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Construction industry plays a decisive role in healthy development of any nation. Not only large but even small construction projects contribute to a country’s economic growth. Hence its activities involve complex and dynamic processes. Successfully completion of construction projects leads to wealth creation, socio-economic growth and improved living standard. Meanwhile, these projects have abundance of risks which has brought about low profit margin to contractors; cost and time overrun; poor quality delivery and aborted projects; thus the need for effective management to ensure successful delivery and sustainability of construction projects. Risk management is one of the most critical project management practices in order to achieve project objectives in terms of time, cost, quality, safety and environmental sustainability. The aim of this research was to develop an appropriate model that enables efficient management and project delivery in Nigeria using capitalization of construction firms in the country as a tool. The research investigated risks militating against successful project delivery in Nigeria. This study adopted a descriptive cross-sectional survey design. Questionnaires, oral interviews and case study were conducted and utilized. The entire 198 construction firms in Nigeria in category of large form the population for the study. The 15 (fifteen) companies that emanated from merger and acquisition were used for the study. The instruments used for data collection were: researcher-developed structured questionnaire based on five point rating scale; interviews; and focus group discussion. The instrument had section A and B. Section A comprised the respondents’ demographic characteristics, while section B contained item designed to generate data on research objectives. A total number of 65 persons from the selected companies were involved in the focus group discussion. The validity of the instrument was carried out by the researcher’s supervisor and two experts in the field. Reliability of the instrument was established by applying split-half method. Kendall’s coefficient of concordance was used to test the data and a degree of agreement was obtained. Data were subjected to descriptive statistics and analyzed using analysis of variance, t-test, and SPSS.


The study identified and ranked factors (in descending order) that have significant impact on the project delivery and performance in Nigeria as: inadequate cash flow, corruption, security, unstable exchange rate, locations, project complexity, poor construction management, and government policy. The average level of risk management awareness among stakeholders is 58% which is relatively low. Identified risk factors affect the quality of job executed, construction and completion time and overall cost of execution. The identified impacts of capitalization were; increase in turnover (24.5%), improvement image (24.5%), risk reduction (20%), business expansion (17.3%), and geographical spread (13.6%). A decision roadmap for sustainability project delivery was developed using four decision criteria namely; client’s goal, stakeholders’ involvement, identification of risks and capitalization.

The study has established a basic level of awareness and understanding among construction practitioners that capitalization can be used as a tool for delivering strategic objectives in the management of construction risks in Nigeria. The study strongly advocates the inclusion of risk management evaluation as part of the construction procurement process. The proposed model in the study provides a useful guide needed by the institutions to navigate to future competitive success in higher education risk/construction management.





Approval page

Abstract                                                                                                                                  i

Acknowledgements                                                                                                                iii

Declaration                                                                                                                              iv

Definitions of terms                                                                                                                v

Abbreviations used in the study                                                                                             vii

Dedication                                                                                                                              viii

Chapter 1                                                                                                                           

1.0       Introduction                                                                                                                1

1.1       Backgrounds                                                                                                               1

1.2       Problem formulation                                                                                                   3

1.3       The statement of problem                                                                                           4

1.4       Research questions                                                                                                      5

1.5       Research hypotheses                                                                                                   5

1.6       Research objectives                                                                                                     6

1.7       Justification for the study                                                                                           6

1.8       Research methodology outline                                                                                   7

1.9       Limitation of study                                                                                                     8

1.10     Scope of the research                                                                                                  8

1.11     Research organization                                                                                                 9

1.12     Critical evaluation of the research approach, techniques and limitations of study     10

1.13     Research overview                                                                                                      12


Chapter 2

2.0       Review of related literature                                                                                        14

2.1       Construction projects                                                                                                  14

2.1.1    Project definitions and features                                                                      14

2.1.2    Project priorities                                                                                              17

2.1.3    Defining project success                                                                                 19

2.2       Road to successful project delivery                                                                            20

2.2.1   The conception stage                                                                                      22

2.2.2    The documentation stage                                                                                23

2.2.3    Tender stage                                                                                                    24

2.2.4    The execution stage                                                                                        25

2.2.5    Completion and demobilization                                                                      25

2.2.6    The review or evaluation stage                                                                       25

2.3       Uncertainty in projects                                                                                                26

