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Project risk management
This document discusses project risk management. It begins by defining risk as an uncertain event that could affect a project's objectives. It emphasizes the importance of risk identification as the first step in risk management. Several methods for identifying risks are presented, including meetings, brainstorming, and assumptions analysis. The document then discusses risk analysis, including qualitative and quantitative approaches. It introduces the risk matrix as a key tool for analysis. The final sections cover selecting appropriate risk responses and controlling risks ongoing. Throughout, examples are provided and exercises proposed to help explain the concepts.
Project risk management
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- 2. PROJECT RISK MANAGEMENT FEB21, 2018 MARRIOTT - KARACHI 02/21/18
- 3. What is Risk…? 02/21/18 StatementRisk (Yes / No) I have not taken my exams and I think I will not be able to move to next class this year I worked very hard, there is chance that I might secure first position in exams Project Manager has resigned Fuel prices might increase further after next year budget Labor from project A might be available for Project B
- 4. An uncertain eventwhich, should it occur, will have an effect on the achievement of the projects objectives 02/21/18 Is it possible to have no Risks in our lives or in project or in business……? Statement USA might experience extreme winter next year PML(N) may not come in power after next elections USD – Kuwaiti Riyal exchange rate might change Uncertainty Impact (positive or negative) What is Risk…? Do all events matter…?
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- 6. 02/21/18 What is Risk…? Therefore,we are left with only one choice – Risk Management..!
- 7. 02/21/18 When should westart Risk exercise at our projects…?
- 8. 02/21/18 What is RiskManagement…? Process to ensure that Risks are managed effectively Why…? But How…?
- 9. 02/21/18 What is RiskManagement…?
- 10. 02/21/18 Let’s Identify Risks…? ARisk cannot be managed unless it is identified But why…? What’s the big deal…? Risk identification is considered the most important step in Risk Management
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- 12. 02/21/18 Let’s Identify Risks…? How…? Dueto underpass construction at Punjab Chorangi There is a possibility of getting stuck in traffic Reaching office late
- 13. 02/21/18 Let’s Identify Risks…? Exercise# 01: From your project, identify one “Risk” and one “Opportunity” Cause Risk Effect Opportunity Risk
- 14. 02/21/18 Let’s Identify Risks…? Meetings Experts Brainstormingsessions Assumptions Analysis Tools that can be used
- 15. 02/21/18 Let’s Identify Risks…? Toolsthat can be used First entry has been made in Risk Register
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- 19. 02/21/18 Let’s Analyze IdentifiedRisks…? Usually applied in most of the projects May not be applied to many simple or moderately complex projects Consider all the risks identified in the identify risk process only considers the risks which are marked for further review after Qualitative Risk Analysis Does not analyze the risks mathematically Stakeholders inputs (expert judgment) are used to judge the probability and impact Uses the mathematical and simulation tools to calculate the probability and impact Assesses individual risks by assigning numeric ranking of probability and impact, usually the rank of 0 to 1 is used where 1 demonstrates high This predicts likely project outcomes in terms of money or time based on combined effects of risks
- 20. 02/21/18 Key to RiskAnalysis….. Risk Matrix
- 21. 02/21/18 Exercise # 02:On the given Risk Register format, analyze the identified risks Let’s Analyze Identified Risks…? S. No. Risk Identification Risk Analysis Risk Response Monitoring & Control Cause Risk Effect Inherent Risk Action Plan Timeline P I P x I 1 Due to delay in shipment delivery of major equipment may get late which might effect Project COD 2 Due to rise in safety incident work at site may get suspended resulting in overall project delay
- 22. 02/21/18 What is RiskManagement…? Next is “Selecting appropriate Responses to Analyze Risks”..!
- 23. ■ To determinethe set of actions, which increases the impact or likelihood of opportunities and decrease the impact of likelihood of threats ■ Risk Action Owner shall be assigned with clear responsibilities ■ Response Trigger conditions shall be identified ■ Should take into account organization culture (Risk Averse vs Risk Seeking) ■ Should be appropriate to the severity of the Risk ■ Focus on both Threats and Opportunities 02/21/18 Risk Responses
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- 26. 02/21/18 Exercise # 03:On the given Risk Register format, mention risks responses S. No. Risk Identification Risk Analysis Risk Response Monitoring & Control Cause Risk Effect Inherent Risk Action Plan Timeline P I P x I 1 Due to delay in shipment delivery of major equipment may get late which might effect Project COD 2 Due to rise in safety incident work at site may get suspended resulting in overall project delay Risk Responses
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