Assignment: 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.
Review your scenario.
Scenario B. Opening a New Hotel
You are part of an exclusive hotel group that has a strong reputation for boutique luxury hotels in the capital city. Having recently disposed of a successful hotel in the capital, the directors wish to reinvest the funds by branching out to another large city within reasonable travelling distance of the capital city. Your team is responsible for the acquisition, refurbishment and opening of the new hotel. You have to acquire a suitable building, plan the capacity, services, décor and branding to launch the new hotel. It need not be an existing hotel, but has to have the potential for between 25 and 40 up-market rooms and suites in an area that assures a high level of occupancy.
Review the resources from this unit related to risk assessment.
- 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.
- 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.
- 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.
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.