BN4206 Risk and Value Management Assignment Sample
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The project will discuss the key concepts regarding integrated risk and values in the project delivery. While developing a project, there are probabilities of specific risks in various stages. This project will analyze those risks. In the first section of the project, the identification of risks and values will be discussed. In this process risk register, a risk identification process will be used to complete the entire investigation. In the second part of this project, various approaches of IRVM will be evaluated.
2.1 Identification of integrated risks and values
The ability to identify the risk in project delivery has come with several tools and in different phases. Project delivery has gone through different stages. Each of these stages contributes to the completion of the whole project. One of the best methods for identification of risks under the project delivery process, risk register, will be most suitable. Primary risks that can be found out during project delivery are listed below with the help of a risk register. This risk register further helps in optimizing value for the project.
|1||Cost risk||This is one of the most common risks that can be seen during project delivery and management. The cost risk can occur due to the poor decision on budget planning and also because of the poor performance in cost estimation (Bedrii,2020). During the whole process of delivering a project, the project team must consider current market costs; otherwise, the probability of the risk will be greater. It will cause the operation to spend more money than what is actually expected for the project, which harms the business.||High||Medium||Project allocator and organizer|
|2||Schedule risk||Schedule risks occur when the project management team takes longer than the estimated period for delivering a project. This also occurred due to a flawed planning process. It can be related to the cost risk because linger the project will take longer to deliver. Higher will be the cost.||Medium||High||Project manager|
|3||Performance risk||When the delivered project does not match with the expected outcomes and benefits them, performance risk can happen. It is the inefficiency of team members for not complying with the proper tasks.||Low||High||Human resource team|
|4||Operational risk||The whole project delivery process has included some significant stages (Handayani, 2018). Operation through every stage will require proper monitoring, control and distribution. Operation risk can include less productivity level, poor organization culture, delay in developing the project etc.||High||High||Project manager|
|5||Market risk||Project delivery can also face the market risk that comes from external sources (Shijin et al. 2018). These external sources can be changes in market conditions, change in foreign policies, credit risk, rate of interest, inflation etc.||High||Medium||None|
|6||Governance risk||The performance of the management board in delivering the project can impose risks on ethical considerations, reputation, community etc.||Medium||Low||Project head|
|7||Strategic risk||This is one type of performance risk that can be seen in terms of the poor performance of the management team while deciding on a strategic issue.||Low||Medium||Project owner and manager|
|8||Legal risk||Legal risks can be unpredictable; they can happen anytime during the project development or delivery. The contract risk will be the most relevant.||Low||Low||Project administrative|
|9||External hazard||External risks involve natural forces like earthquakes, floods, bushfires and any natural disaster.||Medium||Medium||none|
2.2 Approach to the integrated risk and value management in project development (IRVM)
“Integrated risk” and “value management” or IRVM is a new set of proactive and business-focused practices that usually contributes to the project’s security, profile for risk tolerance, and the ability to make strategic decisions. Components of IRM or “integrated risk management” are listed below:
Objective setting: While delivering the project, the team should set its basic primary and secondary goals (Arena et al. 2017). These objectives must be included under measurable characteristics and circumstances.
Risk identification: there are several methods of risk identification. These are risk registers, risk analysis etc. It is considered the most crucial because it will help build the project according to identified risks.
Risk measures: After the identification has been made, the next step in project delivery is the analysis of those risks. It helps to find mitigating ways. Mitigating the risk will help to optimize the value for the project delivery.
Integrated value management is closely related to the risk management princess. The main idea behind these IRVM processes in project delivery is to optimize the value. When the risks are identified, the project immediately looks for solutions. Mitigating the risks will help maximise project delivery value (Cains and Henshel,2021). The two major approaches to the IVM are:
Structured approach: The value to a project is defined as the achievement of meeting requirements. Optimizing the values needs feasibility, design and concept. It establishes a connection on how project aims should be processed to meet the delivery requirements by the team.
Systematic approach: It considers the value of delivering the project at the lowest cost while maintaining quality and reliability (Mandelli et al. 2018). This approach is based on the delivery process for ensuring efficiency in the delivery process. It gives focus on design, “procurement”, and delivery.
The project has given key insights into the concept of risk as well as values to the project delivery prices. While delivering a project, the whole team needs to go through several stages. These stages include certain risks, which are discussed with the help of a risk register. Integrated risk approaches are analyzed with maintaining a connection to integrated value. The project helps to build a useful concept on “integrated risk” and “value management” with respect to project delivery.
Arena, M., Arnaboldi, M. and Palermo, T., 2017. The dynamics of (dis) integrated risk management: A comparative field study. Accounting, Organizations and Society, 62, pp.65-81.
Bedrii, D., 2020. Development of a model of integrated risk and conflict management of scientific project stakeholders under conditions of behavioral economy. Technology audit and production reserves, 3(2 (53)), pp.9-14.
Cains, M.G. and Henshel, D., 2021. Parameterization framework and quantification approach for integrated risk and resilience assessments. Integrated environmental assessment and management, 17(1), pp.131-146.
Handayani, D.I., 2018. Integrated Risk Management Model Related To Occupational Safety In Multi-Storey Buildings. Journal of Engineering and Management in Industrial System, 6(1), pp.27-35.
Mandelli, D., Wang, C., Staples, S., Ritter, C.S., Mack, A.L., St Germain, S.W., Alfonsi, A., Rabiti, C. and Kunz, R., 2018. Cost Risk Analysis Framework (CRAFT): An Integrated Risk Analysis Tool and Its Application in an Industry Use Case (No. INL/EXT-18-51442-Rev000). Idaho National Lab.(INL), Idaho Falls, ID (United States).
Shijin, W., Lanyue, Z. and Yanqiang, W., 2019. Integrated risk assessment of snow disaster over the Qinghai-Tibet Plateau. Geomatics, Natural Hazards and Risk, 10(1), pp.740-757.
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