Risk Management in Engineering
An example of Why Risk Management is Important in Engineering
You were granted your first project as an engineer. Excited and confident in your project planning abilities, you get to work on developing plans that a client requested. A few months out, you realize your project is behind schedule and forecasting to be slightly over budget. You are also having issues keeping enough people on your crew to complete the job at the projected pace. Your client is not happy. Did you consider any risk when starting on this project?
What is Risk Management
Risk management is a process within project management that includes identifying certain risks a project may have. When threats are identified, they are analyzed on how they can impact a project. There are many factors that can be considered risky for a project, especially in engineering, but the main and most recognizable risks include costs, legal liabilities, and going over a projected schedule.
There are five main steps in risk management: planning, identifying, analyzing, developing response strategies, and monitoring and control.
Different Types of Risk Management In Engineering
In engineering, there are many risk factors one must take into consideration when planning or working on a project, such as:
- Surpassing cost budgets
- Not meeting deadlines on planned schedule
- Funding is decreased or removed
- Regulations Change
- Outsourced parties do not perform up to expectations
- Parts do not show up on time
- Loss of project staff
- Chance of accidents and injuries
As it's an engineer's duty to keep the public safe, risk management is not something that should be ignored when working on a project. It is always important to stay ahead of a possible risk and be proactive instead of reactive. By planning for possible risks and determining a plan for if those risks do appear viable, the risk should not pose as large of a threat as if it was not thought of prior.
"Projects are usually undertaken to either solve a problem or take advantage of an opportunity. The probability that the project- even if precisely executed- will complete on time, on budget, and on performance is typically small. Project management is utilized to increase this probability. So in a sense, project management is risk management."