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

Shah Jahan; Khurram Iqbal Ahmad Khan; Muhammad Jamaluddin Thaheem; Fahim Ullah; Muwaffaq Alqurashi; Badr T. Alsulami

doi:10.3390/buildings12060701

Buildings (May 2022)

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

Shah Jahan,
Khurram Iqbal Ahmad Khan,
Muhammad Jamaluddin Thaheem,
Fahim Ullah,
Muwaffaq Alqurashi,
Badr T. Alsulami

Affiliations

Shah Jahan: Department of Construction Engineering and Management, National University of Sciences and Technology (NUST), Islamabad 44000, Pakistan
Khurram Iqbal Ahmad Khan: Department of Construction Engineering and Management, National University of Sciences and Technology (NUST), Islamabad 44000, Pakistan
Muhammad Jamaluddin Thaheem: School of Architecture and Built Environment, Deakin University, Geelong Waterfront Campus, Geelong, VIC 3220, Australia
Fahim Ullah: School of Surveying and Built Environment, University of Southern Queensland, Springfield, QLD 4300, Australia
Muwaffaq Alqurashi: Department of Civil Engineering, College of Engineering, Taif University, P.O. Box 11099, Taif 21944, Saudi Arabia
Badr T. Alsulami: Department of Civil Engineering, College of Engineering and Islamic Architecture, Umm Al-Qura University, Makkah 24382, Saudi Arabia

DOI: https://doi.org/10.3390/buildings12060701
Journal volume & issue: Vol. 12, no. 6
p. 701

Abstract

Read online

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.

Published in Buildings

ISSN: 2075-5309 (Online)
Publisher: MDPI AG
Country of publisher: Switzerland
LCC subjects: Technology: Building construction
Website: https://www.mdpi.com/journal/buildings

About the journal

Abstract

Keywords