Sri Lankan contractors' involvement in international contracts : risk perspective

Abstract

Risk and uncertainty always engage with the global construction market. Awareness of opportunities and threats linked with the international services are paramount important before entering into the international arena. The complexity of international environment creates different characteristics of risks that are not well understood by the organizations though they are active in domestic markets. Therefore, it is difficult to identify and handle by a newcomer in new environments to internationalise their services by examining the most significant drive and risk factors that force them to export in the global construction industry.

Data were collected using structured questionnaires and unstructured interviews. Seven drive factors and sixty-five risk factors were identified reviewing the current literature. Questionnaires were sent to forty industry professionals who have experience/s in both local and foreign projects. A total of thirty-one questionnaires received at the response rate of 77.5%. RII was used to identify most significant drive factors and risk factors. According to the survey results, technological advancement is the most significant drive factor in international services. The top five risk sub-groups in the export services are laws and regulations, company employer/owner, company material & equipment, company internal matters, and political situation related problems. Significant sub-factors of each risk category and new factors that identified by the respondents during the survey are also highlighted in the paper. The findings suggest that organizations, which plan to export their services, need to have good corporate strategies to meet the opportunities and overcome the threats in the organization's external environment.