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Chap 11.1 Plan Risk Management

https://www.slideshare.net/anandbobade/chap-110-project-risk-management-overview-143496876
https://www.slideshare.net/anandbobade/chap-111-plan-risk-management-143497221
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https://www.slideshare.net/anandbobade/chap-114-perform-quantitative-risk-analysis
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https://www.slideshare.net/anandbobade/chap-117-monitor-risks-143497342

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Chap 11.1 Plan Risk Management

  1. 1. By: Anand Bobade (nmbobade@gmail.com) Chapter 11 – Project Risk Management PMP Trainer: Anand BobadePMBOK 6th Edition, 2019, All rights reserved. Plan Risk management SIXTH EDITION
  2. 2. PMBOK 6 - All rights reserved; By: Anand Bobade (nmbobade@gmail.com) Plan Risk Management Plan Risk Management - Definition Why Risk management planning is important? Plan Risk Management Processes: ITTO What Risk Management Plan contains? The Risk Breakdown Structure Review
  3. 3. PMBOK 6 - All rights reserved; By: Anand Bobade (nmbobade@gmail.com) Project Risk Management Processes Plan Risk management Identify Risk Perform Qualitative Risk Analysis Perform Quantitative Risk Analysis Plan Risk Response Implement Risk Monitor Risk P MC P P P P E
  4. 4. PMBOK 6 - All rights reserved; By: Anand Bobade (nmbobade@gmail.com) The process of defining how to conduct risk management activities for a project. Ensures the degree, type & visibility of risk management commensurate with risks & importance of project. Plan Risk Management -> Definition
  5. 5. PMBOK 6 - All rights reserved; By: Anand Bobade (nmbobade@gmail.com) Risk Management helps by • Reduce crisis management. • Minimize project surprises. • Anticipate problems thereby making you proactive than reactive. • Increase likelihood of project success. • Enhance your company’s competitive position. • Become a better manager. Plan Risk Management -> Why to plan?
  6. 6. By: Anand Bobade (nmbobade@gmail.com)By: Anand Bobade (nmbobade@gmail.com) Plan Risk Management->ITTO Expert Judgment Data analysis Meetings Project Charter Project Management Plan Project documents EEF OPA Risk Management plan Inputs Tools & Techniques Outputs
  7. 7. PMBOK 6 - All rights reserved; By: Anand Bobade (nmbobade@gmail.com) Project Charter Project Management Plan Project documents Plan Risk Management-> Input Enterprise environmental factors Organizational process assets
  8. 8. PMBOK 6 - All rights reserved; By: Anand Bobade (nmbobade@gmail.com) Project Charter Project authorization document with high level details. Plan Risk Management-> Input->Project Charter High Level inputs Initial risks Project Objective Project Requirements
  9. 9. PMBOK 6 - All rights reserved; By: Anand Bobade (nmbobade@gmail.com) Project Management Plan All approved subsidiary plans & baselines. PMP All Baselines Scope Baseline Cost Baseline Schedule baseline Cost Manag. Plan Schedule Manag. Plan Communication Manag. plan Plan Risk Management-> Input->PMP
  10. 10. PMBOK 6 - All rights reserved; By: Anand Bobade (nmbobade@gmail.com) Enterprise environmental factors Risk Attitude: Risk Averse: • Not comfortable with digesting risks. Not supportive towards risks. Risk Seeker: • likes to seek risks if they see any opportunity. Young startup/dynamic companies Risk Neutral • Are neutral to risks. They deal with risks objectively. Use EMV & decision tree analysis to analyse risk. Risk Tolerant • Very comfortable with ignoring risks. They don’t care and never pay any attention to a risk until it becomes an issue. Plan Risk Management-> Input->EEF
  11. 11. PMBOK 6 - All rights reserved; By: Anand Bobade (nmbobade@gmail.com) Risk Attitude will drive: Risk Appetite Risk Tolerance Risk Threshold Risk Appetite: Degree of uncertainty an organization is willing to take on in anticipation of a reward. E.g., High, medium, low etc Risk Tolerance: Degree, amount, or volume of the risk that an organization or individual will withstand. E.g., Allow schedule slippage by 5–10% or cost slippage by 7– 15%. Risk threshold: Amount of risk that an organisation is willing to accept. is the limit beyond which your organization will not tolerate the risk. E.g., For a project cost overrun is allowed till 100,000. Plan Risk Management-> Input->EEF Enterprise environmental factors
