Bost university

Faculty of computer
science
Week#2
Course code:cs713 semester: 7th

Lecturer : Faizullah Ehsas

This week lectures topics

 The Risk Management Process in Project

Management

 What Is Risk Management on Projects?

 How to Manage Risk?

 What Is Positive Risk?

 What Is Positive Risk?

The Risk Management Process in
Project Management
 When you start the planning process for a project,
one of the first things you need to think about is:

 what can go wrong?

 It sounds negative, but pragmatic project managers

know this type of thinking is preventative.

 Issues will inevitably come up, and you need a

mitigation strategy in place to know how to manage
risks when project planning.
What Is Risk Management on
Projects?
 Project risk management is the process of

identifying, analyzing and responding to any risk

that arises over the life cycle of a project to help

the project remain on track and meet its goal.

 Risk management isn’t reactive only; it should be

part of the planning process to figure out the risk

that might happen in the project and how to

control that risk if it in fact occurs.

 How to Manage Risk

 To begin managing risk, it’s crucial to start with a

clear and precise definition of what your project has

been tasked to deliver.

 In other words, write a very detailed project charter

, with your project vision, objectives, scope and

deliverables.

 This way risks can be identified at every stage of

the project.

 Then you’ll want to engage your team early in

identifying any and all risks.

How to Manage Risk

 Don’t be afraid to get more than just your team involved

to identify and prioritize risks, too.

 Many project managers simply email their project team and

ask to send them things they think might go wrong on the
project.

 But to better plot project risk, you should get the entire
project team, your client’s representatives, and vendors into
a room together and do a risk identification session.
 How to Manage Risk

 With every risk you define, you’ll want to log it

somewhere—using a risk tracking template helps

you prioritize the level of risk.

 Then, create a risk management plan to capture

the negative and positive impacts of the project

and what actions you will take to deal with them.

 You’ll want to set up regular meetings to monitor

risk while your project is ongoing.

 What Is Positive Risk?
 Not all risk is created equally.

 Risk can be either positive or negative, though

most people assume risks are inherently the

latter.

 Where negative risk implies something unwanted

that has the potential to irreparably damage a

project, positive risks are opportunities that can

affect the project in beneficial ways.

 What Is Positive Risk?
 Negative risks are part of your risk management

plan, just as positive risks should be, but the

difference is in approach.

 You manage and account for known negative risks

to neuter their impact, but positive risks can also

be managed to take full advantage of them.

 What Is Positive Risk?
 There are many examples of positive risks in
projects:

 you could complete the project early;

 you could acquire more customers than you

accounted for;

 you could imagine how a delay in shipping might

open up a potential window for better marketing
opportunities, etc.

 Positive risk can quickly turn to negative risk and

vice versa, so you must be sure to plan for all
eventualities with your team.
How to Respond to Positive Risk

 Like everything else on a project, you’re going to

want to strategize and have the mechanisms in

place to reap the rewards that may be seeded in

positive risk.

 Use these three tips to guide your way:

 How to Respond to Positive Risk

1. The first thing you’ll want to know is if the risk is

something you can exploit.

 That means figuring out ways to increase the

likelihood of that risk occurring.

How to Respond to Positive Risk

 2. Next, you may want to share the risk.

 Sometimes you alone are not equipped to take

full advantage of the risk, and by involving others

you increase the opportunity of yielding the most

positive outcome from the risk.

How to Respond to Positive Risk

 3. Finally, there may be nothing to do at all, and

that’s exactly what you should do. Nothing.

 You can apply this to negative risk as well, for not

doing something is sometimes the best thing you

can do when confronted with a specific risk in the

context of your project.

Managing Risk throughout
the Organization

 So, how do you handle something as seemingly

elusive as project risk management?

 You make a risk management plan. It’s all about

the process.

 Turn disadvantages into an advantage by

following these six steps.

 1 Identify the Risk
 You can’t resolve a risk if you don’t know what it

is. There are many ways to identify risk. As you do

go through this step, you’ll want to collect the

data in a risk register.

 One way is brainstorming with your team,

colleagues or stakeholders.
 1 Identify the Risk
 Find the individuals with relevant experience and

set up interviews so you can gather the

information you’ll need to both identify and

resolve the risks.

 Think of the many things that can go wrong. Note

them.

 Do the same with historical data on past projects.

 Now your list of potential risk has grown.

 1 Identify the Risk
 Make sure the risks are rooted in the cause of a

problem.

 Basically, drill down to the root cause to see if the

risk is one that will have the kind of impact on

your project that needs identifying.

 1 Identify the Risk
 When trying to minimize risk, it’s good to trust

your intuition.

 This can point you to unlikely scenarios that you

just assume couldn’t happen.

 Use a risk breakdown structure process to weed

out risks from non-risks.

 2 Analyze the Risk
 Analyzing risk is hard.

 There is never enough information you can

gather.

 Of course, a lot of that data is complex, but most

industries have best practices, which can help you

with your risk analysis.

