Luton Town Residences: PRINCE2 Risk Management Strategy Report

This document presents a comprehensive PRINCE2 risk management strategy tailored for construction projects. It details the purpose of risk management, which is to plan, monitor, and control potential project risks. The report outlines a structured approach, including risk identification across all project phases, thorough assessment of probability and impact, and the development of mitigation plans based on proximity and severity. It also covers the use of tools and techniques like brainstorming and risk registers, reporting protocols, and the assignment of roles and responsibilities. The strategy defines scales for risk estimation, proximity categories, risk categories such as safety hazards and material costs, and response categories. Early warning indicators, risk tolerance levels, and risk budget considerations are also included, providing a complete framework for managing and minimizing project risks. The report is a valuable resource for students seeking to understand and apply the principles of risk management in project settings, with a focus on the construction industry. The document is available on Desklib, a platform providing AI-based study tools for students.

<Insert Project Name> Created/updated 01/09/24
PRINCE2™- Risk Management Strategy
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Risk Management Strategy Created/updated 01/09/24
<Insert Project Name>
Overview
Purpose A Risk Management Strategy describes the specific risk management
techniques and standards to be applied and the responsibilities for
achieving an effective risk management procedure.
Contents The Risk Management Strategy should cover the following topics.
Introduction...............................................................................................................3
Risk Management Procedure...................................................................................3
Tools and Techniques...............................................................................................3
Records..................................................................................................................... 4
Reporting...................................................................................................................4
Timing of Risk Management Activities....................................................................4
Roles and Responsibilities........................................................................................4
Scales.......................................................................................................................5
Proximity...................................................................................................................5
Risk Categories.........................................................................................................5
Risk Response Categories.......................................................................................5
Early-warning Indicators.........................................................................................5
Risk Tolerance..........................................................................................................6
Risk Budget..............................................................................................................6
Advice The Risk Management Strategy is derived from the: Project Brief; Business
Case; The corporate or programme management’s risk management guide,
strategy or policy.
A Risk Management Strategy can take a number of formats, including: Stand-
alone document or a section in the Project Initiation Document; Entry in a
project management tool.
The following quality criteria should be observed:
 Responsibilities are clear and understood by both customer and supplier
 The risk management procedure is clearly documented and can be
understood by all parties
 Scales, expected value and proximity definitions are clear and
unambiguous
 The chosen scales are appropriate for the level of control required
 Risk reporting requirements are fully defined.
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PRINCE2™ is a Trade Mark of the Office of Government Commerce
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Risk Management Strategy Created/updated 01/09/24
<Insert Project Name>
Introduction
The purpose of management of risk is to plan, monitor and control the
exposure that the construction project could have to risk that may fail the
entire project.
The objective is to identify the hazard and assess how the risk is is capable of
making the entire project of alien or how it may effect individual risks to the
project team members. It would prevent any risk to occur and control and
manage the residual risk to occur again. The risk should be mitigated and it is
the responsibility of the entire team for strategizing and eliminating the risks.
Risk Management Procedure
Identify
The identification of the risk would begin at every point every phase starting from the
project initiation phase to the project closure phase.
Assess
The assessment would be done by identifying the probability of occurrence of risk and
how it would harm the project or the individual team members.
Plan
The plan is to assess the risks according to their proximity and severity.
Implement
Implementation of a risk management strategy would be depending on the proximity and
severity of the risk.
Communicate
The communication would be as per the communication plan decided at the project initiation
phase.
Tools and Techniques
The Tools and techniques for the risk management system would be used by brainstorming,
root cause analysis, risk register and Probability and impact matrix.
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Risk Management Strategy Created/updated 01/09/24
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Records
The risk register would be used in the format of an excel sheet that would record all
the information about the risk in the ways to mitigate them.
Reporting
The reporting of the risks would be done to the project manager to take any decision against
mitigating the risk.
Timing of Risk Management Activities
The timing of the risk management activities are to be done through all the phases of the project.
Roles and Responsibilities
The roles and responsibilities lies to every team member within the organisation associated
with the construction and especially the quality control team.
Scales
The estimating scales would be varying from very high, high, medium, low and very low
Proximity
The typical proximity categories that would be decided for this project would be within
the stages of the project and right after the project is completed.
Risk Categories
The risk management categories would be defined by safety hazards, managing the changing
orders, unknown site conditions, incomplete and poly define scope, bad drawings, and
unexpected increases in the material cost, damage or theft of the equipment, shortage of
labour.
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Risk Management Strategy Created/updated 01/09/24
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Risk Response Categories
The risk response categories would be defined as per the scales so that it can be easily
identify difference is a threat or an opportunity.
Early-warning Indicators
Any early warning indicators would be tracked in the project to find out if the construction
project is being hampered which can also be related to the quality of resources.
Risk Tolerance
The project level risk tolerance could be set by any risk when it would occur and result in a
loss of finances. These would be escalated to the corporate program management and the
project managers.
Risk Budget
The Risk Budget would be described right at the project initiation phase. The funding
should be done accordingly.
© Crown copyright 2009.
PRINCE2™ is a Trade Mark of the Office of Government Commerce
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