Ch07_risk_management.pptVIP

SPM (5e) risk management Software Project Management Chapter Seven Risk management Risk management This lecture will touch upon: Definition of ‘risk’ and ‘risk management’ Some ways of categorizing risk Risk management Risk identification – what are the risks to a project? Risk analysis – which ones are really serious? Risk planning – what shall we do? Risk monitoring – has the planning worked? We will also look at PERT risk and critical chains Some definitions of risk ‘the chance of exposure to the adverse consequences of future events’ PRINCE2 ‘an uncertain event or condition that, if it occurs, has a positive or negative effect on a project’s objectives’ PM-BOK Risks relate to possible future problems, not current ones They involve a possible cause and its effect(s) e.g. developer leaves task delayed A framework for dealing with risk The planning for risk includes these steps: Risk identification – what risks might there be? Risk analysis and prioritization – which are the most serious risks? Risk planning – what are we going to do about them? Risk monitoring – what is the current state of the risk? Risk identification Approaches to identifying risks include: Use of checklists – usually based on the experience of past projects Brainstorming – getting knowledgeable stakeholders together to pool concerns Causal mapping – identifying possible chains of cause and effect Boehm’s top 10 development risks Boehm’s top ten risk - continued Risk prioritization Risk exposure (RE) = (potential damage) x (probability of occurrence) Ideally Potential damage: a money value e.g. a flood would cause ￡0.5 millions of damage Probability 0.00 (absolutely no chance) to 1.00 (absolutely certain) e.g. 0.01 (one in hundred chance) RE = ￡0.5m x 0.01 = ￡5,000 Crudely analogous to the amount needed for an insurance premium Risk probability: qualitative descriptors Qualitative descriptors of impact on cost and associated range values Probability impact matrix Risk planning Risks