Keeping Control: Risk Assessment and Buffers To Damage In Your Projects

Keeping Control: Risk Assessment and Buffers To Damage In Your Projects

- in Finance
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No matter what kind of a project you have, control is always going to be a factor. As much as possible, you want to control your inputs, your outputs, your budget, your expenses, your successes, and even your failures. To do this, you can utilize the concepts of risk assessment along with buffering to give yourself the greatest chance of an ideal conclusion.

If you think about equipment control, the parameters of risk assessment, the likelihood of failure, and what your range of acceptable losses might be, then you can combine all of those concepts to form an overarching theme of damage control.

Equipment Control

Depending on what industry your project is within the scope of, there may be the matter of material controls. Especially when you’re working with things like high temperature or pressure, there are safety limits you should set for all of your pieces of equipment. To visualize this, consider all of the pressure gauges that you associate with a hot water system or all of the temperature gauges that you see surrounding a water heater. Built-in reliability components allow you to keep a closed system in safe operating conditions.




Parameters of Risk Assessment

The general concept of risk assessment is similar no matter what you’re doing really. With any project, you’ll always want to consider the necessary cost, the essential benefits, and how much risk you’re willing to allow inside of your project parameters. If the reward isn’t high enough for dealing with overall variables, then you should take whatever steps necessary to cut them off at the root. Every individual project is going to have its risk assessment, but the analytical process will almost always be the same.

Understanding and Predicting Likelihood of Failure

Though it might seem strange at the outset, you can probably predict the likelihood of failure of many different types of project. You can look at past instances of actions, you can study the historical value of particular projects, or you can even look at various trends that have been established by big data conglomerations. Knowing what the likelihood of failure will be, you can determine appropriate steps to move everything in the right direction consistently.

Acceptable Damages

In the end, given control of the project is all about understanding what you can accept regarding damage, what range of error is not going to affect the quality of your overall product, and how you deal with troubleshooting along the way as well. No project is ever going to be perfect, and predicting that everything will go as planned is one of the fastest ways to bankrupt any project before it can even get off the ground.

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