Abstract
This master thesis titled Risk Management is produced by study group 8, in the period from 2013.09.02 to 2014.01.08 at Aalborg University. The study group consists of three students from the education ”Master of Science and Technology in Civil Engineering with specialization in Management in the building industry”. The thesis has been supervised by Erik Bejder, Associated Professor, Ph.D. from Aalborg University.
The years after the financial crises have been hard on the Danish building industry where a lot of companies declared bankruptcy. Do to the low supply of economic resources together with the low tender of work assignments have resulted in low prices as the key competitive factor. This has led to a fierce competition between the companies and thereby put them in a situation that makes it had for the companies to make an acceptable profit. If you look at the problems the Danish building industry stands before, two of the most mentioned issues are the low productivity and the low profits. But if you look at financial cost of incidental actions in the Danish building industry it adds up to about 5 -10% or 5 – 10 billion DKK per year.
This thesis is aimed at people in the Danish building industry with the purpose of making the Danish building industry more productive and profitable with help from RM. This gave the project group reason to the following problem formulation:
“What characterizes good risk management and what are the challenges, if a company wants to improve themselves in their field? And identify what actions are deemed necessary if the top and bottom level in Risk Management in the Danish building industry wants to be raised.”
One of the thesis results is that the interview companies could be divided in to two groups, system based management and resource based management. Where the companies who are using RM all are active in using system based management. After make a financial comparison, it was revealed that the companies using RM had a more stable financial situation and made profits the last five years.
As a solution for the problem formulation the project group made a framework where the RM process is visualized. This framework is supported by strategic considerations and areas that are rated necessary for a company to have success with RM. Furthermore the framework will show the companies how to work and relate to resource based management and system based management.
To make the thesis more manageable and coherent is the methodological considerations based on Enderuds general model. The theoretical knowledge consists of, publications, newspaper articles, reports, standards, etc. dealing with risk management. These are, complemented with an interview study with actors in the Danish building industry.
The most important used theories are, Value Based Management, Situational Based Management, Work breakdown structure, Risk breakdown structure and McKinsey 7s framework.
The most important used theorist is, Robert J. Chapman, Niel C. Churchill & Virginia L. Lewis, Larry E. Greiner and Patrick X.W. Zou.
The thesis consists of a main report with the corresponding appendix and a CD-ROM with the annex. The main report consists of an introductory part, a problem describing part, a theoretical part, an analytical part, a problem formulation, a suggestion for a solution, conclusion and perspectives.
Keywords: Risk, Risk Management, Risk Management in Building Industry, Risk Management for Contractors,