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Risk Assessment Matrix
© All rights reserved. The Managers Resource Handbook by MHX Global LLP www.ManagersResourceHandbook.com v1
An Example for Project Managers
© All rights reserved. The Managers Resource Handbook by MHX Global LLP www.ManagersResourceHandbook.com v1
What is A Risk Assessment Matrix?
• A Risk Assessment Matrix is a tool. – Helps organize concerns and risks you foresee with a given project
– Includes potential impacts to the project
– Identifies the person(s) responsible for managing each risk item
– Computes the cost associated with each risk
– States the likelihood a risk will occur
– Sums the total potential risk for a project as a function of cost
• A Risk Assessment Matrix helps Project Teams plan for problems, manage risk, prioritize action, and communicate to others.
• The potential cost of risk value you calculate can be factored into your financial model to build a stronger business case.
© All rights reserved. The Managers Resource Handbook by MHX Global LLP www.ManagersResourceHandbook.com v1
Key Steps in Building a Risk Assessment Matrix
1. Identify the Risk
2. Evaluate the Impacts of Each Risk
3. Define Ways to Mitigate Each Item
4. Calculate the Total Cost of Each Risk
5. Define the Probability of Each Item
6. Sum the Total Potential Risk Value of a Project
For Step-By-Step Instructions and to Download The Template: http://www.managersresourcehandbook.com/project-risk-matrix-template/
© All rights reserved. The Managers Resource Handbook by MHX Global LLP www.ManagersResourceHandbook.com v1
Watkins Smith Corporation
RF-30 Upgrade
Jessica Abrams
May 1, 2016
October 1, 2018 C Cost
August 12, 2018 S Schedule
December 3, 2017 R Resources
On Track O Other
Number Risk Description Impact of Risk C S R O Mitigation Strategy Risk OwnerTotal Risk
Value
Probability of
Occurrence
Predicted
Risk Value
1Customer delays release of end
product into market
-Delay in investment recovery
-Reduced Sales next yearX X
-Add customer-driven delays to penalties
clause of contract
-Add milestone payments for Initial Concept
and Design Acceptance to shorten time
between payments
T. Franklin $45,000 60% $27,000
2Customer seeks to renegotiate
price based on final design
-Reduction in total projected revenue
-Business case may not be as strong
-Sales contribution from project may
need to be reduced
-Cost reduction may be needed
X X
-Track detailed cost changes throughout
design evolution to show cost adjustments
-Seek funding for changes to help absorb
non-recurring costs impacts
G. DuBois $33,050 50% $16,525
3
Specialize software is needed
based on current project
requirements
-Purchase of additional software
necessary
-Employees will need training
-Efficiency loss due to learning curve
X X X
-Negotiate with customer to use 'industry
standard' software
-Charge customer for added cost of special
software under scope change clause.
R. Nelson $77,000 25% $19,250
4
Produce Validation Testing
must be performed by 3rd
party
-Need to identify potential suppliers
-Added cost of paying 3rd party
-Schedule impact due to logisticsX X X
-Setup test program to use only internal
equipment
-Work with customer to see what tests they
can perform on our behalf
C. Jenkins $113,000 20% $22,600
5
Product Parts List exceeds
estimated value by more than
10%
-Recurring Cost in excess of business
case
-Reduced profit margin if price
remains unchanged
-Potential loss on effort
X
-Negotiate component costs with suppliers
-Renegotiate contract price with customer
based on customer-driven changes.
M. Hart $8,400 30% $2,520
6
Customer IT system/formats
cannot receive project
deliverables
-Will need to convert formats
internally
-May require specialize conversion
software
-Schedule impact if formatting issues
cannot be resolved
X X
-Test software export abilities within first
90 days
-Have customer provide list of formats to
evaluate import capabilities
R. Nelson $18,500 70% $12,950
$294,950
$100,845
Risk Values
Project Financial Summary:
42%
41%
$100,845
$119,643
75%
68%
$1.595M
$2.351M
Reporting Date
Risk Category DefinitionProject
Project Manager
Current ROS:
Estimated % Complete:
Initial Risk Value:
Current Risk Value:
Total Potential Risk (Unweighted)
Total Estimated Impact (Weighted)
Estimated Completion Date
% Budget SpendPlanned Completion Date
Category
Project Status
Customer Initial ROS:
Estimated Investment:
Current Investment:Project Start Date
Project Information
© All rights reserved. The Managers Resource Handbook by MHX Global LLP www.ManagersResourceHandbook.com v1
Watkins Smith Corporation
RF-30 Upgrade
Jessica Abrams
May 1, 2016
October 1, 2018 C Cost
August 12, 2018 S Schedule
December 3, 2017 R Resources
On Track O Other
Number Risk Description Impact of Risk C S R O Mitigation Strategy Risk OwnerTotal Risk
Value
Probability of
Occurrence
Predicted
Risk Value
1Customer delays release of end
product into market
-Delay in investment recovery
-Reduced Sales next yearX X
-Add customer-driven delays to penalties
clause of contract
-Add milestone payments for Initial Concept
and Design Acceptance to shorten time
between payments
T. Franklin $45,000 60% $27,000
2Customer seeks to renegotiate
price based on final design
-Reduction in total projected revenue
-Business case may not be as strong
-Sales contribution from project may
need to be reduced
-Cost reduction may be needed
X X
-Track detailed cost changes throughout
design evolution to show cost adjustments
-Seek funding for changes to help absorb
non-recurring costs impacts
G. DuBois $33,050 50% $16,525
3
Specialize software is needed
based on current project
requirements
-Purchase of additional software
necessary
-Employees will need training
-Efficiency loss due to learning curve
X X X
-Negotiate with customer to use 'industry
standard' software
-Charge customer for added cost of special
software under scope change clause.
R. Nelson $77,000 25% $19,250
4
Produce Validation Testing
must be performed by 3rd
party
-Need to identify potential suppliers
-Added cost of paying 3rd party
-Schedule impact due to logisticsX X X
-Setup test program to use only internal
equipment
-Work with customer to see what tests they
can perform on our behalf
C. Jenkins $113,000 20% $22,600
5
Product Parts List exceeds
estimated value by more than
10%
-Recurring Cost in excess of business
case
-Reduced profit margin if price
remains unchanged
-Potential loss on effort
X
-Negotiate component costs with suppliers
-Renegotiate contract price with customer
based on customer-driven changes.
M. Hart $8,400 30% $2,520
6
Customer IT system/formats
cannot receive project
deliverables
-Will need to convert formats
internally
-May require specialize conversion
software
-Schedule impact if formatting issues
cannot be resolved
X X
-Test software export abilities within first
90 days
-Have customer provide list of formats to
evaluate import capabilities
R. Nelson $18,500 70% $12,950
$294,950
$100,845
Risk Values
Project Financial Summary:
42%
41%
$100,845
$119,643
75%
68%
$1.595M
$2.351M
Reporting Date
Risk Category DefinitionProject
Project Manager
Current ROS:
Estimated % Complete:
Initial Risk Value:
Current Risk Value:
Total Potential Risk (Unweighted)
Total Estimated Impact (Weighted)
Estimated Completion Date
% Budget SpendPlanned Completion Date
Category
Project Status
Customer Initial ROS:
Estimated Investment:
Current Investment:Project Start Date
Project Information
Create a Header
Since a Risk Assessment Matrix is used by a project team and as a reporting tool, create a header of key information about the project. You may want to include: • Project Name • Customer • Program Manager • Key Dates
Watkins Smith Corporation
RF-30 Upgrade
Jessica Abrams
May 1, 2016
October 1, 2018 C Cost
August 12, 2018 S Schedule
December 3, 2017 R Resources
On Track O Other
Number Risk Description Impact of Risk C S R O Mitigation Strategy Risk OwnerTotal Risk
Value
Probability of
Occurrence
Predicted
Risk Value
1Customer delays release of end
product into market
-Delay in investment recovery
-Reduced Sales next yearX X
-Add customer-driven delays to penalties
clause of contract
-Add milestone payments for Initial Concept
and Design Acceptance to shorten time
between payments
T. Franklin $45,000 60% $27,000
2Customer seeks to renegotiate
price based on final design
-Reduction in total projected revenue
-Business case may not be as strong
-Sales contribution from project may
need to be reduced
-Cost reduction may be needed
X X
-Track detailed cost changes throughout
design evolution to show cost adjustments
-Seek funding for changes to help absorb
non-recurring costs impacts
G. DuBois $33,050 50% $16,525
3
Specialize software is needed
based on current project
requirements
-Purchase of additional software
necessary
-Employees will need training
-Efficiency loss due to learning curve
X X X
-Negotiate with customer to use 'industry
standard' software
-Charge customer for added cost of special
software under scope change clause.
