Risk management lies on risks’ identification and anticipation of their occurrence. Thanks to their multisectoral and cross-cultural experience our experts contemplate the possible risks and can strengthen the awareness of each project team member. We are also able to scrutinize the full set of projects of a company during a merger and acquisition operation.
Risk analysis in major projects
Throughout the entire life cycle of a contract, we perform the analysis of the risks inherent to major projects, in the areas of industry and construction. Our services in risk management are included or complementary to our contract management operational assistance services.
Risk management ahead of the Project
We can perform a Project Risk Audit, in bid phase or as soon as a new contract is signed. Our approach includes the realisation of a mapping of the stakeholders, a directory of the constraints linked to the execution environment and an analysis of the contract structure.
Firstly, risk management should be driven by the company’s strategic goals. Risk reduction can transform in a new opportunity for the company and lead to the creation of value. Nevertheless, the investment decided to reduce a risk should not exceed the consequences of such risk should it occur.
Our experts can pinpoint major risks and then to suggest a relevant allocation among stakeholders. This work leads to the creation of matrix of responsibilities, completed with an acute definition of the boundaries of the scope of each entity’s scope of work.
MAREEX +++ the monitoring of the Risk Register
In the course of our training sessions, we organize workshops and interviews which unite the entire project team to create a risk register. All disciplines are united to identify potential risks, inherent to the client, the subcontracting chain, the regulation, the possible cultural differences with the country where the project is executed.
We assist you in assessing the probability of occurrence and the possible impact of each risk. Our experts share best practices for updating the risk register by continuously reviewing the risk hierarchy, designating risk owners, monitoring the effectiveness of actions taken, and monitoring trigger events. The team is stepping up its vigilance and ensuring that the consequences of risks that materialize during execution are mastered as effectively as possible.
Risk management in the course of the Project
In the course of the Project Execution, we offer to perform a review of the current and future risks through a regular monitoring, in operational assistance or on-call. This review includes the prior setting of risk management, processes and procedures guaranteeing its effective implementation.
Facing disruptions, which are only risks that turn to become reality, our experts aim at suggesting mitigation measures to limit their consequences on costs, execution programme and guaranteed performances.
Should some disruptions lead to disputes between the parties and require the preparation of claims and / or counterclaims, we always seek and promote an amicable resolution allowing the rise in tensions to be alleviated and the situation to be fairly managed.
MAREEX’s success: finding a way around risks
A complex project for the refurbishing of LPG tanks was intended to be launched in a densely populated area. In addition, a pipeline was due to be installed on grounds which topography were showing huge variations. This situation was creating very big risks of various sorts. Without a suitable risk management, this project could turn out to be disastrous.
Through an in-depth risk analysis performed at the start of the project, MAREEX Experts avec suggested a relevant risk allocation among the stakeholders. This study covering the context, the technics and the scheduling has offered a definition of the scope of work of all the future contractors. It allowed to adequately select the EPC contractors.
Health-check of the Project portfolio in a M&A process
Our experts can prepare a health check of the various projects in a company’s portfolio during a merger and acquisition process. This review must be systematic: a single pathological project can indeed harm the health of an entire company, especially when it is already in a fragile situation.
Predictability of deficiencies
Failure is readily predictable when a party finds itself in a position where it has to take risks it is not able to manage, as it is outside its area of competency. This situation is frequent during the negotiation stage at the outcome of a Request for Proposal Process, where negotiation power is favorable to the project owner.
However, a poor risk allocation at the beginning of the project can lead to serious difficulties: overcosts, delays, or even the impossibility to achieve the required performances. Responsibility limitation clauses in the contract can reduce the consequences of the project failure but the company will remain affected in the long term.
A necessary Risk Audit
In addition to legal and financial analysis, a good risk analysis can detect potential failures. This kind of audit requires a solid knowledge in Project Management, in Operational Risk Management and in Dispute Management during execution. It may include diagnosis of management, technical or engineering aspects according to the needs. MAREEX Experts benefit from the necessary experience and technical knowledges that are required to perform it. We perform:
- an analysis of the quality of the specification, and specifically the performance criteria
- the evaluation of the project environment: constraints, level of involvement of the third parties, regulations, cultures involved…
- an elaboration of a cartography of each stakeholder: strengths and weaknesses, ability to deal with risks,contract management culture…
- the review of the contractual protective measures: notice, responsibility limitation clauses, extraordinary conditions, warrantee exclusions, …
We can suggest a relevant risk allocation between the signing parties through an equitable breakdown of risks in consideration of their actual competencies and in suggesting mitigation measures. Failing that, our audit may lead to the termination or the suspension of the merger and acquisition process, subject to negotiations.