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Risk Analysis and Contingency Plan GuidelinesV2

The document provides guidelines for conducting risk analysis and developing contingency plans for projects. It outlines a three-step process: 1) identify high-risk areas in the schedule, resources, and product/technology, 2) analyze risks and quantify their potential impact, and 3) generate contingency plans to mitigate risks, such as revising schedules and resources or developing backup plans. The overall goal is to proactively identify and address potential issues that could threaten a project's timeline, budget, or deliverables.

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101 views4 pages

Risk Analysis and Contingency Plan GuidelinesV2

The document provides guidelines for conducting risk analysis and developing contingency plans for projects. It outlines a three-step process: 1) identify high-risk areas in the schedule, resources, and product/technology, 2) analyze risks and quantify their potential impact, and 3) generate contingency plans to mitigate risks, such as revising schedules and resources or developing backup plans. The overall goal is to proactively identify and address potential issues that could threaten a project's timeline, budget, or deliverables.

Uploaded by

btbowman
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOC, PDF, TXT or read online on Scribd
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Risk Analysis and Contingency Plan Guidelines

No project was ever completed on time and within budget. Identifying risks associated
with a project and mitigating them is a crucial activity of project planning.
Managers need to not only analyze project risks, but also must develop contingency
plans to address those risks. The following guidelines will help you do these activities.
(Note: This utilizes the following project management model.)

Step 1: Isolate ‘high risk points’ in the schedule & resource plans,
product/technology

 Analyze Schedule Plan


o Identify tasks on critical path
o Identify tasks that have several predecessors
o Identify tasks that have several successors
o Identify tasks with small float--the length of time a task (on a non-critical path) could be
delayed without affecting project completion date
o Identify tasks that are spread over many breaks--long weekends, holidays,
Christmas, etc.
o Identify tasks with high visibility such as where top management or customer
demonstration or involvement is required
o Identify all tasks that were optimistically estimated
o Identify tasks that are too big or too complex (too many function points
if FPA is used)
o Identify all tasks that rely on external factors--vendors, consultants, external
events, etc.

©2007-2021 Project Management Institute, Inc. 1


o Identify task that critically rely on people assigned part-time
o Identify tasks that rely upon top-management, overly busy people or the customer
for completion
o Identify unforeseen/unplanned--Review previous projects and identify activities,
events etc. that were not planned but impacted the plan schedule
o Identify major milestones and deliverables
 Analyze Resource Plan
o Identify tasks with only one individual
o Identify tasks with many individuals (more than average number)
o Identify tasks with many types of entities assigned such as co-development
teams and alpha and beta customers
o Identify part-time people
o Identify tasks that require scarce resources, highly specialized resources, etc.
o Identify under-skilled or un-qualified people
o Identify tasks that have over-qualified people assigned
o Identify people that manage large teams (larger than average)
o Identify under utilized resources
o Identify over utilized resources
o Identify resources that are assigned to a number of tasks
o Identify resources that are assigned to more than one task at the same time
o Consider illness, turnover and planned vacations
o Identify unforeseen/unplanned--review previous projects and identify resource
issues that were not planned but impacted the plan schedule
 Analyze Product/Technology/Software/Process
o Consider uncertainty of new development, modification, maintenance, etc.
o Consider dynamics of customer requirements
o Consider availability of tools and techniques
o Consider software/process/technology

 Is the technology/software/process too new?


 Are there enough users?
 How reliable is the support/maintenance, etc.? The vendor?
 Any other aspects that may impact the schedule plan?
o Consider impact of large number of defects
o Consider FURPS

 Functionality – non-trivial, critical functions, security etc.


 Usability – critical usages factors
 Reliability – critical aspects of uptime/recovery/predictability, etc.

©2007-2021 Project Management Institute, Inc. 2


 Performance – response, speed, efficiency, etc.
 Supportability – Critical issues of maintainability, compatibility
 Identify unforeseen/unplanned--review previous projects and identify
product/technology/process issues that were not planned but impacted the plan
schedule
o Identify and document all assumptions related to the project
Step 2: Analyze the risks and quantify risk factors

 What problems could occur…


o With project tasks and activities?
o With project resources?
o With product/technology/process/software?
 What would be the impact in money, elapsed time and total time…
o On overall project?
o On individual modules, milestones and deliverables?
 What is the history of similar problems? Review previous projects.
o How frequently have they occurred?
o What was the impact?
o Was there any warning and what was it?
o What solution was implemented?
 Find out if similar tasks have been allocated equivalent effort, duration and
resources.
o If not, then what would be the impact?
 Would top-management/customer commitment be affected?
 Analyze assumptions--What will happen if they turn out to be false?
Step 3: Generate Contingency Plans

 Revise Schedule plans


o Negotiate deadlines of high-risk tasks to accommodate potential slippages
o Schedule tasks later in the project, which can be postponed or cancelled if
necessary
o Estimate efforts and duration more conservatively for tasks on the critical path
o Generate new schedule taking in to account the contingency
o Complete high risks task first if possible
o Include prototype tasks to assess the risks
o Periodically revisit all assumptions
 Revise Resource plans
o Reassign strong people to high risks tasks and tasks on critical path
o Reassign resources so as to utilize them optimally
o Identify backups for people assigned to high risks tasks
o Negotiate getting more resources
 Develop backup plans

©2007-2021 Project Management Institute, Inc. 3


o Consider preventive actions that will be taken to reduce or remove risks
o Develop escalation strategy and process
o Document contingency actions that can be implemented should a problem occur
o Identify circumstances that would trigger each contingency plan
o Identify workarounds or substitutes
o Identify contingency team/resources

©2007-2021 Project Management Institute, Inc. 4

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