Project risk assessment is rather important in the modern business world. The researcher dwells on the key points connected to the significance of this area and presents evidence of its worth to the companies. Twenty Abu Dhabi Ports employees are interviewed. After evaluating the data obtained throughout the interviews, the author of this research uses the opinions of the interviewed experts in order to identify any particular tendencies inherent in the company. By doing so, the author of the research confirms the hypothesis that there is a functional dependence between the human factor and risk occurrence in the example of Abu Dhabi Ports.
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In the realities of the current engineering trends, it is rather important to pay attention to the risks that may transpire throughout the planning or working processes. The problem of risk assessment is vital because the overall success of a project is contingent on scheduling, preparation, outcomes, and estimation, which subsidize the attainment of the strategic objectives of the organization (Subramanyan, Sawant, & Bhatt, 2012). Another important stage of risk assessment is the elaboration of the list of interior and exterior risks. In this way, the team would be aware of the acknowledged risks, their occurrence rates, possible influences, and anticipated actions.
This paper dwells on the existing literature and provides the readers with information concerning project risk assessment in different specialized fields. The author of this research sees students, instructors, and engineering professionals as the intended readers of this paper. The researcher believes that the occurrence of high-level risks is decidedly dependent on the human factor. The latter statement is the hypothesis of this study, which the investigator expects to confirm throughout the research. The key research question, as a part of this study, is the functional dependence between high-level risks and employees’ impact, which implicitly trigger those risks. The main goal of the current research project is to assess the variables that might impact the occurrence rates of engineering risks and propose a strategy to mitigate the incidence of those risks.
In order to reach the key goal of the research, the author conducts an extensive literature review and a series of interviews. This research involves risk assessment specialists who contributed to the research by providing their opinions on the topic and sharing their professional experiences. In Section 1, the researcher will review literature on the topic; in Section 2, the researcher will dwell on the research methodology and its particular characteristics; in Section 3, the researcher will interpret the outcomes of the investigation; in Section 4, the researcher will draw conclusions and discuss the future work that needs to be done.
The article by Nieto-Morote and Ruz-Vila dwelled on a risk assessment method using the Fuzzy Sets Theory and on the method that is utilized to assemble an assortment of various risks (Nieto-Morote & Ruz-Vila, 2011). The methodology integrated the data attained from numerous experts. Individual findings of the partakers were also reviewed in this study.
Aminbakhsh, Gunduz, and Sonmez presented a safety risk assessment framework that was elaborated on, on the basis of the price-of-safety model and the investigative hierarchy method. This is done to create a balanced budget and set accurate objectives without sacrificing security (Aminbakhsh, Gunduz, & Sonmez, 2013). The proposed security risk framework is demonstrated utilizing an actual engineering project, and the benefits of the framework are also presented.
In their research, Subramanyan et al. attempted to evaluate the existing risk condition in the engineering industry by interviewing professionals in the field to obtain the data. A survey was organized in compliance with the literature review. The surveys were filled by exceptional experts with extensive experience in the engineering field (Subramanyan et al., 2012). The study used a qualitative approach.
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Jaskowski and Biruk developed a novel risk examination and assessment tool. The risk model that they proposed is founded on the process of evaluation of a certain project’s features and anticipated circumstances (Jaskowski & Biruk, 2011). The method used to assist the management in making decisions consistent with the risk level is also presented. Jaskowski and Biruk’s (2011) approach is claimed to revise project development and assessment of risk justification alternatives.
In their research, Yucel, Cebi, Hoege, and Ozok presented an innovative methodology of risk assessment that featured the fuzzy inference system. They found that the risk magnitude in the targeted organization is equal to 100% (Yucel et al., 2012). The comparative importance rates of risk aspects for the enactment success of the framework are attained. Technological and compatibility factors are believed to be the most influential.
