CASE STUDY 3
Development of Risk Registers at Corporate, Strategic Business Unit and Project Levels and a Risk Statement
The following provides a description of a generic risk management process for the identification of risks within a typical hierarchical organisational structure of corporate, strategic business unit and project/functional levels, along with preliminary risk assessment necessary for the initial sanctioning of a project.
A project opportunity scenario is presented along with fictitious company profile and products/projects to satisfy the requirement.
Risk registers are provided, identifying project related risks to the fictitious scenario, along with cumulative cash flow diagram and other supporting information.
Finally, a risk statement is demonstrated, in a format suitable for the high-level decisions related to the sanctioning of a project by corporate, shareholder and financiers, including a tornado diagram to provide a visual overview of the project’s risks and associated cost.
16.2 LEVELS OF RISK ASSESSMENT
Risk assessments are carried out at each level in an organisation. Typically the ‘big picture’ risks are identified at corporate level and more detailed assessment at SBU level associated with the characteristics of the relevant market. At project level more data are usually available to allow a more detailed assessment and to consider project specific activities and their associated risks.
* Reproduced by permission of A. ...