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Risk Management

Risk management involves identifying, assessing, and controlling risks to maximize opportunities and minimize negative impacts on project objectives. The process includes planning risk management, identifying risks, performing qualitative and quantitative analyses, planning responses, and controlling risks. Each step utilizes various inputs, tools, and techniques to ensure effective risk management throughout the project lifecycle.

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20 views36 pages

Risk Management

Risk management involves identifying, assessing, and controlling risks to maximize opportunities and minimize negative impacts on project objectives. The process includes planning risk management, identifying risks, performing qualitative and quantitative analyses, planning responses, and controlling risks. Each step utilizes various inputs, tools, and techniques to ensure effective risk management throughout the project lifecycle.

Uploaded by

arzun.mgr36
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PPTX, PDF, TXT or read online on Scribd
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Risk Management

Risk……!!!!
Risk……!!!!
According PMI:
“ An uncertain event or condition that,
if it occurs, has a positive or negative
effect on a project’s objectives ”.

Characteristics of risk:
Uncertainty – the risk may or may not
happen, that is, there are no 100% risks

Loss – the risk becomes a reality and


unwanted consequences or losses occur
Risk
Management
Risk
Management
Risk management is
 identification

 assessment, monitor, and control the probability

 impact of unfortunate events

 to maximize the realization of opportunities


Risk Management process
groups
Risk Management
Process Groups
1. Plan Risk Management
2. Identify Risks
3. Perform Qualitative Risk Analysis
4. Perform Quantitative Risk Analysis
5. Plan Responses
6. Control Risks
Plan Risk
Management
 Planning process with the risk management plan as its sole
output

 Understand the general level of risks your project faces

 Project team or organizational tolerance for risk

 Domain Tasks:
 Identifying, analyzing
 Defining risk response strategies
 To manage uncertainty throughout the project life cycle
Plan Risk Management
input
Project Management Plan process:
 Project charter

 Stakeholder register

 Enterprise environmental factors

 Organizational process assets

 Tools and techniques

 analytical techniques

 Expert judgment

 Meetings
Plan Risk Management
output
Risk management plan:

o The particular risk methodology and approach to be taken on


the project

o The individual roles and responsibilities within the team and the
wider group of stakeholders

o Any approved budgets for managing risk, which should then be


included
in the cost performance baseline

o An initial analysis of the individual risk categories using a risk


breakdown structure
Breakdown structure
Identify Risks
 Uses a wide variety of inputs and tools and
techniques to identify all the risks to the project

 Performed

1. Through the life of the project

2. The risk register is always updated with newly identified risks


current risks that are reassessed by using the other risk
planning processes
Identify Risks inputs
 Risk management plan

 Cost management plan

 Schedule management plan

 Quality management plan

 Human resource management plan

 Scope baseline

 Activity cost estimates

 Activity duration estimates


Identify Risks inputs
 Stakeholder register

 Project documents

 Procurement documents

 Enterprise environmental factors

 Organizational process assets

 Tools and techniques


I. Documentation reviews
II. Information-gathering techniques
III. Checklist analysis
IV. assumptions analysis
V. Diagramming techniques
VI. SWOT analysis
VII. Expert judgment
Identify Risks
ooutputs
Risk register:

• risk register is highly iterative

• risk register itself should be treated as a live document


and reviewed regularly

• reviewed at all levels

• risk register will take many forms depending on your


organizational risk tolerance and any existing
templates
and guidelines
Perform Qualitative Risk
Analysis

 Focused

 on assigning a qualitative

 subjective

 analysis of probability

 impact to all identified risks

 done on all identified risks

 quick and easy


Perform Qualitative Risk
Analysis inputs

 Risk management plan

 Scope baseline

 Risk register

 Enterprise environmental factors

 Organizational process assets

 Tools and techniques


Perform Qualitative Risk
Analysis inputs

 Tools and techniques:

i. risk probability and impact assessment

ii. Probability and impact matrix

iii. risk data quality assessment

iv. risk categorization

v. risk urgency assessment

vi. Expert judgment


Perform Qualitative Risk
Analysis outputs

o Project documents updates:

• Risk Register

• Assumptions Log
Perform Quantitative Risk
Analysis

 Focused:

o development of a quantitative objective

o assessment of individual risk probability impact

o by using a metric based on money or time


Perform
Quantitative Risk
Analysis
Perform Quantitative
Risk Analysis inputs
Perform Quantitative Risk Analysis
inputs

 Tools and techniques


 Data gathering and representation techniques

 Quantitative risk analysis and modeling techniques


Sensitivity analysis
Tornado diagrams
Expected monetary value analysis (EMV)
Modeling and simulation

 Expert judgment
Perform Quantitative Risk Analysis
outputs

o Project documents updates:

 updated the risk register

 includes quantitative probabilities of individual risks

 quantitative impacts of individual risks in terms of


both cost and time

 subsequently a prioritized list of quantified risks.


Qualitative Risk
Analysis
vs
Quantitative Risk
Qualitative: risk-level
Quantitative: project-level
Analysis
Qualitative: subjective evaluation of probability and impact
Quantitative: probabilistic estimates of time and cost

Qualitative: quick and easy to perform


Quantitative: time consuming

Qualitative: no special software or tools required


Quantitative: may require specialized tools
Plan Risk Responses
o Focused on the development of proactive
responses to risks

o Minimizing the potential effects of negative risk

o Maximizing the potential benefits of positive risk


on a project

o Considers responses to unplanned or unforeseen


risks
Plan Responses
Plan Responses inputs

 risk management plan

 risk register

 Tools and techniques

Strategies for negative risks or threats

Strategies for positive risks or opportunities

Contingent response strategies


Plan Responses outputs

o Project management plan updates


Project documents updates

revisit these foundational documents

o Project documents updates


updated the risk register and the assumptions
log
• Focused on monitoring and controlling the project

• Accordance with the risk management plan and the


information contained within the risk register

• Control Risks process checks the implementation of the


plan

• Like other monitoring and controlling processes

• looking out for any variance between what risks you had
planned and what risks are occurring

• New risks, and any new information affecting already


identified risks, and evaluating the overall risk process
Control Risks
inputs
 Project management plan

 risk register

 Work performance data

 Work performance reports

 Tools and techniques


risk reassessment
risk audits
Variance and trend analysis
Technical performance measurement
reserve analysis
Status meetings
Outpu
o Work performance information
ts
o Change requests

o Project management plan updates

o Project documents updates

o Organizational process assets updates


 Risk
 Risk management
 Risk Management process groups

1. Plan Risk Management


2. Identify Risks
3. Perform Qualitative Risk Analysis
4. Perform Quantitative Risk Analysis
5. Plan Responses
6. Control Risks
THE
END

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