Tsai and Chen investigated several concepts connected to diverse types of natural catastrophe risk investigation mechanisms. This was done in order to develop a swift risk assessment tool appropriate for the tourism business. This tool could be used to rapidly examine crucial features and risk weaknesses in resident areas (Tsai & Chen, 2011). The findings of their study showed that good arrangement could successfully diminish the damage and risks connected to destructive forces and allowed recovery efforts to start as soon as possible.
In Kucukali’s (2011) research, a fuzzy assessment device was elaborated on in order to be used at hydropower plants. Risk assessment and professional decisions were applied in preference to probabilistic reasoning. This method was presented by a system that offers a flexible way to assess project risks (Kucukali, 2011). This risk assessment tool could be used to prevent financial and organizational issues.
In her research, Chernysheva inspected methods of assessing the risks inherent in IT projects. She stated that a multi-layer data system is required to assimilate all stages of the IT risk management sequence (Chernysheva, 2013). Taking into consideration the analytic hierarchy process, the researcher recommended using production guidelines to mitigate major risks and elaborate on a fundamental risk assessment technique.
Backhaus and Faust used two renowned mixture noxiousness perceptions in order to generate a structured summary for ecological threat and risk assessments of hazardous mixtures. The researchers suggested a novel approach to the safety of the large bodies of water (Backhaus & Faust, 2012). Moreover, they proved that there is an opportunity to identify probable risks for an unprotected bionetwork if the baseline data is accessible.
Wickboldt et al. (2011) announced a framework intended to sustain the computerization of some essential stages of risk management. The results showed that the tool is able to speed up the process of assessing the risks. Moreover, this framework provides assistance for project managers and IT operators by displaying comprehensive information about the risks in an easily understood way.
The researcher is interested in evaluating the risk assessment in Abu Dhabi Ports for the reason that this company is the key player in the industrial zone of Abu Dhabi. This company provides almost 16% of the UAE’s non-oil GDP. There are 800 employees at Abu Dhabi Ports, and the company offers first-class services to its partners.
The current project is backed by a qualitative research. This investigation would help the author gain more insight into the assessment of engineering risks (and risks that are connected to engineering as well). The research method, in this case, is opinion-based. This type of research will help the investigator collect a decent amount of information necessary to reach a reasonable and unbiased verdict. The framework that is utilized in the current research is intended to help the investigator reduce the obtained data by summarizing and synthesizing it (El-Reedy, 2011). The author chose this research method because it provides the evidence necessary to elaborate on a strategy to mitigate the risks produced by human attitudes and behavioral peculiarities. In this case, qualitative research is beneficial to the researcher because it would generate a body of evidence that is unbiased and accurate (Subramanyan et al., 2012). Risk assessment specialists are expected to show their extensive knowledge in the field and expose the key sources of risk assessment fails and limitations.
Methodology and Results
The sample will include ten industry professionals and ten employees from Abu Dhabi Ports. The experts in project risk assessment will be interviewed by the investigator. There are no special requirements concerning the age, gender, or any other characteristics of the partakers (Subramanyan et al., 2012). The researcher randomly chose twenty individuals working for this company and proposed that they participate in the research. All twenty individuals agreed to share their personal and professional opinion in order to provide the researcher with the baseline data.
All of the partakers’ answers will be assessed only on the basis of their professional experience in order to eliminate any other potential bias inherent in the research (Jaskowski & Biruk, 2011). Taking into consideration the random sampling methodology, the researcher expects the partakers not to share their location. In other words, not all of them should originally be from Abu Dhabi. The choice of non-local experts is motivated by the supposition that local experts possess an extensive knowledge concerning the risk assessment, but non-local professionals might substantially add to that knowledge due to the differences in risk assessment among different countries and even Emirates.
