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Risk Management: a Case Study of a Ghanaian Ngo

ABSTRACT This paper seeks to discuss an activity from a project programme that allowed the Project Manager to plan for risk reduction in the construction of a Medical Centre for the Mfantseman Municipality in the Central Region of Ghana. The paper focuses on the preliminary/site preparation stage of the construction and highlights an identified risk, with the view to reducing its impact on the project. In analyzing and assessing the activity the following were considered; 1. One Quantitative method was used to establish the component of the activity with the highest level of risk with regard to health 2.

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A reasoned management response would be provided based on the identified risk 3. A proposal for monitoring the impact of the management response was also considered 1. 0INTRODUCTION Amicus Onlus is a not for profit organization that seeks to provide interventions in the areas of education and health to the Ghanaian population. Its health interventions however dwell on identifying rural communities that are deprived from access to medical care, and providing the infrastructure, the medical personnel and other logistics to ensure that the people benefit from quality health care.

The organization has over the years earned a good reputation for itself in this area given how well the three (3) health centres it has established in 3 other rural communities have been doing. Ghana currently has an estimated population of twenty four million (24,000,000) people but suffers from acute health services especially in the rural areas. The Country’s patient to doctor ratio is 1:13,000, but, this is unevenly distributed to the detriment of rural communities. Amicus’ mode of intervention has always been to attract volunteer doctors from abroad, who will practice on rotational basis at its centers.

Amicus’ health centers are run in collaboration with the Ghana Health Services, the mandated body for the provision of medical services in Ghana. The Medical Centre for the people of Mfantseman, in the central region of Ghana, is Amicus’ fourth (4th) initiative in this regard. This paper seeks to look into some risks factors that arose at the preliminary stage of the construction of this 4th Health Centre, with the view to analyzing how it was managed to reduce impact and what monitoring measures were put in place.

The paper will also focus on lessons learned and how this lesson could be replicated in other similar projects of the organisation. 2. 0SCOPE STATEMENT For the Medical Centre to be put up, the Local Authorities of the Mfantseman Municipality had to make land available. The land earmarked for the project was examined by the Project Management team before the Architect sought to start his drawing. After the designs, estimates and building permits were secured, the 11th of September 2011 was set for the ground-breaking ceremony for the construction works to officially commence.

On this day, there was an unexpected heavy down pour in the municipality, which haltered the ground breaking event. After the rains, it was decided that because officials had already travelled far and near for the event, it would be good to have a symbolic ground breaking. Getting to the site, it was realized that the entire area of land that had been cleared for the Medical Centre was flooded. A number of reasons were propounded to explain the incident. With this as a lesson, the project team sought to carry out a risk analysis, which was hitherto not considered, before commencing the project.

This was agreed to be necessary in order to anticipate all risks and avert any future surprise, but mostly importantly, to ensure that the project is not hindered in its adherence to both time and money. It therefore became imperative to first and foremost, create the necessary sensitization and awareness amongst all stakeholders on the need to halt the project and proceed only when a risk identification and management procedure has been considered 2. 1 RISK ANALYSIS

The risk analysis was first carried out in the context of identifying all potential threats which might pose risks to the project; Natural Disasters, Theft of Materials, Power losses, Accidental Errors, Power losses and Human errors due to limited skills and expertise, were the factors that were considered. For each of these factors, it was necessary to establish the probability of occurrence, the impact it will have on the project and the cost of mitigation. This was also necessary in ensuring that the project team is not distracted by symptoms but rather, root causes. . 2 Risk Analysis Procedure The risk analysis was preceded by a risk identification phase that involved all members of the team. The object was to identify all the related risks that could possible hinder the execution of the project. The risks identified were grouped into five (5); Force Majeure (as a result of torrential rain), Theft of materials, Accidental errors (lack of knowledge on safety), Power Losses (due to electrical power failure or disruption, Human errors (due to limited skills and expertise). All of the risks were assessed as negative.

