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62R-11: Risk Assessment: Identification and Qualitative Analysis

62R-11: Risk Assessment: Identification and Qualitative Analysis
AACE International, May 11, 2012

Price: $0 (Member) / $100 (Non-Member)

This recommended practice (RP) of AACE International defines the expectations, requirements, and practices for identifying and qualitatively analyzing risk drivers as part of the overall risk management process. It expands on TCM Framework section 7.6.2.2 Risk Assessment, sections a) Risk Identification and b) Qualitative Risk Analysis, covering common practices and tools such as brainstorming, interviews, and checklists. It also covers documentation for and the deliverables from the process step (e.g., risk register). It does not cover quantification of risks or risk treatment planning.

In TCM, the risk management process is applied in the strategic asset management and project control processes. In the strategic arena, the risk focus tends to be on the state of the current asset, the business environment, and other issues that differentiate alternative asset solutions (e.g. varying levels of scope definition). In project control, the risk focus expands to more specific project conditions, plans, deliverables, and events affecting a defined project scope while strategic risks remain. This RP is intended to be generic to either any focus area and any project scope.

Risk identification may require skills and knowledge of behavioral psychology because methods such as brainstorming and Delphi must deal with participant biases.
This RP is intended to provide guidelines, not a standard, for developing a process to identify project risks and perform qualitative risk analysis that most practitioners would consider to be practices that can be relied upon and that they would recommend be considered for use. It provides a foundation for developing risk treatment plans as described in RP 63R-11, Risk Treatment. Ideally, the risk management process provides an opportunity for all stakeholders and contracting parties to work together and manage project risk for their collective benefit. The implementation of all or part of this RP will depend on the size and complexity of the project but the basic processes described should be used in all cases.

This RP outlines the processes and practices but is not a detailed “how-to” in each case. In that respect it will most benefit those that are new to risk management or to decision and risk management professionals who want to refresh their knowledge of recommended practices.

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