risk management session 2 summer i 2010

8/7/2019 Risk Management Session 2 Summer I 2010

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Risk ManagementRisk Management

Delaware State University Delaware State University

Session 2


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QuantitativeRisk Analysis

QualitativeRisk Analysis

11.611.611.511.5

RiskIdentification

RiskManagement

Planning

Project RiskManagement

11.0

11.311.311.211.211.111.1 11.411.4

RiskResponsePlanning

RiskMonitoring& Control


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Definition: The processes concernedDefinition: The processes concernedwith conducting risk managementwith conducting risk management

planning, identification, analysis, responsesplanning, identification, analysis, responsesand control on a project.and control on a project.Increasing the probability and consequences of Increasing the probability and consequences of

positive eventspositive eventsDecreasing the probability and consequences of Decreasing the probability and consequences of adverse events to project objectives.adverse events to project objectives.


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O bjectivesO bjectivesYou will be able to initiate perform Risk You will be able to initiate perform Risk Management P lanning as described in para 11.1Management P lanning as described in para 11.1P MBOK P MBOK You will be able to perform Risk Identification asYou will be able to perform Risk Identification asdescribed in para 11.2 P MBOK described in para 11.2 P MBOK


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I dont know what I dont know

I know what I dont know

I know what I know


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Risk IdentificationRisk IdentificationThe DefinitionThe Definition

Determining which risks might affect theDetermining which risks might affect theproject, and documenting theirproject, and documenting theircharacteristics.characteristics.


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O utputsO utputsRisk RegisterRisk Register

List of Identified RisksList of Identified RisksP otential ReponsesP otential Reponses


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Wh at are t h e projectsWh at are t h e projectsobjectives?objectives?

Project Charter Project Charter Wh at is t h e completeWh at is t h e completedefinition of t h edefinition of t h eproject?project?Project Scope Statement Project Scope Statement H ow will t h e project beH ow will t h e project beexecuted, monitoredexecuted, monitoredand controlled?and controlled?Project Management Plan Project Management Plan

Risk Identification: What do I need to know?Risk Identification: What do I need to know?

Wh at are t h e pre-definedapproac h es to Risk Management?O rganizational Process Assets O rganizational Process Assets

Wh at are t h e attitudes

toward Risk and Risk Tolerance?E nvironmental and O rganizational E nvironmental and O rganizational Factors Factors


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Tec h nical Risk Tec h nical Risk Quality Quality P erformanceP erformanceTechnical failureTechnical failureP oor assumptionsP oor assumptions

P roject ManagementP roject Management

Risk Risk ScheduleScheduleCostCostIncomplete planning Incomplete planning

Lack of DisciplineLack of Discipline

Types of P roject Risks and O pportunities

O rganizational Risk

Lack of P rioritization

Inadequate funding, time,resources

Resource Conflict

E xternal Risk

Shifting regulatory requirements

Labor issuesP olitical issues

Acts of God


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Review documentsReview documentsGather informationGather informationUse checklistsUse checklistsAnalyze assumptionsAnalyze assumptions

Influence AnalysisInfluence AnalysisDiagram process impacts on one anotherDiagram process impacts on one another

Risk Identification: what do I do?


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Information Gathering TechniquesInformation Gathering TechniquesBrainstorming Brainstorming DelphiDelphiInterviewing Interviewing Root Cause IdentificationRoot Cause IdentificationSW O T analysisSW O T analysis


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Influence Analysis

Keep SatisfiedKeep Satisfied Manage CloselyManage Closely

MonitorMonitor

(Minimum E ffort)(Minimum E ffort) Keep InformedKeep Informed

P

O

W

E

R

LO W

HIGH

INTERESTLO W HIGH


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Problem

Material

Cause

Effect

Risk

Identification11.2

Personnel Method

Is h ikawa (Fis h bone) Diagram


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P rocess Flow C h art


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Risk Breakdown Structure (RBS)


