Methodology
The primary goal of a risk management plan is to understand what risks the project will be exposed to. The Project team supports the premise that “risk management goals and objectives should be consistent with and supportive of the enterprise’s business objectives and strategies.” Therefore, the risk management plan associated with this expansion utilizes the company’s vision and strategic objectives as its foundation.
The risk management plan was developed with the goal of assisting the organization in improving its current capacity to identify, prioritize, and respond to the risks associated with the expansion in to China. As previously stated the primary objective of the risk management plan is to increase the organization’s understanding of the risk associated with this expansion project. In order to effectively utilize risk management the risk management plan must develop a “common understanding” of these risks. The benefits of a common understanding of risk across the organization structure are numerous. For instance, the risk management plan will help to achieve cost savings through better control of both internal and external resources. One way this control will be realized is by developing safeguards that impact the organization’s earnings. This cost savings then makes it possible for the organization to allocate capital more efficiently.
Development of the risk management plan utilized the project’s Scope Statement, Cost, Schedule, and Communication Management plans found in the Project Management Plan. Additional inputs of the risk management plan include the Project Charter, numerous enterprise environmental factors, both here and abroad, and organizational assets.
The Risk Management plan defines the roles and responsibilities of the project’s stakeholders. For example, the executive team is responsible for developing,