Corporate Risk Management, 2nd Edition

9

Risk Management at Project Level

9.1 INTRODUCTION

Many businesses today depend on project-based activities for their growth and long-term well-being. Although ongoing operation is an important part of any business, it is the project elements that are usually at the cutting edge. This is why project management has emerged as an important and critical part of any going concern.

This chapter describes how project management has evolved, project management team functions and goals, and the concept of project risk management. The chapter also describes risks specific to projects.

9.2 THE HISTORY OF PROJECT MANAGEMENT

Project management, in its modern form, began to take root only a few decades ago. Starting in the early 1960s, businesses, especially SBUs and other organisations, began to see the benefit of organising work around projects and to understand the critical need to communicate and integrate work across multiple departments and professions.

9.2.1 The Early Years: Late Nineteenth Century

During the latter half of the nineteenth century the rising complexities of the business world led to further evolvement of principles within project management. Large-scale government projects were the impetus for making important decisions that became management decisions. Business leaders found themselves often faced with the daunting task of organising manual labour and the manufacturing and assembly of unprecedented quantities of raw material (Turner and Simister 2000).

9.2.2 ...