:AACE CERTIFICATION 2009-2010:

Week#06 -Andy blogs

Reading on Humphrey chapter 3 “Introduction to technical Risk Assessment” give me a look that the risk assessment would be an appropriately tools to apply in mine development project characteristic which is sensitively influenced by change of mine plan as result of uncertainty condition on natural reserves. As writing in all previously my blogs that I have issues on project scoping as well as the cost estimate and schedule of the project while the mine plan still keep changed. This condition has been frequently occurred in previous projects and has been contributed on change of scope, delayed on project schedule and deviation on the budget plan. Till I read and do an exercise of Norsk Z-014 Work Breakdown Structure and continuing to use the WBS to develop technical risk assessment recognize me that risk assessment would give a good solution to manage the uncertainty condition in the project management as well as mine development project.

Firstly, I think I have completely miss understood to interpret definition on technical risk as mentioned in the Humphreys book. I trapped into terminology definition on what differences between technical risk, schedule risk and cost risk are, as the risk is typically addressed into those three areas. I tried to identify the risk and categorize separately between technical risk , schedule risk and cost risk and finally have no right understanding what the definition of technical risk assessment is. For this purposed, I read Total Cost Management (TCM) Framework book at subchapter “Risk Management” to compare and get more understanding the definition and relationship between technical risk, schedule risk and cost risk. Then I get the clearly answer (to Mentor : please correct me) that is not talking about classification of risks but the classification on “assessment “ of risk. (hopefully my understanding is right …otherwise if there is meaning of classification of risk existed, I think it doesn’t give much value on definition of risk instead of the assessment method itself will give more valuable contribution on implementation of project . ). Further, TCM give more clearly explanation that the risk assessment is just one piece of the tools of enterprise “Risk Management” which are included activities : identifying risk factors (risk assessment), quantifying the properties of factors (risk analysis), mitigating the impact factor and developing risk management plan (risk mitigation) and implementing the risk management plan (risk control). Further, the result of technical risk assessment will drive force in the schedule risk and cost risk analysis.

TCM and Humphreys book have brought me an idea to follow the steps in order to develop technical risk assessment and capture some tools and method would be required and start working on my paper topic of Risk Management, i.e. :

Identify and assess risk factors whether using Nominal technique or brainstorming, classified the risk then root cause analysis (logical framework). Project scoping and WBS (Norsk Z014) are assisted to perform development of the technical risk analysis. Otherwise, historical data of PT Inco and contractor equipments performance, project planning information on main activities (schedule, cost, resources, value engineering and procurement) will also assisted to ensure that all risk of the activities is identified, optimized and addressed.