2.3.1    Variability associated with project success                                                     26

2.3.2    Uncertainty about the basis of estimates                                                        27

2.3.3    Uncertainty about design and logistics                                                           27

2.3.4    Uncertainty about objectives and priorities                                                    27

2.3.5    Uncertainty about fundamental relationships between project parties           28

2.4       Parties to project execution and their roles at each work stage                                  28

2.5       Critical path in project cycle                                                                                       32

2.6       The industry for project execution                                                                              34

2.6.1    The nature of the construction industry                                                         34

2.6.2    Specific characteristics of construction sector                                                36

2.6.3    The size of the construction industry                                                              37

2.6.4    Management organisation system in the construction companies                  40

2.6.5    Review of Nigeria construction industry                                                        40 Performance of construction firms in Nigeria                         41 Economic contribution to the national growth                                   42

2.7     Project sustainability                                                                                                     43

2.7.1    What makes construction sustainable?                                                           45

2.7.2    Achieving sustainable construction                                                                46

2.7.3    Sustainability risks management                                                                     47

2.7.4    Benchmarks for sustainable infrastructure delivery                                        47

2.8       Risks in construction projects                                                                                     49

2.8.1    Definition of risk                                                                                            50

2.8.2    Risks; threat to successful project delivery                                                     51

2.8.3    Risk terminologies                                                                                          52 Risk, threats and opportunities                                                           52           Probability, impact and proximity                                                      53 Difference between risk and hazard                                                   54 Difference between risk and issues                                                    54

2.8.4    Factors affecting risk                                                                                      55

2.8.5    Risk classification                                                                                           56

2.8.6    Common sources of risk in construction projects                                           59

2.8.7    Contractual risks                                                                                             60

2.9       Risk management (RM)                                                                                              61

2.9.1    Risk management history                                                                                61

2.9.2    Description of risk management                                                                     64

2.9.3    Principle of risk management                                                                          65

2.9.4    Risk control measures                                                                                     65

2.9.5    Measures to avoid risk                                                                                    68 Measures to reduce risk                                                                      68 Measures to prevent risk                                                                     68 Measures to transfer project risk                                                         68 Risk retention measures                                                                      68

2.9.6    Projects that need risk management                                                               68 Awareness of risk management                                                          69 Risk management team                                                                       69 Risk management approaches                                                             69

2.9.7    Advantages of risk management                                                                    70

2.9.8    The implementation of risk management in construction                               71

2.9.9    Managing project risk through effective communication                               73

2.9.10  Response to risk                                                                                              74 Risk management identification                                                       74 Risk identification techniques                                                          74 Risk management assessment                                                           75 Risk monitoring and controlling                                                       76

2.9.11 Risk management outputs                                                                               76

2.10     Risk management in Nigeria construction industry                                                    77

2.10.1 Contractor’s working capital                                                                           83 Other challenges of working capital management

facing Nigerian indigenous contractors                                                          85

2.11     Reducing financial risk in construction                                                                      86

2.11.1 Risk measurement and metrics                                                                       88

2.11.2 Risk measurement process                                                                              90

2.12     Previous studies on construction companies                                                               91

2.13     Construction funding and capitalization                                                                    92

2.13.1 Firms consolidation through merger and acquisition                                       94 Background of consolidation                                                           94 Types of combination                                                                       98

2.13.2 Reason for consolidation                                                                                99 Literature theoretical insights on firms’ capitalization

and consolidation                                                                                            100 Empirical evidences on firms’ capitalization                                    103 Demystified processes                                                                      104

2.14     Reference cases of merged firms                                                                                105

2.14.1 Millstone Weber                                                                                              105

2.14.2 AECOM and URS                                                                                         105

2.14.3 Ascot Africa limited                                                                                       106

2.14.4 Julius berger                                                                                                    106

2.14.5 Employees’ engagement in consolidation.                                                       107

2.14.6 Strategies for a smooth merger                                                                       108 Consolidation approval                                                                     109 Procedure for obtaining merger and acquisition                               109 The role of SEC/NSE and can as regulatory

authorities in mergers and acquisition.                                                            109 Brand implication                                                                             111 Structure implication                                                                         111