The research will use a simple random sampling method. This will help the researcher to obtain accurate and reasonable results. The experts in project risk assessment will be chosen entirely by chance (Nieto-Morote & Ruz-Vila, 2011). The researcher chose this sampling methodology for the reason that it is rather easy to accumulate the sample. It is also seen as one of the most unprejudiced methods in terms of selecting a sample from a certain populace because every individual is given an identical prospect of being chosen (Jaskowski & Biruk, 2011). The researcher chose this sampling methodology because the main feature of simple random sampling is its representativeness of the sample. Hypothetically, luck is the main factor that can harm its representativeness. The researcher picked this sampling methodology for the reason that the sample and its ability to demonstrate the outcomes is a central aspect of drawing conclusions from the analysis of the results of the current research (Nieto-Morote & Ruz-Vila, 2011). Finally, the researcher will be able to make sweeping statements based on the results of the study. This is possible due to the representativeness of the sample and an unbiased approach.
The investigator will interview experts in project risk assessment in order to discover the peculiarities and issues inherent in this field. The researcher will utilize interviews in order to explore the opinions, skills, views, and incentives of the experts in project risk assessment (Bahr, 2012). The interviews contain a set of questions regarding risk assessment. The interview is conducted with the intention of gathering mainly unbiased data. Therefore, the questions should be formulated in a way that would allow the researcher to avoid prejudice (Hillson & Simon, 2012). Nonetheless, the questions should leave room for the personal opinions of Abu Dhabi Ports professionals due to the inevitable impact of their personal views on the outcomes of the study.
The latter means that the data obtained through this interview will be partially biased but to a very little extent (Harris, 2011). The researcher will ask questions concerning the individuals’ past experiences with risk assessment, the factors they believe are the most influential, the effect of the human factor, and the dependency of risk incidence on the organizational structure. The interviews will be conducted individually so as to give the partakers the freedom necessary to express themselves (Jaskowski & Biruk, 2011). The obtained data will not be disclosed in any way and will only be used within the framework of this research.
The analysis of the data showed that there is an explicit connection between the risk probability and human factor (Figure 1). The experts largely stated that the risks that transpire in Abu Dhabi Ports are contingent on the human factor. These include managerial decisions, psychosocial contacts within the team, and the overall reputation of the company (Aminbakhsh et al., 2013). The researcher found that Abu Dhabi Ports is exposed to high-level risks due to its responsibilities concerning the success of operations across Abu Dhabi’s most profitable ports. It is worth mentioning that most participants of the study recognized interpersonal relationships of employees at various levels as the main prerequisite for the appearance of low-level risks that later emerged as high-level risks (Aminbakhsh et al., 2013).
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As we can see from Figure 1, the deterioration of interpersonal relationships leads to a steady increase in the level of risk within the organization. Such an increase may be explained by the level of commitment of the employees and their possible dissatisfaction with the management or their decisions (which may have impacted the employees both directly or indirectly) (Aminbakhsh et al., 2013).
Considering the fact that the data analysis showed a direct connection between interpersonal relationships and risk occurrence, the researcher expected to see a similar outcome in the relationship between managerial decisions and risk occurrence. The results showed an even more dramatic increase in the level of risk (Figure 2). This outcome may be explained by the importance of the decisions that are made by managers on a daily basis. These decisions have both short-term and long-term impacts, and any unweighted solution might be costly for Abu Dhabi Ports. All of the experts agreed that management decisions have to be constantly reassessed in compliance with the project risks and modified in a timely manner (Aminbakhsh et al., 2013). The latter might also be costly for the company, but it would prevent Abu Dhabi Ports from losing even more human and monetary resources if the necessary adjustments are made on time.
Another important aspect is the overall reputation of the company. The experts said in unison that the company’s reputation depends very little on the risks to which the company exposes itself (Figure 3).
In turn, the reputation of the company is subject to the effectiveness of the company’s risk management strategy and not the decisions that it makes. The experts admitted that adequate risk management strategies are able to keep the company and its reputation safe for a long time with no harm at all (Aminbakhsh et al., 2013).
Probability Impact Matrix
Proficient project managers realize that identifying project risks is not enough in the current business state of affairs. In today’s commercial environment, one cannot underestimate the importance of the risk magnitude assessment for the decision makers. This assessment is based on the calculations and is designed to paint the perfect picture for the researchers that are looking to define the significances that may be the result of the risk magnitude influence.
