Risk Identification Worksheet and Paper

Introduction

The selected scenario for this report is scenario 2. The scenario includes building a pipeline in Alaska. The most important details about the project entail the classification of the project as a high-priority project due to the restrictions created by changes in weather conditions, the supplier’s longer lead time than required to complete such a project, lack of flexibility in selecting another supplier, and huge penalty in the project contract if the construction is not completed on time. This report will identify the main risks in the project described in the scenario, the risk management process that would be followed to deal with the risks, risk documentation, and the role of risk management in mitigating the identified risks.

The risk management process

The first step of the risk management process would be identifying the risks that may be encountered in the project. They would be written down and categorized based on the probability of occurrence and impact on the project. The second step would be analyzing identified risks by determining their scope and the connection between them and various factors within the company. The third step would be conducting a detailed risk prioritization. This step would include rating the risks based on the severity of their impact on the project and the company. Prioritization would also consider risks that can be avoided and unavoidable risks that need to be mitigated. The fourth step would be risk treatment. It would include finding an appropriate measure to deal with the risk. Appropriate measures could be eliminating the risk or containing it. Risk management experts would be consulted to find the best solution in this step. The fifth respect would be monitoring and reviewing the identified risks. This step would assess the effectiveness of the identified risk management measures in eliminating or containing the risk.

The role of risk management in the project planning process

Risk management plays a significant role in the project planning process. It helps the project team create alternative strategies that can be applied to complete the project if a certain risk occurs (Hillson, 2012). For instance, if the project team identifies one of the risks as delays in acquiring the supplies needed to complete the project, the project team may create a list of other suppliers who can provide the same quality of supplies within the required time. Risk management also helps the project team create a project schedule that considers any unexpected changes within the project (Hillson, 2012). For instance, if one of the identified risks is delays, the project team may create a timeline that requires the project team to complete activities within a short time or work longer hours to prevent delays. Risk management also helps the project team review stakeholder expectations and determine what is required to ensure that these expectations are met. The project may also recommend adjustments to the project budget based on identified risks, such as labor shortage.

Two risks and their sources for the selected scenario

One of the risks that the project team in the selected scenario could encounter is a delay in completion. The risk could arise from the delay in acquiring the materials needed to complete the project. As indicated in the scenario, the project has a tight deadline because it needs to be completed by the end of summer because of harsh weather conditions. However, there may be a delay in supplies because there is only one supplier. The supplier has a longer lead time than required to complete the project. The project team cannot get supplies from another supplier because other suppliers are not on the construction company’s approved list, and the process of getting them approved is lengthy. The second risk is change orders. The project involves many stakeholders who request changes. For instance, some stakeholders may oppose the pipeline’s construction along a specific route hence creating delays. Therefore, the project team may pay the penalty fine proposed for failure to complete the project on time.

How risk management may mitigate the risks for each risk listed

Risk management may mitigate the risk of project delays arising from having one supplier by changing stakeholder expectations. For instance, the project team may explain to the project stakeholders that the project cannot be completed within their required timeline due to the long lead time in acquiring supplies. The stakeholders may then extend the project timeline or give the project team authorization to pay the selected supplier the fees to expedite so that the supplies required for the project can be acquired on time. Risk management may mitigate the risk of change orders by ensuring that every stakeholder is informed about the project and its specifications. The stakeholders may also be engaged in the project planning process to ensure that they are satisfied with the terms of the project.

How would I document the risk?

Risk documentation is important because it guides the project team in implementing the risk management plan (Kendrick, 2009). I would document risk by clarifying the main elements of the risk. The first element would be the risk title. The title would classify the risk as either an internal or external risk. The second element would be risk detail. This element would include a clear description explaining the risk. For instance, the risk may be described as an operational or financial risk. The third element would be risk consequences. This element would include analyzing the impact of the risk on the project and the company. The fourth element would be the anticipated solution date. This element would include information on the date the risk would be addressed through mitigation or acceptance. The fifth element would be the risk solution. This element would include a detailed description of the actions that would be taken to deal with the risk.

I would also use a risk register to document the project risks. According to Uzulāns (2016), a risk register is a risk management tool used to identify possible risks in a project, track the actions taken to minimize risks, offer contingency plans that should be implemented if a risk occurs, and provide details of the costs incurred in mitigating project risks. The risk register would include different sections. The first section would be risk identification based on risk ID or name. The second section would be risk description. The third section would be the risk category based on the project function it affects. The fourth section would be risk likelihood based on whether the probability of occurrence would be high or low. The fifth section would be risk analysis based on the potential impact of the risk on the project and company. The sixth section would be risk mitigation based on the selected response plan. The seventh section would be risk priority based on the risk level compared to other risks in the project. The seventh section would be risk ownership based on the person responsible for finding the solution. The final section would be risk status, which would include the progress of implementing the risk management plan.

References

Hillson, D. D. (2012). Managing risk in projects. Gower Publishing.

Kendrick, T. (2009). Identifying and managing project risk: Essential tools for failure-proofing your project. Amacom Books.

Uzulāns, J. (2016). Project risk register analysis based on the theoretical analysis of project management notion of risk. Economics and Business, 29(1), 43-48. https://doi.org/10.1515/eb-2016-0020

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Write a 1,050- to 1,750-word paper in which you select one scenario from the Risk Identification Scenarios Worksheet and do the following:
Define the risk management process.

Risk Identification Worksheet and Paper

Explain the role of risk management in the project planning process.
Describe at least 2 risks and their sources for the selected scenario.
Outline how risk management may mitigate the risks for each risk listed.
Explain how you would document the risk.

Format your paper consistent with APA guidelines.

Complete Risk Identification Scenarios Worksheet and paper.