Risk Register analysis
Developed by Dorothea Georgiadou
In an age where the economic, social, and political environment is constantly shifting, there is an urgent need to study the risks that may threaten the success of a project. It is particularly important to study the risks that may adversely affect the project and lead to events that might have as a cause the exceeding of the agreed budget and time. For this reason, the risk management planning should identify and describe in detail the potential risks by providing the needed information for the actions that should be done for eliminating their negative impact. The high uncertainty that exists in projects necessitates the use of a management tool that will control the risks. [1] In this article the risk management framework ‘’Risk register’’ is explained. Risk register is a tool that covers and studies many aspects of risk management processes. More specifically, the aim of this article is to explain how this tool can be used for the identification, assessment, and treatment of potential risks. Moreover, the importance of the risk register in the risk analysis process is outlined, as not only the qualitative aspects of a project are taken into consideration but also it prioritizes the risks based on their impact and probability to happen during the implementation phase of a project. This constitutes one of the positive features of this framework as through the analysis of this article it can be concluded that risk register helps project managers to have a better understanding and ways of managing the potential risks. Finally, the article analyzes along with the benefits the limitations of this risk management tool.
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Introduction
In an ever-changing environment, a projects’ success is associated with a high level of uncertainty. Projects are threatened by external and internal factors throughout their lifecycle and hence the presence of project risk management is more than necessary. In the ‘Practice Standard for Project Risk Management’, risk management is an approach that plays a vital role in the strategic and decision-making processes since adjustments in the project management planning can be done after the identification of the projects’ challenges. [2] The risk register framework is used to support the risk management process in order to eliminate the negative impact that the various threats might have on a project. Threats could come from the external and internal environment of the company. The external risks are associated with the economic, social, political, and technological environment, while the internal threats include risks that are related to human actions and estimations. For example, it is possible for people to make wrong estimations because of inexperience and underestimation of some threats. This high level of uncertainty makes it increasingly necessary to use a model that assists the risk management process in a more effective way.
