Assignment: Telewonder in Slovobia
Slovobia is a former Soviet Republic. It has a population of 30 million people, 35% of whom are ethnic Russians and 65% of whom are Turkic Muslims.
Slovobia has identified the establishment of modern telecommunications capabilities as a high priority. Such capabilities are expected to cost 20 billion Slovars over a 5-year period. The official exchange rate is $1 = 10 Slovars. The black-market rate fluctuates wildly, but basically converges at $1 = 25 Slovars.
Slovobian authorities are hopeful that a low-interest International Development Association (IDA) loan can be obtained to cover a third of the anticipated project costs. They want the telecommunications contractor to supply credit for 10% of the project costs. The remaining funds will come from a variety of sources, including the Telecommunications Ministry and commercial banks.
Telewonder Telecommunications Corporation, an Australian provider of telecommunications services, has been approached by Muhammed Farsi -- the Minister of Telecommunications -- about its interest in bidding on the project. He informs Telewonder that an RFP (request for proposal) will be issued shortly after Slovobia holds its first democratic election in history. Unfortunately, elections recently had to be rescheduled owing to a fundamentalist Muslim insurgency in the southwest portion of the country.
Questions
1. Risk identification - What are the risks Telewonder faces if it obtains a contract to develop telecommunications capabilities in Slovobia?
The main steps of the risk identification process are as follows:
•Create a checklist or Work Risk of all possible risk events
•Work Risk Breakdown Isolate the risk events that are more pertinent to the project under review through a risk classification process. Business risks. Insurable risks. Operational risks. Technical risks. Political risks. etc.
CHAPTER 4 of the Book refers to other tools for risk identification which one is the best to be used here?
2. Risk impact analysis - What are the consequences to Telewonder if the anticipated risks become real?
Examine risk impacts, both qualitative and quantitative,requires people to examine the consequences of bad things happening.If risk event X occurs, what will be the physical consequences?The financial consequences? The impact on the well-being of the public?The impact on the reputation of the organization? And so on.
3. Risk response planning - What can Telewonder do to handle risks?
Develop risk-handling strategies, focuses on preparing to deal with the risk events that you have identified. As you will see in Chapter Eight, there are some standard strategies that you can employ. For example, with risk transfer, you may attempt to shift the burden of dealing with a risk event to a third party (for example, an insurance company). Or with risk acceptance, you recognize that bad Practical Limitations of Risk Management 19 things happen and are prepared to move forward nonetheless; however, you set aside contingency reserves to deal with the possible consequences of untoward events. Or with risk mitigation, you try to fix the problems so that they will not arise. Or finally, with risk avoidance, you stay away from doing things that get you in trouble.