R. Nelson $77,000 25% $19,250
4
Produce Validation Testing
must be performed by 3rd
party
-Need to identify potential suppliers
-Added cost of paying 3rd party
-Schedule impact due to logisticsX X X
-Setup test program to use only internal
equipment
-Work with customer to see what tests they
can perform on our behalf
C. Jenkins $113,000 20% $22,600
5
Product Parts List exceeds
estimated value by more than
10%
-Recurring Cost in excess of business
case
-Reduced profit margin if price
remains unchanged
-Potential loss on effort
X
-Negotiate component costs with suppliers
-Renegotiate contract price with customer
based on customer-driven changes.
M. Hart $8,400 30% $2,520
6
Customer IT system/formats
cannot receive project
deliverables
-Will need to convert formats
internally
-May require specialize conversion
software
-Schedule impact if formatting issues
cannot be resolved
X X
-Test software export abilities within first
90 days
-Have customer provide list of formats to
evaluate import capabilities
R. Nelson $18,500 70% $12,950
$294,950
$100,845
Risk Values
Project Financial Summary:
42%
41%
$100,845
$119,643
75%
68%
$1.595M
$2.351M
Reporting Date
Risk Category DefinitionProject
Project Manager
Current ROS:
Estimated % Complete:
Initial Risk Value:
Current Risk Value:
Total Potential Risk (Unweighted)
Total Estimated Impact (Weighted)
Estimated Completion Date
% Budget SpendPlanned Completion Date
Category
Project Status
Customer Initial ROS:
Estimated Investment:
Current Investment:Project Start Date
Project Information
© All rights reserved. The Managers Resource Handbook by MHX Global LLP www.ManagersResourceHandbook.com v1
Watkins Smith Corporation
RF-30 Upgrade
Jessica Abrams
May 1, 2016
October 1, 2018 C Cost
August 12, 2018 S Schedule
December 3, 2017 R Resources
On Track O Other
Number Risk Description Impact of Risk C S R O Mitigation Strategy Risk OwnerTotal Risk
Value
Probability of
Occurrence
Predicted
Risk Value
1Customer delays release of end
product into market
-Delay in investment recovery
-Reduced Sales next yearX X
-Add customer-driven delays to penalties
clause of contract
-Add milestone payments for Initial Concept
and Design Acceptance to shorten time
between payments
T. Franklin $45,000 60% $27,000
2Customer seeks to renegotiate
price based on final design
-Reduction in total projected revenue
-Business case may not be as strong
-Sales contribution from project may
need to be reduced
-Cost reduction may be needed
X X
-Track detailed cost changes throughout
design evolution to show cost adjustments
-Seek funding for changes to help absorb
non-recurring costs impacts
G. DuBois $33,050 50% $16,525
3
Specialize software is needed
based on current project
requirements
-Purchase of additional software
necessary
-Employees will need training
-Efficiency loss due to learning curve
X X X
-Negotiate with customer to use 'industry
standard' software
-Charge customer for added cost of special
software under scope change clause.
R. Nelson $77,000 25% $19,250
4
Produce Validation Testing
must be performed by 3rd
party
-Need to identify potential suppliers
-Added cost of paying 3rd party
-Schedule impact due to logisticsX X X
-Setup test program to use only internal
equipment
-Work with customer to see what tests they
can perform on our behalf
C. Jenkins $113,000 20% $22,600
5
Product Parts List exceeds
estimated value by more than
10%
-Recurring Cost in excess of business
case
-Reduced profit margin if price
remains unchanged
-Potential loss on effort
X
-Negotiate component costs with suppliers
-Renegotiate contract price with customer
based on customer-driven changes.
M. Hart $8,400 30% $2,520
6
Customer IT system/formats
cannot receive project
deliverables
-Will need to convert formats
internally
-May require specialize conversion
software
-Schedule impact if formatting issues
cannot be resolved
X X
-Test software export abilities within first
90 days
-Have customer provide list of formats to
evaluate import capabilities
R. Nelson $18,500 70% $12,950
$294,950
$100,845
Risk Values
Project Financial Summary:
42%
41%
$100,845
$119,643
75%
68%
$1.595M
$2.351M
Reporting Date
Risk Category DefinitionProject
Project Manager
Current ROS:
Estimated % Complete:
Initial Risk Value:
Current Risk Value:
Total Potential Risk (Unweighted)
Total Estimated Impact (Weighted)
Estimated Completion Date
% Budget SpendPlanned Completion Date
Category
Project Status
Customer Initial ROS:
Estimated Investment:
Current Investment:Project Start Date
Project Information
Create a Header (Continued)
Since a Risk Assessment Matrix is used by a project team and as a reporting tool, create a header of key information about the project. You may want to include: • Return on Sales (ROS) • Total Investment • % of Budget Spent • Risk Values
Watkins Smith Corporation
RF-30 Upgrade
Jessica Abrams
May 1, 2016
October 1, 2018 C Cost
August 12, 2018 S Schedule
December 3, 2017 R Resources
On Track O Other
Number Risk Description Impact of Risk C S R O Mitigation Strategy Risk OwnerTotal Risk
Value
Probability of
Occurrence
Predicted
Risk Value
1Customer delays release of end
product into market
-Delay in investment recovery
-Reduced Sales next yearX X
-Add customer-driven delays to penalties
clause of contract
-Add milestone payments for Initial Concept
and Design Acceptance to shorten time
between payments
T. Franklin $45,000 60% $27,000
2Customer seeks to renegotiate
price based on final design
-Reduction in total projected revenue
-Business case may not be as strong
-Sales contribution from project may
need to be reduced
-Cost reduction may be needed
X X
-Track detailed cost changes throughout
design evolution to show cost adjustments
-Seek funding for changes to help absorb
non-recurring costs impacts
G. DuBois $33,050 50% $16,525
3
Specialize software is needed
based on current project
requirements
-Purchase of additional software
necessary
-Employees will need training
-Efficiency loss due to learning curve
X X X
-Negotiate with customer to use 'industry
standard' software
-Charge customer for added cost of special
software under scope change clause.
R. Nelson $77,000 25% $19,250
4
Produce Validation Testing
must be performed by 3rd
party
-Need to identify potential suppliers
-Added cost of paying 3rd party
-Schedule impact due to logisticsX X X
-Setup test program to use only internal
equipment
-Work with customer to see what tests they
can perform on our behalf
C. Jenkins $113,000 20% $22,600
5
Product Parts List exceeds
estimated value by more than
10%
-Recurring Cost in excess of business
case
-Reduced profit margin if price
remains unchanged
-Potential loss on effort
X
-Negotiate component costs with suppliers
-Renegotiate contract price with customer
based on customer-driven changes.
M. Hart $8,400 30% $2,520
6
Customer IT system/formats
cannot receive project
deliverables
-Will need to convert formats
internally
-May require specialize conversion
software
-Schedule impact if formatting issues
cannot be resolved
X X
-Test software export abilities within first
90 days
-Have customer provide list of formats to
evaluate import capabilities
R. Nelson $18,500 70% $12,950
$294,950
$100,845
Risk Values
Project Financial Summary:
42%
41%
$100,845
$119,643
75%
68%
$1.595M
$2.351M
Reporting Date
Risk Category DefinitionProject
Project Manager
Current ROS:
Estimated % Complete:
Initial Risk Value:
Current Risk Value:
Total Potential Risk (Unweighted)
Total Estimated Impact (Weighted)
Estimated Completion Date
% Budget SpendPlanned Completion Date
Category
Project Status
Customer Initial ROS:
Estimated Investment:
Current Investment:Project Start Date
Project Information
© All rights reserved. The Managers Resource Handbook by MHX Global LLP www.ManagersResourceHandbook.com v1
Watkins Smith Corporation
RF-30 Upgrade
Jessica Abrams
May 1, 2016
October 1, 2018 C Cost
August 12, 2018 S Schedule
December 3, 2017 R Resources
On Track O Other
Number Risk Description Impact of Risk C S R O Mitigation Strategy Risk OwnerTotal Risk
Value
Probability of
Occurrence
Predicted
Risk Value
1Customer delays release of end
product into market
-Delay in investment recovery
-Reduced Sales next yearX X
-Add customer-driven delays to penalties
clause of contract
-Add milestone payments for Initial Concept
and Design Acceptance to shorten time
between payments
T. Franklin $45,000 60% $27,000
2Customer seeks to renegotiate
price based on final design
-Reduction in total projected revenue
-Business case may not be as strong
-Sales contribution from project may
need to be reduced
-Cost reduction may be needed
X X
-Track detailed cost changes throughout
design evolution to show cost adjustments
-Seek funding for changes to help absorb
non-recurring costs impacts
G. DuBois $33,050 50% $16,525
3
Specialize software is needed
based on current project
requirements
-Purchase of additional software
necessary
-Employees will need training
-Efficiency loss due to learning curve
X X X
-Negotiate with customer to use 'industry
standard' software
-Charge customer for added cost of special
software under scope change clause.
