Project Risk
Management
I N T RODUC TION T O P ROJ E C T RI S K M A N AGEM ENT
M OD UL E G UI D E - UN I T 1
P G D PM – M A N C OS A
17/07/2020
PREPARED BY R. JOOMUN FOR STUDENTS OF YKBS
Learning Outcomes and Key Concepts
On successful completion of this unit, the
student will be able to:
 Place project risk management in context
 Build an understanding of key concepts in
project risk management
Key Concepts
 Introduction
 Risk Management Concepts
 Risk Management Principles
 Integrate the various risk management principles  Examples of Project Risk
into the project life cycle
 The Benefits of Project Risk Management
 Understand what constitutes a risk
 Appreciate the benefits of project risk
management
Introduction
Definition of Risk Management:
1.
PMI (2017) : “The processes of conducting risk management planning, identification, analysis,
response planning, response implementation, and monitoring risk on a project. The objectives of
project risk management are to increase the probability and / or impact of positive risks
and to decrease the probability and / or impact of negative risks, in order to optimize the
chances of project success”
2.
APM (2006) : “Project risk management is a structured process that allows individual risk
events and overall project risks to be understood and managed proactively, optimising project
success by minimising threats and maximising opportunities”
Risk Management Process
Plan Risk
Management
Identify
Risks
Perform
Risk
Analysis
Plan Risks
Responses
Monitor and
Control
Risks
• Decide how to approach and plan the RM activities for a project
• Determine which risks might affect the project objective and document their characteristics (Risk Management Register)
• Determine the probability and consequence of risks
• Prioritise their impacts on project objectives
• Maybe qualitative or quantitative
+ Implement Risks Response
• Develop procedures and techniques / Define a set of actions to enhance opportunities and reduce threats to the project’s
objectives
• Monitor residual risks, identify new risks, execute risk mitigation (resolution) plan
Case Study : Project Risk Management: Challenge Established
Practice
The article states that even though risk management has “been around for more than three decades”, projects are still
“delivered too late, over budget and often with less benefit than expected”. Drawing on recommendations from the article,
critically discuss how you would advise a project manager to successfully manage risk with the result of
minimizing project threats and maximizing opportunities presented?
Risk Management is about people and competence
Focus on both risks and opportunities
Team collaboration
Facilitation
Suitable experts with skills, experience
Best practices = Successful projects : Cost estimation under uncertainty
Self Test Questions
1.
From a project of your choice, discuss 5 potential risks that may negatively impact the project.
1.
And 1 potential risk that may positively impact the project.
2.
Articulate what the benefits of project risk management are using examples from a project of
your choice.
3.
What would be the risk of not adhering to the risk management principles when planning for
project risk management?
Key Messages
 Risk Management


Systematic
Proactive
 Risk may be negative (threat) or positive (opportunity)
 The Risk Management Process: Identification, Assessment, Respond and Implement, Monitor and
Control
 Areas of risk extend to ALL project management knowledge areas
 From case study : Risk is about people and competence