Abstract
Nowadays, most organisations are experiencing unprecedented levels of change. Change has become a way of life for organisations that need to remain effective and competitive in order to thrive. It is essential to manage the inherent risk associated with change and innovation. Project brings together resources, skills, technology and ideas to deliver business benefits or to achieve business objectives. Good project management helps to ensure that these benefits or objectives are achieved within budget, within time and to the required quality.Project management must control and contain risks if a project is to stand a chance of being successful and ensure the security of the project. Without an ongoing and effective risk management procedure it is not possible to give confidence that the project is able to meet its objectives. This paper covers the main aspects of the management of risk as they apply to project management and proposes the methodology, which is applicable in implementation of risk management within a project.
Highlights
Nowadays, most organisations are experiencing unprecedented levels of change
This paper covers the main aspects of the management of risk as they apply to project management and proposes the methodology, which is applicable in implementation of risk management within a project
There are essentially two components needed for risk to exist – an uncertain event and its adverse consequences
Summary
The term risk is often elusive, because its interpretation is commonly based on the specific aspect and goal of its utilization. The project risk management should recognize the whole context of the risk and it is necessary to identify these relations as a complex sequence of the different events, which occur within the certain project environment and lead to peril of the project (See Fig. 2). Business risks cover the threats associated with a project’s end result not fulfilling business expectations and not delivering required benefits It is the responsibility of the project board or project steering committee to manage business risks and to keep the validity and viability of the business case within the business strategy. Direct project risk includes the collection of threats to the management of the project and to the achievement of the project’s end results within cost and time. These risks should be managed on a day-to-day basis during all phases of the project life cycle, from initial idea to project close-out
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