Risks – The Dangerous aspect of Project Management

Risks are part of all the software projects. Risks being a very scary term is hardly considered important. A risk, can be explained as, a possibility of an event, which can result in threat, damage, injury, loss, or any other negative occurrence, that is caused by external or internal factors, and thus may be avoided through preventive actions. The risk management, hence, becomes very important to focus upon.

The future is always uncertain and unclear; hence, the best way to tackle the risk is to identify them and plan for their treatment. The Risk Management process involves the complete lifecycle, starting from the identification until the treatment of the risk.

Lifecycle of the Risk

The lifecycle of the risk management process is initiated with the identification of the risks, analysing the risks and focussing on the impact of the risks, identifying the frequency and planning for the treatment, which involves corrective and preventive actions. This is a continuous process. A risk management plan is prepared to track the various steps of risk management process.

  • Risk Identification − The risks can be identified using various methodologies. The risks are the gaps that lead to the failure, loss or damage to the project, directly or indirectly. The risks are identified and documented with complete details.
  • Risk Assessment − The list of risks are then assessed based on their likelihood of occurrence and the severity of the impact of the risk. The prioritization of the risk is done based on the impact and likelihood. The higher is the rating, the faster it need to be tackled.
  • Risk Analysis − The impact analysis is done on the risks to assess them on various dependent parameters. The risk score is then generated out of the analysis. Various measures are then defined to quantify the risks.
  • Risk Treatment − The identified risks need to have the contingency plan. The contingency plan is documented and the checks to review the same is planned. The risks are re-analysed and the risk score is recalculated.
  • Risk Tracking − The risks are then reviewed and re-analysed on periodic basis. There might be new risks that has been mounted because of the change in the technology, business or environment.

In a defined frequency, it is important to visit the risk management plan and process to ensure that we are not living in the past. The risks invent, change, upgrade, and removed on their own with the passage of time. The primary purpose should be to always be ready for the risks, which may hinder the project management process in the near future.

Tools used in Risk Management

There are various tools, techniques which are available in the market that can be used for identifying, monitoring risks. Some of these tools are −

  • TBQ (Taxonomy Based Questionnaire)
  • FMEA (Failure Mode & Effect Analysis)
  • Assumption analysis
  • Past Project Database
  • Documentation reviews
  • Brainstorming
  • Wide band Delphi
  • Interviewing
  • RCA (Root Cause Analysis)
  • SWOT (Strength Weakness Opportunities Threats) analysis
  • Checklist analysis

Risk Management Certifications

Risk Management has become the key focus in the project management process. Hence, various courses and certifications are available, which can help in understanding risks and calculating the same in the correct manner. Few of such courses and certifications are discussed below −

  • PMI-RMP −Project Management Institute (PMI) being renown in the industry, the certification itself has become quite credible. It is a multiple-choice exam with 170 Questions to be completed in 3.5 hours.
  • Institute of Risk Management −Institute of Risk Management (IRM) holds certification and diploma courses on risk management. The exam is held on fixed dates and the information about the dates can be fetched from their website.
  • ISO 31000:2009 −ISO also has an auditing standard on Risk Management – ISO 31000 series. The risk management techniques are discussed in ISO 31010:2009 standard. The copy of the standard can be fetched from ISO website. The individuals can certify themselves for this standard after attending the classroom sessions.
  • Certificate Course on Enterprise Risk Management −The Institute of chartered Accountants of India (ICAI) also has a certification course in Risk Management. This course requires 200 hours of studying which is spread across classroom studies, self-study, e-learning modules and case study preparation.
  • RMP −Risk Management Professional (RMP) Certification is another online certification and is a self-paced course.

There are many other certifications, which are widely available and are doing justice to the course outline.

Risk Management has become the need of the hour. To ensure a proper and timely delivery of the project, we need to evaluate the risks and mitigate the same by analysing the risks and providing the appropriate treatment on the same. The risk management has become a necessity instead of an optional aspect. The risk management has become a very core part of the project management process.

Samual Sam
Samual Sam

Learning faster. Every day.

Updated on: 14-Jul-2020


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