Risk Management Proposal For Three Georges Project

AS ISO 31000:2018 Risk Management Guidelines

1.1 Project selection and justification

The project mainly reflects on the three Georges project that is mainly undertaken by the organization “China Yangtze Power” which is one of the Chinese utilities company that has its headquarters in Beijing (Luk and Whitney 2016). The main reason behind this project is that due to the construction of the dam, it will be intended to enhance the shipping capacity of the Yangtze River and it will also be helpful in minimizing the potential of the floods by giving proper storage space for the floods. It is found that China regard this project as one of the monumental as well as economically successful project as it is quite helpful in limiting the greenhouse gas emissions.

1.2 Application of risk management principles by the organization

According to Hopkin (2018), a risk management framework is defined as one of the structured procedures that is utilized for determining the various threats in order to define the strategies that are helpful in eliminating the impact of the risk. The principles, framework as well as procedures of risk management which are discussed within AS ISO 31000:2018 risk management guidelines will be applied in a number of ways by the organization for managing different types of risks which are mainly linked with the three Georges project (Kaiser, El Arbi and Ahlemann 2015).  It is stated by ISO 31000 that the success of risk management is entirely dependent on the effectiveness of the risk management framework that  mainly helps in giving proper as well as appropriate foundations as well as arrangements which will generally be embedded within the entire organization at different levels. The clauses help in describing the various important components of the framework that are helpful in managing the entire risks in the way that are very much interrelated in a quite iterative manner. The ways are listed below:

Commitment: The organization’s management must properly demonstrate the sustained commitment of risk management by properly defining the various policies, objectives of the risk management (Cagliano, Grimaldi and Rafele 2015). This is done so that the project resources are effectively applied and the benefits are effectively communicated to all the project stakeholders.

Risk management framework design: Before successfully implementing, the organization should develop or design an effective framework that are helpful in managing the project risk and this mainly includes proper understanding about the organizational context and generally establishes the risk management policy.

Risk Assessment for Three Georges Project

Risk management implementation:  Risk management must be adopted within the organization for successfully managing the project risks as well as different types of procedures of risk management (Allen et al. 2015).

Review and monitoring of the framework: For properly ensuring the effectiveness of risk management such that the organization must effectively measure the progress as well as performance of the risk management for reviewing the framework properly.

Risk assessment: It is one of the overall procedures of risk determination, analysis as well as proper evaluation for identifying risk, analyzing risks as well as successfully evaluating the project risk (Nonino 2017).

Recording the procedure of risk management procedure: The activities of risk management must be properly traced and the records that are present within the procedure of risk management helps in providing foundation for improving the methods as well as tools.

Furthermore, 1SO 3100 helps in stating that the success of risk management is also dependent on the effectiveness of the management and the organization applies it by having proper communication as well as consultation with the various internal stakeholders during the entire risk management procedure (Liu, Meng and Fellows 2015). In addition to this, by properly establishing context, it is identified that the organization articulate the objectives and helps in defining both the internal as well as different types of parameters in order to manage the risks in order to set the project scope as well as criteria for the entire procedure.

Scope

  The scope for managing risks which are associated with the three Georges project are listed below:

• To determine the project risks which generally occur during the construction of the three Georges project
• To analyze the impact which is created by the risk during the project progress
• Prioritizing the identified risks so that the most prioritized risk must be managed in the initial phase
• Undertaking proper risk treatment such that the challenges of the project can get properly mitigated
• Reviewing the risk of the project are helpful in proper risk management

Criteria

 The criteria’s that are helpful in managing the risk that occur within the three Georges project are mainly elaborated below:

Prioritize: While progressing with the three Georges project which is undertaken by China Yangtze power, the project manager can deal with a number of risks. Therefore, it is necessary for the team to keep focus on proper ways which are helpful in mitigating the major risks.

Aggregate risk: Analyzing each of the project risk will provide a proper understanding about the risks and aggregation helps in providing bigger picture for managing the level of risk that the project is mainly exposed to all the activities (Kivila, Martinsuo and Vuorinen 2017).

Action steps: Proper control on the risk is required and therefore the risk management procedure must include all the steeps that are associated with action driven. This further includes allocation of each of the project risk to the responsible individual for managing them.

Risk Treatment for Three Georges Project

Facilitating decision making: It is found that an effective system of risk management must be utilized that must further facilitate proper decision making procedure (Hopkin 2018). The decision that is needed must be clear and it must remain easy to utilize within risk reports.

