Risk Management

1
Risk Management

• Risk Management
• Assessing, reducing, and controlling risks so
  that project objectives are met without requiring
  excessive schedules or resource budgets.
• Note, all project planning can be consider risk
  management, however, this topic discusses
  specific actions to plan for risk.

2
Risk Management

• Risk Assessment
• Risk Item Identification
• Risks concerned with the tasks themselves
• Risks that occur between tasks
• Risk Consequence Estimation
• Monetary cost of shortfall
• Impact to schedule overrun
• Shortfall on cost and schedule overrun

3
Risk Management

• Risk Reduction
• Uncertainty Reduction
• Prototyping, simulation, modeling
• Planning in detail
• Parallel alternative developments
• Checking references
• Using trained or certified staff
• Using proven technology
• Verifying suitability of inputs

4
Risk Management

• Risk Reduction cont.
• Consequence Reduction
• Decoupling related items
• Providing margins or reserves

5
Risk Management

• Risk Avoidance
• Reducing requirements
• Increasing budget (locally)
• Extending schedule (locally)

6
Risk Management

• Risk Transfer
• Insurance
• Aligning responsibility and authority

7
Problem Resolution

• Problems are inherent in complex projects.
• Problem Identification
• Motivation
• Conflict
• Technology
• Poor Planning
• Mother Nature
• Problem Solving
• Communication
• Root cause analysis
• Obtain advice

8
Project Ethics

• Are there clear always clear answers to ethical
  questions?
• Sample discussion questions
• Should you quote projects for less than the
  estimated cost?
• If you do under-quote a project should you go
  back and ask for additional funds?
• Should you ever go back and ask for additional
  funds?

9
Project Ethics

• Discussion questions continued
• If in your opinion, the specifications are in
  excess of what is required, should you design to
  a more realistic set of specifications in order
  to save the customer money?
• If there is an opportunity to save the customer
  money even though it may mean smaller profits for
  yourself, should you inform the customer?
• Should you give more attention to the squeaky
  wheel?

10
Project Ethics

• Discussion questions continued
• Should you pay one worker more than another, even
  though they do equivalent work?
• If you make an agreement to purchase materials
  from a vendor, but find a lower price elsewhere,
  should you buy from the new source?
• Other situational questions from the class.