Whenever we undertake a project, risk is inevitable, since projects enable change – and whenever you have change, it introduces uncertainty and hence risk.
A risk is defined as an uncertain event which should it occur, will have an effect on the project meeting its objectives. These uncertain events can be positive in which case it would be called an Opportunity, when negative it is called a Threat. Both have the common thread of uncertainty.
When carrying out risk management, the purpose is to reduce the probability and impact of threats and to increase the probability of opportunities andor their positive impact. It is helpful to consider that risk is an event that may all may not occur in the future, but if it does occur it will have an impact on the project objectives.
The Business Case will contain information weighing project cost and risk against the business benefits. Put simply, that the aggregated project risk is worth the benefits. If this is so, then the Business Case remains viable, desirable, and achievable. This one fact highlights the importance of proper risk management. Whenever a new risk is identified, an existing risk changes its characteristics, an issue is identified, or at important control points such as end stage assessments — the Business Case should be checked for viability — and this includes the aggregated value of all of the risks. » Read more: Risk Management and Project Risk
