Evaluating the Practical Effectiveness of Risk Management Frameworks among SMEs in Zambia’s Construction Sector: A Case Study of Lusaka Building Contractors

This study examines the effectiveness and practical implementation of Risk Management Frameworks (RMFs) among Small and Medium Enterprises (SMEs) in Zambia’s construction industry, with a specific focus on firms operating in Lusaka. Adopting a mixed-methods approach, the research employed a sequential explanatory design, integrating quantitative data from 80 stratified SME respondents and qualitative insights from purposively selected key informants. The study assessed the adoption, perceived effectiveness, and challenges related to four widely recognized RMFs: COSO, ISO 31000, RIMS, and CAS. Findings revealed that COSO was the most preferred and effective framework due to its structured and adaptable nature, whereas ISO 31000 and CAS were perceived as overly complex and less suited for SMEs with limited resources. The study also identified major barriers to RMF adoption, including regulatory complexity, lack of technical expertise, project variability, and resistance to change, while financial constraints, though present, were found to be comparatively less significant. Strategies such as training, simplification of frameworks, digital tools, and policy support were recommended to enhance RMF adoption. The study concludes that improving awareness, building technical capacity, and providing regulatory and financial support are critical for fostering a risk-conscious culture and enhancing the performance of SMEs in Zambia’s construction sector. These findings contribute to the growing body of literature on SME risk management in developing economies and offer practical implications for policymakers, industry regulators, and SME support organizations.