Knowledge areas	Risk/opportunity	Identification	Analysis	Evaluation
Project schedule management	Schedule slippage	By analyzing the project progress report of the Three Georges project, it is found that the project is running late due to slippage of schedule.	Impact-High Probability- Very likely	It is considered as an opportunity for adding some more activities in the project that are needed for successful completion of the three Georges project.
Project scope management	Scope creep	By brainstorming the staffs, it is identified that the problem of scope creep is impacting the project negatively.	Impact-Medium Probability-Likely	The problem of scope management occurs due to improper utilization of management strategies and it can be avoided by keeping control on the changes after the project work is initiated.
Project cost management	Budget shortfall	By analyzing the financial report of the Three Georges project, it is found that the project faces financial issues.	Impact-High Probability-Very Likely	The financial issue that occur due to improper cost management can obstruct the progress of the project due to budget related problem.
Project quality management	Improper quality of materials	After brainstorming, it is found that the quality of the project is not checked properly that further causes quality related issues during the construction of the three Georges project	Impact-High Probability-Probable	Improper use of quality materials can further cause a number of quality related issues within the project.

 

Risk/opportunity	Impact/probability	Risk treatment
Schedule slippage (opportunity)	Impact-High Probability- Very likely	The risk can be mitigated by keeping proper track on the project schedule.
Scope creep (Risk)	Impact-Medium Probability-Likely	The scope creep issue can be avoided effectively by keeping proper control on the changes which are generally required within the project.
Budget shortfall (Risk)	Impact-High Probability-Very Likely	The problem of budget shortfall can be mitigated by managing the budget of the project properly.
Improper quality of materials (Risk)	Impact-High Probability-Probable	The risk can be mitigated by checking the material quality which are mainly utilized for the three Georges project.

Other risks important for the project

The other types of risk that are considered significant for the three Georges project are mainly elaborated below:

Pollution: After the dam gets filled then there will be a chance of submerging 13 cities, 140 towns as well as 1350 villages which further lets home, mines, factories as well as dumps underwater which further cause toxic chemicals (Jiang, Qiang and Lin 2016). This can cause water pollution.

Changes in weather: The alteration within the water flow from the entire dam is significant and therefore that can cause changes within the weather. The three Georges generally create lake effect that further decreases the rainfall within the area.

Conclusion with respect to the result

It can be concluded from the report that the risks which are generally occur within the three Georges project can be mitigated with the help of proper risk treatment strategies. The paper reflects the application of risk management principles by the organization for mitigating the risks that occur during the progress of the three Georges dam project. Furthermore, the paper discusses the risk assessment process for identify, analyzing as well as evaluating the risks that are associated with various knowledge area of the project that includes proper schedule management, scope management, quality management as well as cost management. In addition to this, the other risks that are important for the entire project are mainly elaborated in this paper.

Importance of sound risk management plan

A sound strategy of risk management generally helps in allowing an individual for properly identifying the strengths, weaknesses, opportunities as well as project threats (Wang et al. 2016). By successfully planning the unexpected project events, one needs to properly respond to the risk that they arise. For ensuring the success of the project, it is necessary to properly handle different types of potential risks for identifying as well as mitigating the issues. Furthermore, proper plan of risk management mainly assists in contributing within the project success by properly establishing the list of external risks (Grishunin and Suloeva 2016). For making sure that the entire project is running smoothly, it is needed to properly communicate the project plan to the sponsors, team members as well as project stakeholders. Moreover, risk management determines the possible risks, issues that occur within the project and helps in setting proper procedures for avoiding the risk, minimizing its impact as well as coping within its impact.

Reflection

Profile of the organization

China Yangtze Power Co. Ltd is one of the Chinese utilities companies that have its headquartered in Beijing. It is found that that the company is one of the components of SSE 180 index. The company was mainly founded on 4^th November 2002 and was mainly bought on 18^th November 2003. The company mainly undertakes the work of three Georges project in order to construct the Georges dam that spans the Yangtze Rivers. In addition to this, the project is mainly intended to enhance the shipping capacity of the Yangtze River and it will also be helpful in minimizing the potential of the floods.

It is found that for managing the risks which generally occurs during the construction of the three George’s dam which is undertaken by China Yangtze Power Co. Ltd, it is needed to define the risk management activities that are used by the company. The organization generally analyzes the basic assumption of internal as well as external environment as well as the overall objective which is generally related to the procedure of risk management. It is found that though the definition of framework as well as scope are important for risk management as it is needed to determine proper procedures, tools and methods for proper risk management (Singh and Sarkar 2018). Proper definition of internal environment and external environment must be determined. Secondly, it is important to generate proper risk management context for creating proper balance between the costs, opportunities as well as benefits. Additionally, proper formulation of risk criteria must be identified for evaluating the risk based on operational, financial, regulatory, legal as well as environmental criteria.

