Risk and Issue Management Flashcards
- Initiation
Setting up the process and formulating a risk management plan which will set out a framework for the project manager and project team to ensure risks are managed in a consistent and proactive manner.
Setting up a risk register and deciding risk categories.
- Identification
Various techniques are used to identify as many possible risks as possible which are added to the risk register. A combination of the below methods is usually the most effective way to identify all relevant risks.
a. Brainstorming
b. SWOT analysis
c. Assumptions analysis
d. Constraints analysis
e. Using the WBS (work breakdown structure)
f. Interviews
- Assessment
All identified risks must now be assessed and prioritised.
Determining the probability and impact and plotting on a probability and impact grid.
Either on a qualitative scale e.g. very low, low, medium, high, very high or on a quantitative scale e.g 1-5
Exposure, or the risk severity, is calculated by multiplying the impact by the probability.
- Response Planning
An appropriate response is planned
There are 5 common strategies for addressing risks or threats:
1. Avoid
2. Transfer
3. Reduce / Mitigate
4. Accept
5. Contingency Plan
Response planning actions:
1. Identify possible responses
2. Evaluate each possible response considering the costs involved and how much it would reduce the risk exposure
3. Identify the most cost effective response
4. Check the effect on the budget against the business plan to ensure the project is still viable.
- Implement Responses
For each risk that has a planned response, the risk owner must monitor and review on a regular basis throughout the project.
The primary tool for managing and monitoring risk is the risk register.
The project manager will assign a risk owner to each identified risk, and decide when the risk should be reviewed. During review, a date will be set for implementing any risk reduction measures identified and a date for the next review.
