A CONCEPTUAL FRAMEWORK

OF
PROJECT RISK MANAGEMENT
SYNOPSIS:
• INTRODUCTION TO PROJECT RISK
MANAGEMENT.
• OBJECTIVE OF PROJECT RISK MANAGEMENT.
• NEED FOR RISK ANALYSIS.
• 10 GOLDEN RULES OF PROJECT RISK
MANAGEMENT
• ELEMENTS OF RISK MANAGEMENT.
• RISK MANAGEMENT PLAN.
• THE RISK MANAGEMENT PROCESS.
• CLASSIC MISTAKES OCCUR IN SOFTWARE
PROJECT DEVELOPMENT.
• CONCLUSION.
 INTRODUCTION :
What is a Project?
A project is a temporary endeavor undertaken to produce a
unique product or service
Temporary Characteristics of Unique
Projects

What is a Risk?
A risk is any anticipated unfavorable event that can occur while
a project is ongoing.

What is a Project Risk Management?

It is an art and science of identifying ,analysing and responding
to risk throughout the project and in the best interest of
meeting project objective
OBJECTIVE OF PROJECT RISK MANAGEMENT:
The broad objectives of the project risk management
process are :
 Survival of the organization.
Efficiency in operations.
Uninterrupted operations.
Continued growth .
Enhance the capability of the organization.
Extend the organization’s overall risk management
processes to projects, and apply them in a consistent way.
Enhance the management of projects across the
organization and obtain better project outcomes, in all
respect.
NEED FOR PROJECT RISK MANAGEMENT
 10 GOLDEN RULES OF PROJECT RISK
MANAGEMENT
1. Make Risk Management Part of Your Project
2. Identify Risks Early in Your Project
3. Communicate About Risks
4. Consider Both Threats and Opportunities
5. Clarify Ownership Issues
6. Priorities Risks
7. Analyze Risks
8. Plan and Implement Risk Responses
9. Register Project Risks
10. Track Risks and Associated Tasks
ELEMENTS OF RISK MANAGEMENT

The job of Project Risk management is to identify,

address and eliminate sources of risk before they
become threats to completion of a project.
Different elements of risk management are:
Crisis management.
Fix on failure .
Risk mitigation.
Prevention.
Elimination of root causes.
RISK MANAGEMENT PLAN:
 RISK IDENTIFICATION: Identify all the possible risk events that
could affect the project.
3 MAIN CATEGORIES OF
RISK

PROJECT TECHNICAL BUSINESS

RISK RISK RISK

RISK ASSESSEMENT: Assess each risk in terms of probability, impact

severity and controllability.
For risk assessment, each risk should first be rated in two ways:
1.The likelihood of a risk coming true (r).
2. Severity of damage caused due to the risk becoming true (s).
Based on these two factors, the priority of each risk can be computed as :
p=r*s
 
RISK DEVELOPMENT: Develop a strategy and/or
contingency for responding to each risk.

RISK CONTAINMENT: This involve monitor and control

risks dynamically. Different risks require different
containment procedures.
3 MAIN STRAYEGY USED FOR
RISK CONTAINMENT

Avoid the risk Transfer the risk Risk reduction

PROJECT RISK MANAGEMENT
PROCESSES
It help project teams make informed decisions
regarding alternative approaches to achieving their
objectives and the relative risk involved in each project.

Risk management encourages the project team to take

appropriate measures to:
Minimize adverse impacts to project scope, cost, and
schedule.
Maximize opportunities to improve the project’s
objectives with lower cost, shorter schedules, and
higher quality.
PROJECT RISK MANAGEMENT PROCESSES

Fig.: The Project Risk Management Process

CLASSIC MISTAKES OCCUR IN SOFTWARE PROJECT DEVELOPMENT:
 

What is classic mistake?

Some ineffective practices chosen by many people who
produce predictable and unpredictable bad results, during
and at the end of the project are known are classic
mistakes.

The main effect of these mistakes is, you won’t get rapid
development.

Once if these mistakes are analyzed, it can be used with

project planning and risk management which will
definitely help the development speed of project.
 Classic mistakes have been divided along the development dimensions
of people, process, product and technology.
PEOPLE RELATED PROCESSED PRODUCT TECHNOLOGY
MISTAKES ORIENTED RELATED RELATED
MISTAKES MISTAKES MISTAKES
 Undermined  Overly optimistic  Requirement  Silver bullet
motivation schedules gold-plating syndrome
 Weak personnel  Insufficient risk  Feature creep  Overestimated
 Uncontrolled management  Developer gold savings from new
problem employees  Contractor failure platting tools or method
 Heroics  Insufficient  Push-me, pull-  Switching tools in
 Noisy, crowded planning me negotiation the middle of the
offices  Wasted time  Research project
 Friction between during the fuzzy oriented  Lack of automated
developers and front end development source-code control
customers  Shortchanged
 Unrealistic upstream activities
expectations  Inadequate design
 Lack of user-input
 Wishful thinking.
CONCLUSION:
As the problem and risk faced by each project are unique, so it
is not possible to prescribe a standard format.

A good project risk management within an organization has the

following characteristics:
(a) Project risk management activities commence at the initiation
of the project, risk management plans are developed and risk
management continues throughout the project life cycle.
(b) Project risk management is not a discrete stand-alone process,
but is integrated with other project management functions.
(c) The implementation of project risk management is the
responsibility of all project stakeholders and they participate
actively in the process.
THANK YOU