R. Nelson $77,000 25% $19,250
4
Produce Validation Testing
must be performed by 3rd
party
-Need to identify potential suppliers
-Added cost of paying 3rd party
-Schedule impact due to logisticsX X X
-Setup test program to use only internal
equipment
-Work with customer to see what tests they
can perform on our behalf
C. Jenkins $113,000 20% $22,600
5
Product Parts List exceeds
estimated value by more than
10%
-Recurring Cost in excess of business
case
-Reduced profit margin if price
remains unchanged
-Potential loss on effort
X
-Negotiate component costs with suppliers
-Renegotiate contract price with customer
based on customer-driven changes.
M. Hart $8,400 30% $2,520
6
Customer IT system/formats
cannot receive project
deliverables
-Will need to convert formats
internally
-May require specialize conversion
software
-Schedule impact if formatting issues
cannot be resolved
X X
-Test software export abilities within first
90 days
-Have customer provide list of formats to
evaluate import capabilities
R. Nelson $18,500 70% $12,950
$294,950
$100,845
Risk Values
Project Financial Summary:
42%
41%
$100,845
$119,643
75%
68%
$1.595M
$2.351M
Reporting Date
Risk Category DefinitionProject
Project Manager
Current ROS:
Estimated % Complete:
Initial Risk Value:
Current Risk Value:
Total Potential Risk (Unweighted)
Total Estimated Impact (Weighted)
Estimated Completion Date
% Budget SpendPlanned Completion Date
Category
Project Status
Customer Initial ROS:
Estimated Investment:
Current Investment:Project Start Date
Project Information
Create a Header (Continued)
Since a Risk Assessment Matrix is used by a project team and as a reporting tool, create a header of key information about the project. You may want to include: • A Key or Legend of Definitions
Watkins Smith Corporation
RF-30 Upgrade
Jessica Abrams
May 1, 2016
October 1, 2018 C Cost
August 12, 2018 S Schedule
December 3, 2017 R Resources
On Track O Other
Number Risk Description Impact of Risk C S R O Mitigation Strategy Risk OwnerTotal Risk
Value
Probability of
Occurrence
Predicted
Risk Value
1Customer delays release of end
product into market
-Delay in investment recovery
-Reduced Sales next yearX X
-Add customer-driven delays to penalties
clause of contract
-Add milestone payments for Initial Concept
and Design Acceptance to shorten time
between payments
T. Franklin $45,000 60% $27,000
2Customer seeks to renegotiate
price based on final design
-Reduction in total projected revenue
-Business case may not be as strong
-Sales contribution from project may
need to be reduced
-Cost reduction may be needed
X X
-Track detailed cost changes throughout
design evolution to show cost adjustments
-Seek funding for changes to help absorb
non-recurring costs impacts
G. DuBois $33,050 50% $16,525
3
Specialize software is needed
based on current project
requirements
-Purchase of additional software
necessary
-Employees will need training
-Efficiency loss due to learning curve
X X X
-Negotiate with customer to use 'industry
standard' software
-Charge customer for added cost of special
software under scope change clause.
R. Nelson $77,000 25% $19,250
4
Produce Validation Testing
must be performed by 3rd
party
-Need to identify potential suppliers
-Added cost of paying 3rd party
-Schedule impact due to logisticsX X X
-Setup test program to use only internal
equipment
-Work with customer to see what tests they
can perform on our behalf
C. Jenkins $113,000 20% $22,600
5
Product Parts List exceeds
estimated value by more than
10%
-Recurring Cost in excess of business
case
-Reduced profit margin if price
remains unchanged
-Potential loss on effort
X
-Negotiate component costs with suppliers
-Renegotiate contract price with customer
based on customer-driven changes.
M. Hart $8,400 30% $2,520
6
Customer IT system/formats
cannot receive project
deliverables
-Will need to convert formats
internally
-May require specialize conversion
software
-Schedule impact if formatting issues
cannot be resolved
X X
-Test software export abilities within first
90 days
-Have customer provide list of formats to
evaluate import capabilities
R. Nelson $18,500 70% $12,950
$294,950
$100,845
Risk Values
Project Financial Summary:
42%
41%
$100,845
$119,643
75%
68%
$1.595M
$2.351M
Reporting Date
Risk Category DefinitionProject
Project Manager
Current ROS:
Estimated % Complete:
Initial Risk Value:
Current Risk Value:
Total Potential Risk (Unweighted)
Total Estimated Impact (Weighted)
Estimated Completion Date
% Budget SpendPlanned Completion Date
Category
Project Status
Customer Initial ROS:
Estimated Investment:
Current Investment:Project Start Date
Project Information
© All rights reserved. The Managers Resource Handbook by MHX Global LLP www.ManagersResourceHandbook.com v1
Watkins Smith Corporation
RF-30 Upgrade
Jessica Abrams
May 1, 2016
October 1, 2018 C Cost
August 12, 2018 S Schedule
December 3, 2017 R Resources
On Track O Other
Number Risk Description Impact of Risk C S R O Mitigation Strategy Risk OwnerTotal Risk
Value
Probability of
Occurrence
Predicted
Risk Value
1Customer delays release of end
product into market
-Delay in investment recovery
-Reduced Sales next yearX X
-Add customer-driven delays to penalties
clause of contract
-Add milestone payments for Initial Concept
and Design Acceptance to shorten time
between payments
T. Franklin $45,000 60% $27,000
2Customer seeks to renegotiate
price based on final design
-Reduction in total projected revenue
-Business case may not be as strong
-Sales contribution from project may
need to be reduced
-Cost reduction may be needed
X X
-Track detailed cost changes throughout
design evolution to show cost adjustments
-Seek funding for changes to help absorb
non-recurring costs impacts
G. DuBois $33,050 50% $16,525
3
Specialize software is needed
based on current project
requirements
-Purchase of additional software
necessary
-Employees will need training
-Efficiency loss due to learning curve
X X X
-Negotiate with customer to use 'industry
standard' software
-Charge customer for added cost of special
software under scope change clause.
R. Nelson $77,000 25% $19,250
4
Produce Validation Testing
must be performed by 3rd
party
-Need to identify potential suppliers
-Added cost of paying 3rd party
-Schedule impact due to logisticsX X X
-Setup test program to use only internal
equipment
-Work with customer to see what tests they
can perform on our behalf
C. Jenkins $113,000 20% $22,600
5
Product Parts List exceeds
estimated value by more than
10%
-Recurring Cost in excess of business
case
-Reduced profit margin if price
remains unchanged
-Potential loss on effort
X
-Negotiate component costs with suppliers
-Renegotiate contract price with customer
based on customer-driven changes.
M. Hart $8,400 30% $2,520
6
Customer IT system/formats
cannot receive project
deliverables
-Will need to convert formats
internally
-May require specialize conversion
software
-Schedule impact if formatting issues
cannot be resolved
X X
-Test software export abilities within first
90 days
-Have customer provide list of formats to
evaluate import capabilities
R. Nelson $18,500 70% $12,950
$294,950
$100,845
Risk Values
Project Financial Summary:
42%
41%
$100,845
$119,643
75%
68%
$1.595M
$2.351M
Reporting Date
Risk Category DefinitionProject
Project Manager
Current ROS:
Estimated % Complete:
Initial Risk Value:
Current Risk Value:
Total Potential Risk (Unweighted)
Total Estimated Impact (Weighted)
Estimated Completion Date
% Budget SpendPlanned Completion Date
Category
Project Status
Customer Initial ROS:
Estimated Investment:
Current Investment:Project Start Date
Project Information
Step 1: Identify The Risk
• Meet with Project Team • Brainstorm all possible issues and concerns • Group them into main buckets
• NOTE: Be thorough… but realistic!
