What is mitigation planning in construction?
Mitigation planning in construction is an essential step that project management teams must take to outline all the potential risks to a specific project. The construction industry faces a wider variety of potential risks to a project.
With that in mind, each risk should have its mitigation plan that project leads and teams can put into action smoothly if or when it arises.
By understanding mitigation planning in construction projects, team leads can develop efficient and effective processes to carry out based on the identified risk.
Avoiding Project Failure Through a Risk Management Framework
While mitigation planning cannot guarantee a mitigation plan, it can help employers avoid common construction project risks through mitigation planning. Mitigation planning can also help in situations where mitigation plans have to be changed, providing mitigation strategies that will allow employers to manage any changes during mitigation planning.
The risk management framework consists of 4 concrete stages in dealing with project events. Each stage caters to specific mitigation strategies that are aimed at reducing risks during construction projects. These stages are easily memorised with the MNEMONIC: I-ARM.
1. Risk Identification
The risk identification stage involves brainstorming with stakeholders and the project management team about what risks a specific construction project faces. One method to go about this is to look at similar projects and study the mitigation strategies these projects employed.
By looking at mitigation plans for other construction projects, project managers can deduce the risk events that may arise and gain a basic understanding of mitigating similar circumstances in tandem with the specific risks as the project progresses. There are common risks to many if not all construction projects. Learning what they are can help project leads better account for their probability of occurrence so a mitigation plan can be set in place to address them.
2. Risk Assessment
Once risks to the project have been identified, it is then necessary to proceed with the risk assessment process. Here, the team should evaluate the likelihood of risk from occurring. A practical approach is using a risk matrix to plan the construction project.
The matrix categorises each scenario identified in the risk analysis process and places them on a scale of the likelihood of occurrence:
Risk assessment matrix outlining the probability of risk from occurring.
As seen in the image above, the risk matrix will assist in categorising which are high probability risks. These can potentially cause the most considerable project delays or cost overruns. High risk means that a risk mitigation plan needs to be as fleshed out as possible to incorporate all proposed actions and milestones for monitoring.
Risk Response Planning
A thorough risk assessment allows project teams to effectively create mitigation plans that directly cull the negative impacts of identified risks. In turn, the project is less likely to encounter scheduling issues or budgetary overruns that could lead to disputes over the contract.
3. Risk Response
After having undergone the risk assessments stage, it’s time to work out the risk mitigation strategy or response. Here, the project team members identify the risk owner of each potential risk.
The risk owner is the person who will take charge should that specific scenario play out. By assigning a delegated owner to each risk, the mitigation process can move more quickly and efficiently, leading to a more cohesive response to maintaining the project schedule and budget.
Furthermore, the risk response stage outlines the steps and procedures teams should take to manage the risk. The mitigation plan (or mitigation strategies) should be reviewed and updated as necessary after each mitigation strategy is put in place.
In terms of the type of responses a project team can take, there are four main paths to consider:
Risk transfer: Refers to the transfer of risk to a third party. This involves mitigation strategies such as insurance and mitigation contracting, where mitigation fees are paid to a third party in exchange for mitigation services.
Risk avoidance: The risks to a construction project may not be fully eliminated. However, in some cases, project leads can counterplan a certain aspect of it shows to have a high potential of risk, which would avoid it from arising in the first place. For example, if a contract has proven to be slow in delivery, project leads can opt for another contractor to ensure the timeline is adhered to.
Risk acceptance: Accepting a risk occurs when there is no way to get around a specific risk. This means that the steps taken are optimal, but the risk still remains. In such cases, it is paramount that the project teams involved have a concrete contingency plan for when the risk arises.
Risk management: Managing risk comes into play when there are mitigation strategies in place to help project managers control risk events. The risk management plan would only be implemented once the delay event occurs.
Proper risk response mechanisms and steps can increase the likelihood of attaining project objectives. Keep in mind that each type of construction project faces different risks. With that, the strategies taken should be relevant to the specific construction project being undertaken.
4. Risk Monitoring
If and when a mitigation plan is set into motion, project teams should take care to continually monitor the progress and development of the implemented plan.
Additionally, it is important to monitor the mitigation plan’s effectiveness over time to determine its feasibility based on the current situation. If certain mitigation steps are deemed counterintuitive or even unfeasible, project leads should consider revising the mitigation strategy altogether.
To monitor the mitigation process, it is recommended that the team use construction planning software that can predict the effects of changes to the timeline and budget of the project. One such project managing software is Primavera P6.
