Chapter 11
Risk Performance Index and Measurement System

A mega project can generally be defined as a project that costs more than 1 billion US dollars and includes many risk factors that can cause delays or failures during the project life cycle (Flyvbjerg et al. 2003). Thus, it is important to establish a method and system to manage these risk factors effectively in advance. Moreover, it is necessary to reduce the probability of such risk factors causing failures in the project by measuring the performance of projects from the point of view of risk management. This chapter defines a risk performance index (RPI) that measures the performance of projects by integrating the cost/schedule/risk factors and by adding risk management activities to the EVMS, which is the existing integrated cost/schedule-based performance measurement system for construction projects. We also propose a method to produce and analyze the RPIs to improve the accuracy and efficiency of the general performance measurement for mega projects by extending the conventional cost/schedule-based performance measurement system to include risk management.