The qualitative risk analysis was started with a Probability/Impact assessment. Depending on the perceived gravity of the risks being considered, low, medium and high were assigned. Table 2a) Probability & Impact Assessment Identified Risk EventsRisk ProbabilityRisk Impact 1. Force MajeureMediumHigh 2. Theft of MaterialsLowLow 3. Accidental ErrorsLowMedium 4. Power LossesMediumLow 5. Human ErrorsMediumMedium Of the five risks identified, the risk of force majeure was considered the most significant, attracting a medium probability and a high impact.

The next stage was to assign values of 1-5 to the risks based again on probability and impact with 1 being the least and 5 being the highest Table 2b) Assigning Values to Probability and Impact of Identified Risk Identified Risk EventsRisk ProbabilityRisk Impact 1. Force Majeure (FM)35 2. Theft of Materials (TM)22 3. Accidental Errors (AE)23 4. Power Losses (PL)32 5. Human Errors (HE) 33 Chart 2a) As evident from the chart, force majeure (FM) was the most significant risk and hence, it had to be subjected to a quantitative analysis.

The quantitative analysis is necessary in identifying which areas will be heavily impacted on by the risk so as to identify and allocate the appropriate remedial measure. 3. 0QUANTITATIVE RISK ANALYSIS This was necessary in accessing the probability of achieving specific project objectives, to quantify the effect of the risk on the project’s general objective, and to prioritize the risk based on its significance to the project. Although a number of methods were available to choose from, the Event Tree method was found to be most ideal in this context.

It is authoritative to mention that the meteorological department of the Mfantseman District Assembly assisted the project team with data for the analysis. The department, together with the municipality’s building agency also validated the accuracy of the information used for the probability impact assessment. Largely, frequency of flooding in the area was estimated to the once a year while the accuracy of the data gathered for the probability and impact assessment was estimated to be 80% accurate. 3. 1The Event Tree The event tree seeks to look at the possibility of the event occurring and the mitigation factors that have been put in place.

Chart 3) Using Drains on a Flooded Site It is authoritative to note that the risk of flooding had a low impact on the project and as such, did not pose a huge threat as to whether the project should be pursued or stopped forfeited completely. The total mitigation factors considered were all together less than 20% of the cost of the project. Regardless however, the opportunity was provided to make adequate provision for the risk aside the contingency that had already been considered within the project estimate 3. 2Risk Response

Largely, the risk of force Majeure due to unexpected heavy rains was considered to be a negative risk and hence a threat to the project. In this regard, the strategy chosen was not to avoid of transfer, but to mitigate, with due consideration to its low effect on both cost and time. The construction of a proper drainage to ensure free and regular flow of rainwater, working on a slope gradient that ensures that water collects and flows into the constructed drains raising the substructure and introducing a damp proof membrane (DPM) in the substructure, were all together recommended as an adequate response to the identified risk . 0CONCLUSIONS AND SUGGESTIONS FOR IMPROVEMENTS In order to ensure that the indentified risk response yields the expected outcomes, it became necessary keep a risk register, from where weekly progress on the implementation of the response will be monitored through during and after the duration of the project. Such monitoring will also help in identifying secondary risks if any.

It was obvious that without a risk management approach, the team would have been engaged in “firefighting” which had to tendency of affecting, quality, time and budget of the project. Both team members and stakeholders were satisfied that a risk management procedure had been introduced into the project and saw the decisions as a prudent use of time and effort. The community leaders sought to adopt the conclusions and recommendations to inform future decisions on construction projects within the area.

References: FROSDICK, S. , 1997. The Techniques of Risk Analysis are Insufficient in Themselves. Disaster Prevention and Management, AMRAM, M. , & KULATILAKA, N. (1999): REAL OPTIONS. HARVARD BUSINESS SCHOOL PRESS. CHAPMAN, C. , & WARD, S. (1997): PROJECT RISK MANAGEMENT. JOHN WILEY & SONS. COURTNEY, H. , KIRKLAND, J. , AND VIGUERIE, P. (1997): STRATEGY UNDER UNCERTAINTY. HARVARD BUSINESS REVIEW. NOVEMBER/ DECEMBER

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