Watkins Smith Corporation
RF-30 Upgrade
Jessica Abrams
May 1, 2016
October 1, 2018 C Cost
August 12, 2018 S Schedule
December 3, 2017 R Resources
On Track O Other
Number Risk Description Impact of Risk C S R O Mitigation Strategy Risk OwnerTotal Risk
Value
Probability of
Occurrence
Predicted
Risk Value
1Customer delays release of end
product into market
-Delay in investment recovery
-Reduced Sales next yearX X
-Add customer-driven delays to penalties
clause of contract
-Add milestone payments for Initial Concept
and Design Acceptance to shorten time
between payments
T. Franklin $45,000 60% $27,000
2Customer seeks to renegotiate
price based on final design
-Reduction in total projected revenue
-Business case may not be as strong
-Sales contribution from project may
need to be reduced
-Cost reduction may be needed
X X
-Track detailed cost changes throughout
design evolution to show cost adjustments
-Seek funding for changes to help absorb
non-recurring costs impacts
G. DuBois $33,050 50% $16,525
3
Specialize software is needed
based on current project
requirements
-Purchase of additional software
necessary
-Employees will need training
-Efficiency loss due to learning curve
X X X
-Negotiate with customer to use 'industry
standard' software
-Charge customer for added cost of special
software under scope change clause.
R. Nelson $77,000 25% $19,250
4
Produce Validation Testing
must be performed by 3rd
party
-Need to identify potential suppliers
-Added cost of paying 3rd party
-Schedule impact due to logisticsX X X
-Setup test program to use only internal
equipment
-Work with customer to see what tests they
can perform on our behalf
C. Jenkins $113,000 20% $22,600
5
Product Parts List exceeds
estimated value by more than
10%
-Recurring Cost in excess of business
case
-Reduced profit margin if price
remains unchanged
-Potential loss on effort
X
-Negotiate component costs with suppliers
-Renegotiate contract price with customer
based on customer-driven changes.
M. Hart $8,400 30% $2,520
6
Customer IT system/formats
cannot receive project
deliverables
-Will need to convert formats
internally
-May require specialize conversion
software
-Schedule impact if formatting issues
cannot be resolved
X X
-Test software export abilities within first
90 days
-Have customer provide list of formats to
evaluate import capabilities
R. Nelson $18,500 70% $12,950
$294,950
$100,845
Risk Values
Project Financial Summary:
42%
41%
$100,845
$119,643
75%
68%
$1.595M
$2.351M
Reporting Date
Risk Category DefinitionProject
Project Manager
Current ROS:
Estimated % Complete:
Initial Risk Value:
Current Risk Value:
Total Potential Risk (Unweighted)
Total Estimated Impact (Weighted)
Estimated Completion Date
% Budget SpendPlanned Completion Date
Category
Project Status
Customer Initial ROS:
Estimated Investment:
Current Investment:Project Start Date
Project Information
© All rights reserved. The Managers Resource Handbook by MHX Global LLP www.ManagersResourceHandbook.com v1
Watkins Smith Corporation
RF-30 Upgrade
Jessica Abrams
May 1, 2016
October 1, 2018 C Cost
August 12, 2018 S Schedule
December 3, 2017 R Resources
On Track O Other
Number Risk Description Impact of Risk C S R O Mitigation Strategy Risk OwnerTotal Risk
Value
Probability of
Occurrence
Predicted
Risk Value
1Customer delays release of end
product into market
-Delay in investment recovery
-Reduced Sales next yearX X
-Add customer-driven delays to penalties
clause of contract
-Add milestone payments for Initial Concept
and Design Acceptance to shorten time
between payments
T. Franklin $45,000 60% $27,000
2Customer seeks to renegotiate
price based on final design
-Reduction in total projected revenue
-Business case may not be as strong
-Sales contribution from project may
need to be reduced
-Cost reduction may be needed
X X
-Track detailed cost changes throughout
design evolution to show cost adjustments
-Seek funding for changes to help absorb
non-recurring costs impacts
G. DuBois $33,050 50% $16,525
3
Specialize software is needed
based on current project
requirements
-Purchase of additional software
necessary
-Employees will need training
-Efficiency loss due to learning curve
X X X
-Negotiate with customer to use 'industry
standard' software
-Charge customer for added cost of special
software under scope change clause.
R. Nelson $77,000 25% $19,250
4
Produce Validation Testing
must be performed by 3rd
party
-Need to identify potential suppliers
-Added cost of paying 3rd party
-Schedule impact due to logisticsX X X
-Setup test program to use only internal
equipment
-Work with customer to see what tests they
can perform on our behalf
C. Jenkins $113,000 20% $22,600
5
Product Parts List exceeds
estimated value by more than
10%
-Recurring Cost in excess of business
case
-Reduced profit margin if price
remains unchanged
-Potential loss on effort
X
-Negotiate component costs with suppliers
-Renegotiate contract price with customer
based on customer-driven changes.
M. Hart $8,400 30% $2,520
6
Customer IT system/formats
cannot receive project
deliverables
-Will need to convert formats
internally
-May require specialize conversion
software
-Schedule impact if formatting issues
cannot be resolved
X X
-Test software export abilities within first
90 days
-Have customer provide list of formats to
evaluate import capabilities
R. Nelson $18,500 70% $12,950
$294,950
$100,845
Risk Values
Project Financial Summary:
42%
41%
$100,845
$119,643
75%
68%
$1.595M
$2.351M
Reporting Date
Risk Category DefinitionProject
Project Manager
Current ROS:
Estimated % Complete:
Initial Risk Value:
Current Risk Value:
Total Potential Risk (Unweighted)
Total Estimated Impact (Weighted)
Estimated Completion Date
% Budget SpendPlanned Completion Date
Category
Project Status
Customer Initial ROS:
Estimated Investment:
Current Investment:Project Start Date
Project Information
Step 2: Define the Impact
If the risk became ‘real,’ how would it affect the project? • More Time? • Added Cost? • Require More Resources? • Change Pricing Strategy?
Watkins Smith Corporation
RF-30 Upgrade
Jessica Abrams
May 1, 2016
October 1, 2018 C Cost
August 12, 2018 S Schedule
December 3, 2017 R Resources
On Track O Other
Number Risk Description Impact of Risk C S R O Mitigation Strategy Risk OwnerTotal Risk
Value
Probability of
Occurrence
Predicted
Risk Value
1Customer delays release of end
product into market
-Delay in investment recovery
-Reduced Sales next yearX X
-Add customer-driven delays to penalties
clause of contract
-Add milestone payments for Initial Concept
and Design Acceptance to shorten time
between payments
T. Franklin $45,000 60% $27,000
2Customer seeks to renegotiate
price based on final design
-Reduction in total projected revenue
-Business case may not be as strong
-Sales contribution from project may
need to be reduced
-Cost reduction may be needed
X X
-Track detailed cost changes throughout
design evolution to show cost adjustments
-Seek funding for changes to help absorb
non-recurring costs impacts
G. DuBois $33,050 50% $16,525
3
Specialize software is needed
based on current project
requirements
-Purchase of additional software
necessary
-Employees will need training
-Efficiency loss due to learning curve
X X X
-Negotiate with customer to use 'industry
standard' software
-Charge customer for added cost of special
software under scope change clause.
R. Nelson $77,000 25% $19,250
4
Produce Validation Testing
must be performed by 3rd
party
-Need to identify potential suppliers
-Added cost of paying 3rd party
-Schedule impact due to logisticsX X X
-Setup test program to use only internal
equipment
-Work with customer to see what tests they
can perform on our behalf
C. Jenkins $113,000 20% $22,600
5
Product Parts List exceeds
estimated value by more than
10%
-Recurring Cost in excess of business
case
-Reduced profit margin if price
remains unchanged
-Potential loss on effort
X
-Negotiate component costs with suppliers
-Renegotiate contract price with customer
based on customer-driven changes.
