Description

“All sectors of the economy increasingly focus on the management of risk because good risk management allows an organisation to have confidence in achieving outcomes, to constrain threat to acceptable levels and to take informed decisions about exploiting opportunities.

Governments publish guidance on the principles of risk management – Treasury’s Orange Book for example. However practitioners need more than principles and RAMP brings together for those charged with delivering major infrastructure projects the combined wisdom derived from years of experience.

I commend its use to anyone embarking on a major project”

- Martin Sykes FIMechE FCIPS, Executive Director: Smarter Procurement, Office of Government Commerce

Risk surrounds every human activity and influences everything we do. RAMP (Risk Analysis and Management for Projects) is a simple and straightforward process for evaluating and controlling risk in major projects, which has been developed by a joint working party of the actuarial and civil engineering professions. This handbook shows how RAMP can enable one to identify, analyse and respond to risks, and place financial values on them. Allied with sound judgement, RAMP should reduce the chance of the resources committed to a project being wasted or the project being a failure. It should also lead to better financial returns for sponsors, investors and lenders, and help to improve the consequences of projects for the wider community.

The RAMP process is concerned with more than the construction phase of a project. It covers the entire life-cycle of the asset, with regular reviews at key points and a system for the control of those risks which remain. It can be applied both to ‘hard’ projects involving the construction of a physical asset and to ‘soft’ projects like the acquisition of a business or the launch of a new product or service. The handbook will be of use to everyone who is concerned with the financial, commercial, legal or engineering aspects of projects of any kind.

This is the second edition of the handbook and it incorporates some significant changes, with more attention being devoted to upside risks, general uncertainty, risk efficiency, decision criteria, and the need for independent validation of appraisals. There is also new material about public sector procurement. A new Appendix 12 presents recent evidence about the serious and sometimes unrecognised risks in major infrastructure projects, both in the UK and abroad, and makes recommendations for changes in the way these risks are approached.

Contents

• Introduction and summary
• Overview of RAMP
• Launching the RAMP process
• Starting the risk review
• Responding to risks
• Planning for risk control
• Managing risks
• Closing-down phase
• Applications and case studies