Risk Assessment Questionnaire
Risk management is fundamental to your effective management of contracts and the potential exposures that may arise under contracts.
One aspect of risk assessment involves assessing the likelihood, type and size of the potential risks arising under the contract before the contract is signed and while the project is being scoped. It can be too late to undertake such an assessment at the end of the process when the operational or commercial people involved in a project have already agreed on the parameters and price of the project. An assessment of risk is fundamental to an assessment of the value of a project and it is the responsibility of the operational and commercial people within the Division, Faculty or School.
Risk management involves assessing and accepting risk in a way that minimises the potential costs to Swinburne, both under the contract itself and in the longer term bearing in mind our insurance needs and premiums.
The following Risk Assessment questions should be considered and answered.
In order to proceed with the contract and the project, the risk assessment should conclude that there is no realistic risk of Swinburne being liable to the other party or parties for things such as any significant loss of profit, revenue, business, opportunity, production, goodwill, contract, data, or anticipated savings, or for any financing costs or increase in operating costs or for any economic loss for any special, indirect or consequential loss compared to the benefit for Swinburne (i.e. the profit or enhancement of the University’s status/reputation). If you need help to understand these potential liabilities, you should contact Swinburne Legal or Finance to discuss.
Questions
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What is the relationship with the other party?
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In what environment will the contract operate in and the services be delivered in? For example:
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What personnel are involved?
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Are any third parties involved?
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How familiar are you with those people?
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Where are the tasks to be performed?
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At whose premises?
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How are the outputs of the project to be used?
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By whom?
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Are the activities commercial or non-commercial?
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Whose funds (ultimately) are at risk in the project and in the use of any outputs of the project?
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Who is going to monitor delivery and performance and changing circumstances and keep documentary records of activities and changes?
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What are the key risks to be managed?
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Analyse those risks. For example
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What is the likelihood of an adverse event?
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What are the possible consequences of such adverse events?
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What is the likelihood that those consequences will eventuate?
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How then will you treat the risk so as to achieve the best outcome for Swinburne? For example:
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Realistically, can the risks be eliminated?
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Can they be transferred, controlled or reduced or, if the risk has to be accepted, then the project should be priced accordingly or not proceed?
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