  12. 12. PMBOK 6 - All rights reserved; By: Anand Bobade (nmbobade@gmail.com) Risk Appetite: Risk Tolerance: Risk threshold: Plan Risk Management-> Input->EEF Qualitative Quantitative Quantitative •Organization has high level of Risk appetite. Risk Appetite: •You are bidding for a project. The estimated cost of this project is approximately 1Million. •You are in the process of applying for this bid, however, your management constraints you by stating that you can not bid more than 10% of this amount. This 10% is your tolerance limit. Risk Tolerance: •You are bidding for a project. The estimated cost of this project is approximately 5 Million. •You are in the process of applying for this bid, however, your management constraints you by stating that you can not go beyond additional 100,000 of this amount. This 100,000 is your threshold. Risk threshold:
  13. 13. PMBOK 6 - All rights reserved; By: Anand Bobade (nmbobade@gmail.com) Organizational process assets OPA related to Risks: Organizational risk policy Common Definitions & terms Risk statement format Templates & Risk Categories Roles & responsibilities Decision making authority levels Lesson learned Plan Risk Management-> Input->OPA
  14. 14. PMBOK 6 - All rights reserved; By: Anand Bobade (nmbobade@gmail.com) Meetings Expert Judgment Data analysis Plan Risk Management-> T&T
  15. 15. PMBOK 6 - All rights reserved; By: Anand Bobade (nmbobade@gmail.com) Expert Judgment Expertize should be considered from groups or individuals with specialized knowledge in the area of Risk management. Senior Management Project Stakeholders PM with similar project experience Subject Matter expert Consultants Professional & technical associates Plan Risk Management->T&T->Expert Judgement Help PM to setup risk management context Analyses organizations risk attitude.
  16. 16. PMBOK 6 - All rights reserved; By: Anand Bobade (nmbobade@gmail.com) Data analysis Stakeholderanalysistodeterminetheriskappetiteofprojectstakeholders Plan Risk Management->T&T->Analytical Technique Stakeholder analsyis
  17. 17. PMBOK 6 - All rights reserved; By: Anand Bobade (nmbobade@gmail.com) Meetings Anyone responsible for risk management will be part of the meetings: Project Manager Sponsor Selected team members Selected stakeholders Plan Risk Management->T&T->Meetings Define high level plans for conducting risk management. Review Risk contingency reserve & assign responsibility. Analyse templates, categories & tailor it.
  18. 18. PMBOK 6 - All rights reserved; By: Anand Bobade (nmbobade@gmail.com) Plan Risk Management->Output Risk Management plan
  19. 19. PMBOK 6 - All rights reserved; By: Anand Bobade (nmbobade@gmail.com) RMP includes: Strategy (approach)(How?) Roles & Responsibilities (who?) Budgeting (Cost of Risk management) Timing (Schedule) Risk Categories (RBS) Probability & Impact Stakeholder Tolerances Reporting Format Tracking (Follow-up) Plan Risk Management->Output->Risk Management Plan Risk Management plan
  20. 20. PMBOK 6 - All rights reserved; By: Anand Bobade (nmbobade@gmail.com) Risk Management plan RBS for IT project Business Business process Market changes Change in management Technical Hardware Software Network Project Management Estimation Planning Resource Communication Plan Risk Manag.->Output->Risk Management Plan
  21. 21. PMBOK 6 - All rights reserved; By: Anand Bobade (nmbobade@gmail.com) How much efforts need to be spent on risk management. How risk management helps on project? Risk Attitude(Risk averse, Risk Seeker, Risk Neutral & Risk tolerant) What Risk Management Plan contains? The Risk Breakdown Structure Plan Risk Management-> Review
  22. 22. By: Anand Bobade (nmbobade@gmail.com)

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