Risk Management and Projects

Risk Management is the process by which the likelihood of risk occurrence or its intact on the project is reduced. It has five steps.

• Identify the potential sources of risk on the project.
• Determine their individual impact and select those with a significant impact for further analysis.
• Assess the overall impact of the significant risks.
• Determine how the likelihood or impact of the risk can be reduced.
• Developer and implement a plan for controlling the risks and achieving the reductions.

If a project is Eco-friendly external unpredictable risk is reduced drastically. These external unpredictable risks are beyond the control d manager or their organisations.  Government or regulatory intervention can relate to the supply of raw material or finished goods.

Many projects have been killed by the unexpected requirement to hold a public inquiry into the environmental impact.

Strategies for the Project's Context

The strategies for handling the project's context must include

• External Influences
• Financing the Project
• Scheduling the Project

An analysis of causes of project overruns shows that external factors are a principal cause. Several may be identified but the project's political context, its relationship with the local community, the general environment and the projects location and the geophysical conditions in which it is set are particularly important.

The stake holders especially the local community are an important external influence. The management of change must take account of this influence and so techniques such as Environmental Impact Analysis (EIA) procedure have now been adopted.

This process shows how substantive dialogue can help reduce potential opposition. The value of the EIA process is that it allows consultation and dialogue between developers, the community regulators and others, and yet forces time to be spent on the front end in examining option and ensuring that the project appears viable.

Thus, the likelihood of community opposition and of unforeseen external shocks arising is diminished. Furthermore, in forcing project developers to spend the time planning, the EIA process emphasizes prices that project stage which traditionally was rushed. in spite of the obvious dangers. What factors lead upto the introduction of EJA (Environmental Impact Assessment) as one of the assessment techniques in Project Management.

The prime factor was the scale and apparent urgency of implementation of major Resource Development Schemes in Water Management, Energy Supply. Transportation, Mineral extraction and agricultural improvement. Many of these schemes were so massive and were promoted so rapidly that all kinds of damaging side-effects both to the physical environment and to local communities became too obvious to ignore. Examples included the whole scale removal of settlements for large dams and motorways, the disfigurement of scenically attractive areas for coal developments and water supply reservoirs etc. All this led to the necessity of EIA.