While constructing the project plan, the planner should always consider the risk of an unplanned event occurring along the way. Based on the risk assessment, a contingency plan is devised to mitigate the probable risks. A contingency plan enables an organisation to counter unplanned events and continue its business operations. Such a plan is also called a ‘reactive plan’ as it is applied in reaction to the occurrence of an unplanned event. Example of unplanned events may include bankruptcy of the main supplier, receiving huge orders from customers, and breakdown of equipment.
Short Notes on Contingency plan
While constructing the project plan, the planner should always consider the risk of an unplanned event occurring along the way. Based on the risk assessment, a contingency plan is devised to mitigate the probable risks. A contingency plan enables an organisation to counter unplanned events and continue its business operations. Such a plan is also called a ‘reactive plan’ as it is applied in reaction to the occurrence of an unplanned event. Example of unplanned events may include bankruptcy of the main supplier, receiving huge orders from customers, and breakdown of equipment.