RISKS AND RISK MANAGEMENT ALTERNATIVES FOR BUILDING CONSTRUCTION INDUSTRY ENTERPRISES IN LATVIA: THE RESULTS OF AN EXPERT SURVEY

Sintija Sārtaputna, Anda Zvaigzne

Abstract


In the era of progressive globalisation, risk has become an integral component of entrepreneurship, which makes it necessary for every enterprise to design a risk prevention plan.

The research aim is to assess the expert opinions on risks and risk management alternatives for building construction industry enterprises in Latvia.  To achieve the aim, the following specific research tasks are set: 1) to assess the most essential and widespread risks for building construction industry enterprises in Latvia; 2) to identify the most effective risk management alternatives for building construction industry enterprises.

Research methods used: monographic, descriptive, analysis, synthesis, data grouping and a sociological method – a structured expert survey.

The research results showed that almost half of the identified risks for building construction industry enterprises could be prevented by applying the risk mitigation strategy and taking various daily control and internal management measures, thereby investing no additional funds and reducing the consequences caused by the existing risks. A calculation of the average risk severity level by risk group revealed that the most essential risks affecting the building construction industry were those related to human capital.

To reduce the effect of seasonality and the risk of unforeseeable orders, building construction industry enterprises have to diversify their business, developing some auxiliary kind of economic activity. This would ensure earning revenues throughout the year.

 


Keywords


building construction industry enterprises; Latvia; risks; risk management alternatives

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DOI: http://dx.doi.org/10.17770/lner2018vol1.10.3599

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