Operating Risk Management Term Paper Example | Topics and Well Written Essays - 1000 words

Operating Risk Management - Term Paper Example This caution would not only save their client, but it would also save the personnel or employees they will use in the project. Tetra Tech’s Task Initiation Procedure (TIP) requires that before a project is undertaken all risk associated with the project are known, understood and the management of these risk are defined and detailed (Fletcher and Newell). The Task Initiation Procedure based on the RFP (request for proposal) is conducted even before a bid for the project is put together. Short of coming up with an actual project plan or implementation plan of the project from start-up to its completion the TIP will detail the resources needed as well as the materiel that will be needed by the project. Another aspect of Tetra Tech’s unique risk management strategy is also to stop and suspend the project when it encounters an unknown variable that was not included in the project plan prepared at the onset of the project a re-assessment and re-evaluation of the risk base on the new variable is conducted. This unique aspect of Tetra Tech’s operation sometimes led to a renegotiation of the project. However, this practice has avoided near misses and potential disasters for the client, stakeholders and even the project resource that Tetra Tech is using. An essential component of an effective risk management is being prepared for all known risks, and being prepared to handle unknown risks. The employees of Tetra Tech have appreciated the fact that the TIP is not a rigid mandatory requirement but a strict guideline that allows project manager to tailor fit their requirement to the uniqueness of their individual project. The innovation contributed by each employee to the TIP make the employees feel that they own the risk management and compliance process of Tetra Tech. Sarbanes Oxley Act of 2002 with regards to risk assessment and risk management in the context of good corporate governance (Lahti, Peterson and Lanza) used the COSO (committee of Sponsor ing Organization of the Treadway Commission) model that identifies an Eight Framework Component in managing risks (Moeller). Tetra Tech has an Internal Environment that is geared towards risk management specifically its operating impetus to â€Å"plan to address the risk before execution†. Not only is this enshrined in their operation it is how they do business. For Tetra Tech, the successful risk free implementation of the project that is according to plan is the objective. The TIP in itself is the Event Identification and Risk assessment. The implementation plan is the risk response and the Control and Monitoring activities are the three layers of audit it conducts (Peer review, executive review and compliance audit). Information and Communication is enshrined in the feedback mechanism that would include lessons learned that strengthened the knowledge base of Tetra Tech. Tetra Tech even exceeds the requirement of established Risk Assessment and Management frameworks. Elabor ate on risk assessment in the task initiation procedure and oversight Process The risk analysis of Tetra Tech starts at the TIP process using the RFP as basis. Tetra Tech’s appetite will be the basis for joining a bidding process or not. However, the TIP ensures that what is considered as high risk is converted into low risk