Session II: Risk Assessment and Management Module 3: Project Formulation/Preparation BunChhoeuth KENG; September 2016

Contents Learning Objective What is risk assessment and management? Why the risk assessment and management is important in PFP? How to conduct risk assessment & management? Recommended tools to be used in risk assessment Exercises

1. Learning Objective Participants understand how to conduct risk assessment and management

2. What is risk assessment and management? Risk Assessment and Management: a process of analyzing and identifying potential obstacles or hazards Risks: obstacles or hazards that potentially harm project implementation. Risk Assessment: a simple proper examination of what, in your work, could cause harm to people Risk Management: a process which enables the analysis and management of the associated risks

3. Why the risk assessment and management is important in PFP? Why importance? An increased understanding of the project An increased understanding of the risks An independent view of the project risks to justify decision Facilitation of greater, but more rational, risks taking

4. How to conduct risk assessment & management? Risk assessment and management summary 1. Risk Identification 2. Risk Livelihood Assessment 3. Risk Prioritizing 4. Risk Management 5. Risk Management Plan

4. How to conduct risk assessment & management? There are five steps: Risk Identification Identify most relevant risks. List of all risks

4. How to conduct risk assessment & management? Risk Livelihood Assessment: Analyzes and assesses the level of negative

4. How to conduct risk assessment & management? Risk Prioritizing: determines risk management Risk Management: decisions on how to improve and manage risks See Risk Analysis and Management Framework in the next slide.

4. How to conduct risk assessment & management? Developing Risk Management Plan Develop a clear risk management plan. Review risk management plan on a regular basis (e.g. quarterly). See risk management plan in the next slide

5. Recommended tools to be used in Risk Assessment Risk Analysis Matrix: use to rank identified risks from low to high in relation to livelihood and impact (Monti, 2012). Risk Analysis and Management Framework: use to analyze and manage risks, which consists of risks, livelihood and impact, priority and reasons, and management. Risk Management Plan: use to develop a plan in risk management, which covers risks, priority, actions, resources, lead or responsible person and timeframe.

5. Recommended tools to be used in Risk Assessment Risk Analysis Matrix

5. Recommended tools to be used in Risk Assessment 2. Risk Analysis and Management Framework a. Risks b. Livelihood & impact c. Priority & Reasons d. Management Inappropriate Goal and objectives Low livelihood, high impact Inadequate information for analysis Unpredictable situation and context changes Ensure enough information and proper analysis Do context analysis on a regular basis Government restricts the space of CSOs Medium livelihood, high impact Local authorities do not support communities Local authorities do not cooperation with NGOs  Strengthen relationships with local authorities

5. Recommended tools to be used in Risk Assessment 3. Risk Management Plan Risks Priority Actions Resources Lead Timeframe (every two months) 2 4 6 8 10 12 Inappropriate Goal and objectives 1 Ensure enough information and proper analysis Do context analysis on a regular basis Staff Finance Stationery Assigned Project Manager x Government restricts the space of CSOs Strengthen relationships with local authorities   Head of project/ organization

5. Exercise Materials: flip chart, markers Exercise type: Small group work Purpose: to practice on risk analysis and management Activities: Provides introduction to participants Divides participants into five small groups.

5. Exercise Develop a plan to manage risks: Identify risks: what are the potential risks of your project(s)? Prioritize the risks: low, medium, high. Identify what to do to manage the risks. Identify what resources will need to manage the risks. Identify staff who will take the lead in each risk. Identify timeframe for managing the risks.

5. Exercise Risk management plan Risks Priorities Actions Resources Lead Timeframe 1 2 3 4 5 6  

References Curtis, P., & Carey, M. (2012). Risk Assessment in Practice. Committee of Sponsoring Organisations of the Treadway Commission. Deloitte. (2013). Exploring Strategic Risk: 300 executives around the world say their view of strategic risk is changing. Deloitte. FlexStudy. (n.d.). Financial Risk Management. FlexStudy. HSE. (2012). Health and Safety Executive Five steps to risk assessment. Health and Safety Executive. Monti, G. (2012). Resilience Engineering #30: Balance and Perspective. Active Garage. Norris, C., Perry, J., & Simon, P. (2000). Project Risk Analysis and Management. The Association for Project Management. Taylor, J. (2012). Concepts of Strategic Risk and Managing Strategic Risk. Strategic Planning Task Force. Wikinvest. (2009). Definition of Risks and Risk Management Methods. Wikinvest.