Presentation on Project Risk Management
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The document outlines essential project management topics including risk management, project execution, communication strategies, stakeholder engagement, project artifact creation, change management, issues management, and knowledge transfer for project continuity. It emphasizes the importance of assessing and managing risks—both negative and positive—and provides strategies for executing projects to deliver business value, manage effective communication, engage stakeholders, and create necessary documentation. Additionally, it highlights the need for a structured approach to change management and the management of project issues to ensure continuity and success.
Presentation on Project Risk Management
- 1. 1 Doing The Work M d . M a s u d u r R a h m a n
- 2. 2 Lesson Objectives Access and manage risks.(ECO Task2.3) Execute the project with urgency required to deliver business value.(ECO Task 2.1) Manage communications.(ECO Task 2.2) Engage stakeholders.(ECO Tasks 2.4) Create project artifacts.(ECO Tasks 1.12,2.9,3.1) Manage project changes.(ECO Task2.10) Attack issues with the optimal action to achieve project success.(ECO Task2.15) Confirm approach for knowledge transfers.(ECO Tasks 1.6,2.16)
- 3. 3 Topic A: Assess and Manage Risks Enablers, Deliverables & Tools: This topic addresses various enablers from the ECO. • Determine risk management approach. (ECO 2.3.1) • Iteratively identify, assess and prioritize risk and risk responses. (ECO 2.3.2) • Determine risk response. • Implement risk response.
- 4. 4 A risk is an uncertain event or condition that , if it occurs , has a positive or negative effect on one or more project objectives. • Threats. Threats are the negative risks. • Opportunities. Opportunities are the positive risks. • Trigger Condition. A trigger condition is an event or situation that indicates that a risk is about to happen. RISK
- 5. 5 Negative risks — bad things that will cause your project to suffer if they happen Examples of negative risks Risk of residential fire Physical Injuries Resource Shortage NEGATIVE RISK
- 6. 6 How to respond to negative risks in project management Avoid. try to eliminate the risk or its impact. You do this by changing your project management plan, scope, or schedule. Ex: chance of rain shift of activities to a few days later to avoid the risk. Mitigate. This risk response strategy helps you lessen the impact or probability of the risk. This strategy decreases the severity. Ex: a team member may leave during the peak of your project - find another employee with similar qualifications in your organization. Transfer. Strategy when you lack the skills or resources to manage the risk or are too busy to manage it. Ex: Company install equipment but don’t have much experience. - find an expert and hire them to do the task for you, signing a fixed price contract. Accept. Here you take no action to manage the risk other than acknowledging it. Loss of time due to traffic jam situation in mega cities. NEGATIVE RISK
- 7. 7 Positive risks — events that would be good for your project can also happen Examples of positive risks A technology currently being developed that will save you time if released. A grant that you’ve applied for and are waiting to discover if you’ve been approved. A request for additional resources, materials, tools, or training that will make your project more efficient if provided. POSITIVE RISK
- 8. 8 How to respond to positive risks in project management Exploit it. Exploiting a positive risk means acting in ways that will help increase the chances of it occurring. If you’re hoping for additional project funding, following up and pleading your case can help exploit the risk. Share it. Sharing a risk means working with others outside of your project who could also benefit from it to try to exploit it. If other project teams could benefit from a new technology, you may work together to speed up the release date. Enhance it. Enhancing a positive risk means attempting to increase the opportunity or positive outcome. If you’re seeking for an expert resource’s enrollment/support, you could request for more expert resources repeatedly this will increase the total amount of resources and their potential output. Accept it. Accepting it means you do nothing and wait to see if the event occurs naturally on its own. POSITIVE RISK
- 9. 9 Risk Management Plan Plan Components: Risk strategy Methodology Roles and responsibilities Funding Timing Risk categories (RBS | Effect Based/Source Based) Stakeholder risk appetite (Tolerance/Appetite/Threshold) Definition of risk probability & impact Reporting format Tracking document
- 10. 10 Risk Identification RISK IDENTIFICATION METHODS Expert judgment Data gathering Brain Storming Checklist Analysis – Developed based on historical analysis Interviews Data analysis Root Cause Analysis Assumption and Constraint Analysis SWOT Analysis Facilitation Prompt list Meetings
- 11. 11 Points to be remembered PMs always strive to prevent the risks from occurring or reduce their impact. Triggers can have both positive and negative effects on a project. Each risk is assigned a risk response, which is an action to address that risk and a person to implement that action. A Contingency Plan is a risk response strategy developed in advance , before risk occur. The Fallback Plan is implemented if the initial contingency plan is ineffective in responding to the risk event. Use a PMIS & a Lessons-learned Register for effective risk management.
