1. Irwin/McGraw-Hill ©The McGraw-Hill Companies, 2000 Chapter 5 Managing Risk

2. Irwin/McGraw-Hill ©The McGraw-Hill Companies, 2000 Figure 5-1 Risk Event Graph Risk High Cost Low Project life cycle Chances of risks occurring Cost to fix risk event

3. Irwin/McGraw-Hill ©The McGraw-Hill Companies, 2000 Figure 5-2 Risk Assessment Matrix Risk event Chance- LMH Severity- LMH Detection difficulty- LMH When

4. Irwin/McGraw-Hill ©The McGraw-Hill Companies, 2000 Figure 5-3 Risk Schedules Best-case schedule Baseline schedule Worst-case schedule Actual schedule Forecast completion schedule 10% 50% 90% 470 days 500 days 590 days 550 days 300 days Actual tracking schedule

5. Irwin/McGraw-Hill ©The McGraw-Hill Companies, 2000 Figure 5-4 Responses to Risk Matrix Risk event Accept, reduce, share, transfer Contingency plan Trigger

6. Irwin/McGraw-Hill ©The McGraw-Hill Companies, 2000 Figure 5-5 Change Request Project _________________ Originator ________________ Description of change Install Y2K compatible chip in six computer controlled milling machines Date _________________ Phone ________________ Y2K-Machine Dept. CEG 3/29/ Ext. 4942 Impact AreasBaseline Impact Deliverable # __________ Work Package # __________ Cost Account # __________ Organization Unit __________ 1.3M 1.313M 1.31M IS-M Dept. Scope Budget Schedule Contingency Staff Equipment X X X X Justification (include impact if not implemented) Reprogramming cost is higher than estimated, and risk of old chips failing is higher than estimated. (Eliminating reprogramming cost is -$10,000. Cost of Y2K chips installed is +$15,000) Disposition Approve Approve as amended Disapprove Deferred X Priority Emergency Urgent Routine X Funding Source Mgmt. Reserve $ _____________ Budget. Reserve $ _____________ Other $ _____________ 5,000. Authorized _________________ Date ______________________ Scheduled start _________________ Scheduled finish ________________ S.P 4/3/ 4/7/ 5/10/