Project Risk Management Slides

17-Mar-16

Project Risk

Text and References


Identifying and Managing Project Risks by Tom Kendrick




Project Risk Management: Guidance for WSDOT Projects




Risk Management: Tricks of the Trade for Project Managers by Rita Mulcahy




A risk is any uncertain event or condition that might affect the project.




The purpose of project risk management is to obtain better project outcomes, in terms of schedule, cost and operations performance.

Project Risk (Ctd.)


Not all risks are negative. Some events (like finding an easier way to do an activity) or conditions (like lower prices for certain materials) can help the project! When this happens, it is called an opportunity… but it’s still handled just like a risk.

Project Risk (Ctd.)


All risks have two related, but distinctly different, components. Risk is the product of the probability that the event might occur and expected consequences of the event.




Risk may be characterized in the aggregate for a large population of events (‘‘macrorisk’’), or it may be considered on an eventby-event basis (‘‘micro-risk’’).

1

17-Mar-16

Project Risk (Ctd.)





All risks have two related, but distinctly different, components. Risk is the product of the probability that the event might occur and expected consequences of the event. Risk may be characterized in the aggregate for a large population of events (‘‘macrorisk’’), or it may be considered on an eventby-event basis (‘‘micro-risk’’).

Some Basics


Coins




Coloured Balls




Car Park




The Archer




Anti aircraft gun with 5% hit. 10 hits is equal to one kill.




Normal Distribution Curve (68.2, 95.4, 99.7)

Type

Duration (months)

Risk

Complexity

Technology

Type A

>18

High

High

Breakthrough

Type B

9 to 18

Medium

Medium

Current

Type C

3 to 9

Low

Low

Best of breed

Type D