Definition Risk

Risk management is an important part in all projects. All project management frameworks described detailed the processes. There are many publications about this topic available. Many of these papers refer to operational risk management that occur in the daily work of a project. They describe primarily processes, setting up list of risks, assessment of risks and the management of this level.

Level Model

The LPLM© supplies a broader view on all kinds of risks and groups them into the three level. Additionally, it shows how to link the risks between the level and gives so a strong setting for dealing with risks in large scale projects. Particularly the dependencies between all level is one of the key features of the model. This is necessary because there are different views and understandings of risks in each of the level. Combined with the "LPLM© Interface Model " it supports the understanding how the various knowledge areas influence each other in terms of risk management.

For example, the operational level identifies risks mostly on a day-by-day basis that influence the project execution and is usually not able to classify a certain risk in terms of the overall project goals or even in relation to the objectives of the executing organization. The publication in (R1) claims "Strategic risks do not occur while a project is in progress" because all those risks should be known or sorted out before the project starts. This might be true for all known influences coming from the strategic view inside or outside the executing organization. Nevertheless, there may be risks that occur during the project execution which are only visible on the operational and tactical level, but they could heavily influence the overall strategy of an organization. Neglecting these risks could bring an organization under pressure. On the other hand, a certain strategical risk could influence the project execution. The figure shows the three level and their major characteristic in terms of risk management.

LPLM - Risk Level
Figure R1: LPLM - Risk Level

 

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