RISK MANAGEMENT

Parsons formal risk management process introduces standard risk worksheets and implements a procedure built around the following steps:

• For each project, provide a detailed and explicit definition of success for our clients and for ourselves
• Identify all risks that pose threats to achieving each success factor, and assess the effects of those risks
• Develop mitigation strategies to counter each major risk and focus on risk control
• Ensure that control mechanisms are achieving the desired effect and refine mitigation measures as needed
• Record all project risks, mitigation strategies adopted, and the results of the approach to learn from experience and apply the best mitigation methods

Harnessing the experience and knowledge of an entire project management team to anticipate and overcome risks is a very important part of risk management. Successful risk management depends on our people's knowledge rather than on statistical simulations run on computer models. Software tools play an important role in risk assessment, but only in the context of an overall risk management process. The two proprietary software packages we apply to risk analysis are:

• @Risk

  to provide estimate accuracy and evaluate project contingencies

• Monte Carlo

  to assess schedule risk

Our risk management system is well established and is used by all projects.