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WBSWBSRBSRBS

Cost estimatesCost estimatesDuration estimatesDuration estimatesStaffing P lanStaffing P lanP rocurement Management P lanP rocurement Management P lan

Risk Identification: Consider

Dont ForgetSpecifications

P erformance CriteriaCustomer expectations.Customer major wantsMajor project disciplines and interfaces

Assumptions


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Risk RegisterRisk RegisterList of identified risksList of identified risksSymptoms or warning signsSymptoms or warning signsList of potential responsesList of potential responses

Root causes of risk Root causes of risk Updated risk categoriesUpdated risk categories

P roject Management P lan (Update)P roject Management P lan (Update)

Risk Identification: H ow does it fit into t h e process?


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QuantitativeRisk Analysis

QualitativeRisk Analysis

11.611.611.511.5

RiskIdentification

RiskManagement

Planning

Project RiskManagement

11.0

11.311.311.211.211.111.1 11.411.4Risk

ResponsePlanning

RiskMonitoring& Control


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Q ualitative Risk AnalysisQ ualitative Risk AnalysisP rioritizing risks for subsequent further analysis or actionP rioritizing risks for subsequent further analysis or action

by assessing and combining their probability andby assessing and combining their probability andimpacts.impacts.

P rioritizes risksP rioritizes risksDetermines the importance of addressing specific risksDetermines the importance of addressing specific risksGuides risk responsesGuides risk responsesRapid and CostRapid and Cost--effectiveeffective


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H ow will risk be managedH ow will risk be managed

for t h e overall P roject?for t h e overall P roject?Project Management Plan Project Management Plan (particularly the Risk Management (particularly the Risk Management Plan and the Risk Register)Plan and the Risk Register)H

ow h

as Risk beenH

ow h

as Risk beenmanaged before and w h atmanaged before and w h ath ave we learned?h ave we learned?O rganizational Process Assets O rganizational Process Assets

Q ualitative Risk AnalysisQ ualitative Risk Analysis - - ConsiderConsider

Wh at is t h e project progress

th roug h out t h e life cycle?W ork Performance Information W ork Performance Information Wh at type of project is

th is?

Project Scope Statement Project Scope Statement Wh at information do we

h ave on Identified Risks?Risk Register Risk Register


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Evaluate risk probability & impactEvaluate risk probability & impact

Use a risk probability & impact matrixUse a risk probability & impact matrixAssess data precisionAssess data precisionCategorize RisksCategorize Risks

RBSRBSWBSWBSAssess Risk Urgency Assess Risk Urgency

Wh at are t h e steps?


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Rating Risk Impact


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Risk ManagementRisk ManagementP robabilityP robability- -Impact MatrixImpact Matrix

P robabilityP robability Risk Score = P x IRisk Score = P x I

0.90.9 0.050.05 0.090.09 0.180.18 0.360.36 0.720.720.70.7 0.040.04 0.070.07 0.140.14 0.280.28 0.560.56

0.50.5 0.030.03 0.050.05 0.100.10 0.200.20 0.240.24

0.30.3 0.020.02 0.030.03 0.060.06 0.120.12 0.240.240.10.1 0.010.01 0.010.01 0.020.02 0.040.04 0.080.08

0.050.05 0.100.10 0.200.20 0.400.40 0.800.80

Impact on an objectiveImpact on an objective


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Update the Risk RegisterUpdate the Risk RegisterRelative rating or priority list of project risksRelative rating or priority list of project risksRisks grouped by categoriesRisks grouped by categoriesList of risks requiring response in the near termList of risks requiring response in the near termList of risks for additional analysis and responseList of risks for additional analysis and responseWatch lists of low priority risksWatch lists of low priority risksTrends in qualitative risk analysis resultsTrends in qualitative risk analysis results

Q ualitative Risk Analysis - O utput

risk management session 2 summer i 2010

Documents