WHAT IS RISK?
According to English Oxfords, risk is ubiquitous. In other words, risk can be defined as the potential events that might occur in the project throughout its implementation phase. Thus, it requires strategies to migrate the consequences of the potential risks occurring. Effective strategies for risk enables project team to identify your project’s strength, weaknesses, opportunities and threats Hence, as project control team for Pan Borneo Package project, PCSS manage the risk by using Risk Management Workshop which following the process that has been suggested by PMBOK Fifth Edition. The objectives are:
- Determine the current mitigation strategies for effectiveness and;
- Determine possible reassessments should the mitigation be deemed not to be effective
- Re-assess the identified risks for changes to the probability and consequence factors
- Identify any new risks
RISK MANAGEMENT PROCESS
The risk identification process will be executed through a workshop environment as this allows brainstorming across all stakeholders. The workshop will be very structured to allow the identification of the potential risk events by following the Work Breakdown Structure (WBS) as means of maintaining systematic focus on the project deliverables.
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This is also known as risk response actions. After calculating the possible outcomes you need to decide how to respond to each risk. While small risks may not affect your project at all and may not be worthy of spending time on those, leaving matters completely unattended isn’t a wise decision.
The risk monitoring is to monitor the individual risks contained therein and update the register on a period basis and/or as new risks surface. It’s often very important to analyze and address serious risks as soon as they arise, immediately applying the appropriate risk response plan.
Then, it has to be controlled. This is the final process of risk management and defines which approach is more appropriate to deal with the individual risks identified in the risk register. The four basic approaches discussed:
- Risk Avoidance – an informed decision not to engage in the activity that could give rise to the risk
- Risk Reduction – involve methods that reduce the severity of the loss or the likelihood of the loss from occuring
- Risk Retention – involve accepting the loss from occurs
- Risk Transfer – involve transferring the risk to a third party such as an insurance contract
- Various departments within the organisation