RISK MANAGEMENT PERCEPTIONS AND TRENDS OF US CONSTRUCTION

This paper discusses the current attitude of large U.S. construction firms toward risk, and determines how these contractors conduct construction risk management. The paper is based on a survey of the top 100 large U.S. contractors. After discussion of the current views, the results are compared with a risk survey conducted by ASCE. The study shows that in recent years, contractors have been more willing to assume risks that accompany contractual and legal problems in the form of risk sharing with the owner. Risks of this type include change-order negotiations, third-party delays, contract delay resolutions, and indemnification and hold harmless. The survey also found that contractors currently assume the risk associated with actual quantities of work, a notable difference from the findings of the ASCE survey. Finally, the attitude of contractors toward the practice of defensive engineering is determined. This is significant, as no previous survey has addressed or sought to quantify allocation or importance of this task.