M. Hart $8,400 30% $2,520
6
Customer IT system/formats
cannot receive project
deliverables
-Will need to convert formats
internally
-May require specialize conversion
software
-Schedule impact if formatting issues
cannot be resolved
X X
-Test software export abilities within first
90 days
-Have customer provide list of formats to
evaluate import capabilities
R. Nelson $18,500 70% $12,950
$294,950
$100,845
Risk Values
Project Financial Summary:
42%
41%
$100,845
$119,643
75%
68%
$1.595M
$2.351M
Reporting Date
Risk Category DefinitionProject
Project Manager
Current ROS:
Estimated % Complete:
Initial Risk Value:
Current Risk Value:
Total Potential Risk (Unweighted)
Total Estimated Impact (Weighted)
Estimated Completion Date
% Budget SpendPlanned Completion Date
Category
Project Status
Customer Initial ROS:
Estimated Investment:
Current Investment:Project Start Date
Project Information
© All rights reserved. The Managers Resource Handbook by MHX Global LLP www.ManagersResourceHandbook.com v1
Watkins Smith Corporation
RF-30 Upgrade
Jessica Abrams
May 1, 2016
October 1, 2018 C Cost
August 12, 2018 S Schedule
December 3, 2017 R Resources
On Track O Other
Number Risk Description Impact of Risk C S R O Mitigation Strategy Risk OwnerTotal Risk
Value
Probability of
Occurrence
Predicted
Risk Value
1Customer delays release of end
product into market
-Delay in investment recovery
-Reduced Sales next yearX X
-Add customer-driven delays to penalties
clause of contract
-Add milestone payments for Initial Concept
and Design Acceptance to shorten time
between payments
T. Franklin $45,000 60% $27,000
2Customer seeks to renegotiate
price based on final design
-Reduction in total projected revenue
-Business case may not be as strong
-Sales contribution from project may
need to be reduced
-Cost reduction may be needed
X X
-Track detailed cost changes throughout
design evolution to show cost adjustments
-Seek funding for changes to help absorb
non-recurring costs impacts
G. DuBois $33,050 50% $16,525
3
Specialize software is needed
based on current project
requirements
-Purchase of additional software
necessary
-Employees will need training
-Efficiency loss due to learning curve
X X X
-Negotiate with customer to use 'industry
standard' software
-Charge customer for added cost of special
software under scope change clause.
R. Nelson $77,000 25% $19,250
4
Produce Validation Testing
must be performed by 3rd
party
-Need to identify potential suppliers
-Added cost of paying 3rd party
-Schedule impact due to logisticsX X X
-Setup test program to use only internal
equipment
-Work with customer to see what tests they
can perform on our behalf
C. Jenkins $113,000 20% $22,600
5
Product Parts List exceeds
estimated value by more than
10%
-Recurring Cost in excess of business
case
-Reduced profit margin if price
remains unchanged
-Potential loss on effort
X
-Negotiate component costs with suppliers
-Renegotiate contract price with customer
based on customer-driven changes.
M. Hart $8,400 30% $2,520
6
Customer IT system/formats
cannot receive project
deliverables
-Will need to convert formats
internally
-May require specialize conversion
software
-Schedule impact if formatting issues
cannot be resolved
X X
-Test software export abilities within first
90 days
-Have customer provide list of formats to
evaluate import capabilities
R. Nelson $18,500 70% $12,950
$294,950
$100,845
Risk Values
Project Financial Summary:
42%
41%
$100,845
$119,643
75%
68%
$1.595M
$2.351M
Reporting Date
Risk Category DefinitionProject
Project Manager
Current ROS:
Estimated % Complete:
Initial Risk Value:
Current Risk Value:
Total Potential Risk (Unweighted)
Total Estimated Impact (Weighted)
Estimated Completion Date
% Budget SpendPlanned Completion Date
Category
Project Status
Customer Initial ROS:
Estimated Investment:
Current Investment:Project Start Date
Project Information
Step 3: Categorize the Risk
For Communication purposes, and to help sort information, categorize the risk. Some ways you can categorize: • Types of Impact • Product Families • Customer • Regional Location
• NOTE: Risks may have more than one category
Watkins Smith Corporation
RF-30 Upgrade
Jessica Abrams
May 1, 2016
October 1, 2018 C Cost
August 12, 2018 S Schedule
December 3, 2017 R Resources
On Track O Other
Number Risk Description Impact of Risk C S R O Mitigation Strategy Risk OwnerTotal Risk
Value
Probability of
Occurrence
Predicted
Risk Value
1Customer delays release of end
product into market
-Delay in investment recovery
-Reduced Sales next yearX X
-Add customer-driven delays to penalties
clause of contract
-Add milestone payments for Initial Concept
and Design Acceptance to shorten time
between payments
T. Franklin $45,000 60% $27,000
2Customer seeks to renegotiate
price based on final design
-Reduction in total projected revenue
-Business case may not be as strong
-Sales contribution from project may
need to be reduced
-Cost reduction may be needed
X X
-Track detailed cost changes throughout
design evolution to show cost adjustments
-Seek funding for changes to help absorb
non-recurring costs impacts
G. DuBois $33,050 50% $16,525
3
Specialize software is needed
based on current project
requirements
-Purchase of additional software
necessary
-Employees will need training
-Efficiency loss due to learning curve
X X X
-Negotiate with customer to use 'industry
standard' software
-Charge customer for added cost of special
software under scope change clause.
R. Nelson $77,000 25% $19,250
4
Produce Validation Testing
must be performed by 3rd
party
-Need to identify potential suppliers
-Added cost of paying 3rd party
-Schedule impact due to logisticsX X X
-Setup test program to use only internal
equipment
-Work with customer to see what tests they
can perform on our behalf
C. Jenkins $113,000 20% $22,600
5
Product Parts List exceeds
estimated value by more than
10%
-Recurring Cost in excess of business
case
-Reduced profit margin if price
remains unchanged
-Potential loss on effort
X
-Negotiate component costs with suppliers
-Renegotiate contract price with customer
based on customer-driven changes.
M. Hart $8,400 30% $2,520
6
Customer IT system/formats
cannot receive project
deliverables
-Will need to convert formats
internally
-May require specialize conversion
software
-Schedule impact if formatting issues
cannot be resolved
X X
-Test software export abilities within first
90 days
-Have customer provide list of formats to
evaluate import capabilities
R. Nelson $18,500 70% $12,950
$294,950
$100,845
Risk Values
Project Financial Summary:
42%
41%
$100,845
$119,643
75%
68%
$1.595M
$2.351M
Reporting Date
Risk Category DefinitionProject
Project Manager
Current ROS:
Estimated % Complete:
Initial Risk Value:
Current Risk Value:
Total Potential Risk (Unweighted)
Total Estimated Impact (Weighted)
Estimated Completion Date
% Budget SpendPlanned Completion Date
Category
Project Status
Customer Initial ROS:
Estimated Investment:
Current Investment:Project Start Date
Project Information
© All rights reserved. The Managers Resource Handbook by MHX Global LLP www.ManagersResourceHandbook.com v1
Watkins Smith Corporation
RF-30 Upgrade
Jessica Abrams
May 1, 2016
October 1, 2018 C Cost
August 12, 2018 S Schedule
December 3, 2017 R Resources
On Track O Other
Number Risk Description Impact of Risk C S R O Mitigation Strategy Risk OwnerTotal Risk
Value
Probability of
Occurrence
Predicted
Risk Value
1Customer delays release of end
product into market
-Delay in investment recovery
-Reduced Sales next yearX X
-Add customer-driven delays to penalties
clause of contract
-Add milestone payments for Initial Concept
and Design Acceptance to shorten time
between payments
T. Franklin $45,000 60% $27,000
2Customer seeks to renegotiate
price based on final design
-Reduction in total projected revenue
-Business case may not be as strong
-Sales contribution from project may
need to be reduced
-Cost reduction may be needed
X X
-Track detailed cost changes throughout
design evolution to show cost adjustments
-Seek funding for changes to help absorb
non-recurring costs impacts
G. DuBois $33,050 50% $16,525
3
Specialize software is needed
based on current project
requirements
-Purchase of additional software
necessary
-Employees will need training
-Efficiency loss due to learning curve
X X X
-Negotiate with customer to use 'industry
standard' software
-Charge customer for added cost of special
software under scope change clause.
R. Nelson $77,000 25% $19,250
4
Produce Validation Testing
must be performed by 3rd
party
-Need to identify potential suppliers
-Added cost of paying 3rd party
-Schedule impact due to logisticsX X X
-Setup test program to use only internal
equipment
-Work with customer to see what tests they
can perform on our behalf
C. Jenkins $113,000 20% $22,600
5
Product Parts List exceeds
estimated value by more than
10%
-Recurring Cost in excess of business
case
-Reduced profit margin if price
remains unchanged
-Potential loss on effort
X
-Negotiate component costs with suppliers
-Renegotiate contract price with customer
based on customer-driven changes.
