6th week - Risk management

Question 1

risk management

Answer 1

*Project selection systems
Try to reduce the likelihood that projects will not contribute to the missions of the firm

*Project scope statements
Avoid costly misunderstandings and scope creep

*Risk breakdwon structures
Reduce the likelihood that some vital part of the project will be omitted
reduce the likelihood that the budget goes unrealistic

*Team building
Reduces the likelihood of dysfuncitonal conflict and
breakdowns in coordination

Managers/ Manage risk to compensate uncertainty and that things never goes according to plan
Risk Mgtmt is proactive not reactive

Standards methods for identifying, assessing, and responding to risks

Contingency plans
Increase the chance that project can be completed on time are in budget

Responsibility should be clearly defined and documented
Budget reserves are linked to the WBS and should be communicated to the project team

Control of management reserves

Contingency reserves

Question 2

Risk

Answer 2

Risk is an uncertain event or conditions, that, if occurs has positive or negative effect on project objectives

• Identiy risks
• Minimize risk impact
• (Contingency Plans) Manage response to those event that do materialize
• Provide contingency funds

The cost of a potential risk is more manageable if it is detected in the first part of the project.

Question 3

Management process

Answer 3

1. Step 1. Risk identification
   Focus on the events that could produce 
    consequences
2. Step 2 Risk Assesment
    In terms of :
    Severity of impact
    Likelihood of occurring
    Controllability 

3. Step 3. Risk response Development
   Develop a strategy to reduce possible damage
   Develop contingency Plans
4. Step 4. Risk response Control

Question 4

Sources of risks

Answer 4

• Technical
  Requirement, technology, complexity and
  interfaces,perfomances and quality

*external or threats 
Subcontractors and suppliers
Regulatory 
Market
Customer
Weather
(inflation, market acceptance, exchanges rates and government regulations)

Included before the project starts

*organizational
Project dependencies, resources, funding, prioritization

*Project management
Estimating, Planning, Controlling, communication

Question 5

scale on differents conditions

Answer 5

Very low (1) Low (2) Moderate (3) High (4) Very H (5)

Cost a percentage in which the cost will change ( 0% a
40%)

Time a percentage in which the cost will change ( 0% a
20%)

Scope Qualitative impact areas of scope affected

Quality Qualitative impact areas of scope affected

Question 6

Risk severity Matrix

Answer 6

FMEA ( failure mode and effect analysis)

  Impact x Probability x Detection = risk value

Question 7

Risk severity Matrix

Answer 7

Impact x Probability x Detection = risk value

Impact= 1
Probaility = 5
Detection=  5

FMEA ( failure mode and effect analysis)

Question 8

Probability Analysis

Answer 8

Decision tree

NPV