:AACE CERTIFICATION 2009-2010:

Seeking an idea how I could start to write on paper of topic risk management, I prefer to do some readings and exercises to apply some tools and technique as mentioned in the Humphrey’s book for my current project. First able, I would like to get the big picture of the risk management in regards how to do an assessment of technical risk, schedule risk and cost risk by some different tools. Further, I wish that I could work on the scope of topic in which way the research should be developed. The root cause analysis has brought me on risk identification and given well input on how to quantify the technical risks of Mine Development Project. The root cause analysis also assist to generate the classification of risks which will be required to quantify the risk factor base on category of risk as well as each individual risk activities. Another data also require to assist on developing risk quantification such schedule (Modified Bar/Milestone chart), costing (ABC cost) and historical information of contractor equipments performance and specification to measure the scale factor of risk against performance, schedule and cost.

Firstly, I spent much time to quantify the risk factor at each individual risks using Risk Scales Approach and Modified qualitative and quantitative risk approach. Otherwise, It mentioned in Humphrey that any approach must first identify the risk categories but I think it would be difficult to start straightly with quantifying the categorize of risk instead of each individual risk to ensure that all risks identified are calculated. So I work on quantifying 13 individual risks as generated from the Root Cause Analysis and measure the 3 impact factors of performance, cost and schedule against the risk scale . So it needs 13 times 3 or equal to 39 assessments to generate QRA for each individual risk activity. I do minor modification on the definition of risk scale of schedule to reflect impact of typical of the project with 6 months duration of construction work. I believe the definition Humphrey book is generated to measure the risk for large project or investments portfolio which has long duration of construction and it’s risk impact at least for 12 months period.

Working on technical assessment supports Humphrey's mentioned that “the difficulty in completing the risk table is the determining of probability of risk”. I believe that is argued able as the determining of the probability is come from the best judgment. As the road development is just located near mine active area which will potentially affect positive or negative on changing of assumption and parameters used whether location of disposal, quarry, total material movement , etc, so I select 50% probability of risk to be assumed to develop the risk scoring except the activities where clearly identified will be contributed more than 50 % of probability such safety risk using small fleet by local contractor around heavy equipments (as this project will be nominated to local contractor who experience with similar work), uncertainty of waste material to clean up quarry material due to unavailability data to estimate instead of best approximated based on visual checking by site visit. To ease on quantification of the risk, I propose that the definition severity risk is determined by the maximum severity possible occurrences. Further , the risk management will be applied to eliminate the impact of risk .

The quantification each individual risk result that some risks are assessed in the low risk level. Otherwise, if we combine the risks into one category will outcome that the categorized of risk is jumped from low level to moderate risk level. It means that categorized of the risk will represent a major impact of the risk which is interested and given better points of visibility to be managed instead of long legs of many individual risks which have low risk impact. The risks scale and it’s scoring are presented in the table and graphs below.

Table of Risk Scoring of Mine Road Development Project

Risk Scale Scoring Graph below show the scoring of the risks category. However, to define how level of risk is classified as low, moderate or high risk require to create a new definition of risk score level.

For that purpose, I have an idea to modify and combine both risk matrix method of Qualitative (narrative) and Quantitative Scoring matrix that shows another picture in which risk is located in the scale matrix and assist to identify and give high visibility to the high risk factors by developing a curve line (dash line) across from up to down of the matrix graph. The difference of this modified graph with the previous graph as per shown above is there are two risks are located in the different risk level low and moderate? I think it needs more discussion and analysis which could be addressed in the paper work.