Risk management attempts to recognize and manage potential and unforeseen trouble spots that may occur when the project is implemented (Erik W. Larson). So Risk management will be used to attempt to prevent destabilization of the project when unforeseen events occur. Managing risks on projects is a process that includes risk assessment and a mitigation strategy for those risks (Hillson,
No matter what product the organization is designing to launch, it is very common to take decisions that involve the risks at some point in time (Mind tools editorial team, 1996-2017). Talking about risks, it has two main parts: the likelihood that something will go wrong, and the negative consequences that can occur if the risk occurs. It is difficult to know beforehand but if the risk occurs than the following consequences related to cost, time and reputation have to be dealt smartly. When the work involves risks than risk analyses is an essential tool. It helps in knowing that what all kind of risks and consequences can be faced in assigned role.
Such as time management, going over the budget, inability to get along with co-workers, corrective actions, extra unneeded effort of workers, unclear priorities and poor team morale. Due to these possible ramifications and more of such project management, project management is a vital aspect to the success of a project. With an effective project management, it aids in meeting or exceeding customer expectations, and gives ultimate use of resources and build a strong foundation of confidence for more upcoming projects. In my personal experience, to have a successful project, you have to follow a planned project management life cycle. Any and all projects can be supported with the project management life cycle.
3.0 Risk Analysis Project Risk Management is defined as “the process of conducting risk management planning, identification, analysis, response planning, and monitoring and control on a project.” (Gayani 1988) Risk Analysis is a process which enables the Company to analysis and manages the potential problems associated with the project. This is an essential project management tool to enable pre- review of the project identifies the possible threats which are likely to face during the implementation of the project. 3.1 Risk Management According to Institute of Risk Management, Risk management involves understanding, analysing and addressing risks to make sure organisations achieve their objectives. So it must be proportionate to the complexity
Objectives of the risk management II. An assessment of the high level risk that are connected with different areas of the project III. Process of managing the risk IV. Decision making in the risk management process The creation of the strategies associated with risk management in the very start of the project pave ways of ensuring the effective management of the risks and efficiently completion of the life cycle of the project and also it increases the chances of the producing a standardised product that meets the requirements of the companies objectives for a project (Munier, 2014). Risk Management Process The following steps are very commonly found in the risk management procedures that are followed: 1) Identifying the risks 2) Evaluate the
First of all, resources should be invested in the response actions dealing with the risks influencing the critical constraint of the project (if any). In case of absence of such the constraints or elements, the resources should be invested in the risks responses to the events with the greatest risk value, for example, or to the events having high probability and strong impact on the project. Sometimes, project manager faces the situation when the amount of resources invested in the risk response is insufficient. In this case the action should be taken in accordance with the predefined trade-off analysis. At the same time management could decide to change the scope of the project and some activities could be crossed out in order to reduce the amount of money spent on the less important aspects of the
Setting the objectives must be done before management can identify potential events affecting their achievement. • Event Identification – management identifies potential events that could affect the entity either adversely or presents an opportunity and emanates from internal and external sources. • Risk Assessment – consideration of the extent to which potential events have an impact on the achievement of the organizations objectives. Evaluate the risks that have been identified in order to form a basis for determining their management. • Risk Response – after the determination of relevant risk, management determines how it will respond.
Managers who are open to ideas and ready to accept the challenge are in a better position to prepare themselves for the future challenges of change. The last most important thing in facing the challenges of change is that, every Organization must:-- • Introduce the Change at the Right Time. • The Change must be Gradual and not Drastic. • Increase the Involvement Factor. (Employee Involvement, Participation and Consultation is very important) Many organizations accept to bring in the change but may be the time is not appropriate of the change has been brought is very fast and drastic which will disturb the organizational structure and organizational relationships and will make things difficult when the change has to be actually brought.
Therefore, the design phase was a major source of problems for the subsequent phase if not well manages to specify at the outset of the project. The concept of design maintainability could be initiated early in the design stage to minimize the maintenance problems and building defects.
Project Managers of complex or any large and small projects must make use of available techniques to deal with project risks and if they are used effectively project managers will be able to identify and manage potential risk/problems. Projects are unique and have different objectives from previous projects implemented, some may have very limited time to be implemented with less resources or not enough budget. Any projects involves level of risk. In IT projects risks can be technical or functional. According to Berman (2007:43) “technical risk is related to a specific technology or capability that your project will require as part of its implementation” example of technical risks are as