TOPIC 5 PROJECT RISK MANAGEMENT
Risk Def:
An uncertain or unforeseen event may occur and affect the outcome or success negative / positive of the project
NB:RISK ELEMENTS
• POLITICAL
Change in the government policy – lead to change in the development of a project
• PROFESSIONAL
Nature of profession
• ECONOMIC
Economical status of the country. Inflation
• SOCIO CULTURAL
Demographic change – Structure of population
• HEALTH AND SAFETY
Provide safety for workers
• TECHNOLOGICAL
Current system become obsolete or opportunities from technological development
• CONTRACTUAL
Failure to meet contract agreement
• ENVIRONMENTAL
Meet the environmental changes
• OPERATIONAL
Enough resources on production
FORCE MAJEURE(GREAT FORCE)
Extra-ordinary circumstance cannot be controlled by parties
Prevents the parties from complying with the contract when event aroused
TOPIC 5 PROJECT RISK MANAGEMENT
Risk Def:
An uncertain or unforeseen event may occur and affect the outcome or success negative / positive of the project
NB:RISK ELEMENTS
• POLITICAL
Chang the in government policy – lead to change in the development of a project
• PROFESSIONAL
Nature of profession
• ECONOMIC
Economical status of the country. Inflation
• SOCIO CULTURAL
Demographic change – Structure of population
• HEALTH AND SAFETY
Provide safety for workers
• TECHNOLOGICAL
Current system become obsolete or opportunities from technological development
• CONTRACTUAL
Failure to meet contract agreement
• ENVIRONMENTAL
Meet the environmental changes
• OPERATIONAL
Enough resources on production
FORCE MAJEURE(GREAT FORCE)
Extra-ordinary circumstance cannot be controlled by parties
Prevents the parties from complying with the contract when event aroused
TOPIC 5 PROJECT RISK MANAGEMENT
NB:PHASES IN THE RISK MANAGEMENT PROCESS • IDENTIFY THE RISK • ASSESS THE RISK • RESPOND TO THE RISK • MONITOR THE RISK
― Screen all the project document to determine which risk may affect project
― To identify future event that may affect the project PROJECT DOC Project Scope Statement WBS Project Schedule Project Budget Stakeholder Analysis
― What effects the risks could have on the success of the project
― Quantifies the frequency of occurrence and the impact
― Measure by probability and impact . Pg 238 ― Likelihood and impact
• CLASSIFICATION OF RISK • PG 238
Outlines what to do if the risk is becomes reality.
• NB:RISK MANAGEMENT STRATEGIES ― Accept risk - Take the chance that the risk will not
occur ― Avoid risk - Change the whole project plan ― Mitigation/ Reduced - Try to reduce the chances
for the risk to happen ― Outsource – Outsource the resources
• MITIGATE/REDUCE RISK ― Identify activities to reduce or stop risk ― Identify activities to recover from risk ― Identify activities to take advantage of risk
TOPIC 5 PROJECT RISK MANAGEMENT
NB:REASON FOR RISK TO BE AVOIDED
•
• When the risk outweight the possible benefits.
• When there are no specific benefits to be gained.
• When the odds are not in favour of a positive outcome.
• When there are several possible alternatives.
• When there is not enough data to identify the possible outcome.
