Definition of Risk and its concepts
Discuss about the Advanced Project Risk Management for policy.
Risk management is nothing but a systematic process or method of identifying, providing response and checking or analyzing to various kinds of risk which are associated with projects. It is mainly inclusive of maximization of various kinds of risks and events (McNeil, Frey and Embrechts, 2015). It also focuses on reduction of consequences and probability of various kinds of events which are related to objectives of projects. Risk is generally considered to be an important kind of choice made by environment rather than fate which is associated with it. It is possibility of plans of somethings which can affect the achievement of project goals, business and various kinds of prospects.
In the coming pages of the report I have provided proper definition of risk, various concepts of risks, various kinds of risk associated with road construction project. After that certain number of advantages of risk management has been provided. I have provided an idea regarding Risk Priority Matrix.
Risk can be easily defined as a situation in which there is no kind of knowledge is available of its probable outcomes (Huang et al., 2016). It generally provides an idea regarding the changes of injury or various kinds of loss, dangerous kinds of materials, for running risk. Every kind of risk is known to be proportional for expected kind of values which is caused by various kinds of risk management and probability of various kinds of events.
With respect to road construction industry I have analyzed that risk can be defined as likelihood of occurrence of definite events which is inclusive of factors related to whole kinds of transaction.
Road construction projects are considered to very much complex and consist of various internal and external kinds of risk (Li et al., 2016). One of the best kinds of ways for managing risk in road construction project is analyzing their types and proper managing of them.
Technical Risk: Technical risk is mainly inclusive of anything which generally stops one from the creation of product and customers. This mainly inclusive of various kinds of things and availability of various kinds of risk. The risk is mainly inclusive of various kinds of products and scope.
Logistic Risk: There are large number of logistic risk which needs to be addressed in road construction projects. The risk is mainly inclusive of availability of various kinds of transport facilities, availability of equipment focus on certain number of things like spare parts and labor.
Types of Risk Associated with Road Construction Projects
Environmental Risk: It is mainly inclusive of certain number of things like natural disasters, large number of seasonal implication (Yin et al., 2016). The risk is mainly inclusive of local kinds of condition. In road construction projects one must be easily understand potential kinds of delays and losses associated with it.
Management Risks: The common type of related risk is uncertainty of productivity of various kinds of resources (Brighenti and da Silva, 2016). Before the beginning of road construction one should have enough skilled staff for properly defining of certain roles and responsibilities.
Financial Risk: During a road construction project few number of financial risks are only possible like local tax, inflation and availability (Olson and Wu, 2015). If someone is working on project on international basis, then he can easily analyze the term currency exchange in a similar way.
Socio-political risks: During a construction project one can easily understand customs, importing of things. This risk is totally based on different codes and parameters which someone must follow.
I have analyzed that there are several number of factors which are associated with risk exposure like:
Team size: Higher kind of probability of the various kinds of problems. Communication can be considered to be more difficult when the number of participants increases (Grote, 2015). So as a result the number of interaction of large number of people also increases. This ultimately leads to increase in greater value of coordination.
History: New kinds of projects are considered to be much kind of riskier one as certain number of processes have not been defined yet.
Staff expertise and experiences: If there is lack in the number of staff then there can be direct amount of knowledge and experiences raleted to subject, possible number of people will easily go along with number of time and people.
Complexity: More the number of sophistication of a project, there can be greater the value of mistake and problems associated with it.
Management of Stability: It is considered to be an important kind of stability which focus on unity of direction, which in turn focus on reaching of number of goals (Thaler and Levin-Keitel, 2016). The irritability of management can often have led to insufficient using of large number of resources.
Time compression: If it is on tight schedule then it can easily have led to risk which is being identified. More times generally require greater value of flexibility and various kinds of opportunities have led to prevention and mitigation of various kinds of errors.
Sources of Risk Exposure
Resources availability: The more number of resources have led greater ability for responding to large number of problems (Sweeting, 2017). Large number of resources does not often lead to guarantee of protection from large number of risk.
There are large number of resources which are associated with road projects like
- Various kinds of misunderstanding related to terms and condition which are associated with projects.
- It also checks the design changes and errors associated with a particular kind of projects.
- It generally aims in poor co-ordination of various kinds of roles and responsibilities associated with a project.
- Large number of unskilled staff.
- Various kinds of political and legal number of problems.
There are large number of advantages for making use of Risk Management like:
- Lesser number of uncertainty.
- Achievement of large number of objectives.
- Reliability of large number of staff members.
- Reduction or minimization of various kinds of capital cost associated with a project.
- It also results in creation of large number of values for people.
