Risk management helps to avoid errors and project failure determining the major areas of possible threats and risk probability. Following O'Riordan et al. (1987): "where safety investments, technologies and management practices are judged to be satisfactory, that engineering and regulatory judgments approach the weighing of gains and losses rather differentlydesign engineers do not believe that risks can be accumulated into single numbers or that any given safety investment reduces collective risk" (368 cited Frame, 2002).
The subsequent analysis of the differences or variances and the action taken are a vital part of the control mechanism.
III. Internal Risks. These risks have a great impact on the project and its success, but they can be easily eliminated and avoided. To achieve the task requires clear definition, good planning, clear roles and responsibilities, appropriate resources and regular reviews as the project proceeds.
IV. Quality Risks. There is even evidence that, despite the formal utilization of quantified cost-benefit approaches, the practical implementation of safety and quality may be achieved by informal means. A new or changed design can be costly, as it may need new tools, or new layout of works and employees may have to be retrained (Crouhy et al 2000). Quality policy must be formulated in terms a designer can understand and act upon.
V Resource Risks (Baseline schedule is closely connected with the efficiency levels which are driven by the normal productivity that can be expected from the type of person or equipment allocated to each activity, and the efficient allocatio ...