Homework answers / question archive / Qualitative risk analysis is a technique for estimating the overall effect of a particular risk on the project objectives, such as schedule and cost objectives

Qualitative risk analysis is a technique for estimating the overall effect of a particular risk on the project objectives, such as schedule and cost objectives

Writing

Share With

Qualitative risk analysis is a technique for estimating the overall effect of a particular risk on the project objectives, such as schedule and cost objectives. The analysis results provide a clear insight into the likelihood of project success, and therefore, it is more helpful in developing contingency reserves (Tiusanen, 2017). The primary purpose of this assignment is to assess different risks using Scenario and Industry Fusion Analytics qualitatively. The risks that will be assessed are; economic, operational, security, and fraud risks. Risk analysis Assessing economic risks using Scenario analysis Scenario analysis is the process of predicting the future value of an investment depending on the changes that may occur to the existing variables. This analysis can be used in any business organization to determine economic trends, uncertainties, and risks that may affect its operation (Wright & Goodwin, 2019). Organizational, economic risks can be assessed qualitatively using Scenario analytics by the use of the following steps; a) Defining the issue- this step describes the risk at hand (economic) and the decision that will be made to achieve the intended goal. b) Collecting data- will involve identifying critical factors, uncertainties, and trends that will interfere with the original plan. c) Separation of uncertainties and certainties-this will involve separating certainties from uncertainties to make the correct assumptions. 2 d) Develop scenarios- This will involve analyzing scenarios by taking the top uncertainties, moderate good outcomes, and the bad ones and developing a scenario around each of them. e) Put the scenarios in use-this will involve using the developed scenario as part of planning to make decisions on how to prevent the risk. Due to the increased economic risks, these risks need to be assessed frequently to prevent business organizations from incurring more losses. Assessing security and fraud risk using Scenario analysis The process of managing security and fraud risks can be tiresome and challenging. Different forms of security and fraud risks create a lot of fear and confusion, thus calling for qualitative analysis. Security and fraud risk can be assessed qualitatively using Scenario analytics by the use of the following steps; a) Putting together a team of experts to identify the risk-assembling of experienced professionals to detect fraud and insecurity cases will help determine the possible risk factors and come up with effective measures on how to curb the risk. b) Isolating all potential risks-after the experts identifying the potential risk factors, it will be necessary to isolate, evaluate and analyze the possible impacts. This will help in identifying the root causes and provide adequate measures. c) Rate and prioritize the risk based on its effects and likelihood of occurring; the risk will be rated to identify if it’s of low concern or high priority. 3 d) Develop measures to address the risk-this will involve developing strict and effective strategies to prevent the risk. e) Monitor and evaluate the risk-this step will involve continuous monitoring of the measures developed to ensure that they are operating as intended. With the continuous advancement of technology, this risk needs to be assessed every time to protect organizations' trust, reputation, and financial stability. Assessing operational risk using Industry Fusion Analytics Operation risks result from inadequate/failed internal processes, controls, systems, or external failures. Failure to execute these operations effectively leads to organizational reputational loss, thus calling for qualitative assessment. Operation risk can be assessed qualitatively using Industry Fusion Analytics by the use of the following steps; a) Identifying the risk-this step will help identify the hazard and develop appropriate measures. b) Identifying the risk-this effect will help determine how damaging the operational risk can be. c) Evaluating the risk and developing preventive measures- will help develop effective strategies to control the operational risk. d) Recording the findings-this will help to note down effective strategies that will be used for future needs. e) Reviewing the assessment will help evaluate the fundamental steps and make appropriate modifications. 4 Operational risks are part and parcel of organizational operations. Therefore, frequent assessments should be carried out to identify and prevent them from causing more losses. 5 References Tiusanen, R. (2017). Qualitative risk analysis. Handbook of Safety Principles, 463-492. Wright, G., Cairns, G., O'Brien, F. A., & Goodwin, P. (2019). Scenario analysis to support decision making in addressing wicked problems: Pitfalls and potential. European Journal of Operational Research, 278(1), 3-19.