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last updated: 13th July 2011

In procurement, risk may be defined as the chance or opportunity for something to go wrong or other problems to arise.

Main risk areas to be considered include

  • The goods or services required are not delivered on time, to budget or of an appropriate quality
     
  • There may be risks associated with financial impropriety, fraud and waste
     
  • Inadequate planning caused by something coming out of the blue – negating best efforts to plan procurement activity eg award of research grant
     
  • Missing an opportunity to do something better and more cost effectively due to inadequate timescales or an error of judgement.
     

For further information please refer to the "Management of Risk – Principles and Concepts" (the Orange Book) [pdf 438kb] published by HMT.

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