Risk Management

Introduction

Risk Management

Risk Identification

-Risk

Assessment

-Risk

Handling

Risk

A risk is the uncertainty regarding a future event or outcome

It is the potential for negative future that may or may not

happen
Two characteristics of risk
Uncertainty

the risk that may or may not happen

Loss

risk turns out to be a reality, where loss occurs or have

negative output of consequences

Risk Management

Risk management is an organized method for identifying

and measuring risk

It helps in development and implementation of handling

the risk

It is a discipline for identifying risks, assessing how

serious the risks are, and determining ways to address
that uncertain future with a goal of avoiding or
minimizing harm and financial loss.

Elements of Risk Management

1)

Assess- Identifying and analyzing risk what

can go wrong and estimate an impact made by
risk if occurs

2)

Handle Mitigation of risk steps to reduce

adverse effects. BCP, DR are strategy

3)

Monitor and Report monitoring risk

management strategies, knows whats
happening

4)

Planning a contingency plan to manage those

risks having high probability and high impact
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Risk Identification

Background

Risk identification is process of determining risks and possible

outcomes

Generic risks

Risks that are a potential threat to every software project

Strategic risks
These risks relate to your business strategies such as changes in
customer demand, increased competition, adopting new technology
and pursuing new business opportunities.

How to identify risk

Brainstorm with your accountant, financial adviser, staff and

other interested parties

Use flow charts, checklists and inspections to break down and

analyze your work Industry risk templates

Analyze a wide range of possible future events and their

outcomes

Risk Assessment

Background

Determination of risk management priorities

through establishment of qualitative and/or
quantitative relationships between benefits and
associated risks.

The process of refining the description of the risk

The most common way of analyzing risks is to use

a scale that rates each risk on:
the likelihood of it occurring
the consequences of it occurring.
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Steps
1)

Identify the hazards-Look around your

workplace and see what could reasonably be
expected to cause harm

2)

Evaluate the risks and decide on precautions

3)

Record your findings and implement them

4)

Review your assessment and update if necessary

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Risk Handling

Background

Once the risks have been categorized and analyzed, the

process of handling those risks is initiated

Risk handling is activities is to mitigate risk

four basic categories for risk handling:

Risk Avoidance
Risk Control
Accept the risk
Risk Transfer.

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Risk Mitigation

Risk Avoidance: To avoid risk, remove requirements that

represent uncertainty and high risk

Risk Control: It refers to assuming a risk but taking steps

to reduce, mitigate, or otherwise manage its impact or
likelihood

Risk Transfer: Transfer can be used to reduce risk by

moving the risk from one area of design to another
where a design solution is less risky

Accept the risk: You may accept a risk if it cannot be

avoided, reduced or transferred, need to have plans for
managing and funding the consequences of the risk if it
occurs.
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Summary

Risk management has become an important facet of the project

management activity

Risk management is vital as other controlling methods such as cost and

schedule to ensure successful project deliverable as required by the project
stakeholders

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