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Construction Risk Management Summit
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Project Due Diligence
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Richard Robinson Director R2A Due Diligence Engineers
Risk Paradigms
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BusinessSafety Project
Business Risk (Augmented SWOT)
External / Internal Factors
Opportunities
Strategy
Organisation
Strengths
Value Addeds
Threats
Weaknesses
Vulnerabilities
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SWOT Characterisation
- - - + + +- + + +
- - + + + + +
- -
- - -
Vulnerabilities Value Addeds
Likelihood
ConsequenceDisaster Ugly Bad Good Outstanding Brilliant
- - - + + +
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Project Due Diligence
Military intelligence approach - threats to agreed critical success factors give rise to vulnerabilities
Construction Operations & MaintenanceConcept Scope refinement
Tendering Commissioning
Project Risk Management
Project Due Diligence
Project Critical
SuccessFactors
Project Risk
With project risk, upside risk is assumed in the proposal. !
The risk analysis generally focuses on those issues which will prevent the assumed upside benefits from being achieved. That is, it is a downside risk assessment process from an assumed upside risk position.
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Project Characterisation
- +
- -
- -
- - -
Vulnerabilities
Value Addeds
Likelihood
Consequence
Disaster Ugly Bad Good
- - -
xxx xx x
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2.0 Credible threats
5.2 Risk profile
5.1 Residual risk profile
5.2 Contingency sums
3.0 Credible vulnerabilities
1.0 Project critical success factors
6.0 Action list
5.0 Precautions / protection / controls
4.0 Criticality review
5.1 Risk assessment
Geographic Zones
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Risk Stages
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Flow Chart for Project Vulnerability WorkshopProcess
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Method
Further reviews as required from a ‘lower level top-down’ perspective.
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Example - gas plant
Preliminary dependence diagram14
Vulnerability table
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Show stoppers
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Representative Projects
Eastlink Marina Coastal Expressway (Singapore) Tugan Bypass (Queensland) Interim Rolling Stock Procurement (X’Traps) Class ‘E’ Trams Procurement South Morang Rail Extension
Criticality, not risk
All senior decision makers assess decisions about future uncertainty initially at least, using criticality, not risk. !
NB: The minimisation of personal and electoral liability is logically prior to shareholder profits and taxpayer funds.
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