Risk Approach—Risk Hierarchy or Construction Investment Risks in the Light of Interim Empiric Primary Research Conclusions
Abstract
:1. Introduction
2. Literature Review
- Risk aversion, which means that a given business does not take a certain economic step that is considered risky or ceases any economic activity;
- Risk reduction, one of the fundamental goals of businesses to make the most of their own assets can be further divided into three subgroups according to the authors:
- ○
- Damage prevention means accepting a certain degree of risk but with mineralization of the chance of occurrence;
- ○
- Damage mitigation, it seeks to resolve the situation after the damage event, the aim is to reduce the damage;
- ○
- Doing nothing, the risks are not addressed by the business strategy due to a presumed unlikely occurrence.
- Risk sharing, in some cases this might mean passing on or relocating risk. This is especially true in cases where the business either cannot or does not want to face a particular risk alone.
3. Material and Methods
4. Results and Discussion
4.1. Qualitative Results
- Continuity;
- Communication;
- Costs;
- Deadlines;
- Quality;
- Functionality;
- Style;
- Value for money;
- Effectiveness;
- Experience;
- Reputation;
- Availability;
- The whole project process and its stages;
- Psychological risk;
- The duration of the free decision, adherence to its framework.
4.2. Quantitative Results
- The risk group of the time generated for the duration of the project (construction) and the period of the investment (if work takes place in spring, summer, autumn, or winter);
- Some of the competencies related to the contractors cooperating in the project (problem solving, flexibility, availability, information exchange at the end of each work phase, and information about the next step);
- Changes in legal risks (non-compliant contract) and legislation as a risk (new taxes, contributions);
- Certain range of return risks (market factors change, so the project will not be financially successful, or the loan interest rate will increase).
- “Investment segment (residential or commercial-expenditure on construction)”, or;
- “health risk (for example, the investor becomes ill, or the contractor becomes ill during the process)”.
- Factor 1: “financial and legal risk group”, where the financial risks related to the return on investment and the risks generated by changes in the legal environment were included;
- Factor 2: “human and quality factor” in which the competencies associated with the professional, the quality of the project, and communication were included;
- Factor 3: “health and psychological risk factor group”, which included elements related to the adverse health effects of the investment, as well as psychological and social risk factors related to the investor, such as social perception and acceptance of the project, risk of identification with the end result;
- Factor 4: “range of risks related to the customer” means the flexibility of the customer, their background knowledge, the range of risks related to the investment segment;
- Factor 5: “time risk”, a group of risk factors generated by the duration and period of the project.
4.3. Characteristics of Segments by Risk Factors
- Cluster 1: “over-estimators”, i.e., the group of over-estimators of all risks who considered each risk factor to be more important than the overall sample average;
- Cluster 2: “collaborators, overestimating financial, legal and health risks” who focus on collaboration for whom the financial, legal, and health risks of the investment project were most important compared to the sample average;
- Cluster 3: “customer-based, overestimating health risks and psychological risks” for whom the financial, health, and psychological risks of the investment project were the most important;
- Cluster 4: “rationals” who keep in mind cooperation, quality, and the financial framework;
- Cluster 5: “under-estimators”, i.e., the segment of those “who underestimate all risks” for whom none of the risk factors were more important than the sample average.