Each risk event should then have milestones and objectives to meet in order to determine if it is feasible to continue with the initial plan or whether new steps need to be taken to manage the risk. In cases where the initial risk mitigation actions fail to reduce or address the negative impact, project teams should reevaluate the project timeline and budget to determine how much leeway is allowable for shifts in the initial plan.
Ensuring Proper Construction Project Mitigation Planning
To ensure that mitigation plans are effective and coherent, there are considerations that project management teams can take. Here are a few that increase the likelihood of attaining project objectives:
Outline the specific goals and objectives of the project
Risk mitigation plans should take into account the specifics of a project. Keeping in mind the specific goals and objectives of a construction project allows project teams to outline a more concise plan of action based on the project’s situation.
It is possible to generalise a risk such as dealing with the effects of inclement weather on the likelihood of work cancellation. But, specifying the details will enhance the effectiveness of the risk management process, tailored to the goals and objectives.
Work closely with experts
In addition to the defined mitigation strategies, project teams should consider consulting with experts who can provide their professional insight on risks and risk strategies. Such consultants include legal professionals or even insurance providers, who may have been experienced in handling similar situations in the past. If the mitigation plan is complex, it may be better to consult with an expert in that specific field to ensure that risk response mechanisms are effective and efficient.
Identify potential risks at the start of a project
A great way to implement risk mitigation measures is through early intervention. Identifying potential risks at the onset of a project allows for the mitigation plan to be set into motion before time is lost due to delays. The team can then address potential risk events early in the project, ensuring that they are properly managed before they escalate into something more damaging.
Appoint an appropriate risk manager
Effective risk management is contingent upon selecting the right people for the job. This includes appointing a consistent team member who has an in-depth understanding of mitigation plans and their implementation, as well as an ability to keep project leads informed of ongoing risk events. Furthermore, this person should be capable of monitoring risks and evaluating potential mitigation steps.
The risk manager should be someone who is involved at all levels of the construction process, from the initial planning stages to project completion. When selecting a risk leader, it’s important to consider their expertise and previous experience in similar projects so that they may be able to comprehend risks and apply mitigation plans effectively.
Utilise advanced technology
Construction management software has become more advanced, allowing teams to perform risk tracking and mitigation. Using Primavera P6, for example, project managers can set up threshold alerts that send messages to team members when they reach a pre-defined risk level. These notifications assist in identifying potential risks earlier on the project timeline.
Address when objectives must be completed
Mitigation strategies should be flexible enough to accommodate shifting project requirements. Establishing the deadline for each risk event allows teams to adapt their mitigation plans in accordance with new objectives or events that arise during the course of a construction project.
Evaluate how the proposed mitigation plan will reduce risk
You should always assess how effective your mitigation plan will be at reducing risk. It may not always be feasible to reduce the risk of every event, but you can still establish an appropriate response strategy that protects against undesirable or unmanageable effects and increases the likelihood of success.
By applying these practices, teams can move forward with confidence when it comes to enforcing agreed-upon strategies when the stakes are high. Mitigation plans are strategies whose purpose is to reduce risk on a project. They can vary depending on the goals of the plan and what needs to be taken into account (e.g. legal matters).
At the outset, a risk assessment is conducted to determine what level of risk is present and to identify the risks that are the largest concern. These risks are addressed through mitigation strategies that can be implemented throughout different areas of a construction project from planning to execution to completion.
How Mitigation Planning Contributes to Risk Reduction
Mitigation planning in construction reduces the impact of a specific risk by ensuring that project teams can take quick and decisive action in dealing with the situation. Risk mitigation strategies are put in place so that all parties involved in a project can avoid, eliminate or reduce the risk to an acceptable level.
Such plans’ final goal and purpose ensure that the project remains within workable bounds and does not reach a point wherein the budget or timeline becomes unreasonable. Additionally, it works to prevent unwanted disputes among parties by resolving a situation without unnecessary escalation.
Moving forward, stakeholders and contractors need to incorporate mitigation planning in various project phases. Not only to secure the project’s integrity but also to protect it from legal liabilities that could prevent its completion.
Through mitigation, stakeholders can create a clear vision of what the project should look like and how much time it will require. This information can help establish initial plans for future projects and internal team operations.
Risks to a project are not uncommon in the Malaysian construction industry. The best way to minimise the negative impacts is to create a comprehensive mitigation plan that addresses all potential risks and outlines the best courses of action in dealing with them.
Stakeholders, project leads, and team members need to work together to identify any roadblocks and provide input to overcome them feasibly. It s essential to keep the plan realistic and attainable. This way, no expectations are left hanging, and all parties involved know exactly where the project is headed and what is required to achieve successful completion.