Risk Identification

Risk Identification

Identify project, product and business risks;

- Risk analysis

Assess the likelihood and consequences of these risks;

- Risk planning

Draw up plans to avoid or minimise the effects of the risk;

- Risk monitoring

Monitor the risks throughout the project;

Risk identification

Technology risks.

People risks.

Organisational risks.

Requirements risks.

Estimation risks.

Risk analysis

- Assess probability and seriousness of each risk.

- Probability may be very low, low, moderate, high or very high.

- Risk effects might be catastrophic, serious, tolerable or insignificant.

Risk planning

- Consider each risk and develop a strategy to manage that risk.

- Avoidance strategies

The probability that the risk will arise is reduced;

- Minimisation strategies

The impact of the risk on the project or product will be reduced;

- Contingency plans

If the risk arises, contingency plans are plans to deal with that risk;

Risk monitoring

- Assess each identified risks regularly to decide whether or not it is becoming less or more probable.

- Also assess whether the effects of the risk have changed.

- Each key risk should be discussed at management progress meetings.

Why manage risks?

- It is a fact of life that chance events will occur and affect the outcome of your project

- Murphy's Laws codify this "knowledge"

-If anything can go wrong, it will!

-Of things that could go wrong, the one that causes the most damage will occur!

- Project risks are defined as the undesirable event, the chance this event might occur and the consequences of all possible outcomes

- Risk management attempts to identify such events, minimize their impact & provide a response if the event is detected

Risk Management Steps

There are four major steps to developing a risk management plan

1. Identify all the possible risk events that could affect the project

2. Assess each risk in terms of probability, impact severity and controllability

3. Develop a strategy and/or contingency for responding to each risk

4. Monitor and control risks dynamically

Identify the project risks

- Generate list of all possible risks by "brainstorming" among team members

- Do not attempt to assess risk probability; that is for a later step

- Focus on risk events, rather than risk consequences

---For example, "instrument does not return correct data" is a consequence of events like poor circuit design, incorrect or failed components, poor software implementation

- First focus on overall project risks, then identify specific risks

- Use your WBS to help organize your risk identification process

- Seek input from sources from outside your group

- Emphasize critical thinking and remember Murphy's Laws