Wouldn’t it be nice to avoid a bad construction project before it starts? Nobody wants to waste time, lose money, ruin their reputation, or have workers injured during a difficult job. 

One of the key differences between a good project and a bad project is solid risk management – taking the appropriate steps at the appropriate times to set yourself up for success. 

Unfortunately, some contractors wait until problems arise, then try to find ad hoc, immediate solutions. The trouble with this approach is that solutions are almost always more expensive and less effective.

Instead, contractors need to think about risks and opportunities early and often. It creates more leeway for creative, cost-effective solutions. Whether through contingencies, contracts, or insurance, you can much more easily deal with potential issues with a risk-first point of view. 

This is a two-step process: properly identifying risks, then making strategic plans for managing them. But how do you define risk, and how should you develop those strategies for managing it?