This is a proactive and systematic process of detailed recognition and programming required to minimize the anticipated risk in a project. It involves the project management and implementation of appropriate approaches to mitigate, control and prevent risk .For example: In order to start a new product category certain essential types of risks are kept under special consideration like; financial, legal, environmental, strategic, operational, marketing, production and advertising challenges. Strategic planning is needs to be done to cope up with all these mentioned types of risks and challenges to make new product development a successful venture.
This step entails the in depth assessment of potential vulnerabilities associated and to analyze the risk against the project. It involves complete evaluation of project from every aspect to identify the factors that can jeopardize a business venture. The complete calculation of potential risk aspects, level of damaged expected to take place, after-effects and probabilities of occurrence, and prioritizing them for handling. For example: In this phase the judgment of the above mentioned risks will be carried out in order to measure the extent, frequency and aftermaths of its happening .Main Focus will be to find out the possible impacts of new product failure or success on the already marketed product lines and the reputation of the organization.
A method to scrutinize every plan and crucial technical steps in order to discover and categorize the connected risks of a project .This process delineates different type of risks involved and prioritize the most crucial risk and in order to develop action plan . For example: In this step all the steps involved in the product development right from its idea of inception to its market delivery will be thoroughly analyzed so as to find out which factor can lead to new product failure directly.
Risk monitoring refers to constant checking and evaluation of the project progress against set standards to ensure complete compliance with the rules and safety measures and ensured success. For example: In this segment the product performance in the market will be closely monitored and comparison of the final product attributes against the prototype will be done .This will help the managers to classify the weak areas of the production and also the feedback from the customers and retailers will be collected. All the environmental factors and competitor’s strategies will also be monitored so as to make required amendments in the marketing plan of the newly launched product.
Handling of risk is the complete plot of corrective actions in order to make necessary arrangements to deter the facets causing significant risk .It devises the most suitable set of integrated strategies to combat against the damages caused by risk .For example: managers take suitable preventive and counteractive actions against the factors which may be hampering the success of the new product in marketplace.