3. Risk Definition – Changing Perception ! “ Risk involves the possibility of suffering harm or loss. In the project context, it is concerned with opportunities (positive outcomes) and threats (negative outcomes).” Adapted from PMBOK Guide 1996 Edition “ Project risk is an uncertain event or condition that, if it occurs, has a positive or negative effect on a project objective.” Adapted from PMBOK Guide

4. Risk Management - Industry Standards AS/NZS ISO 31000:2009 - Risk Management Standard

6. Risk Analysis and Management Cycle

7. Risk Management Risk Management is the systematic process of identifying, analyzing, and responding to project risk. It includes maximizing the probability and consequences of positive events and minimizing the probability and consequences of adverse events to program objectives. Identify Analyze Mitigate Manage Risk Management

13. Risk Register Interviews, workshops with Client, Contractors, and others Claims Risk Register Slums Tariffs Currency IE Claims Design OMDA

14. Program Control System (PCIS) Knowledge & Decisions IT Infrastructure Servers & Network Information

15. Decision Tree

17. Interpreting Results

19. Manage the Risk

20. Program Risk for an Airport Expansion Program Program Budget approx. US$ 2 Billion Program Risks Contract Risks Project Risks OMDA LD Technical Claims Others

21. Airport Program– Timeline of major risk/opportunity ? Complete construction by Feb 15, 2010 OMDA Signed Conversion to Lump Sum by July 2008 Revised Master Plan submitted All design & Procurement Activities to be completed before conversion to lump sum 2010 Apr-2006 May-2007 2008 July 2008 2009 2007 August 2008 Substantial Construction activities during 2008-2009 Manpower resources Fund management for payment

22. Program Risk Categories Category 1: Known risk factor and known risk impact: We understand the potential outcomes and the probable impacts. (Issue of Concept Design for Terminal) Category 2: Known risk factor – Unknown risk impact: We understand the situation may affect the outcome but not sure the probability of occurrence (generally remote) or potential impact. (OMDA LDs, Change orders …) Category 3: Unknown risk factor – Unknown risk impact: Conditions we are not aware of and have no idea the potential impact. (war, global economic changes, etc…….)

26. Risk Allocation – By Potential Impact

28. Conclusion Risks are the Opportunities ! Let us manage those ... together