Models And Methods For Selecting Project Risk Response Strategies

Normally,there are always some risks involved in project execution.For example,the risks such as management risks,cost risks and schedule risks usually exist in the execution level of an engineering project,such as construction project.In addition,IT projects and financial projects are also facing several risks caused by the internal or external factors during the execution.Once the risks occurred in the execution of a project,appropriate risk response strategies must be adopted to manage the risks;or the risks will directly affect the normal execution of the project as the consequences.Therefore,it has been always an important research topic on how to manage the project risk response,especially how to select the appropriate project risk response strategies.Currently,some scholars have engaged in the studies on the topics of selecting the project risk response strategies,and several decision-making analysis methods for selecting project risk response strategies have been introduced from different perspectives.However,project risk response is not an isolated and simple process in the reality.The cost of project risk response,total budget of project,project schedule,project quality and other factors related to the project should also be considered simultaneously.Generally speaking,the cost,schedule and quality of a project are regarded as three key factors to measure whether the project execution is successful or not.If only one or two of these three factors were considered,the risks that were caused by some other factors might be ignored.However the current studies on the project risk response strategies have not taken all these factors into account.Moreover,the risks involved in a project execution are not independent but inter-related.The construction project,for example,is always accompanied by the risks of injury,equipment damage and etc.Usually the risk of injury and the equipment damage are inter-related,which means if the equipment was damaged,the probability of the risk of injury will be increased as the result.However,the most of the existing studies were conducted based on the assumptions that the risks involved in a project are all independent;In addition,the occurrence of the project risks and the affects of those risks normally have a great level of uncertainty;So it will lead the collective of risk response strategies become undetermined and,the effectiveness and efficiency of certain risk response strategies become unpredictable;Unfortunately the most of the current studies of those risk response strategies are based on the situation in which the result has already known.Therefore,it is necessary to conduct further research on the models and methods for project risk response problems under the consideration of the characteristic of project risk management as well as the real requirement of the project risk response;After all,there are significances of these studies.The purpose of this thesis tries to take a thorough,theoretical and methodological analysis about the problems of selecting project risk response strategies considering the complex situation.Regarding the shortfalls of existing research,the specific works were presented in the following:(1)The model for selecting project risk response strategies with multiple risk factors is proposed.More specifically,an optimal model on selecting the project risk response strategy with multiple risk factors(cost,schedule and quality etc)is described.The constructed model not only considered the key factors on selecting the risk response strategies,but also studied the circumstances where one risk response strategy could solve multiple risk response problems and multiple risk response strategies solve single risk problem.The optimized method has also compensated the limitation that the previous method has had due to only considering the cost of risk response.By manipulating the model,the optimal project risk response strategies can be obtained.The method proposed in this thesis provides a strong support for selecting project risk response strategy when practicing the project risk management in reality.(2)The model for solving the project risk response strategy selection problem by considering two related project risks simultaneously is proposed.Specifically,for the project risk response strategy selection problem,a corresponding optimization model is proposed.First of all,after analyzing the project background,the conceptual and mathematical description of project risk response strategy will be created.Then,the analysis of the project risk response strategy selection problem is proposed by considering two related project risks in which one risk has an effect on another.On the basis of above analysis,an optimized model of project risk response strategy selection is constructed.Furthermore,the optimal project risk response strategies can be obtained by solving the given model.The proposed method could not only enrich the existing project risk response strategies selecting methods but also provide the theoretical foundation towards the research on the project risk response strategies selecting problem.(3)The method based on the analysis of similar case studies is proposed to solve the problem of selecting project risk response strategies in the situation of lack of project information.In the method,the similarities between the target project and the list of historical cases were drawn to make a comparison at first.Secondly,the project specification,project risk description and project risk response strategy description were calculated respectively.Then,the similar historical cases will be retrieved.Furthermore,for the response strategies used in each similar historical case,the effectiveness and efficiency on implementing their strategies were calculated.On the basis of above calculation,the overall utility of the risk response strategies is calculated by integrating the similarities and utilities;and then the desired risk response strategies can be determined according to the obtained overall utilities.The proposed method can be used to solve the project risk response strategies selecting problem,and has better serviceability and practicability.The method provides a new way to conduct the further study on the method for the project risk response strategies selection.The research and results in this thesis can be used to solve the selection problem of project risk response strategies in the complex situation,and provide the reference and guidance to the study on the project risk response strategies selecting problem.The research has important theoretical and practical values.