Before completing a Risk Assessment, it’s worth the analyst conducting (or at least considering) the following – Identifying Options, Assessing Project Feasibility, Cost-Benefit Analysis and an Impact Analysis.
A risk - “a problem situation that may arise with regard to a project or business situation”.
A risk assessment is where the analyst documents the potential risks that are identified for each option in the business case. This involves documenting the impact the risk is likely to have on the project, the probability of the risk occurring, suitable countermeasures and ownership.
All analysts and project managers should be aware that change never comes without risk. A business case is remarkably strengthened when it can exploit potential risks with suitable countermeasures.
At this stage, the analyst is just looking to document the major risks (“Project Killers”) within the main body of the business case, with any remaining risks documented in the appendix. If senior management choose to go ahead with a particular option, a risk log will then be created to document all risks involved within that change or development project.
There are many different ways to document a risk assessment, depending on the organisation, department or project. As stated before, a risk log at this stage is not necessary. Therefore a general structure covering the risk description, impact assessment, probability, countermeasures and ownership would be sufficient at this stage.
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|Risk Description||Impact Assessment||Probability||Countermeasures (Avoid, Accept and Mitigate)||Ownership|
|Council budget cuts could have a knock-on effect on the project budget.||H||M||Mitigate: Assess how much of the project budget could be affected then take appropriate action.||Project Manager|
After completing a risk assessment, the analyst will begin to reach then final stages of the business case development, which is the Recommendations and Investment Appraisal.