Unit of Competency Mapping – Information for Teachers/Assessors – Information for Learners

PSPPROC501A Mapping and Delivery Guide
Manage contract risk

Version 1.0
Issue Date: May 2024


Qualification -
Unit of Competency PSPPROC501A - Manage contract risk
Description This unit covers management of risks associated with contracts. It includes assessing risk, and preparing, implementing and reviewing a risk management plan.In practice, managing contract risk may overlap with other public sector generalist and specialist work activities such as acting ethically, complying with legislation, providing client service, providing leadership, developing policy, undertaking negotiations etc. This is one of 4 units of competency in the Procurement&Contract Management Competency field that address the requirements of contract management performed by specialist contract managers.Related units are:PSPPROC502A Establish contract management arrangements PSPPROC503A Manage contract performancePSPPROC504A Finalise contractsThis is a new unit of competency, added to the Procurement&Contract Management Competency field of the Training Package in 2004.
Employability Skills This unit contains employability skills.
Learning Outcomes and Application
Duration and Setting X weeks, nominally xx hours, delivered in a classroom/online/blended learning setting.
Prerequisites/co-requisites
Competency Field Procurement&Contract Management
Development and validation strategy and guide for assessors and learners Student Learning Resources Handouts
Activities 		Slides
PPT 		Assessment 1 Assessment 2 Assessment 3 Assessment 4
Elements of Competency Performance Criteria              
Element: Assess risk
  • Legislation, policies, business processes and resources impacting on the contract are identified
  • Contract deliverables and internal inputs necessary for effective contract performance are identified
  • Critical success factors necessary for the achievement of contract deliverables are identified and confirmed
  • Non-trivial business risks relating to the contract are identified
  • Causes of risk are analysed and their potential impact is determined
  • Likelihood of risks is determined and risk ratings are developed
       
Element: Prepare risk management plan
  • A preliminary risk management plan is developed that addresses risks identified in the planning phase of the contract
  • Risks that will be accepted and those requiring treatment are identified
  • Treatments that reduce risks to an acceptable level are designed in accordance with organisational requirements
  • A plan for implementing new treatments, additional controls or modifications to existing controls is developed
  • Where risks relate to the business context, risk management policies and procedures are reviewed and developed/amended
  • Risk level is re-checked in the contract development phase, and the risk management plan is reviewed and adjusted to cover contract management risks not already identified
       
Element: Implement and review risk management plan
  • Risk controls and treatments are implemented in accordance with the treatment plan
  • The risk management plan is implemented, and regularly reviewed and revised to include potential or emerging risks during the life of the contract
  • Review results are used to improve risk treatments and controls
       


Evidence Required

List the assessment methods to be used and the context and resources required for assessment. Copy and paste the relevant sections from the evidence guide below and then re-write these in plain English.

The Evidence Guide specifies the evidence required to demonstrate achievement in the unit of competency as a whole. It must be read in conjunction with the Unit descriptor, Performance Criteria, the Range Statement and the Assessment Guidelines for the Public Sector Training Package.

Units to be assessed together

Pre-requisite units that must be achieved prior to this unit: Nil

Co-requisite units that must be assessed with this unit: Nil

Co-assessed units that may be assessed with this unit to increase the efficiency and realism of the assessment process include, but are not limited to:

PSPETHC501B Promote the values and ethos of public service

PSPGOV504B Undertake research and analysis

PSPGOV505A Promote diversity

PSPGOV511A Provide leadership

PSPGOV517A Coordinate risk management

PSPLEGN501B Promote compliance with legislation in the public sector

PSPPROC502A Establish contract management arrangements

PSPPROC503A Manage contract performance

PSPPROC504A Finalise contracts

Overview of evidence requirements

In addition to integrated demonstration of the elements and their related performance criteria, look for evidence that confirms:

the knowledge requirements of this unit

the skill requirements of this unit

application of the Employability Skills as they relate to this unit (see Employability Summaries in Qualifications Framework)

management of contract risk in a range of (3 or more) contexts (or occasions, over time)

Resources required to carry out assessment

These resources include:

legislation, policy, procedures and protocols relating to contract risk management

case studies and workplace scenarios to capture the range of contract risk situations likely to be encountered

Where and how to assess evidence

Valid assessment of this unit requires:

a workplace environment or one that closely resembles normal work practice and replicates the range of conditions likely to be encountered when managing contract risk, including coping with difficulties, irregularities and breakdowns in routine

management of contract risk in a range of (3 or more) contexts (or occasions, over time)

Assessment methods should reflect workplace demands, such as literacy, and the needs of particular groups, such as:

people with disabilities

people from culturally and linguistically diverse backgrounds

Aboriginal and Torres Strait Islander people

women

young people

older people

people in rural and remote locations

Assessment methods suitable for valid and reliable assessment of this competency may include, but are not limited to, a combination of 2 or more of:

case studies

portfolios

questioning

scenarios

authenticated evidence from the workplace and/or training courses

For consistency of assessment

Evidence must be gathered over time in a range of contexts to ensure the person can achieve the unit outcome and apply the competency in different situations or environments

Submission Requirements

List each assessment task's title, type (eg project, observation/demonstration, essay, assignment, checklist) and due date here

Assessment task 1: [title]      Due date:

(add new lines for each of the assessment tasks)

Assessment Tasks

Copy and paste from the following data to produce each assessment task. Write these in plain English and spell out how, when and where the task is to be carried out, under what conditions, and what resources are needed. Include guidelines about how well the candidate has to perform a task for it to be judged satisfactory.