- 12. 12 Sample Question Your hardware vendor left you a voicemail saying that a snowstorm in the Midwest will prevent your equipment from arriving on time. You identified a risk response strategy for this risk and have arranged for a local company to lease you the needed equipment until yours arrives. This is an example of which risk response strategy? A. Transfer B. Acceptance C. Mitigate D. Avoid
- 13. 13 PMP Questions
- 14. 14 Topic B: Execute Project to Deliver Business Value Projects are commissioned to deliver value. Enablers , Deliverables, and Tools: Access opportunities to deliver value incrementally (ECO 2.1.1) Examine the business value throughout the project (ECO 2.1.2) Support the team to subdivide tasks to find the minimum viable product. (ECO 2.1.3) Measure ongoing progress based on methodology. (ECO 2.6.4) Collect and analyze data to make informed project decisions. (ECO 2.9.4)
- 15. 15 Examination of Business Value Projects produce business value. Throughout a project this can be performed in a variety of means. The business value can be: Financial Improvements New customers First to market Social Technological
- 16. 16 Creating a Culture of Urgency & Product Roadmaps The urgency to accomplish goals in projects is best achieved when the sense of urgency is ingrained in the project environment and culture. Bringing the voice of the customer can express the desires and personalize the value. The PM can lead the way by articulating the project’s importance and vision. As goals, milestones and potential deliverables are determined - a product roadmap emerges. It serves as a high level visual summary of the product/s of the project. Product roadmaps are progressively elaborated over time, and matures & evolves as the project travels down the road.
- 17. 17 Incremental (Product) Delivery Dividing the products into increments enables parts or elements of the product to be in the hands of customers prior to full delivery of the product. Early and regular incremental releases lead to higher customer value and an increased market share. Delivering the product incrementally ensures feedback from the users & business to the project team to adjust the direction , priorities ,and quality of the product. Finding suitable increments demands conversation and alignment.
- 18. 18 Minimum Viable Product(MVP) MVP is the smallest collection of features that can be included in a product for customers to consider it functional. With a MVP , all stakeholders have an opportunity to see and experience some form of project outcomes. MVP channels more valuable feedback which ensure ideas & concepts become reality. MVP ignites shorter-termed urgency and a feeling of accomplishment which is of value to the customer as well as to the project team(PT).
- 19. 19 Defining MVP, MBI, MRF, and MMR
- 20. 20 Topic C: Manage Communications Enablers, Deliverables ,and Tools Analyze communication needs of all stakeholders. (ECO 2.2.1) Plan communications methods, channels, frequency, and level of detail. (ECO 2.2.2) Communicate project information , and update effectively. (ECO 2.2.3) Confirm communication is understood and feedback is received. ( ECO 2.2.4)
- 21. 21 Project Communications The methods & types of communication depend on variety of factors: Internal or external stakeholders; Formal or informal communications; Hierarchical focus in communication; Official or unofficial communications; Written or oral communications
- 22. 22 Communications Management Plan Stakeholder communications requirements. Information to be communicated, including language to be used. Reason for the distribution of the information. Time frame and frequency of information distribution. Person responsible for the communication. Person responsible for the release of confidential information. People who will receive the information. Methods or technologies that will be used to convey the information. Time and budget allocated for communication. Escalation process for issues that need visibility. Method for updating the communications management plan. Glossary of common terminology. Flowcharts of information flow. Any communication constraints due to regulation or policies.
