Frameworks fordeveloping risks interaction models in complex systems

Abstract

Over the years, the lack of understanding of the dynamic interrelationships and interactions among several risks in large projects has remained a huge problem in the field of risk management and major determining factor for project failure till date. Although several studies have attempted to address this issue by modelling the causalities amongst several risks at various stages of the risk management process, they are yet to model the systemicity of risks, which certainly goes beyond modelling of causality. Hence, this study proposes a conceptual framework for developing risk interaction models. A qualitative research approach was used through extensive review and content analysis of related literature on risk interactions and systems theory. The study introduced the risk management system (RMS) which provides better understand to the dynamics within and across components of risks management process. Furthermore, the study found that complex systems theory offers deeper understanding to risk interactions than systems theory. Lastly, the frameworks developed will aid and improve understanding of the systemicity of risks as well as serve as a clear path to developing risks interactions models. This study recommends further studies to develop frameworks that will capture the risk response, monitoring and controlling phases of the risk management process.

Over the years, the lack of understanding of the dynamic interrelationships and interactions among several risks in large projects has remained a huge problem in the field of risk management and major determining factor for project failure till date. Although several studies have attempted to address this issue by modelling the causalities amongst several risks at various stages of the risk management process, they are yet to model the systemicity of risks, which certainly goes beyond modelling of causality. Hence, this study proposes a conceptual framework for developing risk interaction models. A qualitative research approach was used through extensive review and content analysis of related literature on risk interactions and systems theory. The study introduced the risk management system (RMS) which provides better understand to the dynamics within and across components of risks management process. Furthermore, the study found that complex systems theory offers deeper understanding to risk interactions than systems theory. Lastly, the frameworks developed will aid and improve understanding of the systemicity of risks as well as serve as a clear path to developing risks interactions models. This study recommends further studies to develop frameworks that will capture the risk response, monitoring and controlling phases of the risk management process.