Risk interveiw Essay Example

  • Category:
    Management
  • Document type:
    Assignment
  • Level:
    Undergraduate
  • Page:
    2
  • Words:
    816

Risk Management

Submitted by Names:

Every business is a risky venture. The probability that a business/project could fail is extremely high. Mangers at every level that are unaware of probable risks facing their businesses are destined to fail. Discreet business individuals are conscious of risks and erect systems and procedures into place to alleviate any risks. In addition being conscious of risks is vital towards articulating risks to prospective investors. Especially when appealing for funds it is essential to the features that could go wrong, so as to disclose it to investors. This eliminates any legal problems of any undisclosed information when raising funds. According to the manager managing a business/project, it is extremely necessary to locate risks and debate the preventative measures the company is employing in case the risks become visible. It exhibits to investors and others that the management is cautious of the real life business risks (Dowd, 1998). 1:
Question


The manager insisted that the initial stages of any business/project characterize the period for reducing the impact or working around probable existing risks. Equally, as the project exceeds the half way mark, the occurrence of a risk rises substantially as illustrated in table 1 below. Clearly, locating project/business risk events and choosing a response way before the project is initiated is a more discreet approach than opting to assume zero risk prospects. Risk management is an upbeat, not a reactive one. The manager further added that a project manager should realize that risk management is a precautionary process designed to make sure that surprises are minimized and that negative results linked with undesirable incidents are reduced. It also alerts the project manager to make a move when technical benefits are possible. Successful supervision of project risk provides the project manager greater power over the future and can substantially grow chances of attaining project goals on time, within budget, and attaining required purposeful performance. The origins of business/project risks are unlimited. The project managers must address the internal risks facing the project/business, since these are the threats that are they are directly responsible for. The internal risks directly impact the performance and progress of the project. Therefore, they must be project manager’s priority (Froot, Scharfstein & Stein, 1993). 2:
Question

Project stages

Risk occurrence chances

Managing risks by stages is considered better placed than as a whole. Managing risks by stages ensures that all sections of a particular stage and the probable risks are assessed precisely. The manager stressed that taking a particular stage on its own gives the project manager a chance to thoroughly scrutinize both minor and major risks facing his project, list them and prioritize them. In addition, if, in the previous stage, a fault was realized, the project manager will be able to confidently prevent it in the next stage. Managing risks as a whole leading to the project manager skipping or missing some of the crucial probable risks (Dowd, 1998) 3:
Question

The manager indicated that all stages of a project/business are part of the whole project. If one phase of a project fails consequently the whole project/business will proceed to a halt, thus the project will have failed. All stages of a project/business are equally important; risks must be assessed and managed in all phases. It would be dangerous and unprofessional if a project manager opts to consider some phases riskier than others. Failure of risk assessment at all project levels threatens the success of the project (Rasmussen, 1997). 4:
Question

Question 5:
The manager advised that the level and
nature of risk to consider varies with the
business. The
risks
facing
the
financial
sector are different from those
facing
the
construction, the
manufacturing
sector
and
so
on. There, however, exist
similar project/business risk
categories. For
example;
legal
risks; these include conformity to lawful
regulations
and
legislation. Commercial
risks; these relate to the
commercial
feasibility of a good
or
service
and
extends to preservation
and
growth of client
base.
Healthy
and
security of participants of the business/project, this
extends to workplace safety. Environmental risks that include
failure
or
damage as a result of calamity
or
natural
disasters.
Financial
risks that comprise of budgetary needs, tax
responsibilities, remuneration
and
liability
supervision (Crouhy, Galai & Mark, 2000)


The manger’s advice has offered great insight towards the study. He concluded that while businesses/projects are bound to risks
there
exist methods to reduce their occurrences
or
minimize
losses
when
they
occur. Developing a good
and
workable
risk
management
plan is a positive
step towards realising these
objectives. Finally, employing a risk
management
expert is an additional
prudent
step towards anticipation
and
management of risks.

References

Crouhy, M., Galai, D., & Mark, R., 2000. Risk management. New York: McGraw Hill

Dowd, K., 1998. Beyond Value at Risk The New Science of Risk Management.

Froot, K. A., Scharfstein, D. S., & Stein, J. C., 1993. Risk Management: Coordinating Corporate Investment and Financing Policies.

Rasmussen, J., 1997. Risk management in a dynamic society: a modelling problem. Safety Science.