Your SlideShare is downloading. ×
0
Project Risk Management
Project Risk Management
Project Risk Management
Project Risk Management
Project Risk Management
Project Risk Management
Project Risk Management
Project Risk Management
Project Risk Management
Project Risk Management
Project Risk Management
Project Risk Management
Project Risk Management
Project Risk Management
Project Risk Management
Project Risk Management
Project Risk Management
Project Risk Management
Project Risk Management
Project Risk Management
Project Risk Management
Project Risk Management
Project Risk Management
Project Risk Management
Project Risk Management
Project Risk Management
Project Risk Management
Project Risk Management
Project Risk Management
Project Risk Management
Project Risk Management
Project Risk Management
Project Risk Management
Project Risk Management
Project Risk Management
Project Risk Management
Project Risk Management
Project Risk Management
Project Risk Management
Project Risk Management
Project Risk Management
Project Risk Management
Project Risk Management
Project Risk Management
Project Risk Management
Upcoming SlideShare
Loading in...5
×

Thanks for flagging this SlideShare!

Oops! An error has occurred.

×
Saving this for later? Get the SlideShare app to save on your phone or tablet. Read anywhere, anytime – even offline.
Text the download link to your phone
Standard text messaging rates apply

Project Risk Management

1,933

Published on

Published in: Business, Economy & Finance
0 Comments
0 Likes
Statistics
Notes
  • Be the first to comment

  • Be the first to like this

No Downloads
Views
Total Views
1,933
On Slideshare
0
From Embeds
0
Number of Embeds
3
Actions
Shares
0
Downloads
110
Comments
0
Likes
0
Embeds 0
No embeds

Report content
Flagged as inappropriate Flag as inappropriate
Flag as inappropriate

Select your reason for flagging this presentation as inappropriate.

