremost wishes, I would like to thank the ALMIGHTY for
the blessings to complete this project successfully.
I owe my sincere thanks to Dr. Balasubramanian, Director (Academic)
and C.Kaleemulah, Principal of New College Institute of Management,
Chennai for their advice to carry out this project
It is with immense pleasure and respect that i express my deep sense
of gratitude to
Mr. MOHAMED IBRAHIM. General Manager for his valuable technical
inputs,
marketing
methods,
constant
encouragement,
care
and
New
College
Institute
of
Management
for
their
constant
who
remain
constant
source
of
encouragement
and
CONTENTS
Introduction
..7
Company
profile.
..9
Review of literature..
..11
Risk
methodology
...21
Suggestions
31
Conclusion
35
Bibliography
..36
*******INTRODUCTION*******
OBJECTIVES
8
SCOPE OF STUDY
LIMITATIONS
OBJECTIVES:
To study Risk management strategies adopted in skyline is Human Resource, time
management and regulation of employees work time.
To analyze various types of projects undertaken by skyline are constructing
domestic houses, commercial building and complexes in and around Chennai.
To identify various types of expansion strategies adopted by skyline are to
concentrate on existing market and promote the business till national boundaries.
SCOPE:
The scope of the study is related to construction of buildings and new businesses
as it is not restricted to new works, repairs and maintenance.
The study is related to risk management process and assessment.
The study is confined to the state level market and limited to Chennai city.
LIMITATIONS:
The study is confined only to Chennai city in due consideration of traveling time
and expenses.
The constraints of time limit is too short elaborative study was not possible
The data revealed in the study was a secondary data collected in skyline builders
in a short period of time
10
Date of Establishment
1978
Turnover
Rs.7612130
Market Cap
Rs.382000
Corporate Address
Sky Line Builders,
#14 Venkatesan street,
Chepauk, Chennai-5.
Management Details
Chairperson Mohamed Ibrahim
11
COMPANY PROFILE
12
We are being in this construction field since 1978. We are having our inventory from
were our materials are being processed. We construct different individual houses and
commercial apartments. Specialist in making interiors for commercial offices.
The work of our company is under the control of chief engineer, especially who have
been trained from sophisticated construction firms. We have around 25 employees and
200 labours in our concern. The material capacity for making a building is around
35lakhs.
Our mode of payment is through letter of credit, commercial banks and liquid cash. We
are happy to welcome our customers who want to buy a house. We make their dream
comes true by providing best services.
Primary objective:
The main and the basic objective of the firm are to satisfy our customers needs and to
retain their loyalty for longer period.
Secondary objective:
After the accomplishment of the above stated primary objective the firms main aim is to
expand its business from local to national.
13
*****REVIEW OF LITERATURE*****
14
Risk Management in
Constructions Project
15
CONSTRUCTION PROJECTS
A project is an endeavor in which human, material and financial resources are organized
in a novel way; to undertake a unique scope of work of given specification, within
constraints of cost and time, so as to achieve unitary, beneficial change, through the
delivery of quantified and qualitative objectives. The definition suggests three key targets
of the project, i.e. time, cost and quality, which are to be in focus when undertaking the
project. It also highlights the importance of efficient organization of available resources
in order to achieve a good final result.
Flanagan and Norman (1993) emphasize two aspects of any construction project: the
process, i.e. project phases, and the organization, i.e. project actors. From the process
perspective, any construction project comprises a number of sequential phases. Different
authors suggest a different number of project phases. The simplest approach identifies
two main phases project development and project implementation. These two can be
further detailed and developed into a larger number of phases, e.g. feasibility, design,
procurement, construction, commissioning, and operation. Risk management process take
place in programme, design, procurement and production. The maintenance phase was
excluded because no risk management activities are to be found in this phase.
PROGRAMME PHASE
In the programme phase the client has an idea about the project and analyses conditions
for its execution.
16
DESIGN PHASE
During the design phase the architects and engineers produce construction drawings
according to the clients requirements.
PROCUREMENT PHASE
In the procurement phase the client appoints the contractor to carry out the project.
Depending on the form of contract, the procurement phase follows either the programme
phase (DB contracts) or the design phase (DBB contracts).
PRODUCTION PHASE
Finally, the contractor executes the job in the production phase. Figure overviews the
different models presented in the literature and the model used in the thesis.
17
18
CLIENT
A client is a party that carries out or assigns others to carry out construction, demolition
or land work. There are two main groups of construction clients: public and private.
Privately owned companies undertake the projects to make a profit. The public sector
includes the central government and local authorities and undertakes the projects to
provide a public service and/or benefit to the citizens.
CONTRACTOR
A contractor is an organization that provides a service for the client, i.e. executes the
construction works. The contractor organizations have different complexities and provide
different ranges of services from ground works to electrical installations and
telecommunications.