2.14.7 Forms of mergers                                                                                            111

2.15     Prospects of firms after consolidation                                                                                    112

2.16     Global view of consolidation                                                                                      114

2.16.1 Historical perspective of capitalization                                                           114

2.16.2 Revenue of firms and class after merger                                                        116

2.16.3 Class of sectors and revenue after merger                                                       117

2.16.4 Firms involvement in acquisition process                                                        118

2.16.5 Track record of consolidation (m erger and acquisition)                                 119

2.16.6 Challenges of consolidation                                                                             120

2.17     Past research work on risk assessment and management                                            121

2.18     Chapter summary                                                                                                        129

Chapter 3

3.0       Research methodology                                                                                               130

3.1       Research method                                                                                                        130

3.2       Classification of research methods                                                                             132

3.2.1    Subjective and objective researches                                                                132

3.2.2    Approach adopted for the research (mixed or multi-methodology)               132

3.3       Research design                                                                                                          133

3.4       Framework for risk management evaluation                                                               134

3.5       Data sources and collection instruments                                                                     135

3.5.1    Stage 1-preliminary information gathering                                                     136

3.5.2    Stage 2-case study                                                                                          136

3.5.3    Stage 3-interviews                                                                                          137

3.5.5    Stage 4-questionnaire surveys                                                                         139

3.6       Populations for the study                                                                                            141

3.7       Determination of sample and sampling technique                                                      142

3.7.1    Relative significance index scores (RSISS)                                                    143

3.8       Data validity, reliability, ethics and limitations                                                          144

3.9       Method of data analysis                                                                                             146

3.9.1    Relative importance index (RII)                                                                     146

3.9.2   Kendall’s coefficient of concordance                                                             146

3.9.3    Data analysis software                                                                                    147

3.10     Chapter summary                                                                                                        148

Chapter 4

  • Results, analysis, and discussion                                                                                149

4.1       Results                                                                                                                        149

4.1.1    Respondents’ area of specialization                                                                149

4.1.2    Respondents’ geographical location                                                               150

4.1.3    Respondents’ years of experience                                                                  151

4.1.4    Risk management practise                                                                              151

4.1.5 Performance of construction firms in Nigeria                                                    153

4.1.6 Financial strength of firms in Nigeria                                                                154

4.1.6 Ability of firms to acquires professional services                                              155

4.1.8 Target of Nigeria construction firms                                                                  156

4.1.10 Take off of construction project                                                                      157

4.1.11  Knowledge about capitalization                                                                     159

4.2       Information on the risk management in Nigeria                                                         159

  • Risk effect on project’s objectives                                                 160

4.2.2    Respondents’ definition of risk                                                                      161

4.2.3    Identified risk factors                                                                                     162 Severity analysis of the factors affecting project delivery                 163

4.2.4    Capitalization-merger/acquisition                                                                  165 Partnering among firms                                                                       165 Merging with partners                                                                         165 Form of capitalization recommended                                                 167 Benefits of merger                                                                               168

4.2.5    Challenges of capitalization                                                                            169

4.3       Hypothesis testing                                                                                                      170

4.3.1    Significant effect of risk factors on the project delivery                                170

4.3.2    Significant impact of risk management on the project delivery                     171

4.3.3    Significant impact of capitalization on construction firms                             172

4.4       Case studies                                                                                                                172

4.4.1    Company ‘a’ record and document analysis                                                   174

4.4.2    Company ‘b’ record and document analysis                                                  175

4.5       Presentation and analysis of interviews                                                                      177

4.5.1    Interviewees and their roles in the companies                                                177

4.5.2    Summary of in-depth interviews                                                                    177

4.4.      The framework                                                                                                            178

Chapter 5

5.0       Summary, conclusions and recommendations                                                            180

5.1       Conclusion                                                                                                                  180

5.1.1 Identify risk factors that hinder sustainability and successful

project delivery in Nigeria;                                                                                         180

5.1.2    Evaluating the awareness of risk management amongst

construction stakeholders in Nigeria;                                                                          180

5.1.3    Investigate impact of capitalization on sustainable risk management;           181

5.1.4    Formulate a decision roadmap for sustainable successful project

delivery in Nigeria                                                                                                      181

