1. Taken from PMM Risk Management1 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?

2. Taken from PMM Risk Management2 What is Risk? Risk is an uncertain event or condition that, if it occurs, has a positive or negative effect on a projects objectives. PMBOK ® Third Edition

3. Taken from PMM Risk Management3 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

4. Taken from PMM Risk Management4 Project Risk can increase when you have: Lack of resources Lack of communication and information Lack of authority and/or responsibility

5. Taken from PMM Risk Management5 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 cant fix it, how do we do it differently? Develop Action Plans –Prioritize items –Minimize impact –Dont over-correct

6. Taken from PMM Risk Management6 PMM Risk Management Steps

7. Taken from PMM Risk Management7 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

8. Taken from PMM Risk Management8 Identifying Risk Some Techniques: –Brainstorming 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

9. Taken from PMM Risk Management9 Identifying Risk (continued) Categorizing Risks –Technical, Quality, or Performance risks –Project Schedule risks –Project Management risks –Organizational risks –External risks

10. Taken from PMM Risk Management10 Risk Analysis Qualitative Analysis –Individual Risk Ranking –Probability/Impact Matrix (below) –Overall Risk Ranking of the Project

11. Taken from PMM Risk Management11 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.

12. Taken from PMM Risk Management12 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

13. Taken from PMM Risk Management13 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

14. Taken from PMM Risk Management14 PMM Risk Management Template General Info Risk Management Strategy Risk Response Planning Risk Identification Qualitative and Quantitative Analysis

15. Taken from PMM Risk Management15 State of Michigan Project Management Methodology (PMM) More information on Risk Management can be found in the PMM starting on page 3-70

16. Taken from PMM Risk Management16 Videos Video on Risk Management http://www.youtube.com/watch?v=MDNt0_XHf_I&feature=related http://www.youtube.com/watch?v=FRvsa- yNZk8&feature=PlayList&p=BA917478BDFB42B0&playnext=1&playnext_from=PL&index=75