Risky Business - Take A Chance!

risky business a risk management system for project managers

By Peleg Forman pelegf.wordpress.com

You have a good plan Objectives ● Budget ●Time ● Resources ●Checkpoints ●Exit Criteria

Identifying risks is part of every good plan

RISK: Probability or threat of a damage, injury, liability, loss, or other negative occurrence, caused by external or internal vulnerabilities, and which may be neutralized through pre-mediated action.

RISK = Probability × Impact + Manageable

EVERY RISK HAS AN OWNER.

MORE THEN ONE OWNER, MEANS MORE THEN ONE RISK.

An event that can’t be prevented or managed – it is a call for changes in the plan

RISK PARAMETERS - FOCUS It is up to the risk owner to determine the values of the parameters. He will determine the likelihood of the occurrence and the negative impact if the risk materialize.

PROBABILITY

SEVERITY

X

SEVERITY can be quantified. Decide your own scale and match it to your project budget

1

1

2

3

1

2

3

FOCUS Low

2

3

2 3

4 6

6 9

SEVERITY × PROBABILITY

Med High Out of Focus

have a plan ● follow the plan ● manage the risks ● reach plan’s goals!

MANAGE RISKS Identify and quantify Prepare a mitigation plan Prepare a contingency plan

Check the risk frequently according to your plan

Every risk is date sensitive always be ahead of it

Every status change needs to be recorded. You will be able to give an overall status of your risks only if they are up-to-date.

a database and a forum of managers

ATTRIBUTE Risk Level Affected Unit Owner Description Negative Impact

Mitigation Contingency Effective date Probability Severity

Identifying the management level of the risk (team, unit, department, high management) The affected Business Unit/ Area

The name of the person who is responsible for managing the risk. The threatening element on the plan goals – simple business words (not technical lingo) If the risk materialize – what will be the negative impact on the plan goals A plan of actions to reduce the threat’s Probability. This plan should be completed by the time the risk affective date. A plan of actions needed to be executed in case the risk take effect to reduce the risk impact. The plan should be ready before the risk affective date The time/day the risk will take affect The value that describe the occurrence probability

1 – Low; 2 – Medium; 3 – High The value that describes the negative impact

1 – Low; 2 – Medium; 3 – High A dashboard view of the risk! (Calculated) Focus ={ Severity x Probability}

Focus

Green - Low Risk Yellow - Medium Risk Red - High Risk Gray-No Risk (this risk will not materialize or has been Cancelled or Closed)

Status

Current status of the risk.

1-Open; 2-Under Mitigation; 3-In Effect; 4- Under Contingency; 5-Closed; 6-Cancelled

Status Change date Additional description of the risk status Action Description

Additional description of the risk status. For any activity update: [Date, Name] + Description

All good plans has risks.

The key for successfully managing projects is having a good plan and a good risk management system. Risk management system should be a

tool not a

target. It is affective only if it does not consume too much of managers resources. The trick is to increase awareness and

FOCUS on the real risks. Peleg Forman pelegf.wordpress.com