Enterprise risk management implementation in construction firms

Purpose – The purposes of this paper are to: first, identify the critical drivers for and hindrances to enterprise risk management (ERM) implementation in Singapore-based Chinese construction firms (CCFs); second, interpret the critical drivers and hindrances in tandem with organizational change theories; and third, provide possible strategies to strengthen the drivers and overcome the hindrances. Design/methodology/approach – A questionnaire survey was conducted and responses were received from 35 experienced managers in CCFs operating in Singapore. Findings – A total of 13 drivers and 25 hindrances with significant influence were identified. Of them, “improved decision-making” was the top driver, while “insufficient resources (e.g. time, money, people, etc.)” was the most influential hindrance. Research limitations/implications – As the survey was performed with the Singapore-based CCFs, there may be geographical limitation on the identification of the critical drivers for and hindrances to ERM implemen...

[1]  F. Lunenburg.  FORCES FOR AND RESISTANCE TO ORGANIZATION CHANGE , 2010 .

[2]  Bon-Gang Hwang,et al.  Value Management in Singaporean Building Projects: Implementation Status, Critical Success Factors, and Risk Factors , 2015 .

[3]  D. Szabla,et al.  A multidimensional view of resistance to organizational change: Exploring cognitive, emotional, and intentional responses to planned change across perceived change leadership strategies , 2007 .

[4]  Mohd Rasid Hussin,et al.  Enterprise-Wide Risk Management (EWRM) Practices: Between Corporate Governance Compliance and Value Creation. , 2010 .

[5]  Sui Pheng Low,et al.  Current Practices and Challenges of Implementing Enterprise Risk Management (ERM) in Chinese Construction Enterprises , 2011 .

[6]  M. P. D. Val,et al.  Resistance to change: a literature review and empirical study , 2003 .

[7]  Paul Kaestle,et al.  A new rationale for organizational structure , 1990 .

[8]  Nitin Nohria,et al.  Resolving the Tension Between Theories E and O of Change , 2000 .

[9]  James Lam.  Enterprise Risk Management: From Incentives to Controls , 2003 .

[10]  Salvador Roig-Dobón,et al.  Participative management and its influence on organizational change , 2012 .

[11]  Sui Pheng Low,et al.  External risk management practices of Chinese construction firms in Singapore , 2009 .

[12]  Saquib Yusaf Janjua,et al.  The Change Drivers in Business Context: Evidence from Pakistan , 2010 .

[13]  Bon-Gang Hwang,et al.  Reducing Hindrances to Enterprise Risk Management Implementation in Construction Firms , 2015 .

[14]  Gregory S. Larson,et al.  Ambivalence and Resistance: A Study of Management in a Concertive Control System , 2005 .

[15]  K. Muralidhar,et al.  Enterprise risk management in the Middle East oil industry , 2010 .

[16]  Bon-Gang Hwang,et al.  Risk management in small construction projects in Singapore: Status, barriers and impact , 2014 .

[17]  Gill Christy,et al.  Management and Organisational Behaviour , 1985 .

[18]  Percy E. Burrup.  Financing education in a climate of change , 1977 .

[19]  J. Kotter,et al.  Choosing strategies for change. , 1979, Harvard business review.

[20]  He Zhi,et al.  Risk management for overseas construction projects , 1995 .

[21]  Mohammad Mahdavi Mazdeh,et al.  Development and evaluation of a knowledge risk management model for project‐based organizations , 2011 .

[22]  R. Hoyt,et al.  The Value of Enterprise Risk Management , 2010 .

[23]  Ananth Rao,et al.  Evaluation of Enterprise Risk Management (ERM) in Dubai – An Emerging Economy , 2007 .

[24]  Bon-Gang Hwang,et al.  Identifying the critical risks in underground rail international construction joint ventures: Case study of Singapore , 2013 .

[25]  Margaret A. White,et al.  Downsizing in a Learning Organization: Are There Hidden Costs? , 2000 .

[26]  René M. Stulz,et al.  Enterprise Risk Management: Theory and Practice , 2006, Journal of Applied Corporate Finance.

[27]  Michael J. Austin,et al.  Impact of Organizational Change on Organizational Culture , 2008, Journal of evidence-based social work.

[28]  John Hayes,et al.  The Theory and Practice of Change Management , 2002 .

[29]  J. French,et al.  Overcoming Resistance to Change , 1948 .

[30]  Bon-Gang Hwang,et al.  Construction project risk management in Singapore: Resources, effectiveness, impact, and understanding , 2014 .

[31]  Gareth R. Jones,et al.  Understanding and Managing Organizational Behavior , 1995 .

[32]  P. Componation,et al.  The Relationship Between Organizational Culture and Enterprise Risk Management , 2009 .

[33]  R. Hoyt,et al.  The Determinants of Enterprise Risk Management: Evidence from the Appointment of Chief Risk Officers , 2003 .

[34]  Ryan B. Lee,et al.  The Effect of Corporate Governance on the Use of Enterprise Risk Management: Evidence from Canada , 2003 .

[35]  Donald P. Pagach,et al.  The Characteristics of Firms that Hire Chief Risk Officers , 2010 .

[36]  Cynthia Hardy,et al.  Reframing resistance to organizational change , 2011 .

[37]  The Evolution of the Role of Risk Communication in Effective Risk Management , 2005 .

[38]  Alexandra Michel,et al.  The limitations of dispositional resistance in relation to organizational change , 2013 .

[39]  S. Low,et al.  Enterprise Risk Management and the Performance of Local Contractors in Singapore , 2013 .

[40]  Patrick X.W. Zou,et al.  Managing Project Risk at the Enterprise Level: Exploratory Case Studies in China , 2013 .

[41]  Donald P. Pagach,et al.  The Characteristics of Firms that Hire Chief Risk Officers , 2011 .

[42]  R Pascale,et al.  Changing the way we change. , 1997, Harvard business review.

[43]  Stephen Gates,et al.  Incorporating Strategic Risk into Enterprise Risk Management: A Survey of Current Corporate Practice , 2006 .

[44]  Bon-Gang Hwang,et al.  Critical success factors for enterprise risk management in Chinese construction companies , 2013 .

[45]  S. Harrington,et al.  Enterprise Risk Management: The Case Of United Grain Growers , 2002 .

[46]  Keith R. Molenaar,et al.  Enterprise Risk Management Strategies for State Departments of Transportation , 2013 .

[47]  B. Hwang,et al.  Developing Fuzzy Enterprise Risk Management Maturity Model for Construction Firms , 2013 .

[48]  D. Cable,et al.  Employee resistance to organizational change: managerial influence tactics and leader-member exchange. , 2008, The Journal of applied psychology.

[49]  B. Hwang,et al.  Public private partnership projects in Singapore factors, critical risks and preferred risk allocation from the perspective of contractors / , 2013 .

[50]  N. Tichy.  Managing strategic change: Technical, political, and cultural dynamics , 1985 .

[51]  S. D. Rosa.  Cultivating the best board , 2009 .

[52]  Low Sui Pheng.  Managing total service quality: a systemic view , 1998 .

[53]  Stephen Swailes,et al.  Organizational Change , 1997 .

[54]  Lawrence A. Gordon,et al.  Enterprise risk management and firm performance: A contingency perspective , 2009 .

[55]  P. Gupta.  Risk management in Indian companies: EWRM concerns and issues , 2011 .

[56]  Todd D. Dick,et al.  Accelerating change for competitive advantage , 1995 .