Lecture 12 Flashcards
What can we do with risk?
- accept
- control (minimise/mitigate)
- avoid
- transfer (insure (pass on to 3rd party))
What is a risk
risk is a combination of:
- the chance of an event happening
- the outcome should that event occur
when is greatest uncertainty/risk
at the start of a project
when is risk management most effective
early on in the project
when should risk management be carried out
throughout a project
most important time to apply risk management
at ‘project sanction’
Fundamental steps of risk management process
- identification
- analysis
- response
identification
- hardest step
- must identify all risks which may affect the project
- typical identification technique uses a hierachy of risks
analysis
two steps
- the ‘evaluation’of the individual risks
- the ‘evaluation’ of all the risks together
Qualitative Risk Analysis
Probability and impact of occurence for each identified risk
- assessed by the pm with input from the project team
High probability
greater than 70% probability of occuring
Medium Probability
between 30% and 70% probability of occuring
Low probability
less than 30% probability of occurence
High Risk
potential to greatly impact project cost, schedule or performance
Medium Risk
potential to slightly impact project cost, schedule or performance
