Project Management: Management of Risks - Essay Example

Project Management Project Management Introduction Management of risks is a fundamental aspect that must be properly integrated into the daily operation of the firm. In this context, Mode Sante will be exposed to a number of risks as it strategies to open another branch (Active Being Complex). The project management attracts many risks and, therefore, risk management has a reciprocal relationship with the project management. The project must be executed within the scarce capital, and, therefore, effective risk management to eliminate capital misappropriation is inevitability. In addition, the refurbishment of the leased premise must be executed with a close eye on proper risk management to ensure its success. The recruitment and training of the 22 members will also attract a range of risk that must be sufficiently eliminated. The project must thus be preceded by a proactive risk assessment evaluation to inform the quality of the project plan to facilitate the project management particularly through satisfactory risk management framework. In this article, therefore, I will investigate the possible applicable risk management theories that will help accomplish the launch and running of the Active Being Complex. A number of risks are identified to affect the firm in almost all aspects of the company’s operation right from operational to employee’s risk. In addition, small labor turnout, liquidity, natural disaster, inadequate training to employees and other competitors are examples of risk looming. Moreover, the consequences of such risks are daunting leading to close temporarily down, declined number of loyal customers, poor quality products and reduced firm productivity arising from the increased number of employees seeking leaves. With these, a shocking and the surprising revelation of risk that stand to affect the Company, it is prudent to evaluate relevant risk management theories to counteractive these identified risks. The risks are already identified, and therefore I discuss how such risks can be effectively managed. Management of risks encompasses such process as identifying, assessing and prioritizing risks. Subsequently, the risk manager accomplishes the process through a coordinated and economical application of facilities to curtail, screen, as well as to control the likelihood and the upshot of the uncertain events. The aim of managing risks is maximizing the achievement of opportunities. For instance, the Mode Sante Company aims at maximizing the opportunity attributable to Active Being Complex through effective risk management frameworks. In so doing, Mode Sante firm will assure improbability does not diverge the endeavor from the business goalmouths. For the successful launch and subsequent operation of the Active Being Complex, the Mode Sante must start by identifying the risks associated with this venture. The self-theories of risk management will form a major part of the discussion to help the firm manage the identified risk. The self-theories are relevant to this case due to its reciprocal relationship with the risk management. Indeed, many businesses have failed to manage risk due to the difficulty of adequate risk identification. There is a need to showcase the psychological constraints attached to risk identification in comparison to the practical procedure outlined in the ISO phase. As individuals become more confident of particular self-view, they can do everything to confirm and sustain such self-view which may be limit the risks identifiable by the work groups. The self-theories are, therefore, an efficient counteractive measure against such constraints. As outlined in the ISO, risk is an uncertainty that might seem counterintuitive, Mode Sante risk managers must question their opinions about the quality of their risk management framework to assess the risks already identified. The self-worth theory is relevant in risk management as it ensures that individuals struggle to maximize and safeguard their sense of competence to retain the self-worth. Therefore, the likelihood of the employee strike, declined productivity, and excessive application of staff leaves will be eliminated through satisfactory motivation. The motivated employee will make causal attributions about the identification and analysis of risks. Such aspects are necessary to enhance employee’s sense of competence and control despite the risk of solely identifying such risks that improve their self-worth. Accordingly, self-determination theory is also a need to risk management in Mode Sante. The theory provides that the necessities for competence and self-determination effectiveness as it fosters extrinsically motivated behavior like risk identification. Self-determined individuals have their reasons for indulging in behaviors internalized hence facilitating the management urge to seek for complete and manageable palate of identified risk. On the other hand, self-verification theory is also appropriate in helping the Mode Sante to launch and operate Active Being Complex. Such theory asserts that people may prefer receiving negative comments about themselves as they undertake the self-verification. As individuals are sure of particular self-view, they seek to confirm the self-view closing the vision of risk identification. Through self-verification, the people can interact leading to the confirmation of their self-concept. Therefore, risk management involves keeping persons in an interactive framework such as harmonious