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Risk management plan and analysis is an important and integral part of the project manager’s work. At the beginning of each project, drawing up a project risk plan is a mandatory part of project planning.
In this article, we present a real example of a risk management plan and analysis made by a student in project management.
The risk analysis of the project will serve to identify potential risks to the implementation of a given to identify possible causes and assess the foreseeable consequences.
The impact of the identified risks in the different project areas will be analyzed, these risks will be assessed and the procedures for their treatment will be determined, the actions to be taken, those responsible, and the deadlines for actions to eliminate or minimize the impact of these risks. Reference: “What is Project Risk Management“, https://www.policymatters.net/what-is-project-risk-management/
Identification of risk areas: Structured description of functional interdependencies between risk areas. This phase ends with the classification of information.
Threat analysis: Identification of threats concerning the identified risk areas. Frequency study based on documentation with records and other objective data.
Vulnerability research: Identification of vulnerabilities related to risk areas. Assessment of vulnerabilities based on the degree of their vulnerability.Risk analysis: Identification, assessment, and prioritization of risks based on identified threats and vulnerabilities. Assessment of existing risk and residual risk.
Field of action
Risk analysis will be applied in the design, production/purchase, integration, installation, commissioning, and maintenance phases.
Risk areas to be analyzed
In particular, the following risk areas will be analyzed concerning the project:
- Testing and evaluation
- Development capacity
- Specific issues related to the current situation
In general, the activities that determine the implementation of the project work are the following:
The deadlines set by the contracting authority require that the commissioning of the system be synchronized with the construction of the zones in each phase of the project. Reference: “Work Breakdown Structure (WBS) and project risk management“, https://phron.org/work-breakdown-structure-wbs-and-project-risk-management/
The assessment is performed for each risk area and includes identification and analysis. The analysis is a technical and systematic process in which the identified risks are studied, the causes are isolated, the connections with other risks are determined and the impact is indicated in terms of probability and consequences.
After identifying potential future events that could pose risks to the project and agreeing on them, an analysis was carried out on the likelihood of their occurrence, assessing their impact and setting priorities for dealing with them. Learn about more project management practices.
Each risk is assessed below according to the probability of its occurrence following the following criteria:
- Very low probability
- There is a possibility
- Very high probability
- Almost certainly
By combining the two estimates obtained, a risk weight is obtained according to the following matrix, which introduces grades 1 to 5.
- 1. Insignificant
- 2. Relatively normal
- 3. Normal
- 4. Relatively important
- 5. Important
The control consists of evaluation and monitoring of the effectiveness of the corrective actions through measures determined for this purpose. Reference: “Methodology for risk assessment and project risk management“, https://www.mmrls.org/methodology-for-risk-assessment-and-project-risk-management/
The key to the control process is the definition of adequate indicators for changes in costs, deadlines, and measures of production results and how they affect the project as a whole.
The control methods defined for this project are a set of the following elements:
Testing – analysis – and determination: The method includes a controlled test period to identify and correct design deficiencies.
Added value: This includes the combined use of data and costs to assess project improvements in terms of added value. These calculations make it possible to determine whether the planned objectives are achieved through risk management. (More about project management)
Project Measurements: Used for formal and periodic evaluations of alternative ways of developing processes to assess whether the development of the system achieves its objectives.
Deadline control: This includes using data from the phase and work chronology to check that project progress is adequate.
The risk lists do not aim at a definitive summary of each of the possible situations, but represent a first general assessment; the persons responsible for each work area will also be responsible for determining the actions to be taken to overcome any obstacles that may arise in the course of the work.