?? AI CAN PREDICT YOUR DEATH
Errol Braithwaite
MANAGEMENT CONSULTING & PROJECT DEVELOPMENT | INFRASTRUCTURE | MINING | CONSTRUCTION
And you can predict the death of a Construction Company.
Did you know that now there’s an AI model that can predict the age you will die? And why wouldn't there be - actuaries have been using statistical methods to do the same thing for years (and adjusting your medical and life-insurance premiums accordingly).
The AI model is called Life2vec and it was developed by Danish scientists.
Is it accurate?
That’s the million-dollar question right? Well apparently, the model which contains the health data of about 6 million Danes, has been found to be 78% accurate in some studies (which seems eerily accurate if you're a Dane). That’s not all - the model can supposedly predict how wealthy you will be when you die as well. I'm beginning to smell the faint aroma of snake oil. How about you?
Can I try it?
That’s what you really wanted to know, isn’t it? Well, the model is not yet public… but there are bots claiming to use it. I tried one claiming to use the Life2vec model and after answering a handful of questions, it said I’d reach 85…(and then be shot by a jealous husband. Just kidding.).
Take the outcome with a pinch of salt of course, this probably isn’t the proper model.
But you CAN predict the death of a Construction Company.
I recently published an article entitled "How to Kill a Construction Company". In it I pointed out how the modern contractual environment is extremely disadvantageous to the Contractor. BUT, that many contractors blithely accept these contractual risks even though by doing so they are inevitably condemning their companies to death - it's just a question of time.
I pointed out that most tenders require bidders to simultaneously:
The Contractor must swallow all of this on the back of paper-thin margins as well as all the normal contracting risks like fuel and materials prices, industrial action, the weather, local content requirements, and so on and so on.
Taken together, these circumstances effectively mean that Contractors are required to provide unsecured credit to the Employer who can then pull the Performance Bond (seize the Contractor’s money) at any time without following a dispute process, and hold the Contractor liable for unlimited costs, now and in the future, for any default that can be ascribed to the Contractor.
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It’s a crazy set of risks which no Contractor who wishes to stay in business should blindly agree to. I call it SATAN’S TRIANGLE OF CONTRACTING because so many of them, big and small, have been swallowed up by it, never to be seen again:
I've sat in countless "Tender Review Meetings" where "risks" are discussed and debated, and contingency allowances are added to the bid price to mitigate the risk of their occurrence. Mostly these are operational risks - unknown ground conditions, fluctuations in the cost of diesel, regulatory changes etc etc. All good, but it's amazing how very few (savvy) contractors ever take a hard and holistic view of the full ambit of the Contractual Risks they are signing up to - Satan's Triangle. And even if they do, they often shrug their shoulders resignedly and say, "ah well, if we don't accept those conditions we'll be disqualified".
If that's the attitude in your RiskComm, then you can be assured that, at some point, a contract WILL kill your company - it's merely a question of time.
But you CAN cheat death...
Fortunately you CAN mitigate contractual risks, but you've got to be serious about it. I suggest several mitigation measures in the above-referenced article. At the very least you MUST:
1. LIMIT YOUR LIABILITY
2.?QUALIFY PERFORMANCE BONDS
Finally, if you can't mitigate your contractual as well as operational risks to an acceptable level, walk away....
REMEMBER: The first rule of business is to stay in business.
You’ll never regret gifting bad contractual conditions to your competition.
Consultant at Covington Consulting
1 年Interesting and scary