Lecture on Risk Management Techniques

1. Expert Judgment

• Most popular technique
• Experts must have experience in similar projects
• Important for risk management and qualitative risk analysis

2. Data Gathering Techniques

Interviews

• Structured or semi-structured
• Assess probability and impact of individual project risks
• Promote environment of trust and confidentiality
• Conduct with key stakeholders

3. Data Analysis Techniques

Risk Data Quality Assessment

• Critical success factor: High-quality information required
• Evaluates accuracy and reliability of risk data
• Use questionnaire to measure data quality
• Example characteristics: Completeness, objectivity, relevancy, timeliness

Risk Probability and Impact Assessment

• Consider specific risk probabilities and potential impacts
• Impact on project objectives (schedule, cost, quality, performance)
• Conducted in interviews or meetings
• Differences in stakeholder perceptions expected and should be recorded
• Definitions of probability and impact in risk management plan

Assessment of Other Risk Parameters

Characteristics:

• Urgency: Time to respond
• Proximity: Time before risk impacts objectives
• Dormancy: Time to discover impact
• Manageability: Ease of management
• Controllability: Ability to control outcome
• Detectability: Ease of detection
• Connectivity: Relation to other risks
• Strategic Impact: Effect on strategic goals
• Propinquity: Significance to stakeholders

4. Interpersonal and Team Skills

Facilitation

• Improves effectiveness of risk analysis
• Keeps participants focused
• Helps achieve consensus
• Identifies and resolves biases

5. Risk Categorization

• By sources of risk or affected project area
• Helps determine areas most exposed to uncertainty
• Effective for focused risk responses

6. Data Representation Techniques

Probability and Impact Matrix

• Maps probability and impact of risks
• Prioritizes risks based on combined probability and impact
• Helps reduce biases

Hierarchical Charts

Bubble Chart

• Displays three dimensions of data
• Useful for assessing risks based on three parameters

7. Meetings

Risk Workshops

• Dedicated to individual project risks
• Review, assessment, categorization, and prioritization of risks
• Assign risk owner for each risk

Importance of Risk Ranking

• Determines which risks proceed to further analysis
• Helps allocate experienced resources to high-risk projects