Wednesday, September 26, 2012

Risk Categories in Project Portfolio Management

Corporation risk: changes in business strategy or operational processes, project interdependencies or overlapping, problematic communication among stakeholders, management support, realistic expectations and proper planning, clear visions, objectives and scope definitions.
Financial risk: financial endorsement (loan, financial/leveraged lease), cash flows, liquidity, credits, payment periods, replacement/maintenance costs, cost of capital, inflation, external sources of funds, expected revenues.
Market risk: project outcome utility and acceptance, timing, results distribution, quality level, competitors.
Technology risk: available infrastructure and supplied materials, design/architecture suitability and feasibility, time consistency, implementation knowhow, competent staff or outsourcing, maintenance capability, statutory and regulatory obligations, technology obsoleteness or inadequacy.

These risk categories can be handled by:

Risk identification: the most common techniques used herein are: brainstorming, swot analysis, interviewing and experts committee (Delphi approach).

Evaluation of factors that affect the projects implementation and results. Best and worst scenarios are carried out in order for the range of potential outcomes to be determined.

Establishment of a plan of actions to be considered in every step of project cycle. These actions would mitigate negative responses and they would enhance fine performance.

Constant control, adjustments and reconsiderations during the project implementation cycle.

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