Risks identification and ranking using AHP and group decision making technique: Presenting “R index”

• Main Authors: Safar Fazli, Mehrdad Mansourdehghan
• Format: Article
• Language: English
• Published: Growing Science 2013-02-01
• Series: Management Science Letters
• Subjects: Risk; Prediction; Risk identification; Risk importance; R index; Risk ranking
• Online Access: http://www.growingscience.com/msl/Vol3/msl_2012_323.pdf

One of the primary concerns in project development is to detect all sorts of risks associated with a particular project. The main objective of this article is to identify the risks in the construction project and to grade them based on their importance on the project. The designed indicator in this paper is the combinational model of the Analytical Hierarchal Process (AHP) method and the group decision – making applied for risks measurement and ranking. This indicator is called "R" which includes three main steps: creating the risks broken structure (RBS), obtaining each risk weight and efficacy, and finally performing the model to rank the risks. A questionnaire is used for gathering data. Based on the results of this survey, there are important risks associated with construction projects. There we need to use some guidelines to reduce the inherent risks including recognition of the common risks beside the political risks; suggestion of a simple, understandable, and practical model; and using plenty of the experts and specialists' opinions through applying step. After analyzing data, the final result from applying R index showed that the risk “economic changes / currency rate and inflation change" has the most importance for the analysis. In the other words, if these risks occur, the project may face with the more threats and it is suggested that an organization should centralize its equipment, personnel, cost, and time on the risk more than ever. The most obvious issue in this paper is a tremendous difference between an importance of the financial risks and the other risks.