M. Hart $8,400 30% $2,520
6
Customer IT system/formats
cannot receive project
deliverables
-Will need to convert formats
internally
-May require specialize conversion
software
-Schedule impact if formatting issues
cannot be resolved
X X
-Test software export abilities within first
90 days
-Have customer provide list of formats to
evaluate import capabilities
R. Nelson $18,500 70% $12,950
$294,950
$100,845
Risk Values
Project Financial Summary:
42%
41%
$100,845
$119,643
75%
68%
$1.595M
$2.351M
Reporting Date
Risk Category DefinitionProject
Project Manager
Current ROS:
Estimated % Complete:
Initial Risk Value:
Current Risk Value:
Total Potential Risk (Unweighted)
Total Estimated Impact (Weighted)
Estimated Completion Date
% Budget SpendPlanned Completion Date
Category
Project Status
Customer Initial ROS:
Estimated Investment:
Current Investment:Project Start Date
Project Information
Step 4: Define Mitigation Strategies • What can you do to influence the outcome of the risks,
or mitigate their impact? • What can you do to protect the project?
Watkins Smith Corporation
RF-30 Upgrade
Jessica Abrams
May 1, 2016
October 1, 2018 C Cost
August 12, 2018 S Schedule
December 3, 2017 R Resources
On Track O Other
Number Risk Description Impact of Risk C S R O Mitigation Strategy Risk OwnerTotal Risk
Value
Probability of
Occurrence
Predicted
Risk Value
1Customer delays release of end
product into market
-Delay in investment recovery
-Reduced Sales next yearX X
-Add customer-driven delays to penalties
clause of contract
-Add milestone payments for Initial Concept
and Design Acceptance to shorten time
between payments
T. Franklin $45,000 60% $27,000
2Customer seeks to renegotiate
price based on final design
-Reduction in total projected revenue
-Business case may not be as strong
-Sales contribution from project may
need to be reduced
-Cost reduction may be needed
X X
-Track detailed cost changes throughout
design evolution to show cost adjustments
-Seek funding for changes to help absorb
non-recurring costs impacts
G. DuBois $33,050 50% $16,525
3
Specialize software is needed
based on current project
requirements
-Purchase of additional software
necessary
-Employees will need training
-Efficiency loss due to learning curve
X X X
-Negotiate with customer to use 'industry
standard' software
-Charge customer for added cost of special
software under scope change clause.
R. Nelson $77,000 25% $19,250
4
Produce Validation Testing
must be performed by 3rd
party
-Need to identify potential suppliers
-Added cost of paying 3rd party
-Schedule impact due to logisticsX X X
-Setup test program to use only internal
equipment
-Work with customer to see what tests they
can perform on our behalf
C. Jenkins $113,000 20% $22,600
5
Product Parts List exceeds
estimated value by more than
10%
-Recurring Cost in excess of business
case
-Reduced profit margin if price
remains unchanged
-Potential loss on effort
X
-Negotiate component costs with suppliers
-Renegotiate contract price with customer
based on customer-driven changes.
M. Hart $8,400 30% $2,520
6
Customer IT system/formats
cannot receive project
deliverables
-Will need to convert formats
internally
-May require specialize conversion
software
-Schedule impact if formatting issues
cannot be resolved
X X
-Test software export abilities within first
90 days
-Have customer provide list of formats to
evaluate import capabilities
R. Nelson $18,500 70% $12,950
$294,950
$100,845
Risk Values
Project Financial Summary:
42%
41%
$100,845
$119,643
75%
68%
$1.595M
$2.351M
Reporting Date
Risk Category DefinitionProject
Project Manager
Current ROS:
Estimated % Complete:
Initial Risk Value:
Current Risk Value:
Total Potential Risk (Unweighted)
Total Estimated Impact (Weighted)
Estimated Completion Date
% Budget SpendPlanned Completion Date
Category
Project Status
Customer Initial ROS:
Estimated Investment:
Current Investment:Project Start Date
Project Information
© All rights reserved. The Managers Resource Handbook by MHX Global LLP www.ManagersResourceHandbook.com v1
Watkins Smith Corporation
RF-30 Upgrade
Jessica Abrams
May 1, 2016
October 1, 2018 C Cost
August 12, 2018 S Schedule
December 3, 2017 R Resources
On Track O Other
Number Risk Description Impact of Risk C S R O Mitigation Strategy Risk OwnerTotal Risk
Value
Probability of
Occurrence
Predicted
Risk Value
1Customer delays release of end
product into market
-Delay in investment recovery
-Reduced Sales next yearX X
-Add customer-driven delays to penalties
clause of contract
-Add milestone payments for Initial Concept
and Design Acceptance to shorten time
between payments
T. Franklin $45,000 60% $27,000
2Customer seeks to renegotiate
price based on final design
-Reduction in total projected revenue
-Business case may not be as strong
-Sales contribution from project may
need to be reduced
-Cost reduction may be needed
X X
-Track detailed cost changes throughout
design evolution to show cost adjustments
-Seek funding for changes to help absorb
non-recurring costs impacts
G. DuBois $33,050 50% $16,525
3
Specialize software is needed
based on current project
requirements
-Purchase of additional software
necessary
-Employees will need training
-Efficiency loss due to learning curve
X X X
-Negotiate with customer to use 'industry
standard' software
-Charge customer for added cost of special
software under scope change clause.
R. Nelson $77,000 25% $19,250
4
Produce Validation Testing
must be performed by 3rd
party
-Need to identify potential suppliers
-Added cost of paying 3rd party
-Schedule impact due to logisticsX X X
-Setup test program to use only internal
equipment
-Work with customer to see what tests they
can perform on our behalf
C. Jenkins $113,000 20% $22,600
5
Product Parts List exceeds
estimated value by more than
10%
-Recurring Cost in excess of business
case
-Reduced profit margin if price
remains unchanged
-Potential loss on effort
X
-Negotiate component costs with suppliers
-Renegotiate contract price with customer
based on customer-driven changes.
M. Hart $8,400 30% $2,520
6
Customer IT system/formats
cannot receive project
deliverables
-Will need to convert formats
internally
-May require specialize conversion
software
-Schedule impact if formatting issues
cannot be resolved
X X
-Test software export abilities within first
90 days
-Have customer provide list of formats to
evaluate import capabilities
R. Nelson $18,500 70% $12,950
$294,950
$100,845
Risk Values
Project Financial Summary:
42%
41%
$100,845
$119,643
75%
68%
$1.595M
$2.351M
Reporting Date
Risk Category DefinitionProject
Project Manager
Current ROS:
Estimated % Complete:
Initial Risk Value:
Current Risk Value:
Total Potential Risk (Unweighted)
Total Estimated Impact (Weighted)
Estimated Completion Date
% Budget SpendPlanned Completion Date
Category
Project Status
Customer Initial ROS:
Estimated Investment:
Current Investment:Project Start Date
Project Information
Step 5: Identify the Risk Owner
Ownership is a form of accountability. List the name(s) of those individuals who are primarily responsible for managing and mitigating the risk item.
© All rights reserved. The Managers Resource Handbook by MHX Global LLP www.ManagersResourceHandbook.com v1
Watkins Smith Corporation
RF-30 Upgrade
Jessica Abrams
May 1, 2016
October 1, 2018 C Cost
August 12, 2018 S Schedule
December 3, 2017 R Resources
On Track O Other
Number Risk Description Impact of Risk C S R O Mitigation Strategy Risk OwnerTotal Risk
Value
Probability of
Occurrence
Predicted
Risk Value
1Customer delays release of end
product into market
-Delay in investment recovery
-Reduced Sales next yearX X
-Add customer-driven delays to penalties
clause of contract
-Add milestone payments for Initial Concept
and Design Acceptance to shorten time
between payments
T. Franklin $45,000 60% $27,000
2Customer seeks to renegotiate
price based on final design
-Reduction in total projected revenue
-Business case may not be as strong
-Sales contribution from project may
need to be reduced
-Cost reduction may be needed
X X
-Track detailed cost changes throughout
design evolution to show cost adjustments
-Seek funding for changes to help absorb
non-recurring costs impacts
G. DuBois $33,050 50% $16,525
3
Specialize software is needed
based on current project
requirements
-Purchase of additional software
necessary
-Employees will need training
-Efficiency loss due to learning curve
X X X
-Negotiate with customer to use 'industry
standard' software
-Charge customer for added cost of special
software under scope change clause.