- 23. 23 Communication Types Face to face meetings Video & voice conferencing Email Fax Instant Messaging(IM) Text messaging Printed media & documents Social media Company websites
- 24. 24 Communication Models Five steps to a standard communication model: Encode: Ideas are translated into language used by the sender to convey information. Transmit message: The information is actually sent to the receiver by the sender. Decode: The receiver translates the message into meaningful ideas. Acknowledge: The receiver signals that he /she has received the information. Feedback/response : The receiver encodes a message and transmits it back to the sender.
- 25. 25 Communication Methods Communication methods are of three types: Push communication. Involves sending information to a receiver. Pull communication. Involves receivers assessing information whenever required. Interactive communication. Involves communication between multiple people performing multi-directional information exchange. Feedback: It can be verbal/non-verbal(body language & facial gestures),written, positive/negative. It should be clear , specific, and offered in a timely manner.
- 26. 26 Topic D: Engage Stakeholders A PM’s best interest lies in keeping the project stakeholders interested in the project and the outcomes. The Stakeholder Register should be reviewed for information needed to plan appropriate ways to engage project stakeholders. The organizational culture , structure , and political climate should be reviewed to help in determining the best options to support a better adaptive process for engaging stakeholders. The lessons-learned database and historical information helps in providing insight on previous stakeholder engagement plans and their effectiveness.
- 27. 27 The topic ‘Engage Stakeholders’ addresses various enablers from the ECO: Analyze stakeholders. (ECO 2.4.1 Categorize stakeholders. (ECO 2.4.2) Engage stakeholders by category.(ECO 2.4.3) Develop , execute , and validate a strategy for stakeholder engagement. (ECO2.4.4)
- 28. 28 Stakeholder Categories Sponsors - Approve and sign the Project Charter. Provide finance , resources & support to the project. Customers Sellers Business Partners Organizational Groups Functional Managers Other Stakeholders - govt. regulators , consultants, financial institutions etc
- 29. 29 Stakeholder Engagement Assessment Matrix Stakeholder Engagement Assessment Matrix is a matrix that compares current and desired stakeholder engagement levels. Classification levels can include: Unaware: Unaware of project and potential impacts Resistant: Aware of project and potential impacts , but resistant Neutral: Aware of project yet neither supportive nor resistant Supportive: Aware of project and potential impacts , and supportive of changes Leading: Aware of project and potential impacts and actively engaged in ensuring the project is a success.
- 30. 30 Stakeholder Unaware Resistant Neutral Supportive Leading Stakeholder1 C D Stakeholder2 C D Stakeholder3 C D C = Current engagement level D = Desired engagement level Stakeholder Engagement Assessment Matrix
- 31. 31 Topic E: Create Project Artifacts Projects create deliverables—the interim and final products of the project’s scope. Projects also create artifacts throughout their life cycle. A Project artifact is any document related to the management of a project . The PT create and maintain many artifact during the life of the project , to allow reconstruction of the history of the project and to benefit other projects. Project artifacts are normally living documents , and formally updated to reflect changes in project requirements and scope.
- 32. 32 Project Artifacts Acceptance criteria Assumptions Business case Change requests Constraints Lessons learned Minutes of status meetings Project Charter Scope & Scope Baseline Subsid . Proj. Mgt.Plans Requirements Agile Projects: Product Backlog Product Increment Product Roadmap Product Vision Roadmap Release Plan Sprint Backlog
- 33. 33 Project Artifact Management Artifact mgt. includes the procedure used to create, store , retrieve , and distribute project documents. An effective artifact mgt. system includes the following provisions: A way to produce and control documents without unnecessary administrative overhead. Standardized formats and templates. A structured process for the review and approval of documents. Version control and security. Timely distribution of documents.
- 34. 34 TOPIC F Manage Project Changes Change is a must in any type of projects. A great PM is an effective manager of change, able to anticipate , respond to , and deal with the changes that will inevitably arise on any project. Managing changes to performance baselines ensures that the original project scope and the integrity of performance baselines are maintained. Ensuring that changes are agreed upon and continuously managing changes as they occur minimizes the impact changes may have on project time , cost , and quality concerns.
