Certainty, Uncertainty, Probability, Variability and Risk

Abstract

In 1966 the Tavistock Institute published a study¹ on the building industry entitled ‘Interdependence and Uncertainty’, a title that evolved during the course of the research study to which it relates. The title really reflects two of the major findings of the research team, features that are well known to those involved in the construction industry, but not well understood. In chapter 3 reference was made to the fragmentation of the industry, and the interdependence between the fragments does impose a pattern of working upon the industry. The second feature, that of uncertainty, may well result from the complex interaction between the large number of organisations involved in the industry, but some aspects of uncertainty should be avoidable with good management and control. If careful work planning is undertaken, many of the doubts about delivery and completion dates, labour and material availability, quality of work, and so on can probably be eliminated; but it is of interest to note that the Tavistock research team formed the opinion that many people in the construction industry actually thrived on the uncertainty, and would feel at a loss if it were eliminated. It is unlikely that it will disappear, however, and even if it were possible to eliminate the difficulties that arise because other people do not work to programme, there will always remain some areas of uncertainty. These relate to problems of chance events in the future, for example the occurrence of floods, high tides, hurricane winds, all natural phenomena that cannot be accurately forecast. Other chance events concern the winning of contracts, where one company does not know whether it has bid above or below its competitors. The uncertainty in these cases arises from ignorance of the outcome of future events. Ignorance can also lead to uncertainty in relation to factual data; for example, information on ground conditions may be inadequate for a full understanding of the problems that will be involved in an earthworks contract. Here the word ignorance is used not in the common pejorative sense, but in the stricter sense of lack of information. This lack of information characterises many business and engineering decisions; the manufacturer of a new piece of building equipment may be ignorant of the market he can expect for his product; the civil engineering contractor may be ignorant of the exact level of the ground water on the site where he is about to commence work.