2949775129

Ostrava 8.-9. zan 2010

5. mezinarodrri konference Rizenf a modelovdnf finanćnfch rizik VŚB-TU Ostrava, Ekonomicka fakulta, katedra Financf

Methods of risk Identification in companies’ investment projects

Piotr Tworek

Abstract

The paper addresses the issues of risk identification as a separate stage, which forms an integral part of any risk management process. In particular, the author focuses on risk identification methods, which are used by companies that run investment projects. In this paper, the author draws attention to the applicability of some of these methods, based e.g. on his own experience, gained from business practice. When formulating his conclusions, he also draws on the risk management research, conducted in 25, out of 100, leading construction and assembly companies in Poland.

Key words

Risk, risk identification, risk management, construction industry.

Introduction

Looking at an entire risk management process in investment projects (planned and implemented by companies), one can see that a critical stage in this process is the stage of risk identification. At this stage, potential risks and their sources are identified. Any mistakes or errors, i.e. a failure to spot risks at an early stage of an investment project (investment planning), may lead to serious conseąuences at the project implementation and operation stages. Furthermore, a failure to identify some risk sources at the risk identification stage may result in incorrect risk ąuantification and a wrong risk response plan. Managers in companies and, in particular, risk managers and project managers have to possess appropriate methodological background in this respect. They need to know what types of methods and tools may be used, depending on a specific situation, i.e. the type of an identified risk. The paper deals exclusively with the methodological aspects of risk identification in investment projects carried out by companies. It aims, in particular, at discussing such methods and techniąues, which could be most useful in business practice. The empirical illustration are the results of the research, carried out by the author in 25, out of 100, leading construction and assembly companies in Poland. The research was conducted in the third ąuarter of 2009, within the framework of an individual research project carried out at the Department of Investments and Real-Estate, the University of Economics in Katowice, using the basie research methods, such as a questionnaire and a personal interview. The paper mainly consists of theoretical deliberations, and the problems discussed here are presented in a synthetic way.

¹ Piotr Tworek, Ph.D., The University of Economics in Katowice, Faculty of Finance and Insurance, Department of Investments and Real-Estate, 1 Maja 50 Street, 40-287 Katowice (Poland), piotr .t worek @ ae .katowice. pl