  As the organization “China Yangtze Power Co. Ltd” wants to a leader in the world in context to the hydropower industry therefore they generally plays an cutting edge within the operation of the power station as well as management that generally rely on the rich experience, capable team as well as sound standard system (Li et al. 2017). The organization utilizes this facility in undertaking the work of Three Georges Dam which is one of the largest power facility dams. The dam was mainly constructed for controlling the water that is allowed and as a result the dam helps in preventing flooding. Additionally also helps in generating power which can be sold to different provinces around china. Thus, it is found that the organization helps in achieving both the internal as well as external objectives of the organization.

Conclusion

 The organization utilizes different criteria of risk which are represented as view that generally reflects how the risks are acceptable or tolerable. It is found that within the decision making procedure, the criteria are mainly utilized for determining the risks which are quite acceptable, unacceptable or can be minimized (Hu et al. 2015). After the risk identification within the three Georges project, the organization has the capability of properly evaluating the entire risk properly for mitigating the risk which generally creates negative impact on the progress of three Georges dam. It is identified that appropriate method of interview as well as brainstorming is utilized in order to properly analyze the present condition of the entire organization in order to properly evaluate the the significance of project risks such that it would be supported by proper procedures of decision making.

Feasibility of the risk study

The feasibility study that is conducted on the risk that are associated with the Three Georges project is considered as the ideal starting point  within the company for properly introducing risk management strategies. Within the initial step, both the internal as well as external requirements of risk management need to be properly defined (Pekkinen and Aaltonen 2015). Secondly, the strategies that are helpful in mitigating the risks are determined and this are considered as counteract for unfolding fears among the decision makers with the proper introduction of risk management strategies. In addition to this, it is found that after properly collecting the data, the experts generally needs to draft proper customized plan that generally organizes the implementation and helps in analyzing the entire economic feasibility by successfully specifying the various types of technical needs that generally sets out the schedule for the realization of the project (Hornstein 2015). This further helps in allowing the management for making proper informed decision for the introduction of the risk management strategies which are introduced for mitigating the project risks. The risk study that will be conducted is considered to be quite feasible as with the help of the risk which are associated with the three Georges project can be mitigated and the project can progress quite effectively.

Terms of reference for proposal

The Three Georges dam which is undertaken by the China Yangtze Power is one of the renowned Chinese utilities companies which has its headquarters in Beijing. The main aim of the Three Georges dam is to generate power and the sell the power within the different provinces of china. The electricity that is mainly procedure without utilizing the fossil fuels is considered as one of the renewable energy that does not cause pollution. In addition to this, it is found that the Three Georges Dam that was built was considered quite beneficial in preventing floods as the flow of water can be controlled. Moreover, the presence of the reservoir as well as dam generally helps in allowing the ship to travel downstream as well as upstream for the first time. The project that is mainly built by the company “Three Georges dam” started on 14^th December 1994 and the dam was made operational within the year 2009 (Jiang, Qiang and Lin 2016). Additionally, the money that is invested for developing the three Georges dam will be around US$31.765 billion. The team members who will be associated with the project include construction manager, supervisor, contractor, civil engineer, electrical engineer, worker, project planner, project manager as well as financial manager. Moreover, in order to distribute the work effectively to the team members, the manager of the project is responsible of allocating the project work to the different members so that the project work gets finished on time.

Project team

The member of the risk management team that is specific for the organization in order to identify, analyze, and mitigate the risks which are associated with the project are mainly listed below:

• Project manager
• Quality analyst
• Risk management team
• Risk analyst
• Business analyst

Incorporation and application of risk management principles 

The developed proposal must properly incorporate and apply the different=,  principles of risk management framework as well as procedures in order to properly manage the risks which are described in AS/NZS ISO 3100:2018. The ways are mainly illustrated below:

Develop of steering committee: The committee of risk management must be established by giving proper oversight related implementation in order to successfully incorporate the entire framework for managing project risks (Chen et al. 2016). Furthermore, the entire committee should assign the roles effectively.

Known language: For successfully the incorporating the plan of risk management, it is quite important to properly use language that must be understood by the project team during the identification as well as evaluation of the project risk so that the project team can understood such risks.

Assigning proper responsibilities: The responsibilities should be understood by the team so that they can be able to handle the complexities and can manage the project risks properly. Moreover, if the responsibilities are not pre-defined then it would be challenging for the project team to mitigate the risks.

Use of risk management methods: Proper methods as well as frameworks for incorporation of project risk must be developed in order to guide the team for successfully managing the risks of the project (Aydin and Dilan 2017). The definition off risk framework are also beneficial in successfully defining the project roles that further helps in giving proper process so that the risks can be effectively determined and assessed as well as mitigated.