4.4. Socio-Demographic Characters
5. Conclusions
Author Contributions
Funding
Institutional Review Board Statement
Informed Consent Statement
Data Availability Statement
Conflicts of Interest
1 | In the case of an open economy, it means that the total output (Y) is equal to the amount of the household consumption (C), the company investment (I), government purchases (G), and the net exports (NE) Y = C + I + G + NE, the net export is the difference between export and import (EX-I). |
References
- Balcerzak, Adam P., Tomas Kliestik, Dalia Streimikieneand, and Luboš Smrcka. 2017. Non-Parametric Approach to Measuring the Efficiency of Banking Sectors in European Union Countries. Acta Polytechnica Hungarica 14: 51–70. [Google Scholar]
- Banks, Erik. 2004. Alternative Risk Transfer-Integrated Risk Management through Insurance, Reinsurance, and the Capital Markets. Chichester: Wiley, 239p. [Google Scholar]
- Bárczi, Géza, and László (szerk) Országh. 1962. A Magyar nyelv Értelmező Szótára. Budapest: Akadémiai Kiadó. [Google Scholar]
- Boehlje, Michael, and David Lins. 1998. Risk and Risk management is industrialized agriculture. Agricultural Finance Review 58: 1–16. [Google Scholar]
- Castle, Emery N., Manning H. Becker, and A. Gene Nelson. 1987. Farm Business Management. New York: Macmillan Publishing Company. [Google Scholar]
- Chapman, Robert J. 2006. Simple Tools and Techniques for Enterprise Risk Management. Chichester: Wiley, 494p. [Google Scholar]
- Coenen, Markus. 2004. Risikomanagement und Risiko-Controlling im RWE-Konzern. In Controlling, No.2. München: Verlag Franz Vahlen, pp. 97–102. [Google Scholar]
- Coleman, Thomas S. 2011. A Practical Guide to Risk Management. CFA Institute Research Foundation M2011-2. Charlottesville: CFA Institute Research Foundation. [Google Scholar]
- Farkas, Szilveszter, and Szabó József. 2005. A Vállalati Kockázatkezelés Kézikönyve. Budapest-Pécs: Dialóg Campus, 252p. [Google Scholar]
- Fasse, Friedrich-Wilhelm. 1995. Risk-Management im Strategischen Internationalen Marketing. Hamburg: Steuer-und Wirtschaftsverlag Hamburg, 67p. [Google Scholar]
- Fischoff, Baruch, Paul Slovic, Sarah Lichtenstein, Stephen Read, and Barbara Combs. 1978. How safe is safe enough? Policy Sciences 8: 127–52. [Google Scholar]
- Frame, J. Davidson. 2003. Managing Risk in Organizations—A Guide for Managers. San Francisco: Jossey Bass, 287p. [Google Scholar]
- Hámori, Balázs. 2003. Kísérletek és Kilátások. Daniel Kahneman. Közgazdasági Szemle 50: 779–99. [Google Scholar]
- Hardy, Mary. 2003. Investment Guarantees—Modeling and Risk Management for Equity-linked Life Insurance. Hoboken: Wiley, 352p. [Google Scholar]
- Hobbs, Peter. 2000. Professionelles Projektmanagement. Landsberg am Lech: Moderne Industrie, p. 55. [Google Scholar]
- Illés, Csaba Bálint, and G. Megyeri. 2005. Biztosítási Ismeretek. Gödöllő: Szent István University, 200p. [Google Scholar]
- Illés, Csaba Bálint, J. Lehotai, and György K. Takácsné. 1997. Az Üzleti terv Készítés Alapjai, Gazdasági Szaktanácsok. no.2. Keszthely: PATE GEORGIKON. [Google Scholar]
- Knight, Frank H. 1921. Risk, Uncertainty and Profit. University of Illinois at Urbana-Champaign’s Academy for Entrepreneurial Leadership Historical Research Reference in Entrepreneurship. Available online: https://ssrn.com/abstract=1496192 (accessed on 1 January 2021).