• When the risk does not help to achieve project goals
TOPIC 5 PROJECT RISK MANAGEMENT
MONITOR AND CONTROL
― Monitor and control on-going project activities against the project management plan
― To implement the risk management plan by training team and communicate to all stakeholders
METHODS TO MONITOR AND CONTROL PROJECTS RISKS
• OBSERVATION
― Must be done randomly by project manager
― Ask question to keep up to date with project progress
• REGULAR REVIEWS
― Hold meetings to discuss progress
• Schedule evaluations
― Compare the actual quality output against the plan
TOPIC 6 REVIEW PROJECT EXPERIENCES
REVIEW PROJECT EXPERIENCES
• Provides opportunity for a project manager and team to learn experience from the project
• The manager review the achievement and improvements for the project
PROJECT EVALUATION(purpose of project evaluation)
• It is a research-based process of examining the success of a project
• Evaluation must be carried out by external people ( Evaluators) not by project implementers
• Evaluators must assist to determine major problems encountered in the project
• Project manager evaluate in order to compare the progress against original plan or objectives
THE PRINCIPLES OF EVALUATION • It should be impartial (fair) and independent
• Evaluation and project activities should be separate and done by different people
• Evaluators should have experience and expertise
• The process should be transparent
• There should be a distinction between findings and recommendation
• Evaluation should be useful , present information, clearly and concisely
• Involve stakeholders affected to raise views on project
TOPIC 6 REVIEW PROJECT EXPERIENCES
THE PURPOSE AND TIMING OF EVALUATION
• During implementation (Execution)
To review progress and propose alterations to project design
• At the end of a project
To record lessons learned to improve future project design
• Afterwards (ex- post evaluation)
After completion of a project. Focuses on impact of the project
FINAL PRODUCT EVALUATION
• Determine the overall quality of the product
• Implement a mechanism for improving or maintaining the quality
• Evaluates the product against the original objectives
• Identifies outages (shortcomings) in the final product
• Determines how to address any shortcomings
• INITIATE A MAINTENANCE PROCESS
It is an on going process, and it includes continuing support of the project and correctional errors e.g Inspection, preventive maintenance.
• PROCESS IMPROVEMENT
It is the final step in a quality process. It identifies the lessons learnt in the project. If likely could apply to future projects.
― Involves both technical and business staff
― Cover the project process
― Identifies things that worked well
― Identifies things were not necessary
― Improves the estimating model for the process
TOPIC 6 REVIEW PROJECT EXPERIENCES
• STEPS TO FOLLOW FOR PROCESS IMPROVEMENT (Evaluator)
― Prepare End of Project Review
― Conduct End of Project Review
― Update Process Metrics
― Implement Process Improvement
• Prepare Review
• Meeting
• Facilitated workshop
• Questionnaire
• Conduct Review
• The evaluators should come with recommendations to change the process and estimating model should be recorded
• Update Process Metrics
• The evaluators should review and assess changes made.
• They must decide if changes are suitable to apply to future projects
• Implement Process Improvement
• Review the recommendation changes
• Assess each changes
• PROJECT COMPLETION (Project Manager)
It is conducted to complete all outstanding project work
• STEPS TO FOLLOW FOR PROJECT COMPLETION
• Close Outstanding Project Work
• Prepare for Project Closure Meeting
• Conduct Project Closure Meeting
• Follow Up Project Closure Meeting
TOPIC 6 REVIEW PROJECT EXPERIENCES
• PROJECT CLOSURE
When the project coming to an end there is a formal machanisms to close the project.
NB: Purpose of Project Closure
• Establishes mechanisms for the continued development or improvement of the final product of the project
• Improves the standard process for this type of project
• Updates the estimating model for this type of project
• Project resources can be re-deployed
• To review of the project
• To complete unfinished activities
• Assess the extent to which the results met the expectations
• To discuss lessons learnt which could be applied to future projects
• Provides a normal ending for all procedures including delivery of the final product
• Project deliverables can be hand over
• WRAPPING UP THE PROJECT
• Preparing the final report
• Hand over Archiving of information
• Post project evaluation
• Disbanding the project team
REASON FOR LESSON LEARNED
•To improve performance for future similar projects
• Not to repeat the same mistakes with the next projects
• Develop competitive advantage
• To check if the stakeholders participated effectively during the project
• To see what was done well
• To evaluate was achievements with the project
• To identify problems encountered and recommendation for future projects
• To share the lesson learnt on previous project
• To keep record of the previous project
• To use lesson learnt as a reference for the future project