Risk Management Practices of Multinational and indigenous Construction Companies in Nigeria: A Comparative Analysis
Construction projects’ high uncertainty rates make them unattractive to non-risk takers. Construction companies are therefore necessarily risk takers, albeit, to varying degrees. This study made an inquiry into the risk management (RM) practices of multinational and indigenous construction companies (MCCs and ICCs, respectively) in Lagos State, Nigeria with a view to identifying the techniques and procedures that are used for RM by the companies, and comparing their use by MCCs and ICCs. The study utilized a cross-sectional survey design using questionnaire as the instrument for data collection. 19 ICCs and 11 MCCs were involved in the research. Collected data were analysed by parametric and non-parametric statistics such as severity index and the t-test statistic respectively. The study showed sufficient evidence leading to the conclusion that RM training of staff as a corporate RM strategy is the least used corporate RM practice in the research area, and use of soft systems method of risk identification is very low in the construction industry of the research area. It was further observed that significant differences exist between the use of probability, graphical and decision analyses techniques by MCCs and ICCs, with MCCs using the techniques more. It was suggested that RM training of staff and professional of the construction industry should be embarked upon by relevant stakeholders and risk analysis techniques such as probability graphical and decision analyses should be popularized and used by ICCs. The study also contributed a conceptual RM framework for construction companies to existing knowledge.
Keywords: Indigenous, Multinational, Nigeria, Risks Management, Risk Identification and Quantification