Risk Management (Stages 0 to 6)
Risk Management is a systematic management tool to support decision making through all Stages (0 to 7) of a project. Project Managers shall identify the risks involved for their project and use the appropriate Risk Management process for the management of these risks.
Risk Management shall be aimed at project specific risk minimisation targets and shall be introduced at the earliest Stages of the project with all members of the core team involved. This is implemented through facilitated risk management workshops at key Stages of the project throughout design and construction. The output from these workshops shall be used to inform the project process and feed into other project documents such as cost plans and contingency plans.
Risk Management techniques offer a systematic approach to the identification, assessment and control of the significant risk factors affecting the progress of the project. Areas of high risk are reviewed to ensure that all reasonably practicable measures have been taken to mitigate them.
The Risk Management process is designed to ensure that as far as reasonable:
- All significant hazards are identified.
- Financial impact of the risk is understood and compared to project contingencies (if needed contingency can be increased to manage risk).
- Judgements are made as to hazard importance.
- Risk exposure is understood and reduced to acceptable levels.
- Cost effective risk control measures are implemented.
- Control measures are reviewed and managed to close out risks where possible.
The Project Manager shall decide on the appropriate Risk Management log/register schedule that shall be used.
The Project Manager may decide that an initial risk workshop is required before drafting this.
An initial risk workshop as per the Risk Management workshop agenda below, with relevant stakeholders and the project team, will be undertaken for all large works projects.
- Record of early warning meeting - NEC (Word)
- Risk register (Excel)
- Project board approval (Stages 1 to 4)
All 'red' risks shall be noted on the Project Brief, Project Initiation Document or Change Control (outside tolerances) at the appropriate Stage.
The Project Manager shall prepare Risk Management reports to support review or risk status and treatment.
A Quantitative Risk Assessment (QRA) shall be undertaken quarterly to forecast out-turn costs.
The Project Manager shall liaise with the Cost Manager in order to provide contingency costs for inclusion in elemental cost plans and whole life costing studies.
Scheduled risk assessment shall be undertaken for time critical projects affecting occupancy for Imperial academic and research work. The analysis shall be undertaken by a Risk Specialist using critical path and probabilistic planning tools.
The Project Manager shall liaise with the Category Manager (Construction) and the Quantity Surveyor to determine the most appropriate contract strategy and terms in view of the risks identified; the severity and treatment strategy.
Risk Management workshop
Risk Management workshop agenda
- Establish and agree the workshop objectives
- Determine whether to appoint an external facilitator
- Arrange and undertake any pre-workshop analysis
- Identify participants (project team and key stakeholders)
- Prepare and issue workshop agenda to participants
The structure of the risk workshop will take the following format (approximate timings to be determined in discussion with Project Manager):
Introductions, workshop objectives and agenda
- College key requirements and project scope and objectives
- Project cost estimate plus key assumptions and exclusions
- Project schedule, key dates, assumptions and exclusions
Outline of brainstorm process, guidelines and expected deliverables. Risk identification/idea generation
- Generic risks
- Risk specific to agreed risk headings/project activities
- Review of risks raised and elimination of duplicate or insignificant risks
- Explanation of ranking and methodology to be used/scoring values
- Ranking of risks
- Identification of 'Red' risks
- Agreement of 'Red' risks and the top 20 risks on large projects
Proposals for treatment of 'Red' and project risks and identification of best 'Owner'
- Develop options and agree proposal for treatment of red risks
- Develop options and agree actions for treatment of all other project risks
- Identify secondary risks (those arising from treatment of red and project risks)
- Develop options and agree proposals for treatment of secondary risks
- Identify timescales and short term actions required for treatment of risks
Optional quantitative risk analysis shall be carried out following the brainstorm session as follows:
- Determine cost and schedule ranges (as appropriate) for all project risks
- Agree assumptions, qualifications and exclusions from QRA and further actions required
- Input cost and schedule data to QRA model (using risk tool) (this may be undertaken outside the workshop)
- Present and review results of QRA (this may be undertaken outside the workshop)
Summarise and agree findings of Brainstorm Session
Close and subsequently circulate results of meeting
- Risk register containing details of agreed risk description, assessment and treatment plan
- Agreed risk ranking
- Follow-up actions
Initial estimate of costs (Stage 0)