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Nigeria is being classified among the under-developed /developing nations in the world and as such, a strategy was published of the country's government of becoming among the twenty most developed nations in the world by the year 2020. This report focuses on the construction project sector of the country; seeking to identify the cause of project failures and poor project deliveries on time, cost and quality specification by the project stakeholders which caused past failures to the construction sector and will impede the achievement of the vision successfully.
Research findings revealed that the problem in the Nigeria construction project sector is due to poor competency of the construction project stakeholders on risk management and its process; poor understanding why projects are being undertaken and , no drive for sustainability of completed project due to the stakeholders high interest in delivering the project on time('money conscious') . These problems are contributed by all the key project stakeholders mostly at the execution phase of the project life cycle where the build up takes place. To resolve these risks, a triangulation (mixed) method of researching was used to carry out this report. A case study using secondary research studied a well to do UK Construction Company while a questionnaire is designed with the strategy of identifying the maturity/competency state of Nigeria construction project stakeholders while a correlation method will be used to compare the risk management process of Nigeria and the United Kingdom. With the gap identified and resolved on time, Nigeria will be classified among developed nations.
All thanks go to God almighty, the creator of heaven and the earth and made me in his image. He is seeing me through the life cycle of my life: Thanks Lord.
Secondly, I say special thank you to my supervisor (Irena spanovic) for her attention all through the research process.
Finally, thanks to my family members for loving and always there for me; you are the best.
Risk management in the Nigeria construction sector has not been effectively explored which may be the cause of construction relays, cost and time over runs in the Nigerian construction project sector. Therefore, this report seeks to identify the key risk exerted on the Nigeria construction projects by the project stakeholders. Risk is associated with all aspects of human endeavours and this not excluding construction activity where by the associated risks are highly diverse and varies (Odeyinka, 2000).
Construction projects like other types of projects does not occur on its own but, it is being carried out, handled and influenced by stakeholders particular to that project. It is perceived to have high level of risk due to the involvement of contractual parties such as the suppliers, owners, contractors, subcontractors, designers (El-Sayegh, 2007). The roles of stakeholders in a project can contribute positively or negatively towards the success of the project. Stakeholders who are negative (or against) to the project can influence the project in a negative way, which will pose some level of risk to the project. But stakeholders whither positive or negative towards the project can to some extent be the source of risk in a project or alternatively affected by the resultant effect of risk associated to the project activities. It is therefore important to understand the meaning of risk due to the fact that this report primarily focuses on the subject risk management. Risk is defined as events which are likely to affect the ability of a project to achieve its defined objectives (Westland, 2006). All projects are inherently risky when carried out (APMBOK, 2006) construction projects not excluding from the list.
However, the different risk associated with projects as such has the tendency of either affecting the smooth completion of the project on time, cost and quality specification or on the other hand, affects the completed project during the benefit realisation phase (after the project has been completed).
Construction projects are accompanied with different characteristic processes and associated risk but these characteristics varies with regions and locations to which the construction project is being executed (Zhi,1995). Irrespective of the country, locality or region, construction projects are usually risky due to variability of construction practices being upheld in such region.
As it relates to Nigeria, the risks associated with the construction projects (industry) are very numerous leading to cost and time overruns as well as developmental retardation of the country in general. Therefore, this report will seek to identify the main risks Nigeria key construction project stakeholders contributes to project failures and the not deliveries of project on time, cost and quality specifications and also, a recommendation will be given on how the risk can be effectively managed.
1.1 Project Aim
Identification of the Key risks being experienced by the Nigeria construction projects by its key stakeholders which has caused failures in project deliveries and poor development to the entire country.
1. Vivid identification of the prevailing stakeholder's caused risks associated to the Nigeria construction project.
2. Give a proposal for verifying the credibility of the identified risks with a comparison of the risk management process being practiced by a well to do international construction company projects abroad with the aid of a case study.
3. Give a recommendation for the effective management of the identified risk so as for rapid development to begin to take place in Nigeria where by projects will be completed on time ,cost and quality specification required by the associated stakeholders as related to the project
1.3 Project Rationale
1.3.1 Personal Rationale
The word risk has not been better understood by people and even when understood, it has not been effectively managed and therefore, leading to failures and unforeseen circumstances being experienced on projects and business as usual activities.
From literature reviews, it has come to the notice that there is high interest in risk management and as such, various risk related reports has been published on different countries such as construction risks reports on UAE (El-sayegh, 2008), Indonesia (ANDI,2006), USA(Kangari,1995), China (Fang, Fong, and Shen,2004), Hong Kong(Ahmed, Ahmad, and Saram,1999).
It is however noticeable that risk management as it relates Nigeria has not been given concrete attention. This has contributed to the failure of projects and some projects not being delivered in conformance to the specification required by the federal government. This has led to the retardation and slow development on the entire Nigeria infrastructure and sectors. Due to this reason, the country has come out with a visionary statement published by the Concept for Nigeria's vision (2008) as "By 2020 Nigeria will be one of the twenty largest economies in the world able to consolidate its leadership role in Africa and establish itself as a significant player in the global economic and political arena". This report believes that the risk that has led to the slow or poor development of Nigeria and the construction sector specifically was caused by the stakeholders involved in the projects. Therefore, it is best for the risk relating to projects stakeholders to be identified proactively and eradicated so as for the vision of the country to be achieved sustainably.
