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Chap 11.0 Project Risk Management Overview

https://www.slideshare.net/anandbobade/chap-110-project-risk-management-overview-143496876
https://www.slideshare.net/anandbobade/chap-111-plan-risk-management-143497221
https://www.slideshare.net/anandbobade/chap-112-identify-risks-143497237
https://www.slideshare.net/anandbobade/chap-113-perform-qualitative-risk-analysis
https://www.slideshare.net/anandbobade/chap-114-perform-quantitative-risk-analysis
https://www.slideshare.net/anandbobade/chap-115-plan-risk-response-143497289
https://www.slideshare.net/anandbobade/chap-116-implement-risk-response-143497303
https://www.slideshare.net/anandbobade/chap-117-monitor-risks-143497342

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Chap 11.0 Project Risk Management Overview

  1. 1. By: Anand Bobade (nmbobade@gmail.com) Trainer: Anand Bobade Chapter 11 – Project Risk Management PMP PMBOK 6th Edition, 2019, All rights reserved. SIXTH EDITION Plan Risk management Identify Risk Perform Qualitative Risk Analysis Perform Quantitative Risk Analysis Plan Risk Response Implement Risk Response Monitor Risk
  2. 2. PMBOK 6 - All rights reserved; By: Anand Bobade (nmbobade@gmail.com) Chap 11: Project Risk Management What is a Risk? Why Risk Management Trends & Emergent practices Risk Source Risk Management knowledge area Definition Risk Management Processes Review
  3. 3. PMBOK 6 - All rights reserved; By: Anand Bobade (nmbobade@gmail.com) Risk is an uncertain event or condition that if occurs, has a positive or negative effect on one or more project objectives, such as scope, cost & quality. Uncertain event or condition Effect Project objectives What is a Risk?
  4. 4. PMBOK 6 - All rights reserved; By: Anand Bobade (nmbobade@gmail.com) A PM work should not focus on dealing with problems; it should focus on preventing them. How would it feel to say, “No problem; we anticipated this, and we have a plan in place that will resolve it”. Performing risk management helps prevent many problems & helps make other problems less likely. Failure of PM to asses project risks is a major cause of Project failure. Why Risk Management?
  5. 5. PMBOK 6 - All rights reserved; By: Anand Bobade (nmbobade@gmail.com) Threats: • Risks with negative consequences are called threats. Opportunities: • Risks with positive consequences are called opportunities. Issue: • If there is 100% chance of an event occurring, this would be an issue, not a risk. Threats vs. Opportunity
  6. 6. PMBOK 6 - All rights reserved; By: Anand Bobade (nmbobade@gmail.com) Pure Risk (hazard): • Risk with potential loss only. • Ex. Fire, theft, personal injury Business Risk (speculative risk): • Risk with potential loss or gain. • Ex. A new hardware costs less (or more) than you budgeted for! Yes, risk can be good! Stop thinking of risk as bad, & start thinking in terms of opportunities! Risk Types
  7. 7. PMBOK 6 - All rights reserved; By: Anand Bobade (nmbobade@gmail.com) • Addresses overall project risk through decisions made about the structure, scope, content, and context of the project, particularly (though not exclusively) in the pre-project phase Implicit risk management • Deals with individual project risks through the standard risk management process to identify, analyse, respond to, and control risks, mostly during the remainder of the project lifecycle. Explicit risk management Key Concepts ->levels of risk management
  8. 8. PMBOK 6 - All rights reserved; By: Anand Bobade (nmbobade@gmail.com) Non-event risks :- These are not the same as uncertain future events •Examples: Key seller may go out of business, •Customer may change the requirement after the design is complete, •Subcontractor may propose enhancements to the standard operating processes Variability risk Ambiguity risk Trends & Emergent practices
  9. 9. PMBOK 6 - All rights reserved; By: Anand Bobade (nmbobade@gmail.com) Non-event risks: •Uncertainty surrounding planned decision or activity can be addressed using Monte Carlo. •E.g., Productivity may be above or below target •Number of errors found during testing may be higher or lower than expected Variability risk •Uncertainty of future Can be addressed by defining gap area & can be managed via incremental development, prototype & simulation. •E.g., Technical solution, future developments in regulatory frameworks, or inherent systematic complexity. Ambiguity risk Trends & Emergent practices
  10. 10. PMBOK 6 - All rights reserved; By: Anand Bobade (nmbobade@gmail.com) Project resilience: • Awareness of emergent risks (unknowable unknowns). • There risks can be only identified after its occurrence. Emergent risks requires Project resilience schedule & budget contingency Flexible processes Empowered team Strong change management Frequent reviews Trends & Emergent practices •Risks exist at the program or portfolio level. •Risks identified at higher levels will be escalated to higher levels •They are best managed outside the project. Integrated risk management:
  11. 11. PMBOK 6 - All rights reserved; By: Anand Bobade (nmbobade@gmail.com) Customer Lack of Project management efforts Inexperienced PM Suppliers Resistance to change Cultural differences contracts Project Risk Management ->Risk Source
  12. 12. PMBOK 6 - All rights reserved; By: Anand Bobade (nmbobade@gmail.com) Includes the processes of conducting the Risk Management planning, identification, analysis, response planning, & controlling risk on a projects. Plan Identify Analyze Respond Control Project Risk Management-> Definition
  13. 13. PMBOK 6 - All rights reserved; By: Anand Bobade (nmbobade@gmail.com) Plan Risk Management • Define how to conduct risk management activities Identify Risks • Determine & document which risks may affect the project Perform Qualitative Risk Analysis • Prioritize risks by analyzing their probability & impact. Project Risk Management -> Processes
  14. 14. PMBOK 6 - All rights reserved; By: Anand Bobade (nmbobade@gmail.com) Perform Quantitative Risk Analysis • Numerically analyze the effect of identified risks. Plan Risk Responses • How to respond to enhance opportunities & to reduce threats Implement Risk •The process of implementing agreed-upon risk response plans. Control Risk • Track risk, monitor residual risks, identify new risks, & evaluate effectiveness of risk planning. Project Risk Management -> Processes
  15. 15. PMBOK 6 - All rights reserved; By: Anand Bobade (nmbobade@gmail.com) Project Risk Management -> Review Risk Planning is iterative process It should be initiated early in the project lifecycle Risk can be positive or Negative PM has to constantly monitor risks & responds it. Its group activity Risk may change during course of project lifecycle
  16. 16. By: Anand Bobade (nmbobade@gmail.com)

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