RISK MANAGEMENT Flashcards
What is risk management?
Coping with future uncertainties by avoidance, management or mitigation.
What are the four types of risk?
- Project risk
- Technical risk
- Safety and environment
- Financial and commercial risk
What are examples of project risk?
- Late delivery
- Poor quality
- Outcomes not achieved
What are examples of technical risk?
-
What are examples of safety and environmental risks?
- Construction risk
- Health safety and environmental management system
What do engineers have to do minimise the risk of loss of life, injury or suffering?
Take reasonable steps.
What do engineers do about people affected by risks?
Draw attention.
What is the 2014 revision to code of ethics?
An engineer who has reasonable grounds to believe that an engineering matter gives rise to Adverse Consequences shall bring the matter to the notice of the appropriate person or regulatory authority.
What does risk equal?
Probability x Consequence
It does not equal uncertainty
Are risks only Threats?
No, they can also be opportunities as well.
What are sources of risk for Engineers in design contracts?
- Inadequate scope or brief
- Unrealistic timeframe
- Liability from design inadequacies
- Unforeseen circumstances require major changes
- Loss of intellectual property
- Faulty or missing data
- Faulty assumptions
- Calculation errors
- Inadequate or improperly used software
What are sources of risk in resource consenting?
- Assumption that consent would be non-notified
- Request for further info leads to delay
- Consulting outcomes unexpected
- Consent refused
- Conditions of consent are too onerous
- Need to appeal decision to environment court
What are the sources of risk in construction?
- Prices much higher than estimated
- Poor design documents lead to additional cost
- Too few firms bid for work, uncertainty quality/cost
- Building consents requirements lead to changes , costs, delays
- Delays from weather, labour strikes, health/safety incidents
What are the four steps in risk management for design?
1) ID Risks
2) Risk Impact assessment
3) Prioritise risk
4) Decide how to manage risk
- Avoid
- Reduce
- Mitigate
- Transfer
- Accept
What is to ACCEPT a risk?
Accept without engaging in special efforts to control it
What is to AVOID a risk?
Adjust project requirements or constraints to eliminate or reduce the risk.
What is to CONTROL a risk?
Implement actions to minimise the impact or likelihood of the risk.
What is to TRANSFER a risk?
Reassign accountability or responsibility to another stake holder willing to accept the risk.
What is to WATCH/MONITOR a risk?
Monitor the environment for changes that affect the nature and/or the impact of the risk.
What is risk retention?
- Accepting the loss or benefit of gain from a risk when it occurs.
- True self insurance falls in this category.
What are risk workshops for?
ID potential issues ahead of time.
Used to create a RISK REGISTER.
Continuous and iterative process
Who should be in risk workshops?
Project manager
Engineers
Client
What is statistical analysis of a project?
- To predict probable variation of time and budget.
- Allows uncertainty to be quantified and included in the project plan.
What are the two key pieces of information a client wants to know? And how are they determined?
Cost of the project and the completion date.
On a time and resource plan.
How do you assign uncertainty?
- Estimate cost max and min, distribution
- Put on programme
- Run monte carlo
What does the monte carlo do?
Iteratively simulate the project.
Random
Creates a distribution of outcomes.
Giving the most likely date and cost and the range of dates and costs.
