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2 Projectriskmanagement 110110060847 Phpapp01
2 Projectriskmanagement 110110060847 Phpapp01
Dec 2010
What is Risk?
2
Project Risk Management
Does not mean eliminating risk but reducing operational surprises/ losses
3
Risk Management Cycle
Based on
Risk assumptions
Identification which may be
risky
Log frame
Design & superv’n
docs
Brainstorm
Risk Response
Avoid (eliminate)
Assists in process
Reduce (diminish)
of identification/
Depends on risk Share (outsource) mitigation
appetite/preferences Accept (retain)
4
Risk Identification
SOCIO-ECONOMIC
EXTERNAL RISKS ENVIRONMENT EXTERNAL RISKS
PARTNERS POLITICAL
ENVIRONMENT ENVIRONMENT
INNOVATION &
PLANNING RISK MANAGEMENT
PRODUCTIVE WORKFORCE IN A
HEALTHY WORK ENVIRONMENT ACCOUNTABILITY
5
Risk Universe
Define the Risk Universe
– Develop understanding of business area– review documents, interviews
– May be structured by process and/or location
Likelihood Description
10
Risk Monitoring
Log frame approach to risks - example
Decline in the •Farm viability deteriorates H H 5 •Crop diversification in line with, Project
1 Profitable farmer managed Annual
sugar price and •Financing institutions refuse national & international market leadership,
and self-financing irrigation
schemes established and impacts on the to fund capital and on farm needs national Sugar
economic viability development •Develop local livestock Association,
operational
of sugar cane as •Large scale irrigation ownership into commercial herds project
an anchor crop development compromised with supp. feeds produced on beneficiaries
with resulting increase in irrigation areas
poverty and increased food •Pursue downstream
security risk development initiatives with
potential to add value to crops
grown on the scheme, these
initiatives could be production of
crops with potential for bio-fuel
starch, oils & fibre production
2 Policy, institutional & social People resisting Land and irrigation M H 5 Facilitate agreement on equity Project leadership land owners,
environment supportive of land use change development delayed; less options acceptable to all parties Traditional Authorities & project
equitable integration of land is available for beneficiaries
smallholder farmers into the redistribution;
commercial economy Few landless people benefit
from irrigation
8
Project Risk Management in IFAD
Begins at COSOP
7
Risks in IFAD projects
9
10 Golden Rules
9
Thank You