5.2       Summary of the main research findings                                                                     181

5.3       Challenges/constraints to risk management                                                                182

5.4       Recommendations                                                                                                      183

5.4.1    Recommendations for higher education institutions/universities                   183

5.4.2    Recommendation for the Nigerian construction                                             183

5.4.3    Recommendations for researchers/academics                                                 184

5.5       Areas for further research                                                                                           184

5.6       Contribution to knowledge                                                                                         185

5.7       General conclusion                                                                                                      185

5.8       Caution                                                                                                                       186

Reference                                                                                                                                187






1.1       Background

Dealing with risks and uncertainties is usually a problem for contractors and owners. This problem might end up with substantial financial losses for both parties. The sources of risks and uncertainties in a project are several. And not only is the size of a project the main factor that causes risk, but there are also other factors such as cash flow, underestimation of direct costs, and quality problems (Khalafallah, A 2002). Risk and uncertainty often involve many participants in a project. And each participant uses his own methods of analyzing and managing his scope relevant risk items. For whatever method used, it should objectify and quantify the risk in a project and provide the measurable means of diversifying or sharing the risk among the project participants. The willingness of a participant to accept risks often reflects the professional competence of that participant as well as his tendency to risk. And, since usually each participant tries to minimize his own risk, conflict rises between the participants and sometimes this conflict can be detrimental to the project.


In Nigeria, the construction industry was the dominant contributor to the nation’s GDP in the 1980s, accounting for about 70% of the GDP (Planning Committee on the National Construction Policy, 1989). This made the industry very strategic to Nigeria’s developmental efforts. Unfortunately, however, the industry has been bedevilled by a combination of low demand and consistent low productivity and poor performance over the years (Adeyemi et al., 2005 cited by Ugwu 2013). This has reduced its contribution to the national economy to a mere 8.91% of the GDP in 2013 (World Bank, 2014). Over the world, construction activity is regarded as the principle sign of growing economic activity. Risk and uncertainty are inherent in all construction works, no matter the size of the project. Poor risk management has contributed to reduction in economic add-up of the sector to GDP. Although, size of project is one of the major causes of risk, other factors that carry risk within them include speed of construction, location of project, technology being used and familiarity with the work. A construction project is also vulnerable to political, economic, social and environmental conditions. The procedure of taking a project from inception to completion, and then into use, is a complex one that entails time-consuming design and production processes (Ahmed & Azhar, 2004). Hence, since each project has a specified mission or purpose to be achieved; each project mission is unique in itself, and no two projects are ever alike.  Projects’ successful delivery differ from each other in one or more influencing factors such as client and contractors’ input, quality specifications, resources employed, responsibilities delegated and the project environments  (Chitkara, 2006). Project objectives tend to change, as well, there are changes in design, work methods, responsibilities of parties, etc. which result in an increased vagueness of conditions. The participants in the industry have been agonizing outcomes of failure in the form of unusual delays in the project completion with cost overruns and many times, something failing to meet quality standards and operational requirements. An effective analysis and management of construction associated risks, remain a big challenge to industry practitioners (Syed and Azhar, 2004).Thus, construction industry demands systematic risk management approach. All too often, risks are either ignored, or dealt with in a completely arbitrary way. In a business, as complex as construction, such an approach is often inadequate (Hayes, et al., 1986 cited by Walke, 2012). Failure to perform effective risk management can cause projects to exceed budget, fall behind schedule, miss critical performance targets, or exhibit any combination of these troubles (Roberts and Fussell, 1999). The construction industry, perhaps more than most, is overwhelmed with risks.  Ehsan et al. (2006) iterated that, it is highly risk prone, with complex and dynamic project environments creating an atmosphere of high uncertainty and risk. The industry is vulnerable to various technical, socio-political and business risks. Deviprasad (2007) further stated that too often, this risk is not dealt with satisfactorily and the industry has suffered poor performance as a result. According to Pritchard (2001), most of the decisions, including the simplest ones, involve risks.

Risk management is an important part of the decision-making process in construction and now widely accepted as a vital tool in the management of projects (Kangari 1995 cited by Wenzhe Tang et al 2007). Risk management is a complicated process that interrelates with many other processes in the construction industry and on construction projects (Alexander, 1998; Chapman, 1997; Grey, 1995 cited by Holland, 2006). Investigating project risks includes studying potential events that may affect the scope, cost, time, or performance of the project’s objectives. Investigating potential risks requires the collaboration of all disciplines contributing to the project. Technical, managerial, financial, and administrative departments of the participating firms need to cooperate to identify and respond to expected risk events. This integrative process needs practical experience to adapt the required environment (Smith, 1999 cited by Nnadi & Ugwu, 2014).


1.2 Problem formulation

The key issues in project delivery are completion time, value or quality of delivery, final cost and project sustainability. The fact that working drawings and bill of quantities state how the work should perform at stated period and cost, explains these key issues. But, the question is “how well was the work carried out?”; “when precisely was the project delivered”, “what the final construction cost of the project was” and “how sustainable is the delivered project”. At least, three basic perspectives must be considered in this respect:

  1. Client, and how their requirements or desires are met in terms of the quality/outcome of project; the time the work was delivered and the final amount paid;
  2. The consultant, and their performance in terms of project monitoring, assessment and recognition of certificate and authority over the project; and
  • Contractor and his ability to add value; if gotten necessary support from the duo above.
  1. The people and how the project affects their social, economic and environmental activities.

According to Aibinu and Odeyinka (2006), ‘risk is inherent in any construction project right from inception through its completion’.  In that wise, the practitioners must partner in managing the risk involve, ensuring the success of the project.

Edwards and Bowen (2005) define risk as the probability that an adverse event will occur during a stated period of time. There are many risks that are associated with poor project delivery in Nigerian construction industry. Some of these problems include:- constant design changes, cost overrun, poor estimates, variations,  delays in honouring certificates or payment for completed works, misunderstanding of contract documents, accident, unavailability of competent staff         (experience and quality) and non sequencing of work to scheduling etc.


In summary, the main problem addressed in this research may be stated as follows:

  • Most construction stakeholders do not take adequate risk management measures. Contractors are awarded contract without proper evaluation in terms of their financial, equipment and expertise capacity. These have resulted into constant conflict on site, poor project execution, time and cost overrun, abandonment and untimely ‘death’ of projects.
  • Level of risk management awareness among construction stakeholders in Nigeria is low and impacts significantly on project delivery;
  • Risk has huge and visible effect of final project cost, delivery time and quality of job done;
  • Project success in Nigeria is peculiar and has many factors responding to the downward output;
  • The industry is financial incapacitated to fund or start off project without mobilization which is below best practice standards;
  • The above hypotheses were postulated in line with the research problems and related to measurable risk management for sustainable project delivery identified and discussed in the literature.

Since risk has become inevitable in construction works; to ensure successful project delivery, managing risk is therefore an integral part of good management, and fundamental to achieving successful project outcomes and the effective procurement of goods and services. Hence, risk management provides a structured way of assessing and dealing with future uncertainty. Having ascertained the damage risks could do to construction projects; its proper management is essential in order to prevent the colossal failure of the projects which subsequently affect the national economy adversely.


1.3 The statement of problem

Most stakeholders in Nigeria Construction industry; the clients/developers, contractors and the consultants (the architects, engineers, and quantity surveyors), etc. rarely implement risk management during the work or project schedule. Despite the fact that most of them are aware of the threat risk poses on construction projects; its identification and management before the award of contracts, has not been regarded as an area of legitimate interest, which has resulted several times into project cost overrun, collapse of structures, project delay, poor or malfunctioning of the delivered project or even premature death of many projects.

Several researchers have proposed a number of methods and models for dealing with risks and uncertainties. Generally, these models were characterized by their complexity and high mathematical treatment and thus difficult for application. As a result, usually most of the contractors neglect these methods, and based on their intuition they set a percentage for cost contingencies. The main factor they might take into consideration might be the project size and complexity. This approach of setting the contingency percentage intuitively, could either lead to losing the bid or leaving money on the table. Therefore, there is need for a simple model to ensure sustainable project delivery in the Nigeria construction industry.


1.4       Research Questions

  • (i) What are the risk factors that hinder sustainability and successful project delivery in Nigeria;
  • (ii) What is the level of awareness of risk management amongst construction stakeholders in Nigeria;
  • (iii) What are the impact of capitalization on sustainable risk management and;
  • (iv) How effective can a model serve as the roadmap for sustainable project delivery in Nigeria.


1.5 Research hypotheses

In order to know whether their exist disagreement or agreement by the construction stakeholders on the ranking of the factors that affect the delivery and sustainability of the construction projects, a null hypothesis test was used. The test is as follows:

H0:  There is disagreement in rankings of risk factors affecting construction project delivery among the stakeholders.

H0:        The level of awareness of risk management is low and impacts significantly on project delivery in Nigerian construction industry.

H0:       There is no significant impact of capitalization of construction firms in achieving project delivery in Nigerian construction industry.


The industries that are not adaptable and flexible, do not respond to the demands of changing needs in the system. The problem statements and hypothesis are not mutually exclusive, but inextricably related in the development and validation of the research.

1.6       Research Objectives

The aim of this research was to evaluate the challenging issues of sustainable risk management for successful project delivery in Nigeria. In this regard, the following represent the specific objectives of the study:

  • Identify risk factors that hinders sustainability and successful project delivery in Nigeria;


  • Evaluate the awareness of risk management amongst construction stakeholders in Nigeria;


  • Investigate impact of capitalization on sustainable risk management and;


  • Formulate a decision roadmap for sustainable project delivery in Nigeria.



1.7 Justification for the Study

Risk management is still a developing field of knowledge and expertise. There is a great need, therefore, for research that provides an objective assessment of risk management as it affect successful project execution and delivery in Nigeria. In recent times, Nigeria’s construction sector accounts for 1.4% of its GDP (National statistics, 2013). This contribution to total GDP has remained at abysmally low levels. Years back; precisely in 1981, the construction sector accounted for 5.8% of Nigeria’s GDP, and in the last three decades, Nigeria’s total GDP has been raised to approximately 495 times its size. On the contrary, construction sector GDP, has only grown backward of its size in 1981. Notably, the drivers of Nigeria’s GDP over the last three decades have remained the same–Agriculture (crop production), Crude oil production and Wholesale & Retail trade. This shows that the GDP growth of the industry is declining .i.e. from 8% in 2010 to 7.1% in 2012, (Nnadi, 2014).  It also indicates that its growth is in the ratio 1.25: 4.95 if compared to other contributors to the economy. It is evident therefore, that Nigeria is way below realizing its potential in the construction industry.

The major factor responsible for this inability of the sector to live up to expectation is a quantum of unidentified and/or unmanaged risks in the industry. This calls for proactive risk management strategies in the industry in order to achieve her optimal level and performance. Poor estimates, claims, greed, corruption, constant change in design, poor financing of project not only affect the realization of the clients’ dream, but the overall performance of the industry to economic growth. In Nigeria, stakeholders have continuously expressed concern over failure of projects to meet expected standard; over failure of projects to be delivered at appropriately stipulated period and at reasonable cost which invariably characterized the system. Meanwhile, public perception of evaluation is very low and building performance is widely seen as unpredictable in terms of user expectation and quality standards (Nwosu, 2007).

Although there is an understanding among designers and other stakeholders in the industry that there are risks militating against construction works, there is little or no specific research on how, and to what extent risk management influence the successful delivery of construction projects in Nigeria and at what stage of work must risk management be utilized. In other words, there have been relatively few or no detailed studies on this issue. These concerns provide the basis or rationale for the study and the findings will, therefore increase risk awareness, identification and implementation in Nigerian construction industry.  It also identifies and ranks the risk that most contribute to project failure in Nigeria. It also assesses the work stage that is more prone to risk effect. Again, since knowledge in this area is not yet adequate, the findings if successful will provide the industry and the university with the instrument needed to navigate to future project success and contribute to knowledge in this area of study. The Nigerian construction industry will become better off.  It will facilitate taking effective decisions on proper risk management in Nigeria construction industry so as to enhance sustainable project delivery. Having done this, cost overrun will reduce and subsequently improve the contribution of the sector to economic growth.