 You might be surprised to discover that your

company already has a framework for this

process.
 2 Analyze the Risk
 When you assess project risk you can ultimately

and proactively address many impacts, such as

avoiding potential litigation, addressing regulatory

issues, complying with new legislation, reducing

your exposure and minimizing impact

 3 Prioritize Risks & Issues
 Not all risks are created equally.

 You need to evaluate the risk to know what

resources you’re going to assemble towards

resolving it when and if it occurs.

 3 Prioritize Risks & Issues
 Having a large list of risks can be daunting.

 But you can manage this by simply categorizing

risks as high, medium or low.

 Now there’s a horizon line and you can see the

risk in context.
 3 Prioritize Risks & Issues
 With this perspective, you can begin to plan for

how and when you’ll address these risks.

 Then, if risks become issues, it’s advisable to

keep an issue log so you can keep track of each of

them and implement corrective actions

 3 Prioritize Risks & Issues
 Some risks are going to require immediate

attention.

 These are the risks that can derail your project.

Failure isn’t an option.

 3 Prioritize Risks & Issues
 Other risks are important, but perhaps do not

threaten the success of your project.

 You can act accordingly.

 Then there are those risks that have little to no

impact on the overall project’s schedule and

budget.

 Some of these low-priority risks might be

important, but not enough to waste time on.

4 Assign an Owner to the Risk

 All your hard work identifying and evaluating risk

is for naught if you don’t assign someone to

oversee the risk.

 In fact, this is something that you should do when

listing the risks.

 Who is the person who is responsible for that risk,

identifying it when and if it should occur and then

leading the work towards resolving it?

4 Assign an Owner to the Risk

 That determination is up to you.

 There might be a team member who is more

skilled or experienced in the risk.

 Then that person should lead the charge to

resolve it. Or it might just be an arbitrary choice.

 Of course, it’s better to assign the task to the

right person, but equally important in making sure

that every risk has a person responsible for it.

4 Assign an Owner to the Risk

 Think about it. If you don’t give each risk a person

tasked with watching out for it, and then dealing

with resolving it when and if it should arise, you’re

opening yourself up to more risk.

 It’s one thing to identify risk, but if you don’t

manage it then you’re not protecting the project.

 5 Respond to the Risk
 All that planning you’ve done is going to be put to

use.

 First you need to know if this is a positive or

negative risk.

 Is it something you could exploit for the

betterment of the project? If not you need to

deploy a risk mitigation strategy.

 5 Respond to the Risk
 A risk mitigation strategy is simply a

contingency plan to minimize the impact of a

project risk.

 You then act on the risk by how you prioritized it.

 You have communications with the risk owner

and, together, decide on which of the plans you

created to implement to resolve the risk.

 6 Monitor the Risk

 You can’t just set forces against risk without

tracking the progress of that initiative.

 That’s where the monitoring comes in. Whoever

owns the risk will be responsible for tracking its

progress towards resolution.

 6 Monitor the Risk
 But you will need to stay updated to have an

accurate picture of the project’s overall progress

to identify and monitor new risks.

 You’ll want to set up a series of meetings to

manage the risks.

 Make sure you’ve already decided on the means

of communication to do this.

 It’s best to have various channels dedicated to

communication.
 6 Monitor the Risk
 Whatever you choose to do, remember: always be

transparent.

 It’s best if everyone in the project knows what is

going on, so they know what to be on the lookout

for and help manage the process.

 6 Monitor the Risk
 Whatever you choose to do, remember: always be

transparent.

 It’s best if everyone in the project knows what is

going on, so they know what to be on the lookout

for and help manage the process.

 Risk Management Templates

 We’ve created dozens of free

project management templates for Excel and

Word to help you manage projects. Here are some

of our risk management templates to help you as

you go through the process of identifying,

analyzing, prioritizing and responding to risks.

 Risk Management Templates

 Risk Management Plan Template

 Risk Register Template

 Risk Matrix Template

Risk Management Plan Tem
plate
 A risk management plan is a document that

describes the potential risks that might affect a

project, how those risks will be mitigated and the

various risk management guidelines and

procedures that will be followed by a project

team.

 Risk management plans compile other risk

management documents such as a risk register,

risk breakdown structure and a risk response plan.

 Risk Register Template
 A risk register is a risk management document

that allows project managers to identify and keep

track of potential project risks.

 Using a risk register to list down project risks is

one of the first steps in the risk management

process and one of the most important because it

sets the stage for future risk management

activities.
 Risk Matrix Template
 A risk matrix is a project management tool that

allows project managers to analyze the likelihood

and potential impact of project risks.

 This helps them prioritize project risks and build a

risk mitigation plan to respond to those risks if

they were to occur.

Managing Risk with Project Manager

 Using a risk tracking template is a start, but to

gain even more control over your project risks

you’ll want to use project management software.

 ProjectManager has a number of tools including

risk management that let you address risks at

every phase of a project.

Thank you