- Kliestik, Tomas, Maria Misankova, Katarina Valaskova, and Lucia Svabova. 2018. Bankruptcy prevention: New effort to reflect on legal and social changes. Science and Engineering Ethics 24: 791–803. [Google Scholar] [CrossRef] [PubMed]
- Kovacova, Maria, Maria Kliestik, Katarina Valaskova, Katarina Durana, and Katarina Juhaszova. 2019. Systematic review of variables applied in bankruptcy prediction models of Visegrad group countries. Oeconomia Copernicana 104: 743–72. [Google Scholar] [CrossRef] [Green Version]
- Luce, R. Duncan, and Howard Raffia. 1957. Games and Decisions: Introduction and Critical Survey. New York: Wiley, 509p. [Google Scholar]
- Reissland, John, and Vaughan Harries. 1979. A scale for measuring risks. New Scientist 83: 809–11. [Google Scholar]
- Schindelbeck, K. 2002. Leitfaden zum Aufbau eines Risikomanagements und einer Finanziellen Konsolidierung. Deggendorf: A COMIÜT Institut für Controlling-und Managementberatung, 18p. [Google Scholar]
- Tversky, Amos, and Daniel Kahneman. 1973. Availability: A heuristic for judging frequency and probability. Cognitive Psychology 5: 207–32. [Google Scholar] [CrossRef]
- Tversky, Amos, and Daniel Kahneman. 1974. Judgment under uncertainty. Heuristics and Biases Science 185: 1124–31. [Google Scholar]
- Valaskova, Katarina, Tomas Kliestik, and Maria Kovacova. 2018. Management of financial risks in Slovak enterprises using regression analysis. Oeconomia Copernicana 9: 105–21. [Google Scholar] [CrossRef] [Green Version]
- Varga, János. 2017. Bases for organizational competitiveness: Leading change and business agility at the Hungarian enterprises. The Macrotheme Review 6: 69–81. [Google Scholar]
- Vlahos, Kiriakos. 2001. Tooling up for risky decisions. In Mastering Risk Volume 1: Concepts. Harlow: Pearson Education, pp. 47–52. [Google Scholar]
- Wildavsky, Aaron. 1979. No risk is the highest risk of all. American Scientist 67: 32–37. [Google Scholar]
- Williams, C. Arthur, Michael L. Smith, and Peter C. Young. 1995. Risk Management and Insurance. New York City: McGraw-Hill, 680p. [Google Scholar]
- Wytrzens, Hans Karl. 2009. Projektmanagement. Wien: Facultas.wuv Universitätsverlag. [Google Scholar]
Risk Categories | Risk Factors | Architectural Investments (Business Aspect) | Projects (Aspects of the Project within the Company) |
---|---|---|---|
Financial and financial structure | Debt management capacity, pay gaps, liquidity, bad investments, receivables management. | Whether the given enterprise has the necessary resources, the scheduling availability corresponds to the pace of the investment. | Whether the financial framework for the project is provided at the right pace and distribution. |
Market prices–market demand | Market price fluctuations, cost structure, contract terms, market exit and entry. | Adaptation of the enterprise to price fluctuations according to the original budget, e.g., exchange rate risk. | Flexibility of the project budget in relation to the bid price and the price differences caused by the price change. |
Stakeholders and their relationships | Dependencies, conflicts arising from cultural differences, contractual risks. | The effect of dependencies arising from the interests of the company on the investment process. | Company priorities and disparities to be taken into account during the implementation of the project |
Competitive environment, competitors | Market power segmentation, market espionage, antitrust measures, measuring and controlling market power. | Competitive activities observed during the architectural investment and changes in the investment environment, e.g., regulatory preferences. | Uncertainty of project implementation due to changes in external factors and changes in company preferences. |
Distribution system and channels | Supplier flexibility, availability, raw material dependence, raw material substitutability. | The dependencies of the company during the investment process, e.g., supplier attitudes, resp. availability of raw materials. | Material needs arising during the project and their availability through the company’s networking. |