REQUIRED SKILLS AND KNOWLEDGE

This section describes the essential skills and knowledge and their level, required for this unit.

Skill requirements

Look for evidence that confirms skills in:

analysing risks associated with procurement and contracting

interpreting complex, formal documents

writing plans requiring reasoning and precision of expression

responding to diversity, including gender and disability

applying occupational health and safety and environmental requirements in the context of contract risk management

Knowledge requirements

Look for evidence that confirms knowledge and understanding of:

Commonwealth/State/Territory Government legislation, policies, practices and guidelines relating to contract risk management, including environmental purchasing guidance

risk management procedures

probity principles and issues

risks associated with financial and accounting issues relevant to the contract

public sector legislation including occupational health and safety and environment

aspects of law of contracts, trade practices law and commercial law relevant to contract risk management relating to complex procurement

equal employment opportunity, equity and diversity principles

The Range Statement provides information about the context in which the unit of competency is carried out. The variables cater for differences between States and Territories and the Commonwealth, and between organisations and workplaces. They allow for different work requirements, work practices and knowledge. The Range Statement also provides a focus for assessment. It relates to the unit as a whole. Text in italics in the Performance Criteria is explained here.

Information sources used to assess risk may include

computer modelling

sensitivity analysis

structured interviews

statistical data

questionnaires

fault trees

analysis of consequences - loss of money, time, labour, intangibles

Legislation and policies may include

Commonwealth and State/Territory legislation including equal employment opportunity and anti-discrimination law

national and international codes of practice and standards

the organisation's policies and practices

government policy

codes of conduct

national competition policy

Risk ratings

differentiate between risks that have:

high impact/consequence/likelihood and those having

lowimpact/consequence/likelihood

Risk management is

a logical and systematic process of identifying, analysing, assessing, treating, and monitoring risks related with any strategy, plan, process, program or procedure that will enable the organisation to minimise losses and maximise opportunities

often considered in relation to an organisation's:

people

assets and physical environment

reputation and image

legal issues

business continuity

finances

stated outcomes

Risk controls may include

hierarchy of controls

aversion

risk mitigation

reduction in likelihood

reduction of consequences

transfer of responsibility

retention

Copy and paste from the following performance criteria to create an observation checklist for each task. When you have finished writing your assessment tool every one of these must have been addressed, preferably several times in a variety of contexts. To ensure this occurs download the assessment matrix for the unit; enter each assessment task as a column header and place check marks against each performance criteria that task addresses.

Observation Checklist

Tasks to be observed according to workplace/college/TAFE policy and procedures, relevant legislation and Codes of Practice Yes No Comments/feedback
Legislation, policies, business processes and resources impacting on the contract are identified 
Contract deliverables and internal inputs necessary for effective contract performance are identified 
Critical success factors necessary for the achievement of contract deliverables are identified and confirmed 
Non-trivial business risks relating to the contract are identified 
Causes of risk are analysed and their potential impact is determined 
Likelihood of risks is determined and risk ratings are developed 
A preliminary risk management plan is developed that addresses risks identified in the planning phase of the contract 
Risks that will be accepted and those requiring treatment are identified 
Treatments that reduce risks to an acceptable level are designed in accordance with organisational requirements 
A plan for implementing new treatments, additional controls or modifications to existing controls is developed 
Where risks relate to the business context, risk management policies and procedures are reviewed and developed/amended 
Risk level is re-checked in the contract development phase, and the risk management plan is reviewed and adjusted to cover contract management risks not already identified 
Risk controls and treatments are implemented in accordance with the treatment plan 
The risk management plan is implemented, and regularly reviewed and revised to include potential or emerging risks during the life of the contract 
Review results are used to improve risk treatments and controls 

Forms

Assessment Cover Sheet

PSPPROC501A - Manage contract risk
Assessment task 1: [title]

Student name:

Student ID:

I declare that the assessment tasks submitted for this unit are my own work.

Student signature:

Result: Competent Not yet competent

Feedback to student

 

 

 

 

 

 

 

 

Assessor name:

Signature:

Date:

Assessment Record Sheet

PSPPROC501A - Manage contract risk

Student name:

Student ID:

Assessment task 1: [title] Result: Competent Not yet competent

(add lines for each task)

Feedback to student:

 

 

 

 

 

 

 

 

Overall assessment result: Competent Not yet competent

Assessor name:

Signature:

Date:

Student signature:

Date: