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Week 6 Discussion

Project risk management strategies should be tailored to the specific needs of each project rather than following a one-size-fits-all approach. The essential steps in determining an appropriate risk management strategy include identifying, assessing, prioritizing, treating, and monitoring risks. Effective risk management is crucial to prevent delays, cost overruns, and declines in project quality and security.

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5 views

Week 6 Discussion

Project risk management strategies should be tailored to the specific needs of each project rather than following a one-size-fits-all approach. The essential steps in determining an appropriate risk management strategy include identifying, assessing, prioritizing, treating, and monitoring risks. Effective risk management is crucial to prevent delays, cost overruns, and declines in project quality and security.

Uploaded by

Somlata Bispat
Copyright
© © All Rights Reserved
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
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1. Are project risk management strategies “one-size-fits-all?

It's not a one-size-fits-all procedure and should be scaled to meet the needs of the project

2. What are the major steps in determining the appropriate risk management strategy for a
specific project?

Project risks can have a detrimental effect on the project's goals by causing delays, cost overruns,
and a decline in the project's quality and security, which can all lead to significant project
failures. The 4 essential steps of the Risk Management Process are:

 Identify the risk - It takes "discovering" risks before they can be effectively managed.
Identifying any incident that could potentially have a negative (risk) or good
(opportunity) impact on the project's goals is the first stage in the risk management
process. These are - project milestones, the project's financial trajectory, and the project
scope. Two common techniques to accomplish this are “experience-based” – learned
from experience and “brainstorming-based” - brainstorming meetings with client
stakeholders, and project team members.
 Assess the risk - Risk assessments can either be: qualitative or quantitative. A qualitative
analysis examines the degree of criticality in light of the likelihood and consequences of
the event. A quantitative analysis examines the event's financial impact or benefit. Both
are required for a thorough assessment of risks and opportunities. Being as unbiased as
feasible is the aim of risk assessment. The information produced by the analysis will be
false if the data entered into the schedule is biased or inaccurate, basically – garbage in,
garbage out.
 Prioritize the risk - Risks are not all created equal. To determine what resources, you
will gather to address the risk when and if it arises, you must assess the risk.
Some risks will need to be addressed right away. These are the potential risks to your
project. There is no room for failure. Other risks are significant, but they might not
jeopardize your project's success. You can respond in kind. Then there are the risks that
have little to no bearing on the project's overall budget and timeline. There may be some
importance to some of these low-priority threats, but not enough to waste time on them.
 Treat the risk - Once a list of risks has been prioritized, the following stage is to
consider the choices for addressing those risks and implement various techniques and
controls to attain an acceptable level of risk. An organization must first prepare a
remediation plan that details its strategy for managing risks. The goal of the risk
treatment strategy is to lessen the likelihood that the risk will materialize (preventive
action) and/or lessen the impact of the risk (mitigation action). The cost of a risk
mitigation plan must be integrated into the budget of the project.
 Monitor and Report on the risk - To ensure that risks stay within the boundaries set by
the organization's management, it is crucial to track and monitor results even after
completing each of the aforementioned procedures. It is necessary to monitor and report
on risks, opportunities, and the strategy for addressing them. The importance of the risk
or opportunity will determine how often this occurs. It will be made sure there are
appropriate forums for escalation and that the right risk responses are being taken by
creating a monitoring and reporting framework.

References:

Faris, R. K. & Patterson, D. (2007). Managing risk in the project portfolio. Paper presented at
PMI® Global Congress 2007—North America, Atlanta, GA. Newtown Square, PA: Project
Management Institute.

Lock, D 2014, The Essentials of Project Management, Taylor & Francis Group, Farnham.
Available from: ProQuest Ebook Central. [8 November 2022].

Royer, P. S. (2000). Risk management: the undiscovered dimension of project management. PM


Network, 14(9), 31–39.

Shenhar, A., Dvir, D., Lechler, T., & Poli, M. (2002). One size does not fit all—true for projects,
true for frameworks. Paper presented at PMI® Research Conference 2002: Frontiers of Project
Management Research and Applications, Seattle, Washington. Newtown Square, PA: Project
Management Institute.

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