Cancel
No notes for slide

Transcript

  • 1. Project Risk Management “Those who cannot remember the past are condemned to repeat it” – George Santayana
  • 2. Project Risk • Project is a temporary endeavor undertaken to create a unique product, service or result. • Risk is “Loss” multiplied by “Likelihood” • Risk Types: Macro-risk & Micro-risk
  • 3. Successful Project Leaders ! Aware of lessons learned from prior projects ! Plan the work thoroughly " to understand challenges ahead " to an=cipate poten=al problems ! Make team understand sources of varia=on " minimizes where ever possible
  • 4. Project Failures ! They are impossible ! Objec=ves lies outside capabili=es ! Possible deliverable but other objec=ves are unrealis=c ! Feasible deliverable, plausible objec=ves but insufficient effort put into planning
  • 5. Use of Risk Data ! Lower cost/less chaos ! Project priority/management support ! Project porJolio management ! Tuning plans to reduce risks ! Project communica=on & control ! Establishing management reserve
  • 6. Data for Project Management ! Achieving delivery ! Managing budgets ! Managing schedule ! Delivering business value
  • 7. Defining Risk Management ! Project assump=ons ! Stakeholder risk tolerance ! Planning data? ! Templates and metrics ! Risk management plan
  • 8. Project Selec=on ! Proper mix of risk and benefits consistent with business objec=ves ! Frequent reviews ! Revisit assump=ons ! Re balance project load
  • 9. Project Planning ! Without planning no one knows whether something is going wrong ! Regular reviews of methods and processes used ! Adopt and use a project management process
  • 10. Project Scope ! Change & defects - Creep in scope - Gaps - Dependencies ! Minimized by - planning and WBS - Scope documenta=on using IS/IS NOT technique
  • 11. Project Deliverables ! Documented deliverable defini=on process ! Use a straw man defini=on document ! Adopt a rigorous evolu=onary methodology ! Key project contribu=on from start?
  • 12. Reduce Risk ! Dollar Ac=ons? - Scope with sufficient details & limits ! WBS: any sec=on resis=ng breakdown is risky ! WBS: Lack of ownership is risky ! WBS: size of more than 200 entries is risky - Sequence or collec=on of projects
  • 13. Other Risk ! Scope risks can bring out - Market risks - Confiden=ality risks
  • 14. Risk Documenta=on ! Define scope and iden=fy challenges ! Set limits based on value of deliverable ! Decompose work into small pieces ! Iden=fy work not well understood ! Assign ownership and look into reason for reluctance ! Note risks from expected project dura=on or complexity
  • 15. Project Schedule ! Sources of schedule risks - Delays - Dependency - Es=ma=on
  • 16. Project Es=ma=on ! PiJalls - Avoidance - Op=mism - Lack of informa=on - Granularity
  • 17. Project Ac=vity Sequencing ! Cri=cal Path Methodology (CPM) ! Mul=ple Cri=cal Paths ! Interfaces ! Scheduling risky work
  • 18. Risk Documenta=on ! Long dura=on ac=vi=es ! Significant worst case es=ma=on ! High uncertainity es=ma=on ! Overly op=mis=c es=mate ! All cri=cal & near cri=cal path ac=vi=es ! Mul=ple cri=cal paths ! Convergence points in logical network ! External dependencies and interfaces
  • 19. Risk Documenta=on ! Deadlines further out than the planning horizon ! Cross func=onal and subcontractor work
  • 20. Project Resource ! People - A^ri=on - late joining - Not dedicated ! Outsourcing ! Budget
  • 21. Project Team Environment ! Team building - Forming - Storming - Norming - Performing ! 20 minutes to get back to concentra=on ! Delega=ng to dedicated staff is low risk ! Outside dependency delay > 7 weeks
  • 22. Project Procurement ! Solicita=on: RFP - One resource for planning and procurement - Clear scope defini=on in RFP - Clear criteria to evaluate responses ! Risks - non contac=ng suppliers - bidders asking trivial ques=ons
  • 23. Source Selec=on ! Risks during - decision making - nego=a=ons - contrac=ng process ! Turnover due to outsourcing ! Rela=onship with outsourcing partners
  • 24. Contract ! Clear defini=on of scope of work ! Measurable deliverables ! Payments with achievements of results ! Process to be used for any change ! Should specify responsibili=es ! Should include “not to exceed” limita=on ! Terms that aligns with goals
  • 25. Cost Es=ma=on ! Staff ! Equipment ! Outsourcing ! Travel ! Other costs (e.g. communica=on)
  • 26. Document Resource Risk ! Ac=vi=es with unknown staffing ! Un-­‐staffed ac=vi=es ! Work that is outsourced ! Contract risks ! Ac=vi=es requiring a unique resource ! Part =me and remote team members ! Impact of work environment ! Budget exceeding project objec=ves ! Over commi^ed staff
  • 27. Managing Project Constraints • “ Good, Fast, Cheap : Pick two” Scope Schedule Resources
  • 28. Risk Framework ! Technology (the work) ! Marke=ng (the user) ! Manufacturing (Produc=on & delivery)
  • 29. Risk Complexity Index ! Index = (Tech+Arch+System) * Scale ! Assessment against experience and capability - 0 = only exis=ng technology required - 1 = minor extension - 2 = significant extension - 3 = possible with innova=on - 4 = probably feasible - 5 = new, feasibility in doubt
  • 30. Risk Complexity Index (cont..) ! Scale signifies the number of people - 0.8 for up to 12 - 2.4 for 13 to 40 - 4.3 for 41 to 100 - 6.6 for greater than 100 ! Index - < 20 low risk - < 40 medium risk - > 40 high risk
  • 31. Es=ma=on Techniques ! Using historical data ! Experts and expert judgment ! Experience based rules and func=ons ! Delphi group es=ma=on
  • 32. Es=ma=on Process History Base Effort Es.mate Dura.on Es.mate Calendar Es.mate Project Factors Other Factors Resource Factors
  • 33. Es=ma=on for Uncertainty ! Program Evalua=on and Review Technique ! PERT te = (to + 4tm + tp)/6 ! Standard devia=on = (tp -­‐ to)/6
  • 34. Resource Planning ! Resource requirements ! Holidays ! Vaca=ons ! Time-­‐offs ! Non-­‐project ac=vi=es ! Distributed resources - consumed 60% more
  • 35. Staff Acquisi=on ! Skills requirements ! Staff availability - 2 projects is op=mal ! Outside of project responsibility is a risk
  • 36. Qualifying & Analyzing Risk ! Separate parts that are well understood from that are not ! Making a project impossible to possible is to isolate and schedule most risky work early ! Qualita=ve and quan=ta=ve risk assessment ! Qualita=ve is less effort but quan=ta=ve assessment strives for precision
  • 37. Qualifying & Analyzing Risk ! “loss” in =me, money etc ! “likelihood” based on sta=s=cs, probability ! Risk probability is 0 or 1 at project end ! Uncertainty in the beginning ! Qualita=ve assessment divides choices into ranges ! Quan=ta=ve assessment assigns each risk a specific frac=on
  • 38. Qualifying & Analyzing Risk ! Probability - Experiments e.g. tossing a coin - Historical and empirical data - Guessing or gut feel ! Most of the project risks are in this category ! Illusion of precision can be a risk ! Measurement based probabili=es can help trend analysis
  • 39. Quan=ta=ve Risk Assessment ! Difference of the mean of the distribu=on and measured 90% point ! Can be expressed as a single value or a histogram of possibili=es - High – project objec=ve at risk - Medium – objec=ves are OK, significant re-­‐planning - Low – No major plan changes, risk is a inconvenience
  • 40. Quan=ta=ve Risk Assessment ! Unit of impact and max value are risk specific ! More ranges the be^er the precision but harder to achieve agreement ! Cost impact is easier compared to effort/ schedule ! Increase in effort may not translate directly into schedule impact
  • 41. Quan=ta=ve Risk Assessment ! Over=me or lower morale ! Rela=onships with customers, suppliers and others connected to the project ! Increased stress, worry and extra mee=ngs ! Concerns about health and safety
  • 42. Qualita=ve Risk Assessment ! Minimum outcome - risk list ordered by severity - simple sort, Delphi technique ! Shows only the rela=ve risk and not the project exposure each risk represent
  • 43. Qualita=ve Risk Assesment ! Risk assessment table Risk Probability Impact Overall Risk ! Risk assessment matrices ! Alternate assump=on tes=ng ! Data precision ranking ! Decide list of risks that require further a^en=on
  • 44. Qualita=ve Risk Assessment ! Sensi=vity Analysis? ! Risk assessment tables - Select one type of impact - Several tables for each type of impact ! Two dimensional qualita=ve analysis - X axis probability - Y axis impact
  • 45. bnair@asquareb.com blog.asquareb.com https://github.com/bijugs @gsbiju

×