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Project management > L9 > Flashcards

L9 Flashcards

1
Q

There are 3 main risk categories that make it easier to bundle together, what are they?

A
  • common cause (HR, vendors, tech, etc)
  • business area (strategy change, market risk)
  • technical area (design, production..)
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2
Q

What are the 5 further risk categories?

A
  1. Scope risks (scope creep, ill-defined scope, new legal req.)
  2. Schedule risks (task delays, estimation errors)
  3. Resource risks (cost est. errors, funding changes, team lacking skills)
  4. Tech risks (tech failures/feasibility)
  5. Commercial risks (ROI est. errors)
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3
Q

What is the name of the risk assessment?

A

Failure Mode and Effect Analysis (FMEA)

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4
Q

What is the goal of FMEA?

A
  • risk prioritisation, power/interest map
  • adapt strategy
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5
Q

What are the steps in FMEA?

A
  1. List all ways a project can fail
  2. Evaluate severity S
  3. Estimate likelihood L
  4. Estimate the inability to detect D
  5. Calculate risk priority number
  6. Consider ways to reduce S,L,D for each cause of failure
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6
Q

How do you calculate the risk priority number? RPN

A

RPN = S * L * D

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7
Q

Who does the FMEA?

A

You can do it internally or outsource

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8
Q

What is an alternative to FMEA?

A

A risk matrix.

Just looking at impact vs probability.

Low/med/high

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9
Q

What’s the simplest risk assessment method?

A

Traffic lights - high/med/low risk

High = formal risk mitigation plan
Med = careful monitoring
Low = ignore

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10
Q

When would we use a quantitative risk analysis?

A

For top priority risks

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11
Q

What are quantitative risk analysis methods?

A
  • field/lab experiment
  • probability/statistical analysis
  • Monte Carlo simulation
  • scenario analysis
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12
Q

What are the 6 risk mitigation techniques?

A
  1. Escalate the risk
  2. Avoid the risk
  3. Accept the risk
  4. Share the risk
  5. Limit the risk
  6. Transfer the risk
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13
Q

How do you escalate the risk?

A

Involve the project sponsor or client and make a change in strategy

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14
Q

How do you avoid the risk ?

A

Abandon possible causes: reliable sources

Choose projects based on risk profile

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15
Q

How do you accept the risk?

A

Understand that time/cost/scope could be compromised somewhat

For low priority risks

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16
Q

How do you share the risk?

A

Collaborate with client/vendors/suppliers

Eg Shell stakeholder analysis

17
Q

How do you limit the risk?

A

Roll-out plans: P&G

Stage-gate model: MoD

18
Q

How do you transfer the risk?

A
  • Insurance
  • use means from financial markets (interest rate options)
  • Use contractors (with penalty payments)
19
Q

How do you reduce the probability/impact of a risk?

A
  1. Monitor: risk register, communication, external project assurance.
  2. Testing: simulation/prototyping/beta
  3. Contingency: backup plans, cost/time buffer
  4. Process standards: health&safety, staff training, regular inspections
20
Q

How do we choose what response to do once we’ve identified a risk?

A

Do a probability/impact matrix.

If it’s low:low, you can accept the risk.
If it’s high:high, we shouldn’t take the risk

Rest are reduce/transfer

21
Q

What is your risk responsibility as a PM?

A
  1. use risk to prioritise your daily tasks
  2. communicate risks to stakeholders (sponsor, client, team members)
  3. discuss risk at team meetings (keep updating risk plan)
  4. Be proactive not reactive
22
Q

How can risk be self-inflicted?

A
  1. Thoughtless optimism (leads to underestimating time to completion)
  2. Management cutting time to motivate workers

BUT inflated time estimates lead to student syndrome, Parkinson’s law, Murphy’s law.

23
Q

What does a PM need to be aware of?
Goldratt’s critical chain

A
  • capacity should not always be equal to demand. Sometimes you’ll have too many/few resources.
  • multitasking does NOT reduce idle time as the time to switch gets larger
  • network complexity makes a difference

Project management (10 decks)

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