1.8 Research methodology outline

The methodology for this research is structured around risk management as it enhances successful project delivery with a focus on the construction stakeholders. The study therefore attempts to determine the extent to which users’ needs were met with respect to some identified measures within the target organizations. In this context, the outline of the study methodology includes:

  • (i) In-depth examination of the country and study context;
  • (ii) A descriptive understanding of risk management as it affects construction projects and related concepts;
  • (iii) Identification of risk and its effect on work stages in the industry;
  • (iv) General level of risk management awareness and performance evaluation among the practitioners in the industry;
  • (v) The extent to which client and other stakeholders’ needs were satisfied or met in the target industry.
  • (vi) Evaluate the construction industry in Nigeria and identify a more robust working principle.

The research adopted the case study approach with a mixed method of data collection. The mixed method involved both qualitative and quantitative data sets. The main instruments of data collection are interviews, focus group discussions, questionnaires, reviews and observations. The case study involves the analysis of capitalization process as a risk management practice in Nigeria and the world. Evaluation of the case studies start with a descriptive approach, identifying the mission, characteristics and result of merger and its effect on construction projects executed. This would be followed by the qualitative and quantitative analysis of data from the study. Based on the findings of the study, a conceptual graphical model would be proposed to guide management in taking decisions concerning risk management measures. The role of the quantitative data throughout this research is to support the qualitative findings.



1.9       Limitation of Study

A number of factors militated against this research work.  The first was the attitude of respondents who were reluctant to provide answers to the questions asked in the questionnaire.

Secondly, a study of this magnitude requires a much longer time compared with the normal academic workload. Scanty information is made available by most construction companies in terms of their operations, staffing and profit. Corporate Affair Commission of Nigeria bestowed with the responsibility of registering firms in the country has poor documentation of this firms in terms of the classes they belong; thereby making it difficult to ascertain the construction firms operating in Nigeria.


1.10     Scope of the Research:

The scope of this research is to design a model to make it easier for ensuring sustainable risk management in Nigeria using capitalization as the tool. The client or developer under study include government Ministry of Works both Federal and State, parastatals like Federal Road Maintenance Agency (FERMA), Niger Delta Development Commission (NDDC), while the total 198 large firms in Nigeria including the 15companies that had participated in the process of merger and acquisition were targeted and educated observers of the industry in the six geopolitical zones of Nigeria. The first section begins by bringing into focus the problems, aim and objectives of the research and proceeds to the explanation of methodology and methods. Subsequently, discussions of literature on the various philosophical assumptions and paradigms of research are presented. This leads to the philosophical position of the research and justifications. Discussions on the research design/ strategies and methods adopted are also presented in the light of the particular context of this research.



1.11 Research Organization:

The work of this research in the next chapters will be organized as follows:

Chapter 2: This chapter presents a review of the previous research work in the fields of risk management, construction activities in Nigeria and at global stage and capitalization as a vital risk management tool.

Chapter 3: This chapter presents an overview of the risk management process in construction. It presents the methodology of the research, describes the data collection technique and most of the techniques used to weigh each factors that contributed to risk in construction. It also examined the ranking of each of the factors base on the level of their impact on the project. Some of these techniques are:

  • Relative Importance Index (RII)
  • Kendall’s Coefficient of Concordance
  • Data Analysis Software like SPSS

Chapter 4: This chapter discusses the analysis of these data and presents the results of this analysis. It discusses level of awareness, effect of risk factors and the impact of capitalization on overall construction activities. Also, the steps of developing the capitalization risk tool model are also presented.

Chapter 5: This chapter will include the following items:

  • Summary of the research.
  • Recommendation for further research.





This is thus summarized in figure 1.1 below.

















Fig1.1 Graphical representation of the thesis structures

Source: Nnadi, 2015


1.12 Critical evaluation of the research approach, techniques and limitations of study

Given the philosophical underpinnings of this research, the approach adopted was both qualitative and quantitative or mixed method. The principal means of data collection was reviews, interviews, questionnaires, and direct observations. The purpose of the questionnaires was to corroborate the information provided in the literature as well as provide the quantitative data for hypotheses testing. The qualitative approach enabled the researcher to acquire a better understanding of the feelings, attitudes, experiences and perceptions of stakeholders in the case of firms regarding risk management to ensure successful project delivery.


