Introduction          Introduction         Introduction          Introduction         

A risk is a potential problem, a situation that, if it materializes, may adversely affect the project. Risks that materialize are no longer risks, they are problems.

All projects have risks, and all risks are ultimately handled:

1). Some disappear,

2). some develop into problems that demand attention, and

3). a few escalate into crises that destroy projects.

The goal of risk management is to ensure that risks never fall into the third category.

 For logical purposes, it is useful to contrast a system of high wholeness to a non-system in which no parts are interrelated. Measures of outcome would not reflect the operation of other parts measured and would not be Interco related. This is so obvious that it seems silly. But the converse, stated above, is not so easily grasped: outcome measures from different parts of a system are correlated because those outcomes are jointly determined by common parts of the system.

  There are four steps to managing risks: identify them, categorize them, mitigate them, and manage them.