- 35. 35 Enablers , Deliverables , and Tools The topic ‘Manage Project Changes’ addresses various enablers from the ECO: Anticipate and embrace the need for change.(ECO 2.10.1) Determine strategy to handle change.(ECO 2.10.2) Executing change management strategy according to the methodology(ECO 2.10.3) Determine a change response to move the project forward.(ECO2.10.4)
- 36. 36 Causes of Project Changes Inaccurate initial estimates Specification changes New regulations Missed requirements
- 37. 37 Change Management Plan Who can propose a change? What exactly constitutes a change? What is the impact of the change on the project’s objectives? What steps are necessary to evaluate the change requests before approving or rejecting it? When a change request is approved ,what project documents must be amended to record the actions necessary to effect the change? How will these actions be monitored to confirm that they have been completed satisfactorily? A Change Management Plan can answer the following questions:
- 38. 38 Change Control system A Change control system is a set of procedures that describes how modifications to the project deliverables and documentation are managed and controlled. An effective change control system includes the forms , tracking methods , processes, and approval levels require d for authorizing or rejecting requested changes. Change control systems often specify that a Change Control Board(CCB) will address the issues that affect cost , time , and product quality.
- 39. 39 Change Control Board A Change Control Board(CCB) is a formally chartered group responsible for reviewing, evaluating , approving , delaying, or rejecting changes to the project , and for recording and communicating such decisions. Normally, the CCB operates closely with the project’s sponsor , customer , and other key stakeholders. Decisions made during the CCB meetings are documented and communicated to the required stakeholders. Stakeholders can use this information to follow-up on the necessary actions.
- 40. 40 Change Control Strategy Change Management consists of 5 main stages: Change identification Change documentation Analyzing the impact of change Course of action Updating related plans
- 41. 41 Approved Change Requests Approved changes can include: Corrective action : Adjust the performance of the project work with the project management plan. Preventive action: Ensures future performance of the project work with the project management plan. Defect repair : Modifies a non-conformance with the project. Updates : Modifies project documents and plans to reflect the project changes.
- 42. 42 TOPIC G Manage Project Issues Issue: An issue is a current condition or situation that may have an impact on the project objectives. An issue is an action item that the project team must address. Risk: A risk is an uncertain event or condition that ,if it occurs , has a positive or negative effect on one or more project objectives. Issue Log: An issue log is a document where information about issues is recorded and monitored. It is used to track problems , inconsistencies , or conflicts that occur during the life of the project and require investigation in order to work toward a resolution.
- 43. 43 Risk and Issues Risk Characteristics: • Focus on the future • Can be positive or negative • Is documented in the risk register • Response is called a “Risk Response” Issue Characteristics: • Focused on the present • Will always be negative • Is documented in the ‘Issue Log’ • Response is called a “Workaround”
- 44. 44 TOPIC H Ensure Knowledge Transfer for Project Continuity It is important for the project team members to obtain the right knowledge at the time when they need it to their job. Therefore, as the PM, one needs to know how to collect , consume, and use the knowledge so that the team is prepared and ready. A PM should also know how to transfer this knowledge to other projects , so they can benefit from it.
- 45. 45 This topic addresses various enablers from the ECO: Maintain team and knowledge transfer. (ECO 1.6.4) Discuss project responsibilities within team. (ECO 2.16.1) Outline expectations for working environment. (ECO 2.16.2) Confirm approach for knowledge transfer.(ECO 2.16.3)
- 46. 46 Types of Knowledge Knowledge can be divided into two main types: Explicit: Explicit Knowledge is the knowledge that can be codified using symbols such as words, numbers, and pictures. Tacit: Tacit Knowledge is personal knowledge that can be difficult to articulate and share such as beliefs , experience , and insights.
- 47. 47 Project Knowledge Management The PM has to be concerned with managing both types of knowledge(Explicit & Tacit) to take advantage of the knowledge , skills , and experiences that the PT members have gained throughout the project duration/time-span. Knowledge management is more than keeping track of what is known and then distributing it to the team and the project stakeholders. For managing tacit knowledge, the key is to create and maintain trust among those involved in the project so they are willing to share their experiences with everyone else.
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- 49. 49 THANK YOU