Consumers and consumer preferences | Flexibility of product/service choice, credibility, weak consumer core. | The relationship of the business with the consumers, reaching and serving the target group core. | To what extent the given project fits into the consumer preferences, how much it is supported and how relevant it is. |
Human Resources | Employees, subcontractors, personal competencies, qualities, personnel changes based on political reasons, personal competencies. | Competencies and incompetencies of the corporate workforce. | Competences of the project owner and the project team and their limitations. |
Political environment | Social support, political involvement in the company’s activities, the threat of terrorism, personal changes based on political reasons. | The political influence of the company and independence from political power. Brand social support, CSR, PR activities. | Project vulnerability based on political considerations. |
Legislation | Permits to operate, legal supervision and justice, office cooperation competence. | Compliance with and control of the legal framework of the enterprise. | The official and corporate legitimacy of the project. |
Corporate identity, fame, image | Credibility of corporate image, product reliability, popularity of reference persons. | The credibility of the business and its communication. | The communication and image of the project towards the whole business. |
Strategic factors | Correct company goal selection, acquisitions, mergers, resource allocation. | The place of the company’s strategic goals and the fit of the investment into it. | Integration of the project into the corporate strategy. |
Technical–technological factors | Technology complexity, amortization, labour demand. | The technological development of the enterprise and its development. | Adapting the project to the company’s technology aspirations. |
Financial market factors | Exchange rates, reliability of investments, liquidity of investments, actual liquidity, rate of interest rates. | The financial stability of a business is a guarantee of investment. | One of the pillars of the project’s success is the company’s financial stability. |
Tangible assets, business operation framework | Equipment, manufacturer service units, force majeure cases, international influences, trends. | Adaptation of the company’s investments to the technical level. | Alignment of the project with the corporate technology direction. |
Cognitive Risk or Psychological Risk | The risk of the difference between the image in the mind of the investor and the way it is realized. | How the corporate investment is realised depending on relationship between the vision of decision makers and the actual investment. | How much the project fits to the company’s ideas. |
Communication | Side-by-side “narratives”, conceptual and content misunderstandings between the participants in the process. | The quality and quality of corporate communication during the investment process. | Feasibility of the project and how it fits to the corporate investments. |
Health risk | It includes risk elements related to the adverse health effects of the investment. | Healthy implementation of the company’s construction investment in all segments. | Health-conscious implementation of the project in the investment segment. |
Risk Categories | Causes | Authors |
---|---|---|
Financial and financial structure | Debt management capacity, pay gaps, liquidity, bad investments, receivables management. | (Boehlje and Lins 1998; Schindelbeck 2002; Hardy 2003; Illés et al. 1997; Castle et al. 1987; Chapman 2006) |
Market prices–market demand | Market price fluctuations, cost structure, contract terms, out and market entry. | (Boehlje and Lins 1998; Hobbs 2000; Schindelbeck 2002; Coenen 2004; Illés et al. 1997; Castle et al. 1987; Chapman 2006) |
