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risk
basis
▪Definition: Once it occurs, an uncertain event or condition that will have a positive or negative impact on the project goal
▪4 elements of risk: Event, cause, probability of occurrence, consequence
▪ Risk category: such as technical risk, management risk, internal risk or external risk, etc., usually usedRBSDefinition as a starting point for risk identification
Project risk management
▪Project risk management is the science and art of identifying, analyzing, and responding to risks in the entire life cycle of a project, and best meeting project goals.
▪Risk management has a positive influence on the selection of projects, the determination of project scope and the preparation of realistic schedules and cost estimates.
▪Risk management is also an area of project management that is often overlooked.
Planning risk
1. Identify risks
▪ Determine which risks (such as market, finance, technology, human resources, etc.) will affect the project and record its characteristics. The main methods include:
-Document review. Structured review of project documents (including various plans, assumptions, past project files and other information)
-Brainstorming(Can't overuse, sometimes individuals who work independently have more ideas)
–Interview(Collect information face to face)
–Checklist analysis. Compile a risk identification checklist based on previous similar project RBS (Risk Breakdown Structure) or other historical information
Risk breakdown structure (RBS)-risk analysis and classification
• RBS (Risk Breakdown Structure): The company arranges the risks encountered in past experience into a hierarchical structure according to categories and subcategories to help future projects quickly identify risks.
2. Implement qualitative risk analysis
▪Assess and comprehensively analyze the occurrence probability and impact of risks, and prioritize risks (use probability and impact matrix to estimate risk factors)
3. Implement quantitative risk analysis
Quantitative risk analysis can be carried out after qualitative risk analysis, or together, and for some projects, only the qualitative analysis of project risk can be carried out.
- Decision tree (a graphical method to help choose the best course of action when future results are uncertain)
- Expected currency value (the product of the probability of a risk event and the currency value of the risk event)
- Simulation (use the model or representation of the system to analyze the expected behavior or performance of the system, such as stock market simulation)
- Sensitivity analysis (by changing one or more variables to observe the effect of its results)
4. Plan risk response
According to project goals, formulate plans and measures to increase opportunities and reduce threats
- Identify and assign the responsible person for risk response to implement the risk response measures that have obtained consent and financial support
- Develop response measures according to the priority of risks, and add the resources and activities required for risk response to the project budget, schedule and project management plan
- Risk response measures must match the importance of the risk, economical and feasible
Negative risk or threat response strategy
- Avoidance. Change the project management plan to completely eliminate the threat. Such as extending the schedule, reducing the scope, etc.
- Transfer. Transfer part or all of the negative impact of a risk to a third party together with the responsibility for responding. Usually need to pay for risks, such as insurance, outsourcing
- Alleviate. Reduce the probability and/or impact of adverse risk events to within acceptable thresholds. For example, conduct more tests and choose more stable suppliers
- accept. Accepting a risk means that the project team decides not to change the project management plan to deal with a certain risk, or cannot find any other reasonable response strategies. Actively accept risks by establishing emergency reserves (cost, time), such as flight delays due to weather
- open up. If the organization wants to ensure that opportunities are realized, it can create opportunities by adopting this strategy for risks that have a positive impact. For example, allocate the most capable resources in the organization to the project to shorten the completion time or save costs
- share it. Assign part or all of the responsibility for the opportunity to a third party that can best seize the opportunity for the benefit of the project, such as a joint venture company
- improve. Identifying the key factors that affect the occurrence of positive risks and maximizing these factors can increase the probability of the occurrence of opportunities. For example, increase resources to complete activities as early as possible
- accept. Happy to take advantage of opportunities when they happen, but not actively pursuing them
Planning the outcome of risk
▪ The previous results are integrated and recorded in the "Risk Register";
▪ Risks are not organized all at once, nor are they fixed. The above process is repeated as the project progresses (for example, weekly or monthly risk review) ；
Integration
The meaning of
▪ Organize the planning results of each sub-item to guide the next phase (execution and monitoring) from a global perspective
. The most important role of the project manager is the integrator. The project manager coordinates through communication, and integrates through coordination
▪ The project is managed by the plan, not by someone