Title: Project Based Risk Management Defusing a potential ticking time bomb
1Project BasedRisk ManagementDefusing a
potential ticking time bomb
- What is Risk Management?
- Why do we need to manage Project Risk?
- How do we manage Project Risk?
2What is Risk?
- Risk is an uncertain event or condition that,
if it occurs, has a positive or negative effect
on a projects objectives. PMBOK Third
Edition
3Risks That Can Effect a Project
- The technology used on the project
- The environment in which the project is executed
- The relationships between team members
- How well the project fits the culture or business
area or strategic objectives of the agency - How great of a change will result from the
project
4Project Risk can increase when you have
Lack of communication and information
Lack of authority and/or responsibility
5Using Risk Management to Plan
- Identify risk mitigation strategies
- How can we fix it?
- Are we working on the right risks?
- Identify risk contingency strategies
- If we cant fix it, how do we do it differently?
- Develop Action Plans
- Prioritize items
- Minimize impact
- Dont over-correct
6PMM Risk Management Steps
7Risk Management Strategy Development
- Decide on a Risk Management Methodology
- Identify Risk Assumptions
- Define Risk Management Roles and Responsibilities
- Define Risk Management Timeframes
- Define Risk Communication Strategy
- Define How Risks Are to be Tracked
- Define any Risk Thresholds
- Define Ranking/Scoring Techniques
8Identifying Risk
- Some Techniques
- Brainstorming
- All team members participate - include
stakeholder perspectives - Initially list all potential risks, no matter how
small - Watch for contradictory information
- SME Interviews
- Project Documents
- Deliverable Descriptions
- Specifications Documents
9Identifying Risk(continued)
- Categorizing Risks
- Technical, Quality, or Performance risks
- Project Schedule risks
- Project Management risks
- Organizational risks
- External risks
10Risk Analysis
- Qualitative Analysis
- Individual Risk Ranking
- Probability/Impact Matrix (below)
- Overall Risk Ranking of the Project
11Risk Analysis(continued)
- Quantitative Analysis
- Sensitivity Analysis
- Decision Analysis
- Note Not every Risk needs Quantitative Analysis
only those that need to be highly quantified,
such as needing to determine certain cost and
time objectives for the project.
12Risk Response Planning
- Risk Avoidance
- Eliminate Cause
- Risk Transfer
- Purchase Insurance
- Subcontract high risk tasks
- Risk Mitigation
- Minimize Probability
- Minimize Impact
- Risk Acceptance
- Contingency Plans
13Risk Monitoring and Control
- Using the Risk Management Plan to monitor risk
(periodically reviewing the known risks) and
controlling risk (mitigating and tracking known
risks) - Dealing with actual risk events (taking
corrective action) - Identifying new risks
- Updating the Risk Management Plan
14PMM Risk Management Template
General Info
Risk Management Strategy
Risk Identification
Qualitative and Quantitative Analysis
Risk Response Planning
15State of Michigan Project Management
Methodology(PMM)
- More information on Risk Management can be found
in the - PMM starting on page 3-70