About 50-60% of the capital investment in developing countries goes to construction related activities and projects (Dharwardker ,1979) and this not effectively managed usually results in the waste of the allocated investment on such projects. A report according to the planning committee on national construction policy (1989) explained that the Nigeria construction projects during the 1980's contributed about 70% of the Gross domestic product (GDP) of the country and, contributed immensely to the overall country's development during that period. Unfortunately, by 2004, the GDP of Nigeria on construction projects has decreased to 1% which was primarily as a result of various factors ranging from poor performance to unidentified causes (AfDB/OECD, 2006).
Also, with the vision of Nigeria to become among the twenty most industrialised and developed nation in the world by the year 2020 with aim of having a GDP and a national per capital income per year target of not less that $900 billion and $4000 respectively( Oni,2010), it is however important to discover the chief risks which has contributed to the past decrease in the GDP and poor development of the of the Nigeria construction sector and also, recognise hindrances that will stand to the achievement of the vision 2020 successfully as well as continuous sustainability of the Nigerian construction economic sector . Therefore, this report seeks to identify the most inherent risk in the Nigeria construction projects which when analysed and resolved, will lead to a proper construction project management, boost the Nigeria economy, fostering development and allowing Nigeria to stand in the level of highly developed countries.
1.3.3 Academic Rational
More researches are beginning to be carried out on the topic risk and risk management. This report seeks to pick this opportunity to carryout a research topic on risk as it related Nigeria and this will be carried out with the aid of literature review based on secondary research. However, it is anticipated that the project when completed will be further explored by other researchers using both primary and secondary research for the purpose of coming out with more facts and real time information relating to the topic area.
1.4 Research schedule
NAME OF TASK
Research for topic areas
Select project topic
Review selected project topic
Submit topic to supervisor
Review topic and finalise topic area
Draft research proposal and
Discuss proposal with supervisor
Approval of research topic
Draft research schedule
Source for relevant literatures
Draft research introduction
Draft research rational
Submit and meet with supervisor for clarifications and approval
Project research plan approved
Draft literature review; report findings and methodology
Submit and meet with supervisor for approval
Draft data analysis, conclusion and recommendation
Submit conclusion and recommendation to supervisor
Proof read and edit write-ups
Write table of content and Abstract
Pass report through plagiarism software
Burn report to CD
Print and bind final report
Submission of final report
Final report submitted
Table 1: Research schedule
1.5 Gantt Chart
The Gantt chart which explains the project research schedule is as shown in appendix â€¦.
1.6 Project Deliverables
The deliverable which this report seeks to achieve includes the following
The project research plan
Project literature review and report findings
Report conclusion and recommendations
During the cause of this report, the following assumptions have been taken:
The project title will be flexible to changes until the final report has been concluded
The stakeholders that will be discussed in this report are all primary key construction project stakeholders.
The report will not be bound with restrictions that will impede the collection of literature data
This report will end up as a proposal and as such, further research on the topic area will be carried out by other researchers and the use on primary research for real and raw information interpretation
No change in project scope
1.8 Critical success factors
The success of the this project depends on some factors; these include
An effective communication in place between the researcher and the project supervisor
Strict conformance to the outlined research schedule
A clear understanding of the project vision and making sure the research is been carried out on relevant topic areas
1.9 Research constrains
The main limitation that will hinder the delivery of this project is time and resources constrain. The time available for this report to be carried out is very short and basically not enough and as such, there would have been availability of enough resources on the different topics areas and use of primary data/research methodology.
This not-availability of real/primary data and information from the stakeholder's particular to the Nigeria construction industry as well as some from other international construction projects/countries is another major constrain to this report. This therefore is due to the fact that the research is constrained to using basically secondary data for its interpretations.
1.10 Research scope
The scope of this project includes
Carrying out the project report based on secondary research and at the closeout phase, will give a proposal for primary research to be carried out by other researchers.
The entire report will have a total of five chapters.
The primary focus of this report will be how stakeholders in the Nigeria construction projects have contributed to the construction project risk and delays.
1.11 Scope exclusions
The project scope does not include the following
Analysing the risks based on project technical risk point of view
Carrying out the research using primary research
In conformance to the research methodology specified for this project, this report will be carried out strictly on secondary research. The materials used for this report will be sourced from textbooks, journals, news letters, white papers, lecture note, internet sources and critical evaluations of already written literatures. Also, a case study of the risk management process of a UK construction company will be carried out by secondary research so as to make comparison to the risk management practice of the Nigeria construction project sector.
1.13 Research requirements
The materials to be used will be strictly secondary and will be made available mainly from the school library, international journals, textbooks and other already written literatures related to this topic area. Mostly, literature on the area can only be assessable from international journal sites where by there needs to be a pre-registration before accessibility.
1.14 Ethical consideration
In conformance to the university ethical research policy, the following ethical consideration has been made for this project report:
The write-ups of this report will not be revealed to any other student except the report has been finalised and submitted. This is to avoid plagiarism which is against the university policy.
The secondary data to be used for this report will be accessible through the university library resources and other sources.
All findings of this report should be kept confidential and not revealed to any organisation unless there is a due permission from the university and the researcher.
The authors used for literature reviews will be adequately acknowledged by being referenced.