Risk Management Essay

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Assessing the level risk as related to the project management agreement between The Coleman Project L.L.C. (TCP) and J. Smith & Associates (JSA) is critical to meeting all project deadlines. The focus of this risk assessment is related to the office build out, furniture and equipment set up for JSA’s new regional office in Scottsdale AZ. The agreed upon start date of the project is February 28, 2013 with a completion date of May 25, 2013.
What is risk as it is related to this project? Microsoft defines project management risk as “A risk is the possibility of an event or condition that would have a negative impact on a project. Risk management is the process of identifying, mitigating, and controlling the known risks in order to increase the probability of meeting your project objectives” (Microsoft, 2013). This definition of risk will stand as a point of clarification between JSA and TCP to establish a basic understanding of project management risk.
The TCP project management risk tool used to identify, mitigate or control risk will focus on three areas; overall project risk, subcontractor risk, and risk specific to this project. Overall project risks are risks that are susceptible to any project. Kendrick, (2009) utilized information form the Peril Database and with that data TCP created a matrix representing delays from unmitigated risk see Appendix 1. The list quantifies actual project delays over a specific period of time and then averages those risks identifying the average potential delay per category of risk. This component of TCP risk tools gives a visual of how drastically a risk can delay a project. The impact of a “black swan” was not quantified within the matrix given their rarity but Kendrick, 2008 explains how devastating they are;
The worst of the risks from each category in the PERIL database deserve more detailed attention. Defining the worst 20 percent of the risks based on schedule impact as “black swans,” we’ll explore these “large-impact, hard -to-predict, rare events.” Each of the “black swan” risks represented at least three months of schedule slip, so they certainly qualify as large impact. They are rare; the PERI L database has an intentional bias in favor of the most serious risks, which are (or at least we hope are) not risks we expect to see frequently.
The second component of the TCP risk tool is to identify subcontractor risk. Some contractors may have risk management protocols in place but a basic questionnaire can identify sub-contractors risk readiness.
• Do you have a risk management protocol in place for this project?
• Do you currently have all your resources needed for your deliverable?
• What suppliers supply you and do any have the potential to affect the deliverable(s) for this project?
• What risk can...

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