Four tips on risk mitigation for construction businesses
Without proper planning and risk mitigation, construction can be a perilous business. Many construction projects can take longer than expected, go over budget or become embroiled in legal disputes. Workers’ safety can also become a problematic issue on construction sites.
These types of risks all pose a direct danger to a construction project’s viability. Minimising risks in a construction project is essential to maximising profitability. Not only that, risk mitigation is a task that, in some cases, is legally mandated by Australian law – particularly in the case of high-risk construction projects, where a Safe Work Method Statement (SWMS) is a legal requirement.
The following 4 tips can help you gain a better understanding of how to approach risk mitigation for construction businesses:
1. Determine the greatest risks to a project early on
It’s best to take stock of all risk factors and then work to prevent any possible resulting problems as early as possible in a construction project. It’s also ideal to prioritise risks and deal with the highest priority hazards first.
2. Research how others are managing similar risks
Construction businesses repeatedly face the same sorts of risks from one project to the next. When your business is new, you won’t necessarily be familiar with all of these possible risk factors – but experienced industry professionals will have already had to work through a good number of them. Simply researching and talking to experienced tradies in the industry will be helpful to you in managing known risks that are common to construction projects.
3. Use technology to minimise risks
There are multiple new technologies that can help you minimise the risks your construction business is vulnerable to. A couple of these include building information modelling software and unmanned aerial vehicles.
Building Information Modelling software
Building information modelling (BIM) is one of the top technologies that can help you with risk management in your construction projects. The sophisticated software utilised for BIM manages data about all aspects of a building project, including time projections and cost projections plus design and engineering details
One of the main benefits of BIM is its ability to help you uncover conflicts between fantasy and reality. This is possible because you can use the software to generate models that include complex space calculations and analysis of the structural details of a building. When you work through the modelling process, you’re quite likely to uncover any instances of incorrect measurements or faulty cost estimations.
Unmanned aerial vehicles
Your company can use unmanned aerial vehicles, also known as drones, to perform risky tasks that humans used to have to do. For example, you have the option to send a drone equipped with camera gear to get photos of a hard-to-reach bridge or building instead of making a human climb the bridge to perform the initial inspection. There may be times when you need to conduct environmental sampling for hazardous materials such as chemicals, pesticides, silica, lead, heavy metals or gases. Drones can be equipped to do this sort of sampling, which would be hazardous to your team of human workers.
4. Communicate your risk mitigation strategies
Any time you are carrying out high-risk construction activities, you will be required to carefully document and communicate the hazards that could result from these activities. You must also document the steps your company will take to minimise these risks. You’re required to make this documentation using a SWMS. Free SWMS statements are available on the internet. However, you might find it beneficial to pay for, and use, a more detailed SWMS statement that has been worked out by an experienced professional.
While SWMS documents are required in certain high-risk situations, there is nothing stopping you from using them even in lower-risk environments where the SWMS would not necessarily be a legal requirement. Others have developed and refined SWMS statements for a broad variety of building and construction scenarios – so why reinvent the wheel? Using the SWMS statements they’ve developed can be a smart and proactive approach to risk mitigation for your construction projects.
You can see that systematically working through this list of suggestions could substantially reduce the risks to your business. Reduced risk often translates to greater profitability – so here’s wishing you less risk and greater profits on your company’s next construction project.