A novel model for risk management of outsourced construction projects using decision-making methods: a case study Amin Mahmoudi Department of Construction and Real Estate, School of Civil Engineering, Southeast University, Nanjing, China Mehdi Abbasi Department of Industrial Engineering, Shiraz Branch, Islamic Azad University, Shiraz, Iran Xiaopeng Deng Department of Construction and Real Estate, School of Civil Engineering, Southeast University, Nanjing, China Muhammad Ikram College of Management, Research Institute of Business Analytics and Supply Chain Management, Shenzhen University, Shenzhen, China, and Salman Yeganeh Department of Industrial Engineering, Shiraz Branch, Islamic Azad University, Shiraz, Iran Abstract Purpose – Selecting a suitable contract to outsource construction projects is an ongoing concern for project managers and organizational directors. This study aims to propose a comprehensive model to manage the risks of outsourced construction project contracts. Design/methodology/approach – To employ the proposed model, firstly, the types of contracts and risks in the organization should be identified, then, to prioritize the contracts, the identified risks are considered as criteria. After receiving the experts’ opinions, the best–worst method (BWM) integrated with grey relation analysis (GRA) method was used to prioritize the contracts. BWM and GRA are multi-criteria decision-making methods with different approaches and applications. In the current study, BWM has been employed to calculate the weights of criteria because it has better performance than other methods such as the analytic hierarchy process (AHP). After calculating the weights of criteria, the GRA method has been utilized for ranking the alternatives. Findings – According to the results obtained from the case study, the cost plus award fee contract is the most suitable alternative for outsourcing construction projects. The proposed methodology can be practically applied through different types of the projects such as construction or “engineering, procurement and construction”. Originality/value – To the best of our knowledge, this is the first time a conceptual model has been proposed to select an appropriate contract for construction projects. Also, for the first time, the BWM integrated with GRA method has been used to prioritize project contracts based on the potential risks. The proposed model can contribute to project managers for selecting a suitable contract with the least risk in construction projects. Keywords GRA, BWM, Risk management, Construction projects, Project management, Decision making Paper type Research paper Risk management This study was supported by the National Natural Science Foundation of China (NSFC-71771052 and 71372199). The work presented in this paper corresponds to the doctoral dissertation of the first author at Southeast University, China. The current issue and full text archive of this journal is available on Emerald Insight at: https://www.emerald.com/insight/2043-9377.htm Received 23 September 2019 Revised 20 November 2019 27 December 2019 Accepted 29 December 2019 Grey Systems: Theory and Application © Emerald Publishing Limited 2043-9377 DOI 10.1108/GS-09-2019-0038