There are a large number of interdependent risk factors in complex project. Risk response strategy without considering risk correlation cannot achieve good risk response. Therefore, the purpose of this paper is to propose a risk response strategy selection model considering risk correlation based on the grey K-shell algorithm.Design/methodology/approachThis paper mainly focuses on the measurement of two aspects of risk factors. One is the ability of the risk factors to influence other risk factors, another is the degree affected by other risk factors. Both of the above are measured by the grey K-shell algorithm improved in this paper, and the weights of these are used for the constructing of risk response strategy selection model.FindingsThe risk response strategy considering risk relevance is more effective than the risk response strategy without considering risk relevance. Also, results indicate that as the risk response budget increases the risk response effect also increases, and the increasing trend is weakens. The relative gap between the effect of response strategies considering risk relevance and the strategy without considering risk relevance increases first and, then, decreases with the increase of budget.Originality/valueThe results of this paper demonstrate that the risk response strategy considering risk relevance is more effective than not considering risk relevance. The approach presented in this paper can guide project managers’ risk decisions and may also help to find the best risk response budget.
Grey Systems: Theory and Application – Emerald Publishing
Published: Oct 16, 2020
Keywords: Risk response; Interval grey number; K-shell; Risk correlation