LIMITED DIVERSITY IN RISK TREATMENT SELECTION IN PUBLIC INFRASTRUCTURE PROJECTS: A RATIONAL RESPONSE?

Abstract

In public infrastructure projects, risks can emerge quickly due to its external uncertainties and interdependencies among a large number of stakeholders. Scholars still debate whether the current approach of risk management is dynamic enough to safeguard project objectives in such public environments. Because of little empirical evidence that explains how and why Project Management Teams (PMTs) select a specific risk treatment, we aim to characterize risk treatment selection by PMTs in public infrastructure projects. Based on document reviews and semi-structured interviews with PMT members and their executives of a Dutch project-oriented public infrastructure agency, it was found that the diversity in risk treatment selection is limited and risk treatment in public infrastructure projects focuses on controlling risk predominantly through preventive control measures. Although PMTs also intentionally control risk through preventive measures, the decision to do so is often implicitly taken and constitutes an unwitting routine that PMTs seem to have developed due to a risk-averse organizational culture. We conclude with providing directions to improve risk management practices and enable more diversity in risk treatment selection by PMTs in public infrastructure projects.