teamwork. The self-verification theory help in effective risk identification that is followed by assessment and monitor to manage the risk effectively identified. Therefore, the Mode Sante top management should advocate the self-verification theory to help both high and low self-esteem individuals. In doing so, such risk such as employee asking for more leaves, strikes, and low productivity will be reduced. In addition, self-verification theory is also useful as it helps the group process risk identification while keeping the cohorts well integrated and even conflictual. Employee’s strike as a risk to the company must be eliminated. Risk assessment is the first step in managing risk and then monitor. In evaluating this risk, there is a need always to base on sufficient motivation. The self-efficacy theory is effective, in this case. Through this theory, the company must ensure there is a sense of belonging through training. The firm must employ the principle of triangulation and to ensure that each worker’s input is integrated with the company operations (Dye, Mills & Weatherbee, 2005). The firm should be keen on both the upside and downside of self-efficacy theory. The risk of the employee strike will thus be eliminated due to the reciprocal relationship between upside of self-efficacy theory and sufficient risk management. In addition, the upside of self-efficacy is a value adding as it capitalizes on the automatic tendency to diminish uncertainty. On the other hand, the downside of self-efficacy may prevent the firm from realizing black swan risks leading to an unreasonable degree of risk tolerance making things to charge emotionally. Self-theories support several mechanisms such as work incrementally, heterogeneous groups, real or normative teamwork. The analysis of the identified risks is also an important step in risk management. The Mode Sante risk management team must analyze the identified risk as high impacts/low likelihood risks as outlined in the ISO 31010. The risk must be analyzed to since it facilitates risk management process. After the firm has categorized risks as high impact/low likelihood risks (ambiguous threats or black swans), the risk evaluation follows. However, the firm must be keen in identifying such risk-based the three predisposition factors as group dynamics, organizational culture, and cognition. The risk evaluation then follows the analysis of the risk process based on feedback exercise depending on our evaluation of self-efficacy (Anseel, Lievens & Levy, 2007). The management must exploit the aspects of human nature that facilitate the accuracy of risk evaluation. The feedback motives such as instrumental, ego-based and image-based motives allows for effective risk evaluation. The risk management is closely linked to self-efficacy as it aids in determining the goal setting, activity choice and willingness to expend effort shaping the individuals responses to risk. Therefore, the Mode Sante should create an enabling environment for its employees as controllable environment is attributable to increased employee motivation and thus fully exercise their perceived efficacy. In addition, such strategies improve employee’s probability of success that collapse into effective risk responses. The central point is that when the firm’s goals are aligned with the key values there are increased efforts to execute research on risk and tirelessly seek to resolve risk issued connected to such values. Therefore, the Mode Sante risk management framework should never threaten the workforce self-worth as employee might procrastinate, seek for excuses and averse challenging tasks thus being incremental. The Mode Sante must effectively employ the following mechanism to prepare for the uncertainty that might lead to failure of its goal of launching Active Being Complex. 1) The risk management team must practice teamwork under pressure. 2) Take advantage of recovery windows 3) Experiment by trying out solutions in a manner that is distinguished from mainstream framework. Risk management monitoring and review process is also key stage. There should be a continuous process to monitor and review the risk for alterations in levels and efficiency of the risks responses. Conclusion In conclusion, the success of the Active Being Complex hangs on the ability of Mode Sante Company to manage risk. The firm should employ the self-theories discussed above to ensure proper risk management. In so doing, the firm will benefit from the launch and sustenance of Active Being Complex outlet through increased revenue base. The firm risk managers must effectively and systematically identify, analyze, evaluate, monitor and review the risk management framework adopted. Bibliography Anseel, F., Lievens, F. & Levy, P. (2007). A self-motives perspective on feedback-seeking behavior: Linking organizational behavior and social psychology research. International Journal of Management Reviews, 9, 211-236. Dye, K, Mills, J. & Weatherbee, T. (2005). Maslow: Man interrupted: reading management theory in context. Management Decision, 43, 1375-1395. Eccles, J. & Wigfield, A. (2002). Motivational beliefs, values and goals. Annual Review of Psychology, 53, 109-132. Ehrlinger, J., Gilovich, T. & Ross, L. (2005). Peering into the bias blind spot: People’s assessments of bias in themselves and others. Personality and Social Psychology Bulletin, 31, 1-13. Gardner, D. (2009). Bad news bias. Ottawa Citizen. Latham, G. & pinder, C. (2005). 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