Risk Management in the Homes Building Project

It is vital important in this day to have projects within the organization. The organization develop project to achieve a specific goal(s) which is/are related to the strategy of the organization. PMBoK 2008 state that project is a temporary endeavor undertaken to create a unique product or service. Organization uses project as a pilot system, others use projects to solve problems. The project life cycle consist of four steps: Conceptualization, Planning, Execution and Termination. Each and everything need management to function very well, therefore projects need Project Management. Project Management is application of knowledge, skills, tools, and techniques to project activities to achieve project requirements. Project management is accomplished through the application and integration of the project management processes of initiating, planning, executing, monitoring and controlling and closing” (Heaney, 2011:4). During the project there are some factors that may have negative influence on the achievement of the project aims. In addition those influences are called risks, however not all risks a negative influence; there are some positive risks (danger or threat or probability that an event will occur). Lock (2007) defined risks as unforeseen (and often unforeseeable) events that can result in a change of project plans or even total project failure” (p100) Project has to be recognized within limitation of cost, schedule and quality. These three limitations gives birth to four elements of projects which are complex, one-time processes; limited by budget, schedules, and resources; developed to resolve a clear goal or set of goals; and project are customer focused. The result of risks can interrupt the element of any projects, because of risk the cost of the project maybe more than what the organization budget for and can take more time to be completed. In order to mitigate these problems before they appear Risk Management strategy must be implemented to the project.

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