Smsvn pmp training_slides_chapter_11

SMSVN – PMP Training Course 2013 – Chapter 11 Prepared by Nguyen Quy Son - 20/08/2013

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PROJECT RISK MANAGEMENT Example: Company Trip

Identify Response Owner


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PROJECT RISK MANAGEMENT Risk is an uncertain event or condition that, if occurs, has an

effect on at least one project objective. Issue is a point or matter in question or in dispute. Threat: Negative risks Opportunities: Positive risks Risk management objectives:

increase the probability and impact of positive events (opportunities).

decrease the probability and impact of negative events (threat).


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PROJECT RISK MANAGEMENT Risk Attitudes

Risk Averse: people are not comfortable with risks; they are willing to avoid the risks, doesn’t like risk.

Risk Neutral: people manage risks based on their expected value, that is, probability times impact. In other words, their decisions towards risks are not biased by any other factors, except for the risks’ expected value.

Risk Seeker: people see risks as challenges and feel exciting dealing with them.

Risk Tolerant: people are indifferent about risks. This means they do not pay much attention to risks, until these risks become real problems.

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PROJECT RISK MANAGEMENT

11.1 Plan Risk Management 11.2 Identify Risks 11.3 Perform Qualitative Risk

Analysis 11.4 Perform Quantitative Risk

Analysis 11.5 Plan Risk Responses 11.6 Control Risks


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PROJECT RISK MANAGEMENT

Knowledge Area

Process

Initiating Planning Executing Monitoring & Contol Closing

Project RiskManagement

11.1 Plan RiskManagement11.2 Identify Risks11.3 PerformQualitative RiskAnalysis11.4 PerformQuantitative RiskAnalysis11.5 Plan RiskResponses

11.6 Control Risks


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11.1 PLAN RISK MANAGEMENT Plan Risk Management is the process of defining how to conduct

risk management activities for a project.

Risk Management Plan include: Methodology. Roles and responsibilities. Budgeting. Timing. Risk categories. …

Inputs Tool&Techniques Outputs

.1 Project management plan

.2 Project charter

.3 Stakeholder register

.4 EEFs

.5 OPAs

.1 Analytical techniques

.2 Expert judgment

.3 Meetings

.1 Risk management plan


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11.1 PLAN RISK MANAGEMENT Risk categories: Provide a means for grouping potential causes of risk. Several

approaches can be used, for example, a structure based on project objectives by category

Example of a Risk Breakdown Structure (RBS)


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11.2 IDENTIFY RISKS Identify Risks is the process of determining which risks may affect

the project and documenting their characteristics.



.2 Cost management plan

.3 Schedule management plan

.4 Quality management plan

.5 Human resource management plan.6 Scope baseline.7 Activity cost estimates.8 Activity duration estimates.9 Stakeholder register.10 Project documents.11 Procurement documents.12 EEFs.13 OPAs

.1 Documentation reviews

.2 Information gathering techniques.3 Checklist analysis.4 Assumptions analysis.5 Diagramming techniques.6 SWOT analysis.7 Expert judgment

.1 Risk register


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11.2 IDENTIFY RISKS SWOT Analysis: This analysis looks at the project to identify its strengths and

weaknesses and thereby identify risks (opportunities and threats).


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11.2 IDENTIFY RISKS Risk Register


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11.3 PERFORM QUALITATIVE RISK ANALYSIS Perform Qualitative Risk Analysis is the process of

prioritizing risks for further analysis or action by assessing and combining their probability of occurrence and impact.



.2 Scope baseline

.3 Risk register

.4 EEFs

.5 OPAs

.1 Risk probability andimpact assessment.2 Probability and impactmatrix.3 Risk data qualityassessment.4 Risk categorization.5 Risk urgency assessment.6 Expert judgment

.1 Project documentsupdates


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11.3 PERFORM QUALITATIVE RISK ANALYSIS Probability and Impact Matrix


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11.4 PERFORM QUANTITATIVE RISK ANALYSIS Perform Quantitative Risk Analysis is the process of

numerically analyzing the effect of identified risks on overall project objectives.



.2 Cost management plan

.3 Schedule managementplan.4 Risk register.5 EEFs.6 OPAs

.1 Data gathering andrepresentationtechniques.2 Quantitative risk analysisand modeling techniques.3 Expert judgment

.1 Project documentsupdates


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11.4 PERFORM QUANTITATIVE RISK ANALYSIS Expected monetary value analysis Expected monetary value (EMV) = Probability * Impact


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11.5 PLAN RISK RESPONSES Plan Risk Responses is the process of developing

options and actions to enhance opportunities and to reduce threats to project objectives.



.2 Risk register.1 Strategies for negativerisks or threats.2 Strategies for positiverisks or opportunities.3 Contingent responsestrategies.4 Expert judgment

.1 Project management planupdates.2 Project documentsupdates


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11.5 PLAN RISK RESPONSES Strategies for Negative Risks or Threats

Avoid: Changing the project management plan to eliminate the threat entirely: extending the schedule, changing the strategy, or reducing scope

Transfer: Make another party responsible for the risk by purchasing insurance, performance bonds, warranties, or guarantees or by outsourcing the work.

Mitigate: Taking early action to reduce the probability and/or impact of a threat

Accept: Do nothing and say, “If it happens, it happens:”


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11.5 PLAN RISK RESPONSES Strategies for Positive Risks or Opportunities

Exploit: Add work or change the project to make sure the opportunity occurs.

Enhance: Increase the likelihood (probability) and/or positive impacts of the risk event.

Share: Allocate ownership of the opportunity to a third party (forming a partnership, team, or joint venture) that is best able to achieve the opportunity

Accept: Do nothing and say, “If it happens, it happens:”


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11.5 PLAN RISK RESPONSES Contingency plans are plans describing the specific actions that

will be taken if the opportunity or threat occurs. Secondary risks that arise as a direct outcome of implementing a

risk response. Residual risks These are the risks that remain after risk response

planning. Fallback plans These plans are specific actions that will be taken if

the contingency plan is not effective. Contingency reserves that are calculated based on the

quantitative risk analysis of the project and the organization’s risk thresholds.

Risk response owners A key concept in risk response planning is that the project manager does not have to do it all and neither does the team.


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11.6 CONTROL RISKS Control Risks is the process of implementing risk

response plans, tracking identified risks, monitoring residual risks, identifying new risks, and evaluating risk process effectiveness throughout the project.


.1 Project management plan

.2 Risk register

.3 Work performance data

.4 Work performancereports

.1 Risk reassessment

.2 Risk audits

.3 Variance and trendanalysis.4 Technical performancemeasurement.5 Reserve analysis.6 Meetings

.1 Work performanceinformation.2 Change requests.3 Project management planupdates.4 Project documentsupdates.5 Organizational processassets updates

Business

Smsvn pmp training_slides_chapter_11