An Effective Framework for Risk Management in the National Government Constituency Development Funded Construction Projects in Nairobi County

Abstract

While risk management is described as the most difficult area within construction management its application is promoted in all projects to avoid negative consequences. Despite the efforts by the national government, many construction projects funded through NG-CDF run a high risk of poor performance and have a reputation for time and cost overruns. Failure to manage construction risks in a more systematic way has made many CDF projects to stretch over the scheduled timelines, spending more than the baseline budget and missing the intended scope, settling for a poor performance than the initial target. The purpose of this study was to investigate effectiveness of risk management in the NG-CDF construction projects in Nairobi County, with a view of making recommendations that are geared towards upgrading the risk management process of the NG-CDF construction projects. A survey research design was considered in this study; the study was conducted in Nairobi County where it targeted two on-going CDF projects in each ward of the seventeen constituencies (each constituency has 5 wards) translating to a total of 170 projects. The accessible population to the research were Construction project managers charged with the responsibility of managing projects within their jurisdiction. The sample size was 118 Ward Managers, questionaires were used to collect primary data which was then analysed using descriptive statistics tools and presented in tables and figures. Further a regression model was developed to quantify the variables relationship. The study revealed that resource risk management had a positive significant influence on NG-CDF construction projects in Nairobi County. In line with the second objective the study revealed that risk management procedures play a positive instrumental role on performance of NG-CDF construction projects in Nairobi County. All the independent variables had negative correlation to the dependent variable. The model had an average adjusted coefficient of determination (R2) of 0.402 and which implied 40.2% of the variations on risk impact on NG-CDF construction projects performance in Nairobi County is explained by the independent variables. The regression model was as follows; Y= 1.242 -0.535x1-0.583x2-0.379x3 -0.551x4. The study concluded that strong risk management policies have a positive impact of on performance of NG-CDF construction projects in Nairobi County. To enhance the process, CDF risk management committee should benchmark its operations with other established organizations and that the risk management team should use an approved project management software for accountability and efficiency enhancement. The constituencies should have a well laid policy guiding the risk management process.The policy frame work should provide clear and strong basis for informed decision making at all levels of the organization.