Risk Management processes : Plan Risk Management

Purpose of Plan Risk Management

• Risk attitude, probability, and impact definitions are determined in the plan risk management process.

Inputs

• Project charter
  • High level risks
• Project management plan
  • Project Scope Statement
  • Schedule Management Plan
  • Cost Management Plan
  • Communication Management Plan
• Project documents
  • Stakeholder register
• EEF
  • Risk thresholds set by the organization and key Stakeholders
  • From here, you will know the company’s Level of risk tolerance.
  • The lower the level of tolerance is; the more stringent risk Management should be.
• Organizational Process assets
  • From them you get the templates, risk Categories, definitions, etc.
  • Company Historical Records
  • Policies
  • Templates
    • For Risk management plan
    • For risk register
    • For risk reports
  • Look-up tables (tables de correspondance)
    • Look-up table determine the priority of a risk given its probability and impact.
  • Risk categories
  • RBS
  • Common definitions of risks and terms
  • Probabilities defined in look-up table
  • Risk statement formats
  • Roles and responsabilities
  • Authority levels for decision making
  • Lessons learned repository from previous similar projects

Tools and Technics

• Expert judgment
• Data analysis
  • Stakeholder analysis
  • Analatycal techniques
    • You analyze (i.e. think and try to understand) your stakeholders risk tolerance and the exposure to risks your project has.
    • From that you can determine how much to invest in risk management ( for example, a low risk tolerance and high risk exposure will require stronger management of risks)
    • Project rating scheme
    • You can create an overall project rating scheme to reflect the bias towards risks that affect the project schedule.
• Meetings
  • Meetings are used for discussions and brainstorming.
  • You need to invite relevant people from your project team, stakeholders and the organization.

Outputs

• Risk Management Plan
  • The risk management plan is a great way of communicating how you intend to conduct risk management.
  • Ultimately, the risk management plan will be placed in the project plan before project execution starts.
  • Content
    • Risk strategy
    • Risk management Methodology
      • Methodology
        • Defines how you will conduct risk management and what tools will be used.
        • Risk management techniques and guidelines for use
        • Criteria for success
        • Thresholds and corresponding definitions
        • Templates
        • Links with Communication management plan
      • Tailoring
        • Specific items to tailor include:
          • When risk activities are done
          • How much time is spent on the activities
          • Who is involved
          • What standard rating schemes are used
          • What forms and processes are used
        • Adaptation
          • Adaptation also relates to company risk management policies
    • Assignment of roles
      • Defines who will do what.
      • Roles, responsibilities and authority
        • Risk management organization
    • Budgeting
      • If your risk management activities will cost you money, then you need to include that in the overall project cost.
      • Funding
      • Protocoles for contingency and management reserves
      • Budget
    • Timing
      • Defines when you are going to conduct risk identification, risk analysis, response and audits.
      • Risk management activities
    • Risk categories (or sources of risk)
      • Sources of risks are usually organized in an RBS.
      • Potential categories of risks
      • Customer
      • Customer’s customers
      • Lack of project management effort
      • Lack of knowledge of project management
      • Suppliers
      • Resistance to change
      • Cultural differences
      • Specific risk categories
        • External
        • Internal
        • Technical
        • Commercial
        • Unforeseeable (imprévisible)
      • Additional exemple of sources of risk
        • Scope
        • Schedule
        • Cost
        • Quality
        • Resources
        • Customer satisfaction
        • Stakeholder satisfaction
        • Business risk
        • Pure (insurable) risk
        • Only a risk of loss (fire, theft, personal injury, …)
      • List
      • RBS
• Risk matrix
  • Very important for defining the probabilities and impacts and for making your project team and stakeholders clear about them.
  • Your risk matrix might be the single most important tool for risk analysis.
  • Definitions of probability and impact
  • Preparation of the probability and impact matrix template
• Stakeholder risk appetite, thresholds and tolerances
  • You will know about company tolerance from the enterprise environmental factors.
  • Tresholds are a study of the organization’s risk tolerance.
  • However, you need to revise the tolerance for the specific project at hand.
  • Stakeholders tolerance
• Reporting and tracking
  • Most of the communication can be done by sharing the updated risk register.
  • You need to specify the information it will contain.
  • During risk planning, you will also define how you will document and audit the implementation of risk management (for this task, it’s usually better to appoint a risk manager).
  • Reporting formats
  • Tracking

PMI-RMP Certification exam flashcards

Created : 19/05/2022