Contingency Release During Project Execution: The Contractor's Decision-Making Dilemma. Issue 6 (December 2019)

• Record Type: Journal Article
• Authors: Ayub, Bilal; Thaheem, Muhammad Jamaluddin; Ullah, Fahim
• Is Part Of: Project management journal. Volume 50:Issue 6(2019)
• Page Start: 734
• Page End: 748
• Publication Date: 2019-12
• Subjects: contingency management -- contingency release -- key performance indicators -- mathematical model; Project management -- Periodicals; 658.40405
• DOI: 10.1177/8756972819848250
• Languages: English
• ISSNs: 8756-9728

Abstract

Risk is inherent in construction projects and managed through contingency. Dynamic management of contingency escrow accounts during project execution poses decision-making challenges. Project managers use key performance indicators (KPIs) for contingency release decisions. However, their subjective mental models influence risk perception, exacerbating the decision-making dilemma. This research integrates project KPIs with future risk perception to develop a mathematical model for facilitating such decision making. Results suggest timely completion, project cost, stakeholder satisfaction, quality and safety as top KPIs, and the influence of managerial pressure as a significant decision contributor. The proposed model helps project managers in dynamic decision making for cost contingency.