Project Management Introduction What is Project Management? Application of knowledge, skills, tools and techniques to project activities to meet project

Project Management

Introduction

What is Project Management?

Application of knowledge, skills, tools and techniques to project activities to meet project requirements.

A temporary endeavor with a defined beginning and end, undertaken to meet unique goals and objectives, typically to bring about beneficial change or added value.

Different than an Operation (repetitive, permanent/semi-permanent activities to produce products or services.

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Why is Risk Management Important?

What is Risk Management?

Risk management refers to a principled approach and process to the tasks of identifying and assessing risks, and then planning and implementing risk responses.


What is Risk?

Risk is “an uncertain event or condition that, if it occurs, has a positive or negative effect on a project’s objectives.”

Workbook, Rmstudy; Targeting Success.


An example of a Risky Situation

Painting our own house can be Risky

A pleasant surprise (positive effect or condition):

The color is prettier than expected.An unpleasant surprise (negative effect or condition):

The HOA says the colorIs not acceptable.


Threats and Opportunities

Threat: Used to describe an uncertain event that would have a negative impact on objectives if it occurred. Contrast this with opportunity….

Opportunity: Used to describe an uncertain event that would have a positive impact on objectives if it occurred.

The combined effect of risks is known as risk exposure.


Top Ten Reasons Why Risk Management Is Important

Reason #1

The future is uncertain


Our house painting project

Will it rain on the day we plan to paint?

What if the paint sprayer we borrowed does not work?

What if we don’t buy enough paint?

What if one of our helpers falls off a ladder?


Reason #2

Risk threatens the very reason your organization exists



What risks do we face, if we do not paint?

• If our house develops mold, it could be condemned.

• If we do not paint and the eaves develop dry-rot, we might have to re-roof the house.


Reason #3

Not all risks are manageable, so managing the ones you can is

essential



What risks threaten our house that we cannot manage?

• Mudslide

• Earthquake


Reason #4

Risk threatens organizational profitability



What accidents can make our house painting cost us more than we expected?

• Spilled paint (clean-up and paint replacement)

• Put ladder through a window


Reason #5

Risks threatens employee success



We have hired two teenagers to help us on Saturday and we want to get all the painting done on that day. What risks could keep them from being successful?

• Not having the prep work done for them to begin on time.

• Running out of paint before they are through.

• Not buying enough pizza for lunch.


Reason #6

Risk provides unpredicted opportunities to out-perform goals

and projections



• There’s enough leftover paint to paint the doghouse!

• The neighbor’s like it so much they want to hire us to paint their house!


Reason #7

Risk can result in litigation



How could a new coat of paint land us in court?

• We accidentally splashed paint on the neighbor’s new Maserati.

• We put our ladder through someone else’s window.

• That woman living next door sues us because our color clashes with the rest of the neighborhood.


Reason #8

Risk changes



Prior to 1978, paints used on private dwellings could contain lead—an ingredient that made paint last longer. After studies revealed how toxic lead is to humans, it was banned for use in house painting, toys and applications where humans could come into direct contact with the paint.

How can we protect ourselves against a situation such as this with our house painting project?

• Buy house paint that’s been approved by safety organizations


Reason #9

Risk is everywhere




Reason #10

A recent allPM.com poll showed that according to Project Management Professionals one of the top five documents needed for project success is the Risk Management Plan.

http://www.projecttimes.com/articles/ten-reasons-to-trash-your-risk-management-plan.html

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Jaimie M. Rush

Instructor, PMstudy

[email protected]

(909) 225-7309

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THANK YOU!

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Project Management Introduction What is Project Management? Application of knowledge, skills, tools and techniques to project activities to meet project