A rich description of the respondents/stakeholders and the setting enhanced certain aspects of the study. The role of the quantitative data throughout the research was to support the qualitative findings. Simply put, although the researcher made use of questionnaires and graphic representation to illustrate data which are associated with quantitative research, this study was primarily a qualitative case study. However, both methods were employed and used in a complementary manner with the research benefiting from the advantages associated with each of the methods while at the same time avoiding the weaknesses of each. Since the study focuses on construction firms and the stakeholders (clients, consultants and the contractors), the case study strategy /design was adopted. The outcome was an in-depth description and enhanced understanding of the various issues related to risk management in ensuring successful project delivery. The multiple case studies were chosen because the researcher needed to inquire about the impact capitalization played in the identified firms. This design was descriptive in nature and therefore provided substantive information about the firms.


The sampling strategy adopted for the study was sequential involving first the stratified random sampling for the questionnaire administration and purposive sampling for group discussion and interviews. The need for informative subjects who can contribute and expand the phenomenon under investigation as well as the need for small sample size for the interviews informed the choice of purposive sampling. This approach helped to capture the views of the various stakeholders involved in the investigation.

The use of mixed method and case studies provided clarity and further enhanced the validity of the research. The multi-methods strategy for data collection and analyses allowed for triangulation. Different methods of data collection were used to corroborate the application of Risk Management for Sustainable Project Delivery in Nigeria construction industry. The researcher made a statistical presentation of data in form of graphs and tables and then presented a narrative interpretation of the findings.

The constructs applied in this research were drawn from the literature review and field surveys as demonstrated in the above discussions. The data collection phase of the case study included a series of interviews and document evaluation from the case firms and the CAC. For the purpose of this study, the focus was on the users or stakeholders (Clients, consultants and the contractors) and this generated some limitations to the study.


The first limitation of this study relates to the nature of the topic and strategic responses. Obtaining candid responses on sensitive information such as risk management was not easy. Another limitation in this respect is the problem of case study research on its own. Although qualitative research involves studying the respondents in their natural setting, no research can truly capture the full effect of the setting or the respondents because they are complex entities (Gay and Airasian, 2003:19). Respondents may not provide the researcher with the true reflection of events due to lack of understanding or time constraints. These issues are problematic and may not have allowed the free flow of information.


Coverage of this study was limited to two (2) firms as a compromise for in-depth studies. The literature review minimized the influence of the limited scope on the reliability of the study findings. Again, during the research, the respondents were informed about the research and assured of anonymity and confidentiality. This, according to Gray and Airasian (2003) are regarded as a limitation because the researcher, being involved with human beings will have to consider numerous ethical concerns and responsibilities to the respondents. It is difficult therefore to assess the extent to which these assurances allayed the fears of the respondents in the study.


1.13     Research overview

This study is concerned with risk management for sustainable project delivery in Nigeria construction industry. This was necessitated by the poor performance of the industry which presents tremendous challenges to the construction sector in terms of low contribution to the country’s GDP, profit earnings of the contractors; late project delivery, cost overrun and inability of the construction firms to expand beyond their location none execute complex or bigger projects. To provide a solution to this challenge, the thesis explored the application of capitalization as a toolkit for improving risk management in Nigeria construction industry. The thesis further demonstrated how this can be achieved by developing a conceptual graphical model based on the balanced scorecard. The model provides a systematic process of mitigating factors against successful project delivery. Its application for effective risk management lies on a clear understanding and objectives at the outset of the procurement process.

In pursuing the aim and objectives of the research, a multi or mixed method strategy was adopted with particular reference to the case organizations within capitalization (merger and acquisition) took place and which expands their operations. The case studies in the research presented a reasonable unit of analysis for impact of capitalization at a qualitative or subjective level.


Qualitative instruments such as interviews and group discussions were used to generate important constructs or themes from the target population. This was followed by a quantitative method of data production comprising the design, pre-test and administration of structured questionnaires to construction stakeholders. Data and information obtained from the quantitative research instruments were used to test the hypotheses. Accordingly, eight hypotheses guided the gathering and analyses of data and interpretation of results in line with the research problems and objectives. The thesis has endeavoured to provide a descriptive account of risk management and how the concept of capitalization could be a vital tool to ensure sustainable risk management.




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