A Method of Optimizing a Set of Programs for Mitigating Threats Related to the Undertaking of a Contract for the Execution of Construction Works

Katarzyna Budek-Wiśniewska and Roman Marcinkowski
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Katarzyna Budek-Wiśniewska: Faculty of Civil Engineering, Mechanics and Petrochemistry, Warsaw University of Technology, 09-400 Plock, Poland
Roman Marcinkowski: Faculty of Civil Engineering, Mechanics and Petrochemistry, Warsaw University of Technology, 09-400 Plock, Poland

Sustainability, 2021, vol. 13, issue 21, 1-12

Abstract: This article deals with the problem of limiting the risk of taking up a construction contract for the execution of construction works. The authors have developed an advisory system that will support the analysis of threats on the basis of existing experiences for a specific activity without having to construct an individualized organizational model of an investment. In order to identify a relatively complete set of threats that occur in investment and construction processes in road construction investments, as well as to identify possible programs of their reduction, a model and a method of optimizing programs for reducing risks related to contracts was developed. Threats are considered to be possible events that take place during the preparation, implementation and settlement of any contract. The programs concern specific actions that can be taken in relation to specific threats. Every program contains a set of threats that will be limited as a result of its execution and also has a specific implementation cost. The aim of the proposed optimization is to determine, with regard to costs, a combination of risk reduction programs that is appropriate for the risk states that are accepted by a decision maker. The problem is solved using graph theory and a minimum cover determination algorithm with the use of the minimum alternative formula ( mfa ) of the Boolean function. A method of actively responding to identified threats during the implementation of a construction contract should take the form of an advisory system that will provide an answer as to what risks should be taken into account when undertaking a contract, as well as what actions can be taken to reduce these risks.

Keywords: risk; construction process; construction contracts; optimization; risk reduction (search for similar items in EconPapers)
JEL-codes: O13 Q Q0 Q2 Q3 Q5 Q56 (search for similar items in EconPapers)
Date: 2021
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