Fundamentals of Risk Management

Project risk management
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communicating about risks;
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considering both threats and opportunities;
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clarifying ownership issues;
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prioritizing risks;
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analysing risks;
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planning and implementing risk responses;
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registering project risks;
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tracking risks and associated tasks.
opportunity in projects
Projects are undertaken because they represent an opportunity to be embraced or a 
challenge that needs to be overcome. Often a number of projects will need to be 
undertaken at the same time. A collection of projects of this sort is referred to as
a programme.
Good project planning requires arrangements to overcome unexpected events or 
circumstances. This is often referred to as contingency in the budget or timescale. 
Contingency may be for additional time to complete a task, or additional costs that 
may arise to ensure that the final project deliverable operates to the required specifi-
cation. As the project develops, any perceived difficulties will need to be addressed 
and opportunities to reduce the impact of these difficulties explored.
Very frequently, the specification of a project will change during the course of the 
work. A well risk-managed project will take the opportunity of change to specifica-
tions to provide a greater level of customer satisfaction, as well as a greater level of 
income for the organization delivering the project.
The main opportunity offered by undertaking a project is that the project will 
prove to be the correct tactic for delivering the strategic objectives. In some organ-
izations, projects are only authorized if they reduce the risks faced by the organ-
ization. This is particularly true in energy companies, where the justification for
undertaking projects will be to improve output, efficiency or quality of operations. 
This in turn reduces the risk associated with reduced output, wasted resources and 
poor quality.
As well as achieving the opportunities offered by undertaking the project, organ-
izations will also wish to take advantage of opportunities that are offered within the 
project. These opportunities may reduce costs, reduce time and/or increase quality. 
For example, if a construction project assumes a certain level of ground contamination 
but this proves to be less than expected, there would be an opportunity for the project 
to be delivered ahead of schedule and at reduced cost. Some construction project 
contracts will include clauses to share the benefits should the circumstances arise.
Within many established cities, there are archaeological remains that may be of 
considerable historical interest, if uncovered during the excavation phase of the 
project. When undertaking construction work to replace buildings in the old cities 
around the world, there is a chance that the construction company will come across 

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