There are number of limitation which are associated with risk management
- If there are large number of risk are associated with it then time can be easily wasted in dealing with large number
- Spending too much amount of time on managing and accessing can often led to divert of large number of resources.
- Unlikely of various kinds of events can often led to various kinds of risk and also dealing with better retaining of large number of issues.
Probability risk management tools and techniques have been easily identified for improving the success of a project (ROSSI, LOMBARDI and DI MASCIO, 2018). They have easily analyzed the fact that risk management processes are not used on widely basis and have also found the fact that management practices are not easily used on widely basis. They have easily focused risk management processes are considered to be more applicable to higher value of risk. For this proper amount of data and SWOT analysis is needed. The matrix consists of four parts namely meeting of functional specific values, meeting of technical specification, schedule and various kinds of budget.
I have also analyzed that common kinds of risk which are associated are overrun with various kinds of roads. There are several kinds of projects which are mainly associated with project management and contracts (Teixeira et al., 2015). It generally focuses on low equipment efficiency, high value of competition and various kinds of political situation.
Risk priority matrix is mainly done with the help of likelihood and impacts which can be gathered from the various kinds of samples. A risk priority matrix is very much easier to make as major portion of results can be easily made. Risk priority matrix generally provides quick views of certain number of risk and followed by priority matrix is created.
Generally, there are large number of risk factors which are associated with road construction project (Evans et al., 2016). It can be easily categorized into various terms like external, internal and legal value of categories.
Fig 1: Specific project Risk
(Source: Teixeira et al., 2015, pp-28)
Conclusion
From the above discussion it can be easily concluded that this report is all about risk management is roads. In the discussion portion of the report an idea has been provided regarded risk, after that an idea has been provided regarding risk and risk management. Various kinds of risk associated with road construction like technical risk, logistic risk, environment risk, management risk, financial risk, socio-political risk. After that an idea has been provided regarding team size, history, staff expertise and experiences has been provided. Various kinds of sources and advantages of risk management has been discussed in details. Certain limitation of risk management has been discussed in details. An idea has been provided regarding probability impact matrix. After that a risk breakdown structure with respect with respect to road construction has been provided.
References
Brighenti, J. and da Silva, M.Z., 2016. Environmental uncertainty perception and risk management: A study on providers of road freight transport services. BASE-Revista de Administração e Contabilidade da Unisinos, 13(3), pp.200-215.
Evans, C., Fisher, J., Gourio, F. and Krane, S., 2016. Risk management for monetary policy near the zero lower bound. Brookings Papers on Economic Activity, 2015(1), pp.141-219
Grote, G., 2015. Promoting safety by increasing uncertainty–Implications for risk management. Safety science, 71, pp.71-79.
Huang, J., Li, F., Zeng, G., Liu, W., Huang, X., Xiao, Z., Wu, H., Gu, Y., Li, X., He, X. and He, Y., 2016. Integrating hierarchical bioavailability and population distribution into potential eco-risk assessment of heavy metals in road dust: A case study in Xiandao District, Changsha city, China. Science of the Total Environment, 541, pp.969-976.
Li, Z., Kolmanovsky, I., Atkins, E., Lu, J., Filev, D.P. and Michelini, J., 2016. Road risk modeling and cloud-aided safety-based route planning. IEEE transactions on cybernetics, 46(11), pp.2473-2483.
McNeil, A.J., Frey, R. and Embrechts, P., 2015. Quantitative risk management: Concepts, techniques and tools. Princeton university press.
Olson, D.L. and Wu, D.D., 2015. Enterprise risk management(Vol. 3). World Scientific Publishing Company.
ROSSI, G., LOMBARDI, M. and DI MASCIO, P.A.O.L.A., 2018. Consistency And Stability Of Risk Indicators: The Case Of Road Infrastructures. International Journal of Safety and Security Engineering, 8(1), pp.39-47.
Sweeting, P., 2017. Financial enterprise risk management. Cambridge University Press.
Teixeira, A., Sou, K.C., Sandberg, H. and Johansson, K.H., 2015. Secure control systems: A quantitative risk management approach. IEEE Control Systems, 35(1), pp.24-45.
Thaler, T. and Levin-Keitel, M., 2016. Multi-level stakeholder engagement in flood risk management—A question of roles and power: Lessons from England. Environmental Science & Policy, 55, pp.292-301.
Yin, J., Yu, D., Yin, Z., Liu, M. and He, Q., 2016. Evaluating the impact and risk of pluvial flash flood on intra-urban road network: A case study in the city center of Shanghai, China. Journal of hydrology, 537, pp.138-145.
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