SIP/2004-WP13

Business case

Special Implementation Project

Risk Management

(Presented by Chaouki Mustapha

Economist, ICAO)

Workshop on the development of business case for the

implementation of CNS/ATM systems
Cairo, 6–9 September 2004
 Outline
¾Risk management
9Definition
9Objectives
¾Risk analysis
¾Risk evaluation
¾Development of mitigation plans

2
Risk Management
 What is risk?
¾Risk can be defined as the likelihood
of occurrence of an undesirable event
combined to the magnitude of its
impact

4
 What is risk management?
¾Risk analysis
9 Identification of risks
9 Estimation of their likelihood of occurrence
9 Estimation of their causes and the magnitude of
their potential impact
¾Risk evaluation
¾Development of risk mitigation plans

5
Objectives of risk management
¾ Not to eliminate risks
¾ But, to identify them and minimize their
effects through:
9 improved awareness of their likelihood of
occurrence and potential impact and;
9 development and implementation of appropriate
mitigation plans

6
Risk Analysis
Risks for the implementation of
CNS/ATM systems
¾ Technical
¾ operational
¾ political
¾ economic
¾ financial
¾ managerial

8
Risks for the implementation of
CNS/ATM systems
¾ Exchange rates
¾ Schedule, extended transition
¾ Traffic growth
¾ Rate of return
¾ Efficiency rates
¾ Systems integration failure
¾ Resistance to change

9
Estimation of the likelihood of
occurrence
¾Expert interview
¾Analogy
¾Review of implementation plans
¾Delphi technique

10
 Estimation of the potential
impact
¾Expert interview
¾Analogy
¾Review of implementation plans
¾Delphi technique

11
Risk Evaluation
 Risk evaluation
¾Assign a risk score to each risk
¾Assign a weight to each risk
¾Determine a risk score for each
implementation option

13
Development of
mitigation plans
 Development of mitigation
plans

¾Identification of potential causes

¾Development of mitigation plans

15
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