Stakeholders and their relationships | Dependencies, conflicts arising from cultural differences, contractual risks. | (Boehlje and Lins 1998; Coleman 2011; Chapman 2006) |
Competitive environment, competitors | Market power relations, segmentation, market espionage, antitrust measures, measurement and control of market power. | (Boehlje and Lins 1998; Schindelbeck 2002; Coleman 2011; Coleman 2011; Illés et al. 1997; Castle et al. 1987; Chapman 2006) |
Logistics, distribution system, and distribution channels | Supplier flexibility, availability, raw material dependence, raw material substitutability. | (Boehlje and Lins 1998; Chapman 2006) |
Consumers and consumer preferences | Flexibility of product/service choices, credibility, weak consumer core. | (Boehlje and Lins 1998) |
HR—Human Resources | Employees, subcontractors, personal competencies, qualities, personnel changes based on political reasons. | (Boehlje and Lins 1998; Hobbs 2000) |
Political environment | Social support, political involvement in the company’s activities, the threat of terrorism. | (Boehlje and Lins 1998; Coleman 2011; Coenen 2004; Chapman 2006) |
Legislation | Permits to operate, legal supervision and justice, office cooperation competence. | (Boehlje and Lins 1998; Coleman 2011; Coenen 2004; Illés et al. 1997; Castle et al. 1987; Chapman 2006) |
Corporate identity, fame, image | Credibility of corporate image, product reliability, popularity of reference persons. | (Boehlje and Lins 1998) |
Strategic factors | Correct company goal selection, acquisitions, mergers, resource allocation. | (Boehlje and Lins 1998; Coleman 2011; Coenen 2004; Illés et al. 1997; Castle et al. 1987; Chapman 2006) |
Technical–technological factors | Technology complexity, amortization, labour demand. | (Boehlje and Lins 1998; Coleman 2011; Coenen 2004; Illés et al. 1997; Castle et al. 1987; Chapman 2006) |
Financial market factors | Exchange rates, reliability of investments, liquidity of investments, actual liquidity, interest rates. | (Boehlje and Lins 1998; Coleman 2011; Coenen 2004; Illés et al. 1997; Castle et al. 1987; Chapman 2006) |
Tangible assets, business operation framework | Equipment, production service units, cases of force majeure, international influences, trends. | (Boehlje and Lins 1998; Coleman 2011; Coenen 2004; Illés et al. 1997; Castle et al. 1987; Chapman 2006) |
Communication | Side-by-side “narratives”, conceptual and content misunderstandings between the participants in the process. | (Wytrzens 2009) |
Cognitive risk or psychological risk | The risk arising from the difference between the image in the mind of the investor and the way the investment is realized. | (Williams et al. 1995; Tversky and Kahneman 1973, 1974; Reissland and Harries 1979; Wildavsky 1979; Fischoff et al. 1978; Hámori 2003) |
Macro environmental factors | Changes in market conditions, the emergence of factors hindering and disrupting the company’s activities. Changes in interest rates, exchange rate risk, cash flows. Political, social, legal, technological changes. Other risks that the business does not expect. | (Frame 2003; Banks 2004; Williams et al. 1995; Fasse 1995; Illés and Megyeri 2005; Varga 2017) |
Micro environmental factors | Direct risks of the company, strategic and operational risks. | (Frame 2003; Banks 2004; Williams et al. 1995; Fasse 1995; Illés and Megyeri 2005) |
Perceived Risks |
---|
the quality of the work done (poor quality materials, improper work) |
the reliability of those collaborating on the project (how many tasks and what responsibilities they take on, and whether promises are met by the deadline) |
investment coverage (whether the money is enough to complete the work) |
availability of project collaborators |
the price of services (how expensive the service is) |
the flexibility of the contractors cooperating in the project in relation to each problem |
the experience of the participants in the project |
credit risk (interest on the loan rises) |
