1. Project Based Risk Management Defusing a potential ticking time bomb
What is Risk Management?
Why do we need to manage Project Risk?
How do we manage Project Risk?
This is where the “voice over” text would be displayed for those that do not have speakers on their computer.
PMM Risk Management

2. 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 PMBOK® Third Edition
PMM Risk Management

3. Risks That Can Effect a Project
The technology used on the project
The environment in which the project is executed
The relationships between team members
How well the project fits the culture or business area or strategic objectives of the agency
How great of a change will result from the project
PMM Risk Management

4. Project Risk can increase when you have:
Lack of resources
Lack of communication and information
Lack of authority and/or responsibility
PMM Risk Management

5. Using Risk Management to Plan
Identify risk mitigation strategies
How can we fix it?
Are we working on the “right” risks?
Identify risk contingency strategies
If we can’t fix it, how do we do it differently?
Develop Action Plans
Prioritize items
Minimize impact
Don’t over-correct
PMM Risk Management

6. PMM Risk Management Steps

7. Risk Management Strategy Development
Decide on a Risk Management Methodology
Identify Risk Assumptions
Define Risk Management Roles and Responsibilities
Define Risk Management Timeframes
Define Risk Communication Strategy
Define How Risks Are to be Tracked
Define any Risk Thresholds
Define Ranking/Scoring Techniques
PMM Risk Management

8. Identifying Risk Some Techniques: Brainstorming SME Interviews
All team members participate - include stakeholder perspectives
Initially list all potential risks, no matter how small
Watch for contradictory information
SME Interviews
Project Documents
Deliverable Descriptions
Specifications Documents
PMM Risk Management

9. Identifying Risk (continued)
Categorizing Risks
Technical, Quality, or Performance risks
Project Schedule risks
Project Management risks
Organizational risks
External risks
PMM Risk Management

10. Risk Analysis Qualitative Analysis Individual Risk Ranking
Probability/Impact Matrix (below)
Overall Risk Ranking of the Project
PMM Risk Management

11. Risk Analysis (continued)
Quantitative Analysis
Sensitivity Analysis
Decision Analysis
Note: Not every Risk needs Quantitative Analysis – only those that need to be highly quantified, such as needing to determine certain cost and time objectives for the project.
PMM Risk Management

12. Risk Response Planning
Risk Avoidance
Eliminate Cause
Risk Transfer
Purchase Insurance
Subcontract high risk tasks
Risk Mitigation
Minimize Probability
Minimize Impact
Risk Acceptance
Contingency Plans
PMM Risk Management

13. Risk Monitoring and Control
Using the Risk Management Plan to monitor risk (periodically reviewing the known risks) and controlling risk (mitigating and tracking known risks)
Dealing with actual risk events (taking corrective action)
Identifying new risks
Updating the Risk Management Plan
PMM Risk Management

14. PMM Risk Management Template
General Info
Risk Management Strategy
Risk Identification
Qualitative and Quantitative Analysis
Risk Response Planning
PMM Risk Management

15. State of Michigan Project Management Methodology (PMM)
More information on Risk Management can be found in the
PMM starting on page 3-70
PMM Risk Management