BBVA Banco Continental (bancos y financieras – Continc1)

To recognize risks, it helps to highlight assumptions about external conditions that are required for the project to achieve its objectives. Assumptions are positive statements about the conditions in the target market, generally social, economic, or cultural. As illustrated in Figure IV, there are assumptions at each level of the causal chain that need to be confirmed in order for the next level of objectives to be achieved.

Tip: Consider a stakeholder discussion, potentially including a SWOT (Strengths, Weaknesses, Opportunities and Threats) analysis to identify risk and mitigation strategies.

Tip: While not always the case, the root causes identified in the problem analysis are often closely tied to potential risks.

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A. Start with the Summary of Intervention (Worksheet #6) for each Solution. First, consider what must hold true for the stated intervention to lead to sustainable delivery of the solution. Next, identify what is necessary for that delivery to result in the desired outcome. Finally, recognize what assumptions must hold true for the outcome to lead to the expected value chain result. For example, the following traces the assumptions that must be in place to enable female farmers to increase productivity:

63 a) Start with the Summary of Intervention (Worksheet #6) for each Solution. First, consider what must hold true for the stated intervention to lead to sustainable delivery of the solution. Next, identify what is necessary for that delivery to result in the desired outcome. Finally, recognize what assumptions must hold true for the outcome to lead to the expected value chain result. For example, the following traces the assumptions that must be in place to enable female farmers to increase productivity: b) Repeat part a) with each intervention. Write these down in the blank Risk Manager Table provided at the end of the chapter.

Figure IV: How Assumptions Affect Program Solutions and Outcomes Expected Value Chain Result Outcome Solution Assumptions Assumptions

Adapted from AusAID, 2005 and CIDA, 1997.

Female farmers increase productivity

Existing commercial extension

providers are aware of market amongst female, rural farmers

Female farmers have greater access to appropriate extension services

Dispersed communities do not prohibit profitable service provision Women are able to make

autonomous production decisions on new methods.

Summary of

Intervention Assumptions

Services offered are demanded by project clients and are still affordable for target farmers. Awareness campaign and product

development for extension service providers

Figure IV: How Assumptions Affect Program Solutions and Outcomes

63 a) Start with the Summary of Intervention (Worksheet #6) for each Solution. First, consider what must hold true for the stated intervention to lead to sustainable delivery of the solution. Next, identify what is necessary for that delivery to result in the desired outcome. Finally, recognize what assumptions must hold true for the outcome to lead to the expected value chain result. For example, the following traces the assumptions that must be in place to enable female farmers to increase productivity: b) Repeat part a) with each intervention. Write these down in the blank Risk Manager Table provided at the end of the chapter.

Figure IV: How Assumptions Affect Program Solutions and Outcomes Expected Value Chain Result Outcome Solution Assumptions Assumptions

Adapted from AusAID, 2005 and CIDA, 1997.

Female farmers increase productivity

Existing commercial extension

providers are aware of market amongst female, rural farmers

Female farmers have greater access to appropriate extension services

Dispersed communities do not prohibit profitable service provision Women are able to make

autonomous production decisions on new methods.

Summary of

Intervention Assumptions

Services offered are demanded by project clients and are still affordable for target farmers. Awareness campaign and product

development for extension service providers

B. Repeat part a) with each intervention. Write these down in the blank Risk Manager Table provided at the end of the chapter.

C. Once you have a list of assumptions for each solution, rephrase them as negative statements to identify the risks of various external conditions. For example:

64 c) Once you have a list of assumptions for each solution, rephrase them as negative

statements to identify the risks of various external conditions. For example:

d) Write each negative statement in the Risk Manager Table, provided at the end of the chapter.

STEP 2: Assess Risks

Not all risks are equal - an important step in the risk management process is to assess the impact of each risk and the level of threat they pose to the program. Each of the risks identified in Step One should be assessed using the following Risk Decision Tree (Figure V) which measures risk based on both likelihood of occurrence and impact. For each identified risk, ask the following questions: a) Is the risk significant? Will it have a substantial impact on the project’s progress? x If not, then you can disregard the risk. x If yes, then continue with question b. b) Is the risk likely to occur? x If unlikely, then again you can exclude from the design process. x If moderately likely, add it to Risk Manager, proceed to Step Three and develop mitigation strategy. x If the risk is almost certain or extremely likely to occur, proceed with question c. c) Can the program as planned be adapted to reduce the influence of the risk? x If no, re-examine whether you should proceed with the program. x If yes, revisit the constraints analysis to develop alternative solutions and interventions. Women are able to make

autonomous production decisions on new methods.

Women are not prevented by socio-cultural norms from deciding about and applying learnings.

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