Definition: The process of identifying potential risks in a project and developing plans to mitigate or manage their impact.
Key Components:
- Risk Identification: Recognizing possible events that could negatively affect the project.
- Risk Analysis: Assessing the likelihood and impact of identified risks.
- Contingency Plans: Developing strategies to address risks if they materialize.
Use Cases/Industries:
- Energy Projects: Preparing for potential regulatory changes affecting project timelines.
- Construction: Anticipating delays due to unforeseen site conditions.
- Manufacturing: Planning for supply chain disruptions.
Advantages:
- Proactive Management: Addresses issues before they escalate.
- Improved Decision-Making: Provides data-driven insights for planning.
Challenges:
- Uncertainty: Not all risks can be anticipated.
- Resource Intensive: Requires time and expertise to conduct thoroughly.
Related Terms: Risk Assessment, Risk Mitigation, Emergency Planning
Example: A solar farm project includes contingency plans for potential delays in panel shipments due to global supply chain issues.
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Synonyms:
Risk Management, Contingency Planning, Risk Mitigation
