Risk Drivers
Risk assessment and risk management are used to identify and mitigate risk drivers. A risk driver is a situation in a project from which project risks can arise. Identifying risk drivers can help a project manager evaluate the needs of the project, make changes as needed and allow the project to stay on course. For example, consider an organisation that is taking on a new project unlike any other they have done in the past. The organisation's level of inexperience with this new project can be identified as a risk driver. The risks that could arise from this risk driver include overlooking necessary tasks that were not known to be needed, underestimating time, underestimating resources and exceeding budget. It is a project manager's responsibility to evaluate risk drivers and associated risks throughout every phase of the project life cycle, propose possible solutions to risks and communicate risks to stakeholders.
To complete this Individual Assignment:
- Review your scenario (Launching new haircare packaging production line).
- Review the resources from this unit related to risk assessment.
- Identify risk drivers in your project and the risks associated with each.
- Explain how the risks you identified could impact the project, and propose strategies to mitigate each risk.
Unit resources
• Crawford, L., & A. H. Nahmias, (2010) ‘Competencies for Managing Change', International Journal of Project Management, 28 (4), pp.405-412.
Organisational change can be a project in itself, resulting in a specific project type. Project managers and change managers often debate on whom should be responsible to take charge of organisational change. This article explores the differences in approach of project managers and change managers in managing organisational change initiatives.
• de Bakker, K., A. Boonstra, & H. Wortmann, (2011) ‘Risk Management Affecting IS/IT Project Success through Communicative Action', Project Management Journal, 42 (3), pp.75-90.
Risk management can be used to convey messages to others, with the aim of influencing their behaviour, reconciling disparate perceptions and making them aware of the context and their responsibilities. In this article, the authors interviewed project stakeholders, and analysed their perception on risk assessment and its contribution to project success.
• Marle, F., & L.-A. Vidal, (2011) ‘Project Risk Management Processes: Improving Coordination Using a Clustering Approach', Research in Engineering Design, 22(3) pp.189-206.
In this article, Marle and Vidal analyse increased project risks, and how these risks need to be clustered to be more manageable. The authors find that effective clustering can result in an easier process, increased communication and a better decision-making process.
• Mastering-project-management.com, (2009) Project Closure - Whether Your 1st or 21st Project, Successful Completion Involves a Few Important Steps..., Available at:https://www.mastering-project-management.com/project-closure.html (accessed: 12/09/12)
This website provides the steps needed to complete a project closure, and provides reasons why a project closure is performed.
• Mind Tools, (2012) Post-Implementation Reviews: Making Sure that What You Delivered Actually Works, Available at: https://www.mindtools.com/pages/article/newPPM_74.htm(accessed: 12/09/12)
This website explores the post-implementation review process, and outlines what to review and when to review.
• Wallace, S., (2007) Post-Implementation Review (PIR), Available at:https://www.epmbook.com/pir.htm (accessed: 12/09/12)
This website takes a look at the who, what, why, when and how of the PIR process.
• Zwikael, O. & M. Ahn, (2011) ‘The Effectiveness of Risk Management: An Analysis of Project Risk Planning Across Industries and Countries', Risk Analysis: An International Journal, 31 (1) pp.25-37.
Risk management is a major factor in determining the success of a project. In this article, Zwikael and Ahn use a multinational and multi-industry study to examine the effectiveness of risk management practices. The authors find that project context - industry and country where a project is executed - significantly impacts perceived levels of project risk, and the intensity of risk management processes.