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    This document discusses concepts and practices of project risk management. It defines key risk management terms like probability, impact, and severity. It also outlines how to determine the most critical risks to a project based on factors like cost, business efficiency, and reputation. Finally, it describes different risk management strategies like acceptance, avoidance, transfer, and mitigation and when each may be applicable.

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    Assignment 1

    Uploaded by

    avinashf3
    16 views5 pages
    This document discusses concepts and practices of project risk management. It defines key risk management terms like probability, impact, and severity. It also outlines how to determine the most critical risks to a project based on factors like cost, business efficiency, and reputation. Finally, it describes different risk management strategies like acceptance, avoidance, transfer, and mitigation and when each may be applicable.

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    This document discusses concepts and practices of project risk management. It defines key risk management terms like probability, impact, and severity. It also outlines how to determine the most critical risks to a project based on factors like cost, business efficiency, and reputation. Finally, it describes different risk management strategies like acceptance, avoidance, transfer, and mitigation and when each may be applicable.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    16 views5 pages

    Assignment 1

    Uploaded by

    avinashf3
    This document discusses concepts and practices of project risk management. It defines key risk management terms like probability, impact, and severity. It also outlines how to determine the most critical risks to a project based on factors like cost, business efficiency, and reputation. Finally, it describes different risk management strategies like acceptance, avoidance, transfer, and mitigation and when each may be applicable.

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    © All Rights Reserved
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    of 5

    Project Risk Management

    PMGT730
    Term 2018-19
    Assignment 1
    Submitted By
    Student Name Student No.
    Avinash Kalayappan 301000798
    Project Risk Management

    Table of Contents

    Concepts of Project Risk Management..................................................................................1

    Risk Probability......................................................................................................................1

    Risk Impact.............................................................................................................................1

    Risk Severity..........................................................................................................................1

    Risk Categorization................................................................................................................1

    Practices of Project Risk Management..................................................................................2

    Determine the most critical risks............................................................................................2

    Determination of Risk Management Strategies......................................................................2


    Project Risk Management

    Concepts of Project Risk Management

    Risk Probability

    The probability of a risk is based on how often we believe that the risk may occur in the

    project. Risks that have a higher probability of occurrence could be attended first.

    For example: If two of the best football teams play, there would be 50% probability for either

    team to lose.

    Risk Impact

    The impact of a risk on a project may be determined by the effect it will have on the project if

    the event occurs. Risks that have high impact on the project could be the ones that we will

    need to concentrate on.

    For example: In a project that designs card pay systems for public transport(like Presto), the

    impact will be Very High if the system is a failure.

    Risk Severity

    Risk Severity is a method of measuring the probability of occurrence against the impact of

    risks in an individual project. The higher the severity of a project, the more the impact on the

    project and probability of occurrence.

    This will help in identifying the priority of the risks in a project. The risks with the highest

    severity have to be looked into first.

    Risk Categorization

    Risks can be categorized in many ways. It is best to categorize them based on the Work

    Breakdown Structure or the Risk Breakdown Structure. Risks are also categorized based on

    the priority.

    Page 1 of 3
    Project Risk Management

    This quickens the process of managing risks by grouping them and solving one group at a

    time.

    Practices of Project Risk Management

    Determine the most critical risks

    In a project there should be a baseline for the level of impact a probability of a risk on a

    project. All risks above this are to be considered critical and should be paid more attention.

    The factors of the risk including cost, business efficiency and reputation should be

    considered.

    Determination of Risk Management Strategies

    We need to choose one of the below strategies based on the management costs and impacts

    on the projects.

    1. Risk acceptance:

    We know the risk and accept its consequences. This is often sed when mitigation

    costs are too high.

    2. Risk Avoidance:

    The activity that contains the risk is eliminated. This removes the risk and benefits of

    a certain action. For example: If we don’t leave our house, we will be safe and we

    won’t gain anything out of it.

    3. Risk Transfer:

    This can be used to transfer the risk or part of the risk if the cost is worthy enough.

    For example, paying an insurance company for managing the project risks.

    Page 2 of 3
    Project Risk Management

    4. Risk Mitigation:

    Risk mitigation can be used to minimize the probability of occurrence of the risk or

    it’s impact on the project. This requires investment and is not the best solution to all

    risks.

    Page 3 of 3

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