R. Nelson $77,000 25% $19,250
4
Produce Validation Testing
must be performed by 3rd
party
-Need to identify potential suppliers
-Added cost of paying 3rd party
-Schedule impact due to logisticsX X X
-Setup test program to use only internal
equipment
-Work with customer to see what tests they
can perform on our behalf
C. Jenkins $113,000 20% $22,600
5
Product Parts List exceeds
estimated value by more than
10%
-Recurring Cost in excess of business
case
-Reduced profit margin if price
remains unchanged
-Potential loss on effort
X
-Negotiate component costs with suppliers
-Renegotiate contract price with customer
based on customer-driven changes.
M. Hart $8,400 30% $2,520
6
Customer IT system/formats
cannot receive project
deliverables
-Will need to convert formats
internally
-May require specialize conversion
software
-Schedule impact if formatting issues
cannot be resolved
X X
-Test software export abilities within first
90 days
-Have customer provide list of formats to
evaluate import capabilities
R. Nelson $18,500 70% $12,950
$294,950
$100,845
Risk Values
Project Financial Summary:
42%
41%
$100,845
$119,643
75%
68%
$1.595M
$2.351M
Reporting Date
Risk Category DefinitionProject
Project Manager
Current ROS:
Estimated % Complete:
Initial Risk Value:
Current Risk Value:
Total Potential Risk (Unweighted)
Total Estimated Impact (Weighted)
Estimated Completion Date
% Budget SpendPlanned Completion Date
Category
Project Status
Customer Initial ROS:
Estimated Investment:
Current Investment:Project Start Date
Project Information
Step 6: Quantify the Total Value of Each Risk
Calculate the total financial value of the risk, if it were to occur. This is a similar exercise to estimating a new project. • How much more time would be needed? • How many hours of effort are required? • What is the Hourly Rate? • What additional expenses (travel, materials, supplies) are there?
© All rights reserved. The Managers Resource Handbook by MHX Global LLP www.ManagersResourceHandbook.com v1
Number HoursRate
($/Hour)
Travel
($2000/Trip)
Other
ExpensesTotal
1 300 $30 $16,000 $20,000 $45,000
2 490 $45 $6,000 $5,000 $33,050
3 600 $45 $0 $50,000 $77,000
4 500 $30 $8,000 $90,000 $113,000
5 240 $35 $0 $0 $8,400
6 100 $35 $0 $15,000 $18,500
Cost Calculations
Step 6 (Continued): Keep The Assumptions Nearby
Your assumptions may need to change as time goes by. Include these values in your template off to the side, or on another tab of the spreadsheet. The “Total” value corresponds to the “Total Risk Value” in the Risk Assessment Matrix. Things to include: • Time (Hours) • Hourly Rates • Travel Costs • Additional expenses (software,
materials, supplies)
© All rights reserved. The Managers Resource Handbook by MHX Global LLP www.ManagersResourceHandbook.com v1
Watkins Smith Corporation
RF-30 Upgrade
Jessica Abrams
May 1, 2016
October 1, 2018 C Cost
August 12, 2018 S Schedule
December 3, 2017 R Resources
On Track O Other
Number Risk Description Impact of Risk C S R O Mitigation Strategy Risk OwnerTotal Risk
Value
Probability of
Occurrence
Predicted
Risk Value
1Customer delays release of end
product into market
-Delay in investment recovery
-Reduced Sales next yearX X
-Add customer-driven delays to penalties
clause of contract
-Add milestone payments for Initial Concept
and Design Acceptance to shorten time
between payments
T. Franklin $45,000 60% $27,000
2Customer seeks to renegotiate
price based on final design
-Reduction in total projected revenue
-Business case may not be as strong
-Sales contribution from project may
need to be reduced
-Cost reduction may be needed
X X
-Track detailed cost changes throughout
design evolution to show cost adjustments
-Seek funding for changes to help absorb
non-recurring costs impacts
G. DuBois $33,050 50% $16,525
3
Specialize software is needed
based on current project
requirements
-Purchase of additional software
necessary
-Employees will need training
-Efficiency loss due to learning curve
X X X
-Negotiate with customer to use 'industry
standard' software
-Charge customer for added cost of special
software under scope change clause.
R. Nelson $77,000 25% $19,250
4
Produce Validation Testing
must be performed by 3rd
party
-Need to identify potential suppliers
-Added cost of paying 3rd party
-Schedule impact due to logisticsX X X
-Setup test program to use only internal
equipment
-Work with customer to see what tests they
can perform on our behalf
C. Jenkins $113,000 20% $22,600
5
Product Parts List exceeds
estimated value by more than
10%
-Recurring Cost in excess of business
case
-Reduced profit margin if price
remains unchanged
-Potential loss on effort
X
-Negotiate component costs with suppliers
-Renegotiate contract price with customer
based on customer-driven changes.
M. Hart $8,400 30% $2,520
6
Customer IT system/formats
cannot receive project
deliverables
-Will need to convert formats
internally
-May require specialize conversion
software
-Schedule impact if formatting issues
cannot be resolved
X X
-Test software export abilities within first
90 days
-Have customer provide list of formats to
evaluate import capabilities
R. Nelson $18,500 70% $12,950
$294,950
$100,845
Risk Values
Project Financial Summary:
42%
41%
$100,845
$119,643
75%
68%
$1.595M
$2.351M
Reporting Date
Risk Category DefinitionProject
Project Manager
Current ROS:
Estimated % Complete:
Initial Risk Value:
Current Risk Value:
Total Potential Risk (Unweighted)
Total Estimated Impact (Weighted)
Estimated Completion Date
% Budget SpendPlanned Completion Date
Category
Project Status
Customer Initial ROS:
Estimated Investment:
Current Investment:Project Start Date
Project Information
Step 7: Estimate Probability of Occurrence
Estimate the probability that each risk will occur. This estimate should be revised over time. If a risk becomes real, set the probability to 100%. Reduce the probability as issues and risks are mitigated or eliminated.
© All rights reserved. The Managers Resource Handbook by MHX Global LLP www.ManagersResourceHandbook.com v1
Watkins Smith Corporation
RF-30 Upgrade
Jessica Abrams
May 1, 2016
October 1, 2018 C Cost
August 12, 2018 S Schedule
December 3, 2017 R Resources
On Track O Other
Number Risk Description Impact of Risk C S R O Mitigation Strategy Risk OwnerTotal Risk
Value
Probability of
Occurrence
Predicted
Risk Value
1Customer delays release of end
product into market
-Delay in investment recovery
-Reduced Sales next yearX X
-Add customer-driven delays to penalties
clause of contract
-Add milestone payments for Initial Concept
and Design Acceptance to shorten time
between payments
T. Franklin $45,000 60% $27,000
2Customer seeks to renegotiate
price based on final design
-Reduction in total projected revenue
-Business case may not be as strong
-Sales contribution from project may
need to be reduced
-Cost reduction may be needed
X X
-Track detailed cost changes throughout
design evolution to show cost adjustments
-Seek funding for changes to help absorb
non-recurring costs impacts
G. DuBois $33,050 50% $16,525
3
Specialize software is needed
based on current project
requirements
-Purchase of additional software
necessary
-Employees will need training
-Efficiency loss due to learning curve
X X X
-Negotiate with customer to use 'industry
standard' software
-Charge customer for added cost of special
software under scope change clause.
R. Nelson $77,000 25% $19,250
4
Produce Validation Testing
must be performed by 3rd
party
-Need to identify potential suppliers
-Added cost of paying 3rd party
-Schedule impact due to logisticsX X X
-Setup test program to use only internal
equipment
-Work with customer to see what tests they
can perform on our behalf
C. Jenkins $113,000 20% $22,600
5
Product Parts List exceeds
estimated value by more than
10%
-Recurring Cost in excess of business
case
-Reduced profit margin if price
remains unchanged
-Potential loss on effort
X
-Negotiate component costs with suppliers
-Renegotiate contract price with customer
based on customer-driven changes.
