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Risk Management Plan
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Risk is defined as an event that has a probability of occurring, and could have either a positive or negative impact to a project should that risk occur. A risk may have one or more causes and, if it occurs, one or more impacts. For example, a cause may be requiring an environmental permit to do work, or having limited personnel assigned to design the project. The risk event is that the permitting agency may take longer than planned to issue a permit, or the assigned personnel available and assigned may not be adequate for the activity. If either of these uncertain events occurs, there may be an impact on the project cost, schedule or performance. All projects assume some element of risk, and it’s through risk management where tools and techniques are applied to monitor and track those events that have the potential to impact the outcome of a project.
Risk management is an ongoing process that continues through the life of a project. It includes processes for risk management planning, identification, analysis, monitoring and control. Many of these processes are updated throughout the project lifecycle as new risks can be identified at any time. It’s the objective of risk management to decrease the probability and impact of events adverse to the project. On the other hand, any event that could have a positive impact should be exploited.