| All of us manage risk in our day to day life by buying | | | | that are best handled by the business. Generic risks |
| insurance cover for our life, house, car etc, so why | | | | are risks to all projects. |
| not do risk management for the project. Risk | | | | 2. Risk Quantification |
| Management is a key responsibility of the project | | | | Risk need to be quantified in 2 dimensions. The |
| manager. | | | | impact of the risk needs to be assessed. The |
| Risk management is one of the project management | | | | probability of the risk occurring needs to be assessed. |
| disciplines which have a direct impact on the project | | | | If probability is high, and impact is low, it is a Medium |
| success or failure. A better risk management ensures | | | | risk. On the other hand if impact is high, and |
| that you are prepared for the unforeseen | | | | probability low, it is High priority. |
| circumstances and when they actually happen, you | | | | 3. Risk Response |
| can handle it well. Some Project managers show | | | | A risk response plan should include the strategy and |
| helplessness in case of some external disturbances | | | | action items to address the strategy. The actions |
| like workers strike. But good managers do not. They | | | | should include what needs to be done, who is doing |
| do plan for such risk and have a ready work around. | | | | it, and when it should be completed. |
| However, all real projects carry risk through | | | | 4. Risk Monitoring and Control |
| uncertainty. The most obvious examples of sources | | | | The final step is to continually monitor risks to |
| of project risk comes from: | | | | identify any change in the status, or if they turn into |
| * dependencies (internal or external) | | | | an issue. |
| * assumptions made by project team members | | | | At the start of a project, the potential impact of |
| (about any aspect of the project). | | | | risk is almost unlimited. The simple choice is to either |
| There are 4 stages in the Project Risk management | | | | dedicate proper and timely attention to understanding |
| process : | | | | and managing risk, or suffer its consequences. On |
| 1. Risk Identification | | | | large projects, there are few areas where a Project |
| In this stage, we identify and name the risks. There | | | | manager can have a greater impact on a project |
| are different sorts of risks and we need to decide | | | | than the area of risk. |
| on a project basis. Business risks are ongoing risks | | | | |