cooperation with project participants, information exchange (if the partner shares all the info at the end of each work phase, the partner gives information about the next step, etc.) |
legal risk (contract is not appropriate) |
duration of construction |
health risk (the built-in materials are harmful to health) |
changes in legislation (new taxes, contributions) |
investment risk (market factors change, so it does not hold the value of the property) |
accident risk (someone is injured during the investment process) |
expected return on investment (when the investment pays off) |
the investment segment (construction for residential or commercial purposes) |
the reputation of the architect/constructor and the client |
health risk (the contractor gets sick during the process) |
implementation phase (when the work can be done: spring, summer, autumn, or winter) |
taste risk: the client does not like the finished property in the end |
the social perception of the realized real estate is not what the client wanted (the opinion of friends and colleagues will be negative) |
flexibility of project participants |
Aspects Determining the Reduction of Perceived Investor Risks |
---|
continuous information of the customer |
giving the customer the opportunity to make free decisions |
involving the customer in professional issues |
explanation of the steps in the construction project to see what happens next |
meeting the deadlines |
respecting the budget |
introducing a cheaper solution to the customer |
presenting other contractor prices and results to allow the customers to compare |
Perceived Risks | Average (Where 1 = I Do Not Feel Risky at All, 4 = I Feel Completely Risky) | Relative Standard Deviation |
---|---|---|
Investment coverage (if the money is enough to complete the work) | 3.33 | 0.95 |
Reliability of the contractors cooperating in the project | 3.32 | 0.89 |
The quality of the work done (poor quality materials, inadequate work) | 3.27 | 0.93 |
Flexibility of the contractors cooperating in the project in case of problems | 3.17 | 0.87 |
Contact details of the contractors cooperating in the project | 3.12 | 0.94 |
Legal risk (contract is inadequate) | 3.09 | 0.90 |
Expected return on investment (when the investment will pay off) | 2.95 | 0.92 |
Investment risk (market factors change, so the property does not keep its value) | 2.94 | 0.93 |
Availability of the customer | 2.94 | 0.95 |
Changes in legislation (new taxes, contributions) | 2.93 | 0.97 |
Accident risk (someone gets injured during the investment process) | 2.92 | 1.05 |
Customer flexibility | 2.91 | 0.88 |
The price of the services (how expensive the service is) | 2.89 | 0.88 |
Credit risk (credit interest rate rises) | 2.88 | 0.96 |
Cooperation with the contractor, exchange of information (share all information, inform about the next step at the end of each work phase, etc.) | 2.87 | 1.06 |
Duration of construction | 2.85 | 0.86 |
Health risk (built-in substances are harmful to health) | 2.81 | 1.02 |
Health risk (I get sick or the contractor gets sick during the process) | 2.60 | 0.86 |
Investment segment (construction for residential or commercial purposes) | 2.53 | 0.89 |
The reputation of the architect/constructor | 2.51 | 0.98 |
Reputation of the customer | 2.50 | 0.97 |
Taste risk: the customer does not like the finished property in the end | 2.48 | 0.99 |
Period of the investment (work would take place in spring, summer, autumn, or winter) | 2.44 | 1.05 |
The customer’s expertise, knowledge, and information | 2.35 | 1.03 |
The social perception of the realized real estate is not as expected (the opinion of friends and colleagues will be negative) | 2.31 | 0.93 |
Risk Factors/Factor Groups | Financial and Legal Risk Factors | Human and Quality Factors | Health and Psychological Risk Group | The Range of Risks Associated with the Customer | Time Risk |
---|---|---|---|---|---|
Investment risk (market factors change, so the project will not be financially successful) | 0.739650532 | 0.135618209 | 0.200265563 | 0.112925152 | 0.190510841 |
