Risk management was a novice in many industries....until in recent years, when it has grown leaps and bounds..... I agree with Mr. Nabeel that Risk analysis of a project is a step which enables an organisation to understand the various kinds of risks associated with the project and the potential losses that may arise due to the same. If an organisation plans ahead and ensures the same risk is mitigated, the same can leads to maximization of profit. For example: increase in price of raw material during the course of the project is a big risk and can impact the profitability...hence if the organisation plans and do simple hedging..it can ensure it meets its projected profit....
Well, it depends on destination and company organization nature; but I do believe that pertaining the risk management analysis shall save cost and time for any project and also, implementing such analysis shall be a guid for other future projects and serves the global data base of any company.
Each company or project should and must have some level of risk appetite. For example, a Bank must expose itself to some level of credit risk as part of its day to day operations, there's no guarantee a debtor will repay the loan that they've taken (e.g. credit risk). Defining the risks you are or are not willing to take and the maximum levels you're willing to take shapes your risk appetite. Monitored weekly, or monthly (if you're a Board member) with appropriate triggers, limits and capacities allows you to monitor and then manage risks as they crystallise. It's important to remember though, you must always have good mechanisms and processes in place to consistently assess your risks and build appropriate controls for managing them.
