Areas of key risk in Project Management

Companies believe that the most critical risk they face is market or competitive risk. There are various other risks faced by organisation and the note below outlines the method by which they are handled by organisations. The risks include:  

Political risks: This risk is not a major worry for the Indian organisations and the impact is the least. These risk are tackled in the following ways: 

• Proactive communication with the local government:  Many companies are taking initiative to build relationships with government departments. Some organisations communicate directly with the officials. They discuss the consequences of political changes and express their views.  
• Participating in Industry associations:  Industry associations (like Confederation of Indian Industry) are ideal vehicles to enhance organisation's view on policy of government and these also help as communication vehicles for company leaders to lend their views on policy
• Fraud, Bribery or corruption risks: This is a very prominent risk found all over the world. This risk is handled by Indian companies in the following way: 
• Using codes of conduct:  Global companies which have a local presence in India tackle this risk by developing codes which were developed globally and applied in India. These were part of Employee handbooks and value charters. 
• Internal and external audits:  The audits checked details and verified account balances, internal controls, regulations, compliance and corporate governance. This was followed by auditing for legal conformance. 
• Strong internal controls;  While addressing fraud risk, internal controls like day-to-day checks, stringent approval procedures and management oversight, whistleblowing policies, use of technology help in mitigation. 
• Raising awareness: Many companies educated their employees on good practices. One such example is through Training the management for Foreign corrupt Practices Act (FCPA) regulations. 
• Insurance policies: Fraud is today a part of their insurance  cover for many companies. 

Market or Competitive risks: 

• Market analysis and testing:  A continuous testing of market conditions which includes competitor analysis and customer needs is done. It is done through in-house market research departments, customised research, use of ratings and published intelligence. New product research and development is the key focus. 
• Investing in technology:  Latest technology is used to improve productivity in organisations to build competitive advantage and attract greater demand. Greater focus on quality builds good products and services. 
• Selling and brand building:  Advertisement targeted sales efforts and public relations are the key techniques used to sell and promote products. Even acquisition of new companies, launch of new products and entrance into new markets are few other techniques. 
• Workforce Risks:   As India's economy continues to boom, it is becoming harder to hire and retain talented staff, a problem faced by all the companies. The demand is particularly strong for middle and senior management, thereby, prompting companies to monitor the recruitment market closely with a view to improve retention. The following are some of the techniques adopted: 
• Training: Training and education problems are part of many organisations. 
• Competitive Salaries: Capable employees are provided good pay packets. High performers are identified and rewarded.  
• Background reference checks are performed to verify employee backgrounds