R&D PROGRAM RISK ASSESSMENT Yuri Tsenkov UNWE – DNRS
CONTENT 1. What is risk 2. What causes it 3. The assessment process 4. Likelihood indicators 5. Consequence indicators 6. Risk profile
Introduction The risk assessment is vital part of the risk management system, thus it is part of the good management and a base for achieving better program and project results. The risk assessment is aimed at identifying and evaluating the accidental events which, should they occur, may have a negative impact on the achievement of the program goals and the magnitude of their impact.
What is risk? Risk is exposure to the consequences of uncertainty. In a project context, it is the chance of something happening that will have an impact upon objectives. Likelihood Consequence RISK
Causes for risk Risks arise because of uncertainty about the future. Risk exposure may arise from: Possibility of economic, financial or social loss Physical damage or injury Delay Changes in the relationships between the parties involved in the supply, ownership, operation and maintenance of assets
The assessment process Determine the potential risk bearing events Determine the consequences of each risk, should the event occurs; {development of likelihood indicators} Assesses the likelihood of those consequences occurring; {development of consequence indicators} Calculate the risk factors Develop agreed risk priorities and inherent risk levels. Arrange the risk factors according to these priorities
Likelihood indicators
Consequence indicators
Maturity factors
Cost increase, schedule delay and performance degradation factors
Risk profile RF=P + C − (P*C) P and C are on a scale from 0 to 1
Conclusion What I presented is a method used by government agencies and private companies in USA, Australia, Canada, Netherlands, etc. As a method it has proved its reliability, but it’s quite dependable on the experts involved in the process.