19
CONSULTANTS
The role of consultants is to assist clients and contractors and provide architectural and
engineering services. Due to their dynamic nature, projects change continuously. Thus a
great amount of risk and uncertainty is involved in construction activities. This
uncertainty may have a significant impact on the project objectives and, therefore, has to
be properly managed by the project actors during the whole project life cycle.
20
Each phase consists of several stages, which, in turn, are divided into different activities.
Despite the variety of models, risk identification, assessment and response form the core
of project risk management. Therefore, a model consisting of these three stages is mostly
used in construction projects.
21
RISK IDENTIFICATION
Risk identification is the first step of the risk management process. It is aimed at
determining potential risks, i.e. those that may affect the project. PMBOK (PMI 2000)
suggests that as many project stakeholders as possible should participate in the risk
identification process. There are a number of tools and techniques for identifying the
project risks these are brainstorming,
interviews,
22
RISK ASSESSMENT
During risk assessment, identified risks are evaluated and ranked. The goal is to priorities
risks for management. The research literature offers a large number of models that use
both qualitative and quantitative methods for assessment of project risks. A fuzzy system
is used by Motawa et al. (2006) to evaluate the risk of change in construction projects.
Poh and Tah (2006) have developed an integrated model that takes into account both
duration and cost risks and can be used for modeling risk impacts that affect the project.
Dikmen and Birgonul (2006) propose a methodology for both risk and opportunity
assessment of international projects.
23
****RESEARCH METHODOLOGY****
24
RESEARCH:
It is a scientific and systematic search for pertinent information on a specific topic. It is
the art of scientific investigation and gaining knowledge.
RESEARCH DESIGN:
Every research activity carried out follows a specific frame work in collecting and
analyzing the data, ensuring the accuracy in an economic way, this frame work is known
as research design. A good research design aims to collect only data that is needed by the
researchers.
DESCRIPTIVE DESIGN:
Descriptive research includes surveys and fact findings, inquires of different kinds the
design which simply describes demographic characteristics of customers to use the
product. The research has undertaken descriptive study to find out the customer
satisfaction level.
DATA COLLECTION:
There are two types of data collection methods. They are primary and secondary. And the
secondary type of collection is used in this type of research design.
25
SECONDARY DATA:
Secondary data is collected from the past record and past performance of the firm and
from other construction projects. This gives a strong base to carry out the research in a
smooth and planned manner. Thus secondary data is considered as polished information;
it gives a clear picture about the market condition and fierce competition faced by the
firm.
26
27
Project 1 included the new construction of a house at ECR. The project was executed
over 8 months in the year 2009. The contract sum was 41.1 Lakh and the final cost was
43.5 Lakh. Design-build, with a lump sum payment mechanism, was the chosen form of
procurement. The technical characteristics and functionality of the final product were
evaluated as high by all actors. However, the project implementation in terms of cost was
unsatisfactory from the contractors perspective. The contractors costs increased
significantly due to the poor quality of design documents. Time constraints for project
execution were kept and the project was finished earlier than planned. The client was
involved in all four phases of the project: programme, design, procurement and
production. The architect participated in the programme and design phase, but was not
involved in the production phase. From the perspective of dealing with risks, nonparticipation of the architect in the production phase created problems and conflicts
because there was a need for design changes during the project execution.
The contractor joined the project in the procurement phase, which is the traditional
approach for design-bid-build contracts.
28
PROJECT 2
29
INFERENCE:
30
INFERANCE:
20% of the customers were satisfied without the implementation of the risk management
strategies. After the implementation of the risk strategies in the firm the customers
satisfaction was increased to 40%, 75% and so on in the following years..!!!
31
*******FINDINGS*******
32
33
******* SUGGESTIONS*******
34
SUGGESTIONS
The company should go for advertisement to expand the business
The company risk can be reduced through three factors they are
Risk allocation through construction contracts
Design bid build
35
DESIGN-BID-BUILD
Separated contracts are characterized by a traditional separate appointment of a design
team and a construction firm. First, the client appoints an architect or engineer to produce
design documents (Design) and then procures (Bid) the contractor to execute (Build) the
project. Thus the client is responsible for the planning, design and function of a
construction and the contractor is responsible for the job execution
36
37
CONCLUSION:
Risk management often focuses on matters of insurance. However, there are
several other major considerations when assessing areas of risk in your business.
Risk Management aims to facilitate the exchange of information and expertise
across countries and across disciplines. Its purpose is to generate ideas and
promote good practice for those involved in the business of managing risk.
Risk management strategies helps to manage risk and transferring the risk to
another party, avoiding the risk, reducing the negative effect of the risk, and
accepting some or all of the consequences of a particular risk
38
BIBLIOGRAPHY
RISK MANAGEMENT: CHALLENGE AND OPPORTUNITY
Michael Frenkel, Ulrich Hommel, Gunter Dufey
The essentials of RISK MANAGEMENT
WIKIPEDIA
CONSTRUCTION MANAGEMENT
W. D. Mc George, Angela Palmer, Kerry London
39