Credit risk (credit interest rate rises) | 0.711940589 | 0.091592357 | 0.295703072 | 0.17124916 | 0.019558177 |
Expected return on investment (when will the investment bring back the price) | 0.669200342 | 0.148531452 | 0.070752438 | 0.093886042 | 0.164026609 |
Legal risk (contract inadequate) | 0.589038706 | 0.340185457 | 0.323983013 | 0.129944502 | −0.099284854 |
Coverage of the investment (is the customer’s money enough to complete the work) | 0.571156798 | 0.441639618 | −0.066622845 | 0.068056801 | 0.112196081 |
Changes in legislation (new taxes, contributions) | 0.536317083 | 0.215690293 | 0.374978472 | 0.194524322 | 0.071097341 |
The price of the services (how expensive the service is) | 0.385084958 | 0.236411275 | 0.353695438 | 0.101449688 | 0.161374615 |
Reliability of the contractors cooperating in the project | 0.239982439 | 0.769682561 | −0.022873692 | −0.093167717 | 0.148028787 |
Flexibility of the contractors cooperating in the project in case of individual problems | 0.155858921 | 0.709031054 | 0.157460285 | 0.133577458 | −0.08505418 |
Contact details of the contractors cooperating in the project | 0.252843797 | 0.698308186 | 0.188996042 | 0.127774303 | 0.039227324 |
Reliability of the contractors cooperating in the project | 0.239982439 | 0.769682561 | −0.022873692 | −0.093167717 | 0.148028787 |
Cooperation with the customer, exchange of information (share all information, inform about the next step at the end of each work phase, etc.) | 0.033171011 | 0.533252382 | 0.452369601 | 0.078325083 | 0.19398377 |
Customer contact information | 0.160343255 | 0.52190143 | 0.151052796 | 0.440812597 | 0.264741343 |
The quality of the work done (poor quality materials, inadequate expertise for cooperating partners) | 0.456837058 | 0.516009197 | 0.082775637 | −0.031076431 | 0.144666861 |
Health risk (built-in substances are harmful to health) | 0.305701843 | 0.288090779 | 0.721805753 | −0.033999431 | −0.005837631 |
The social perception of the realized real estate is not what the customer wanted (the opinion of friends and employees will be negative) | −0.000799636 | −0.040493122 | 0.694161844 | 0.318397775 | 0.179991604 |
Taste risk: the customer does not like the finished property in the end | 0.126216839 | −0.016581778 | 0.671615781 | 0.262973639 | 0.240523952 |
Accident risk (someone is injured during the investment process) | 0.359196812 | 0.247112612 | 0.645271361 | −0.069412706 | 0.061903125 |
Health risk (will I get sick or will the contractor get sick during the process?) | 0.219913925 | 0.150440476 | 0.548520972 | 0.259525286 | −0.051911081 |
Reputation of the customer | 0.123640618 | 0.144685258 | 0.058023626 | 0.736856548 | 0.096902821 |
The customer’s expertise, knowledge, and awareness | 0.079624398 | 0.009441861 | 0.198631459 | 0.734174833 | −0.053461624 |
Customer flexibility | 0.07996056 | 0.438805424 | 0.084006536 | 0.495542336 | 0.338792634 |
Investment segment (residential or commercial construction for rent) | 0.236392366 | −0.072008247 | 0.300288017 | 0.438990597 | 0.110186329 |
Period of investment (spring, summer, autumn, or winter) | 0.118427388 | 0.026395918 | 0.243013503 | 0.024767455 | 0.760059993 |
Duration of construction | 0.20674014 | 0.219572722 | 0.029294916 | 0.161886255 | 0.713734644 |
Risk Factors | Segments | |||||
---|---|---|---|---|---|---|
Over-Estimators Cluster 1. | Collaborators, Overestimating Financial, Legal, and Health Risks Cluster 2. | Customer-Based, Overestimating Health Risks and Psychological Risks Cluster 3. | Rationals Cluster 4. | Under-Estimators Cluster 5. | Total Sample (Average) N = 462 | |
Period of investment (spring, summer, autumn, or winter) | 3.12 | 2.31 | 2.15 | 2.00 | 2.05 | 2.44 |
Duration of construction | 3.32 | 2.78 | 2.70 | 2.82 | 1.93 | 2.85 |
Reliability of the contractors cooperating in the project | 3.83 | 3.62 | 2.64 | 3.53 | 2.19 | 3.32 |
Flexibility of the contractors cooperating in the project in case of individual problems | 3.69 | 3.31 | 2.82 | 3.11 | 2.12 | 3.17 |