 The risks which generally arise during the Three Georges project are generally determined in the below table:

ID	Risk	Description
1.	Schedule slippage	Due to slippage of project schedule, the chances of delay in the project are quite high that further helps in enhancing the total budget of the project.
2.	Budget shortfall	Due to lack of budget and improper financial support, the project “three Georges dam” faces financial issues which can obstruct the progress of the project.
3.	Improper requirement analysis	As the requirements that are needed during the construction of the dam are not identified then, it would be quite challenging for the project managers to progress properly with the project work.
4.	Scope creep	If the changes within the requirement are not controlled after  the initiation phase then  it is found that the scope creep chances are quite high which further causes delay as well as hindrance during the project progress.
5.	Lack of experienced workers	If the workers who are associated with the project are not much experienced and therefore they faces a lot of issues and challenges in working with the three Georges dam. Skill and knowledge within the workers are important but as the team members are not skilled they can face issue in handling complex activities.
6.	Pollution	As the water level increases within the dam then the home, mines, factories as well as dumps underwater that has toxic chemicals. This further causes water pollution.
7.	Undefined deliverables of project	If the deliverables of the project are not defined properly then they face a number of challenges in order to accomplish the project goals and objectoves.
8.	Changes in weather	The three Georges generally create lake effect that further decreases the rainfall within the area.

Risk analysis

 The risks which are identified can be successfully analyzed by using the impact and probability components that categorizes as well as prioritize the risks which generally creates negative impact on the entire project. The probability matrix is provided below for the risks which are determined in the Three Georges dam project.

ID	Risk	Impact	Probability
1.	Schedule slippage	High	High
2.	Budget shortfall	High	High
3.	Improper requirement analysis	Medium	Medium
4.	Scope creep	High	Medium
5.	Lack of experienced workers	Medium	Medium
6.	Pollution	Medium	High
7.	Undefined deliverables of project	Medium	Low
8.	Changes in weather	High	Medium

The below table reflects the priorities of each of the risks that are identified during working in the three Georges project.

ID	Risk	Impact	Probability	Priority
1.	Schedule slippage	High	High	2
2.	Budget shortfall	High	High	1
3.	Improper requirement analysis	Medium	Medium	6
4.	Scope creep	High	Medium	5
5.	Lack of experienced workers	Medium	Medium	7
6.	Pollution	Medium	High	4
7.	Undefined deliverables of project	Medium	Low	8
8.	Changes in weather	High	Medium	3

The table which is given above generally reflects on the three priorities of  project risks that further showcase that schedule slippage as well as budget hindrance can stop the progress of the project and therefore they are the first priority before the risk management team. Similarly, the risks like weather change as well as pollution causes environmental impact and therefore the risks can be reduced by adopting some strategies. All the risks that are identified must be mitigated as per the identified priority such that the entire project do not experiences negative imapct.

The table that is provided below showcase on the strategies those are quite beneficial in mitigating the  project risks that are linked with the Three Georges project.

ID	Risk	Impact	Probability	Mitigation
1.	Schedule slippage	High	High	Tracking the schedule and focussing on the project progress report can resolve this challenge.
2.	Budget shortfall	High	High	Using earned value analysis for identifying the cost indicator as well as keeping track on the expenditures are the two ways through which the risk can be mitigated.
3.	Improper requirement analysis	Medium	Medium	It is necessary to use proper requirement analysis bore starting the project for avoiding this issue.
4.	Scope creep	High	Medium	Keeping control on the project and using change management procedure can avoid the problem of scope creep.
5.	Lack of experienced workers	Medium	Medium	In order to mitigate this issue, it is quite important to  give proper facility of training to the workers of the project.
6.	Pollution	Medium	High	The problem of pollution must be reduced by keeping track on the water flow so that excess water does not flow  and does not cause flood.
7.	Undefined deliverables of project	Medium	Low	It is necessary to define the deliverables before assigning the work to the team so that they can be able to achieve the objectives.
8.	Changes in weather	High	Medium	Using alternative strategies can avoid environmental issues like changes within the weather of the project.

While building the Three Georges project, I have come across many risks which required be identifying as well as mitigating and therefore utilization of risk management process was important. The risks which I have identified includes schedule slippage, pollution, budget shortfall, scope creep, changes in weather as well as inexperienced team and found that such risks can cause negative impact on the project progress. The risks which are identified must be evaluated, prioritized and then mitigated so that the objective of the project can be achieved. Moreover, the paper reflects the feasibility of the project risk that showcases that the risks which are associated with the Three Georges dam can be resolved effectively. I have also determined the project team who has the role of determining the issues. Moreover, the proposal that is developed generally incorporates as well as applies the different risk management principles such that the project risks can be effectively determined. Furthermore, the risk management process uses different types of methods, tools and techniques. The risk management plan which was developed is quite beneficial for clarifying the importance of the events for managing the business-related risks.

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