1. Risk Assessment: Riskit Analysis Graph
COMM80: Risk Assessment of Systems Change
Unit 7

2. Objectives of Session Coverage
To gain the ability to build a Riskit Analysis Graph

3. Riskit Analysis Graph Perspective
This technique belongs to the Riskit method
Riskit was designed to manage risk during systems development.
However, there is nothing in it that restricts its use to such a perspective.

4. Summary of Techniques

5. Risk Analysis Graph
(example from the Riskit Manual)

6. Riskit Analysis Graph Components
The overall risk being evaluated
An event that may occur as a result of the risk happening
A possible action that can be taken in response to the event happening
The resultant costs to the organisation on taking a specific action
Consequences can be either deterministic (known): full arrow. Or stochastic (probabilistic) : dashed arrow
An outcome (can be omitted) shows the situation in a project after the risk event has occurred but before any corrective action is taken.
Outcome

7. General Example of Riskit Analysis Graph Components
Risk Factor: a high cholesterol diet
Risk Event: a doctor's diagnosis of a patient’s heart problem
Risk Outcome: a diagnosed heart disease exists
Risk Reaction: treatment of heart problem
Risk Effect: hospital stay
Utility Loss: net effect of pain, loss of time, expenses felt by individuals: in this case emotional upset and disruption to normal life.

8. General Example of Riskit Analysis Graph Components
Risk Factor: living near a fault line of earth's plates
Risk Event: an earthquake
Risk Outcome: some buildings/roads destroyed
Risk Reaction: reconstruction of infrastructure
Risk Effect: cost of reconstruction
Utility Loss: net effect of pain, loss of time, expenses felt by individuals: for one individual minimal since personal losses low and covered by insurance, for another catastrophic since home destroyed and without insurance.

9. Software Systems Example
Risk Factor: inexperience of personnel
Risk Event: a system crashes
Risk Outcome: system out of operation for up to hours
Risk Reaction: systems operational after delay, back up data restored
Risk Effect: added cost
Utility Loss: perceived harm experienced by stakeholders: in this case minimal since only small data entry per day and data backed up daily

10. Software Systems Example
Risk Factor: use of new development methods
Risk Event: key personnel leave
Risk Outcome: personnel and competence shortage
Risk Reaction: recruiting initiated, staff reassigned
Risk Effect: two month delay
Utility Loss: perceived harm experienced by stakeholders: in this case catastrophic since software delay results in client imposing financial penalty.

11. A Riskit Analysis Graph for a Systems Change Case Study (part 1)
Factor
Lack of IT specialist
Lack of staff training
Event
Project costs underestimated.
Outcome
Project behind schedule, exceeding budgets
Reaction
Do nothing
Allocate more resource

12. A Riskit Analysis Graph for a Systems Change Case Study (part 2)
Effect Set
Project behind schedule:10 months
budget overrun by £10,000
Reaction
Do nothing
Allocate more resource
Utility Loss
Delaying other projects (significant problem)
Unable to process all potential orders - lost business (catastrophic)
Project behind schedule: 2 weeks budget overrun £25,000
Reduced budget available for planned projects resulting in delay to some non-critical projects (minor problem)

13. A student generated graph