Contact details of the contractors cooperating in the project | 3.80 | 3.29 | 2.61 | 3.08 | 1.79 | 3.12 |
Reputation of the customer | 3.13 | 2.09 | 2.64 | 2.11 | 1.83 | 2.50 |
Customer flexibility | 3.60 | 2.75 | 2.66 | 2.79 | 2.00 | 2.91 |
Customer contact information | 3.77 | 2.82 | 2.59 | 2.81 | 1.74 | 2.94 |
Expertise, knowledge of the customer | 2.89 | 1.92 | 2.71 | 1.82 | 1.71 | 2.35 |
Health risk (Will I get sick or will the contractor get sick during the process?) | 3.22 | 2.55 | 2.68 | 1.69 | 1.88 | 2.60 |
The price of the services (how expensive the service is) | 3.44 | 2.97 | 2.68 | 2.42 | 2.19 | 2.89 |
The quality of the work done (poor quality materials, inadequate expertise for cooperating partners) | 3.84 | 3.54 | 2.73 | 3.29 | 2.07 | 3.27 |
Expected return on investment (when will the investment pay its price?) | 3.45 | 3.15 | 2.63 | 2.74 | 1.90 | 2.95 |
Investment segment (residential or commercial construction for rent) | 3.02 | 2.24 | 2.75 | 2.05 | 1.98 | 2.53 |
Coverage of the investment (Is the customer’s money enough to complete the work?) | 3.84 | 3.69 | 2.77 | 3.44 | 1.90 | 3.33 |
Legal risk (contract inadequate) | 3.77 | 3.45 | 2.78 | 2.29 | 1.86 | 3.09 |
Changes in legislation (new taxes, contributions) | 3.61 | 3.15 | 2.65 | 2.15 | 1.95 | 2.93 |
Credit risk (credit interest rate rises) | 3.47 | 3.18 | 2.75 | 1.98 | 1.81 | 2.88 |
Investment risk (market factors change, so the project will not be financially successful) | 3.58 | 3.24 | 2.62 | 2.23 | 1.88 | 2.94 |
Taste risk: the customer does not like the finished property in the end | 3.14 | 2.28 | 2.60 | 1.48 | 2.10 | 2.48 |
The social perception of the realized real estate is not what the customer wanted (the opinion of friends and employees will be negative) | 2.93 | 2.01 | 2.60 | 1.26 | 1.95 | 2.31 |
Cooperation with the customer, exchange of information (share all information, inform about the next step at the end of each work phase, etc.) | 3.49 | 2.90 | 2.66 | 2.42 | 1.95 | 2.87 |
Health risk (built-in substances are harmful to health) | 3.57 | 3.18 | 2.64 | 1.31 | 2.02 | 2.81 |
Accident risk (someone is injured during the investment process) | 3.68 | 3.18 | 2.65 | 1.81 | 2.14 | 2.92 |
Criteria | Over-Estimators N = 134 | Collaborators, Overestimating Financial, Legal and Health Risks N = 119 | Customer-Based, Overestimating Health Risks and Psychological Risks N = 105 | Rationals N = 62 | Under-Estimators N = 42 |
---|---|---|---|---|---|
gender sig = 0.001 | women (36.13%) Adj.R. = 2.86 | men (91.93%) Adj.R. = 3.48 | |||
education sig = 0.003 | secondary school education (45.52%) Adj.R. = 2.10 higher education (36.56%) Adj.R. = −3.39 excessively underrepresented | secondary school education (57.98%) Adj.R. = 2.29 skilled worker (5.88%) Adj.R. = −2.54 excessively underrepresented | skilled workers (16.19%) Adj.R. = 1.27 | higher education (66.12%) Adj.R. = 2.91 | primary education (2.38%) Adj.R. = 2.01 |
Publisher’s Note: MDPI stays neutral with regard to jurisdictional claims in published maps and institutional affiliations. |
© 2021 by the authors. Licensee MDPI, Basel, Switzerland. This article is an open access article distributed under the terms and conditions of the Creative Commons Attribution (CC BY) license (https://creativecommons.org/licenses/by/4.0/).
Share and Cite
Szemere, T.P.; Garai-Fodor, M.; Csiszárik-Kocsir, Á. Risk Approach—Risk Hierarchy or Construction Investment Risks in the Light of Interim Empiric Primary Research Conclusions. Risks 2021, 9, 84. https://doi.org/10.3390/risks9050084
Szemere TP, Garai-Fodor M, Csiszárik-Kocsir Á. Risk Approach—Risk Hierarchy or Construction Investment Risks in the Light of Interim Empiric Primary Research Conclusions. Risks. 2021; 9(5):84. https://doi.org/10.3390/risks9050084
Chicago/Turabian StyleSzemere, Tibor Pál, Mónika Garai-Fodor, and Ágnes Csiszárik-Kocsir. 2021. "Risk Approach—Risk Hierarchy or Construction Investment Risks in the Light of Interim Empiric Primary Research Conclusions" Risks 9, no. 5: 84. https://doi.org/10.3390/risks9050084