Modeling Profitability-Influencing Risk Factors for Construction Projects: A System Dynamics Approach

Jahan, Shah and Khan, Khurram Iqbal Ahmad and Thaheem, Muhammad Jamaluddin and Ullah, Fahim ORCID: https://orcid.org/0000-0002-6221-1175 and Alqurashi, Muwaffaq and Alsulami, Badr T. (2022) Modeling Profitability-Influencing Risk Factors for Construction Projects: A System Dynamics Approach. Buildings, 12 (6):701. pp. 1-22.

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Abstract

This study addressed the complexity involved in integrating the causative risk factors influencing construction profitability. Most of the existing studies cover the individual effects of profitability influencing factors. Very few focus on the systematic impact without incorporating the complexity and associated dynamics, presenting a gap targeted by the current study. The current study aimed to assess causative interrelations and interdependencies between profitability influencing risk factors (PIRF), through systems thinking (ST) and system dynamics (SD) modeling. The SD approach was used to evaluate the integrated impacts on profitability-influencing risk categories (PIRC) in construction projects. The causative influencing factors affecting construction profitability were identified through a comprehensive literature review. These were ranked using content analysis, and categorized into significant issues. Through 250 structured surveys and 15 expert opinion meetings, the path for quantitative and qualitative evaluations was prepared. Following these investigations, a causal loop diagram (CLD) was established using the ST technique, and the integrated effect was quantified using SD modeling. The study finds the rising cost of material, supply chain process, payment issues, planning and scheduling problems, financial difficulties, and effective control of manpower and equipment resources as the most critical PIRFs. The integrated effects of PIRFs on PIRC were quantified using SD modeling. This study helps field professionals with profitability-influencing factors, diagnosing issues, and integrating impacts regarding decision-making and policy formulation. For researchers, it presents a list of factors that can be investigated in detail, and the holistic interrelationships established.


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Item Type: Article (Commonwealth Reporting Category C)
Refereed: Yes
Item Status: Live Archive
Faculty/School / Institute/Centre: Current – Faculty of Health, Engineering and Sciences - School of Surveying and Built Environment (1 Jan 2022 -)
Faculty/School / Institute/Centre: Current – Faculty of Health, Engineering and Sciences - School of Surveying and Built Environment (1 Jan 2022 -)
Date Deposited: 25 May 2022 04:10
Last Modified: 25 May 2022 04:10
Uncontrolled Keywords: causal loop diagram; profitability-influencing risk factors; profitability-influencing risk categories; system dynamics; systems thinking
Fields of Research (2020): 33 BUILT ENVIRONMENT AND DESIGN > 3399 Other built environment and design > 339999 Other built environment and design not elsewhere classified
33 BUILT ENVIRONMENT AND DESIGN > 3301 Architecture > 330199 Architecture not elsewhere classified
33 BUILT ENVIRONMENT AND DESIGN > 3302 Building > 330202 Building construction management and project planning
40 ENGINEERING > 4005 Civil engineering > 400501 Architectural engineering
40 ENGINEERING > 4005 Civil engineering > 400504 Construction engineering
33 BUILT ENVIRONMENT AND DESIGN > 3302 Building > 330201 Automation and technology in building and construction
46 INFORMATION AND COMPUTING SCIENCES > 4699 Other information and computing sciences > 469999 Other information and computing sciences not elsewhere classified
40 ENGINEERING > 4005 Civil engineering > 400599 Civil engineering not elsewhere classified
33 BUILT ENVIRONMENT AND DESIGN > 3301 Architecture > 330107 Architecture management
Socio-Economic Objectives (2020): 12 CONSTRUCTION > 1205 Construction processes > 120501 Civil construction processes
12 CONSTRUCTION > 1203 Construction materials performance and processes > 120399 Construction materials performance and processes not elsewhere classified
12 CONSTRUCTION > 1204 Construction planning > 120401 Civil construction planning
12 CONSTRUCTION > 1299 Other construction > 129999 Other construction not elsewhere classified
12 CONSTRUCTION > 1201 Building management and services > 120101 Civil building management and services
12 CONSTRUCTION > 1205 Construction processes > 120502 Commercial construction processes
Identification Number or DOI: https://doi.org/10.3390/buildings12060701
URI: http://eprints.usq.edu.au/id/eprint/48538

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