Probability impact matrix is one of the most prevalently utilized qualitative approaches for risk assessment. With the help of the probability impact matrix, risk estimation becomes a trivial task if we bear in mind that probability and influence of an event are usually assessed on an arbitrary basis. In general, risk assessment matrix should be perceived as a specific classification of risks.
In Table 1, the researcher presents the probability impact matrix for this project. This matrix is dedicated to the influence of the human factor to the occurrence of risks.
(sensible influence, to be supervised)
(will have a momentous effect)
(not likely to occur)
(may befall at a time)
(expected to occur)
Table 1. Probability Impact Matrix.
As we also need to calculate the exposure risk, it is necessary to evaluate the risk occurrence rates in compliance with the matrix. In order to do so, the human factor is analyzed for the presence of risk and graded on a scale from 1 to 5 (where 1 – very low and 5 – very high). The results showed that human factor is a B-class risk and should be carefully supervised if the organization does not want to get into a long-term distress.
To propose an adequate risk response strategy, the researcher came up with a response for every risk category that transpired throughout the process of research. On a bigger scale, the project team at Abu Dhabi Ports will be in charge of picking a response for certain risks which are rather hazardous for the company. The project team will have to go through all the options available in order to select the most appropriate response. Moreover, these responses should be adjusted to the organizational culture and values of Abu Dhabi Ports. The likelihood of the risk event taking place and the consequences of it will be the base for defining the extent to which the company should try to alleviate the risks and their occurrence rates.
The researcher believes that the best way to assess the eminence of a mitigation strategy is to multiply the total expenditures attributable to risk times the likelihood of risk manifestation. Mitigation policies that cost not as much as risk likelihood assessment should be carefully reviewed by the project team. The researcher proposes several probable response selections. The most evident is the avoidance. This means that Abu Dhabi Ports would change their approach in order to mitigate the risk imposed on the company by human factor. Another type of reply is transference. In this case, Abu Dhabi might redirect the adverse outcomes of a risk to an arbitrator or a subcontractor. Nonetheless, this approach does not eradicate the human factor risk as it merely shifts accountability. To the author’s mind, the most profitable response strategy is mitigation. By taking this approach, the company would aim to condense the likelihood and adverse influence of a risk. Abu Dhabi Ports might want to take proactive measures, monitor the relationships in the company more thoroughly, and perform more testing activities.
The findings of the current study supported the hypothesis that there is a positive correlation between the human factor and risk occurrence. Moreover, the study showed that managerial decisions have a major impact on the overall state of affairs in the company and dramatically increase the risk probability at all levels. The interviews have been successfully conducted, and all the data has been correctly obtained. The findings of the study show that there is still work to be done in the area of decision-making at all levels of the company. The author recommends implementing a strategy that would feature a modeling framework. By using this framework, Abu Dhabi Ports will be able to anticipate the emergence of risks and minimize their impact on the company even before they manifest themselves. The researcher also believes that the evidence obtained throughout the current research might be valuable for other companies in the field.
Aminbakhsh, S., Gunduz, M., & Sonmez, R. (2013). Safety risk assessment using analytic hierarchy process (AHP) during planning and budgeting of construction projects. Journal of Safety Research, 46(4), 99-105.
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Yucel, G., Cebi, S., Hoege, B., & Ozok, A. (2012). A fuzzy risk assessment model for hospital information system implementation. Expert Systems with Applications, 39(1), 1211-1218.
Index of Terms
- Bionetwork – a group of interrelating elements represented by organisms from various environments.
- Fuzzy Sets Theory – a mathematical theory that is based on the membership function and may come in the form of a graphical representation
- Probabilistic reasoning – the ability to manage vagueness using the probability theory combined with the manipulation of the structure of the formal argument that is in compliance with deductive logic
- Representativeness – a subgroup that defines an accurate reflection of the members of the entire community
- Risk assessment – a process of identifying and evaluating risks associated with a certain threat
- Risk assessment framework – a strategy for arranging and distributing data concerning the security risks to other related substructures
- Risk magnitude – the probability of risk manifestation