M. Hart $8,400 30% $2,520
6
Customer IT system/formats
cannot receive project
deliverables
-Will need to convert formats
internally
-May require specialize conversion
software
-Schedule impact if formatting issues
cannot be resolved
X X
-Test software export abilities within first
90 days
-Have customer provide list of formats to
evaluate import capabilities
R. Nelson $18,500 70% $12,950
$294,950
$100,845
Risk Values
Project Financial Summary:
42%
41%
$100,845
$119,643
75%
68%
$1.595M
$2.351M
Reporting Date
Risk Category DefinitionProject
Project Manager
Current ROS:
Estimated % Complete:
Initial Risk Value:
Current Risk Value:
Total Potential Risk (Unweighted)
Total Estimated Impact (Weighted)
Estimated Completion Date
% Budget SpendPlanned Completion Date
Category
Project Status
Customer Initial ROS:
Estimated Investment:
Current Investment:Project Start Date
Project Information
Step 8: Compute the Expected Value
Multiply the Total Risk Value (Step 6) by the Probability of Occurrence (Step 7) to establish the Predicted Risk Value. This is often referred to as an expected value or a weighted value.
© All rights reserved. The Managers Resource Handbook by MHX Global LLP www.ManagersResourceHandbook.com v1
Watkins Smith Corporation
RF-30 Upgrade
Jessica Abrams
May 1, 2016
October 1, 2018 C Cost
August 12, 2018 S Schedule
December 3, 2017 R Resources
On Track O Other
Number Risk Description Impact of Risk C S R O Mitigation Strategy Risk OwnerTotal Risk
Value
Probability of
Occurrence
Predicted
Risk Value
1Customer delays release of end
product into market
-Delay in investment recovery
-Reduced Sales next yearX X
-Add customer-driven delays to penalties
clause of contract
-Add milestone payments for Initial Concept
and Design Acceptance to shorten time
between payments
T. Franklin $45,000 60% $27,000
2Customer seeks to renegotiate
price based on final design
-Reduction in total projected revenue
-Business case may not be as strong
-Sales contribution from project may
need to be reduced
-Cost reduction may be needed
X X
-Track detailed cost changes throughout
design evolution to show cost adjustments
-Seek funding for changes to help absorb
non-recurring costs impacts
G. DuBois $33,050 50% $16,525
3
Specialize software is needed
based on current project
requirements
-Purchase of additional software
necessary
-Employees will need training
-Efficiency loss due to learning curve
X X X
-Negotiate with customer to use 'industry
standard' software
-Charge customer for added cost of special
software under scope change clause.
R. Nelson $77,000 25% $19,250
4
Produce Validation Testing
must be performed by 3rd
party
-Need to identify potential suppliers
-Added cost of paying 3rd party
-Schedule impact due to logisticsX X X
-Setup test program to use only internal
equipment
-Work with customer to see what tests they
can perform on our behalf
C. Jenkins $113,000 20% $22,600
5
Product Parts List exceeds
estimated value by more than
10%
-Recurring Cost in excess of business
case
-Reduced profit margin if price
remains unchanged
-Potential loss on effort
X
-Negotiate component costs with suppliers
-Renegotiate contract price with customer
based on customer-driven changes.
M. Hart $8,400 30% $2,520
6
Customer IT system/formats
cannot receive project
deliverables
-Will need to convert formats
internally
-May require specialize conversion
software
-Schedule impact if formatting issues
cannot be resolved
X X
-Test software export abilities within first
90 days
-Have customer provide list of formats to
evaluate import capabilities
R. Nelson $18,500 70% $12,950
$294,950
$100,845
Risk Values
Project Financial Summary:
42%
41%
$100,845
$119,643
75%
68%
$1.595M
$2.351M
Reporting Date
Risk Category DefinitionProject
Project Manager
Current ROS:
Estimated % Complete:
Initial Risk Value:
Current Risk Value:
Total Potential Risk (Unweighted)
Total Estimated Impact (Weighted)
Estimated Completion Date
% Budget SpendPlanned Completion Date
Category
Project Status
Customer Initial ROS:
Estimated Investment:
Current Investment:Project Start Date
Project Information
Step 9: Sum the Total Project Risk
To calculate the Total Project Risk, sum all the values you calculated in Step 8. In this example: From Step 6: Total Potential Risk (Unweighted): ~$295k From Step 8: Total Estimated Impact (Weighted): ~101k
© All rights reserved. The Managers Resource Handbook by MHX Global LLP www.ManagersResourceHandbook.com v1
Final Tips for Creating a Risk Assessment Matrix
1. Create the Matrix Before Project Starts To Fully Understand Risks
2. Factor Costs Into Business Case / Financial Models
3. Reevaluate Often with Project Team – Have Any Risks Become Real?
– Are Risks Still Valid?
– Are Probabilities Still Accurate?
– Any New Items to Add?
4. Change Probabilities and Assumptions As Needed to Continuously Understand Financial Values
For Step-By-Step Instructions and to Download The Template: http://www.managersresourcehandbook.com/project-risk-matrix-template/
© All rights reserved. The Managers Resource Handbook by MHX Global LLP www.ManagersResourceHandbook.com v1
Final Tips for Creating a Risk Assessment Matrix
1. Create it Before Project Starts To Fully Understand Risks
2. Factor Costs Into Business Case / Financial Models
3. Reevaluate Often with Project Team – Have Any Risks Become Real?
– Are Risks Still Valid?
– Are Probabilities Still Accurate?
– Any New Items to Add?
4. Change Probabilities and Assumptions As Needed to Continuous Understand Financial Values
For Step-By-Step Instructions and to Download The Template: http://www.managersresourcehandbook.com/project-risk-matrix-template/
Step 10: Review & Update Matrix Over Time
Review with Project Team often to keep ahead of changes in the project!
© All rights reserved. The Managers Resource Handbook by MHX Global LLP www.ManagersResourceHandbook.com v1
Watkins Smith Corporation
RF-30 Upgrade
Jessica Abrams
May 1, 2016
October 1, 2018 C Cost
August 12, 2018 S Schedule
December 3, 2017 R Resources
On Track O Other
Number Risk Description Impact of Risk C S R O Mitigation Strategy Risk OwnerTotal Risk
Value
Probability of
Occurrence
Predicted
Risk Value
1Customer delays release of end
product into market
-Delay in investment recovery
-Reduced Sales next yearX X
-Add customer-driven delays to penalties
clause of contract
-Add milestone payments for Initial Concept
and Design Acceptance to shorten time
between payments
T. Franklin $45,000 60% $27,000
2Customer seeks to renegotiate
price based on final design
-Reduction in total projected revenue
-Business case may not be as strong
-Sales contribution from project may
need to be reduced
-Cost reduction may be needed
X X
-Track detailed cost changes throughout
design evolution to show cost adjustments
-Seek funding for changes to help absorb
non-recurring costs impacts
G. DuBois $33,050 50% $16,525
3
Specialize software is needed
based on current project
requirements
-Purchase of additional software
necessary
-Employees will need training
-Efficiency loss due to learning curve
X X X
-Negotiate with customer to use 'industry
standard' software
-Charge customer for added cost of special
software under scope change clause.
R. Nelson $77,000 25% $19,250
4
Produce Validation Testing
must be performed by 3rd
party
-Need to identify potential suppliers
-Added cost of paying 3rd party
-Schedule impact due to logisticsX X X
-Setup test program to use only internal
equipment
-Work with customer to see what tests they
can perform on our behalf
C. Jenkins $113,000 20% $22,600
5
Product Parts List exceeds
estimated value by more than
10%
-Recurring Cost in excess of business
case
-Reduced profit margin if price
remains unchanged
-Potential loss on effort
X
-Negotiate component costs with suppliers
-Renegotiate contract price with customer
based on customer-driven changes.
M. Hart $8,400 30% $2,520
6
Customer IT system/formats
cannot receive project
deliverables
-Will need to convert formats
internally
-May require specialize conversion
software
-Schedule impact if formatting issues
cannot be resolved
X X
-Test software export abilities within first
90 days
-Have customer provide list of formats to
evaluate import capabilities
R. Nelson $18,500 70% $12,950
$294,950
$100,845
Risk Values
Project Financial Summary:
42%
41%
$100,845
$119,643
75%
68%
$1.595M
$2.351M
Reporting Date
Risk Category DefinitionProject
Project Manager
Current ROS:
Estimated % Complete:
Initial Risk Value:
Current Risk Value:
Total Potential Risk (Unweighted)
Total Estimated Impact (Weighted)
Estimated Completion Date
% Budget SpendPlanned Completion Date
Category
Project Status
Customer Initial ROS:
Estimated Investment:
Current Investment:Project Start Date
Project Information
© All rights reserved. The Managers Resource Handbook by MHX Global LLP www.ManagersResourceHandbook.com v1
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