A computerized risk evaluation model for public-private partnership (PPP) projects and its application

Yelin Xu; Yujie Lu; Albert P.C. Chan; Miroslaw J. Skibniewski; John F.Y. Yeung

doi:10.3846/1648715X.2012.686928

A computerized risk evaluation model for public-private partnership (PPP) projects and its application

Yelin Xu, Yujie Lu^*, Albert P.C. Chan, Miroslaw J. Skibniewski, John F.Y. Yeung

^*Corresponding author for this work

School of Continuing Education

Research output: Contribution to journal › Journal article › peer-review

23 Citations (Scopus)

Abstract

PPP projects usually involve more risks than other traditional procurement models because of their complexity. This paper presents the third stage of a funded study, which aims to develop a practical and computerized risk evaluation model for PPP projects. In the first and second stages, a risk hierarchal structure composed of 17 weighted risk factors is developed to describe risk profiles of PPP projects. The weightings and membership functions for risk factors are established using the Delphi survey technique and Fuzzy Set Theory. The risk evaluation model is then developed using a fuzzy synthetic evaluation approach. In the third stage, an automated decision support tool based on the risk evaluation model is designed for PPP practitioners by using Visual Basic for Application (VBA). The computerized tool can not only assist PPP participants to assess a PPP project's overall risk level for auxiliary investment decision, but can also help practitioners to identify the most risky areas of a PPP project for effective risk response. To demonstrate the applicability of the computerized model, an illustrative case is finally provided.

Original language	English
Pages (from-to)	277-297
Number of pages	21
Journal	International Journal of Strategic Property Management
Volume	16
Issue number	3
DOIs	https://doi.org/10.3846/1648715X.2012.686928
Publication status	Published - Sept 2012

Scopus Subject Areas

Strategy and Management

User-Defined Keywords

Decision support
Fuzzy
Public Private Partnerships (PPP)
Risk evaluation
Risk management

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10.3846/1648715X.2012.686928

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title = "A computerized risk evaluation model for public-private partnership (PPP) projects and its application",

abstract = "PPP projects usually involve more risks than other traditional procurement models because of their complexity. This paper presents the third stage of a funded study, which aims to develop a practical and computerized risk evaluation model for PPP projects. In the first and second stages, a risk hierarchal structure composed of 17 weighted risk factors is developed to describe risk profiles of PPP projects. The weightings and membership functions for risk factors are established using the Delphi survey technique and Fuzzy Set Theory. The risk evaluation model is then developed using a fuzzy synthetic evaluation approach. In the third stage, an automated decision support tool based on the risk evaluation model is designed for PPP practitioners by using Visual Basic for Application (VBA). The computerized tool can not only assist PPP participants to assess a PPP project's overall risk level for auxiliary investment decision, but can also help practitioners to identify the most risky areas of a PPP project for effective risk response. To demonstrate the applicability of the computerized model, an illustrative case is finally provided.",

keywords = "Decision support, Fuzzy, Public Private Partnerships (PPP), Risk evaluation, Risk management",

author = "Yelin Xu and Yujie Lu and Chan, {Albert P.C.} and Skibniewski, {Miroslaw J.} and Yeung, {John F.Y.}",

note = "Funding Information: the work described in this paper has been supported by a joint grant from the research grants council of the Hong Kong Special administrative region, china (Project no. n_Polyu 514/07) and the national Science foundation council of china research grant (Project no. 70731160634). the model presented in this paper also forms part of the broader research project entitled “Developing an equitable risk Sharing Mechanism for Public Private Partnership Projects in the People{\textquoteright}s republic of china”, from which other deliverables have been produced with different objectives/scopes but sharing common background of study and research methodology. Special gratitude is also extended to national natural Science foundation of china (Project no. 71101130).",

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doi = "10.3846/1648715X.2012.686928",

language = "English",

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AU - Yeung, John F.Y.

N1 - Funding Information: the work described in this paper has been supported by a joint grant from the research grants council of the Hong Kong Special administrative region, china (Project no. n_Polyu 514/07) and the national Science foundation council of china research grant (Project no. 70731160634). the model presented in this paper also forms part of the broader research project entitled “Developing an equitable risk Sharing Mechanism for Public Private Partnership Projects in the People’s republic of china”, from which other deliverables have been produced with different objectives/scopes but sharing common background of study and research methodology. Special gratitude is also extended to national natural Science foundation of china (Project no. 71101130).

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N2 - PPP projects usually involve more risks than other traditional procurement models because of their complexity. This paper presents the third stage of a funded study, which aims to develop a practical and computerized risk evaluation model for PPP projects. In the first and second stages, a risk hierarchal structure composed of 17 weighted risk factors is developed to describe risk profiles of PPP projects. The weightings and membership functions for risk factors are established using the Delphi survey technique and Fuzzy Set Theory. The risk evaluation model is then developed using a fuzzy synthetic evaluation approach. In the third stage, an automated decision support tool based on the risk evaluation model is designed for PPP practitioners by using Visual Basic for Application (VBA). The computerized tool can not only assist PPP participants to assess a PPP project's overall risk level for auxiliary investment decision, but can also help practitioners to identify the most risky areas of a PPP project for effective risk response. To demonstrate the applicability of the computerized model, an illustrative case is finally provided.

AB - PPP projects usually involve more risks than other traditional procurement models because of their complexity. This paper presents the third stage of a funded study, which aims to develop a practical and computerized risk evaluation model for PPP projects. In the first and second stages, a risk hierarchal structure composed of 17 weighted risk factors is developed to describe risk profiles of PPP projects. The weightings and membership functions for risk factors are established using the Delphi survey technique and Fuzzy Set Theory. The risk evaluation model is then developed using a fuzzy synthetic evaluation approach. In the third stage, an automated decision support tool based on the risk evaluation model is designed for PPP practitioners by using Visual Basic for Application (VBA). The computerized tool can not only assist PPP participants to assess a PPP project's overall risk level for auxiliary investment decision, but can also help practitioners to identify the most risky areas of a PPP project for effective risk response. To demonstrate the applicability of the computerized model, an illustrative case is finally provided.

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A computerized risk evaluation model for public-private partnership (PPP) projects and its application

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