Construction risk analyzer

Describe the project and what is in place. The analyzer applies fixed rules and returns each risk it finds, with the input behind it, why it matters, what usually helps, and what the rule cannot see.

The project

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What is in place
Reset to the example

Findings

Automated check by fixed rules. It assists your judgement and does not replace a qualified engineer or quantity surveyor.

10 findings: 4 high, 6 medium, 0 low.

    • High
    • cost

    Contingency is thin for construction

    Why
    A contingency of 3% leaves little room for quantities, ground conditions or prices that turn out different from the estimate.
    From your inputs
    Contingency
    What helps
    Set the contingency from a list of the project’s known risks and their likely cost, and agree who may draw on it.
    What the rule cannot see
    The 5% line is this tool’s rule of thumb. The right figure depends on how complete the design and the site information are.
    • High
    • schedule

    Imported materials take up much of the programme

    Why
    A lead time of 20 weeks (about 4.6 months) is half or more of the 8-month programme.
    From your inputs
    Lead time for imported materials; Planned duration; Materials imported
    What helps
    List the long-lead items, order them at contract award, and plan work that does not depend on them first.
    What the rule cannot see
    The tool assumes one lead time for all imported materials; real lead times differ by item and supplier.
    • High
    • schedule

    Foundations are designed without knowing the ground

    Why
    A building project without a soil or site investigation can meet ground that needs a different foundation, with redesign and delay.
    From your inputs
    A soil or site investigation; Project type
    What helps
    Commission a site investigation before the design is fixed, sized to the structure.
    What the rule cannot see
    Some small works on known ground may not need one; the tool cannot tell.
    • High
    • quality

    No plan for checking the work

    Why
    Without a quality and testing plan, defects in concrete, steel or finishes can be built in before anyone checks.
    From your inputs
    A quality and testing plan
    What helps
    Agree the tests, who does them, how often, and the hold points where work stops until it is checked.
    What the rule cannot see
    The tool cannot tell how much testing a project of this kind needs.
    • Medium
    • procurement

    No competitive check on price and capability

    Why
    A direct award has no competing offers to compare the price and the contractor’s capability against.
    From your inputs
    Procurement method
    What helps
    Record why a direct award was used, check the price against an independent estimate, and check the contractor’s past work.
    What the rule cannot see
    A direct award can be justified (an emergency, a sole supplier); the tool only flags the missing comparison.
    • Medium
    • logistics

    Long haul from the supply town or port

    Why
    250 km from the main supply town or port adds transport cost and time to every delivery.
    From your inputs
    Distance to the main supply town or port
    What helps
    Price transport separately, consolidate deliveries, and keep a buffer stock on site.
    What the rule cannot see
    The 200 km line is this tool’s rule of thumb; road condition matters as much as distance.
    • Medium
    • quality

    Skilled roles depend on people from elsewhere

    Why
    With 40% of skilled roles filled locally, the work depends on bringing in and keeping skilled staff.
    From your inputs
    Skilled roles you can fill locally
    What helps
    Plan recruitment and accommodation early, and pair incoming staff with local trainees.
    What the rule cannot see
    The 50% line is this tool’s rule of thumb; one missing specialist can matter more than the share.
    • Medium
    • documentation

    Permits or plan approvals are not in hand

    Why
    Work that starts before the approvals that apply can be stopped or have to be changed.
    From your inputs
    The permits or plan approvals that apply
    What helps
    Ask the local authority which approvals apply to this work and obtain them before starting.
    What the rule cannot see
    The tool does not know which approvals apply in a given place; see the construction laws and regulations page.
    • Medium
    • supply chain

    One supplier stands between the site and its materials

    Why
    With a single supplier for the main materials, one failure stops the site.
    From your inputs
    Suppliers for the main materials
    What helps
    Qualify a second supplier for each main material, or hold a buffer stock.
    What the rule cannot see
    The tool does not know the market for each material.
    • Medium
    • supply chain

    Most materials depend on imports

    Why
    60% of materials by cost are imported, so port delays, freight costs and exchange rates reach the project.
    From your inputs
    Materials imported
    What helps
    Order imported items early, allow for freight and exchange rate changes, and check for local alternatives.
    What the rule cannot see
    The tool does not track freight, customs or exchange rates.

What it is for

A structured first look at where a construction project is exposed, before the money is committed: the gaps in contingency, programme, procurement, access, quality control, paperwork and supply that most often cause cost and delay.

How it works

Each rule below looks at one or two of your inputs. When its condition holds, it adds a finding with a level. Nothing else is used: no outside data about places, prices or firms, and no model unless one is configured to write a short synthesis of the findings.

CategoryThe rule is triggered whenLevel
costContingency below 5% of the contract valueHigh
costContingency from 5% to under 10%Medium
costNo price adjustment clause, at least 30% of materials imported, and 12 months or moreHigh
scheduleImported materials and a lead time of half the planned duration or moreHigh
scheduleA building, road, water or port project without a soil or site investigationHigh
procurementDirect awardMedium
procurementProcurement method not decided or not knownLow
logisticsTrack only or no road accessHigh
logisticsMore than 200 km from the main supply town or portMedium
qualityNo quality and testing planHigh
qualityNo approved drawingsHigh
qualityUnder 50% of skilled roles can be filled locallyMedium
documentationNo signed contract with written conditionsHigh
documentationNo bill of quantitiesMedium
documentationPermits or plan approvals not in handMedium
supply chainOne supplier or none named for the main materialsMedium
supply chainHalf or more of materials by cost importedMedium

Assumptions

  • The thresholds (5% and 10% contingency, 30% and 50% imported, 200 km, 50% local skills) are this tool’s rules of thumb, not standards.
  • One lead time stands for all imported materials; a month is taken as 52/12 weeks.
  • A box left unticked means that item is not in place.

Example

The form opens on an example: a USD 250,000 building, direct award, 3% contingency, 8 months, 60% of materials imported with a 20-week lead time, one main supplier, 250 km from the supply town on a gravel road, 40% of skilled roles local, with a contract, drawings and a bill of quantities but no site investigation, permits, quality plan or price adjustment clause. It returns 10 findings, 4 of them high: contingency is thin for construction; imported materials take up much of the programme; foundations are designed without knowing the ground; no plan for checking the work.

Limitations

  • It sees only what you enter. A risk the rules do not describe (security, disputes over land, a funder’s conditions) is not flagged.
  • It does not know the place, the market or the firms involved, and it never rates a contractor.
  • It is not engineering, legal or financial advice. Use it to structure a review, not to replace one.

Related guides

More in Business and Costs.

The construction budget analyzer checks a cost breakdown; the laws and regulations page lists the texts we have found on permits and procurement.