CLEANROOMS & GIGAFACTORIES

Risk management is the process of identifying, assessing, and controlling threats to an organization’s capital, earnings, or objectives. These risks can stem from various sources such as financial uncertainty, legal liabilities, strategic management errors, accidents, or natural disasters.

In any organisation, projects deal with risks and uncertainty. A risk identification plan allows to identify potential risks. According to Burke (2013) a project risk can be understood as any event that limits or influences the achievement of the project objectives. According to APM (2012) the risk management process allows the project team to understand and manage the risks and the objective is to minimise negative risks and maximise opportunities. The risk management process is important because potential risks can be identified and priorities can be established. Additionally, it is possible to efficient manage the resources and identify hidden risks.
This section of the report will focus on risk identification which belongs to the risk management process. According to APM (2012), the risk identification is the process
that determines which risks might affect the project and documents their characteristics. Gardiner (2005) stated that the objective is to identify potential threats and opportunities that influence the achievement of the objectives.

In simpler terms, risk management involves:

1. Identifying potential risks.
2. Analysing
3. Monitoring and reviewing from the beginning to the end of the project.

Once the risks are identified, a risk response must be given by the project manager.
According to APM (2012), a risk response is an action whose objective is to reduce the probability or impact of a threat or increase the probability or impact of an opportunity. The output of this process is a risk response plan. Next, possible risk responses are provided:

Threats
Avoid: According to Burke (2013), avoiding the risk implies eliminating it completely or taking another alternative.
– Mitigate: Mitigating the risk implies reducing the likelihood or impact of the risk. For example, conducting more tests, or choosing other suppliers (Burke 2013).
– Transfer: The risk can be shared or transferred to another party, such as a contractor or risk insurance agency.
– Share: split the risk with a third part.
– Accept: This strategy is adopted because it is rarely possible to eliminate all threats from a project. The strategy can be either passive or active.

Opportunity
– Exploit: the project might be modified in order to take advantage of a change in
technology, finance or a new market. For example, new and emerging markets,
positive changes in exchange rates or interest rates.
– Enhance: this strategy consists of increasing the likelihood of the opportunity
occurring or the positive impact of the opportunity. For example, commercial
opportunities such as new partnerships, new capital investment, new promoters.
– Share: An opportunity can be shared with a partner or supplier with the objective of
maximising the benefits using a shared resource, technology etc.
– Reject: This strategy implies that no action is taken and the possibility of obtaining
benefits from the opportunity is rejected.

4.5.1. Risk register table

According to Dallas (2006), the risk register is a risk management document with the objective of identifying potential threats and opportunities and establishing priorities of risks. The risk register includes aspects such as the risk identification, description, likelihood, impact and priority, type of risk, response action and risk owner. The risk register table must be and updated during all the project.