Assume you have just been assigned to a project risk team composed of five membe

Question

Assume you have just been assigned to a project risk team composed of five members. Your task, as project manager, is to develop a process for handling risks to the project. Because this is the first time your organization has formally set up a risk team for a project, it is hoped that your team will develop a process that can be used on all future projects. Your first team meeting is next Monday morning. Each team member has been asked to prepare for the meeting by developing, in as much detail as possible, an outline that describes how you believe the team should proceed in handling project risks. Each team member will hand out his or her proposed outline at the beginning of the meeting. Your outline should include, but not be limited to, the following information:

What methods should be used for identifying risks?

Who should be involved in identifying risks?

What should be considered when identifying risks?

Explanation / Answer

METHODS USED FOR IDETYFYING RISKS:

Brainstorming is a technique that is best accomplished when the approach is unstructured (the facilitator encourages random inputs from the group). Group members verbally identify risks that provide the opportunity to build on others’ ideas. To achieve the desired outcome, it is essential to select participants that are familiar with the topics discussed, relevant documentation is provided and a facilitator that knows the risk process leads the group.

A note-taker should be appointed to capture the ideas that are being discussed. A structured brainstorming session, where each group member presents an idea in turn, may be used where not all group members are participating. Structured brainstorming ensures participation by all group members. Brainstorming can also be used during planning to generate a list of migration strategies, possible causes for the risk, or other areas of impact. It is not intended for an in-depth risk analysis of risk.

Delphi technique. The Delphi technique is a way to reach a consensus of experts. Project risk experts as well as Technology experts participate in this technique anonymously. A facilitator uses a questionnaire to solicit ideas about the important project risks. The responses are summarized and are then sent back to the experts for further comment. Consensus may be reached in a few rounds of this process. The Delphi technique helps reduce bias in the data and keeps any one person from having undue influence on the outcome.

Interviews are an effective way to identify risk areas. Group interviews can assist in identifying the baseline of risk on a project. The interview process is essentially a questioning process. It is limited by the effectiveness of the facilitator and the questions that are being asked.

The interview can be conducted before or after the brainstorming session. However if it is accomplished before the brainstorming session, the results should be shared with the group after they have provided their input to the risk list. If the interview(s) are completed after the brainstorming session has been completed, the list of risks should be provided to all participants for comment before they are added to the risk list.

Working Groups are great way to analyze a particular area or topic in a discussion process to identify risks that may not be obvious to the risk identification group. The working group is usually a separate group of people working a particular area within the project that is conducting the risk identification.

Strengths, weaknesses, opportunities, and threats (SWOT) analysis. This technique ensures examination of the project from each of the SWOT perspectives, to increase the breadth of considered .analysis. project team uses this technique to fully examine the risks that had been identified.

Checklist Analysis. Risk identification checklists can be developed based on historical information and knowledge that has been accumulated from previous similar projects and from other sources of information. This means you have to record project information at the end of the project to build the historical database. The lowest level of the risk breakdown structure can also be used as a risk checklist. While a checklist can be quick and simple, it is impossible to build an exhaustive one. Care should be taken to explore items that do not appear on the checklist. The checklist should be reviewed during project closure to improve it for use on future projects.

Assumptions Analysis. Every project is conceived and developed based on a set of hypotheses, scenarios, or assumptions. Assumptions analysis is a tool that explores the validity of assumptions as they apply to the project. It identifies risks to the project from inaccuracy, inconsistency, or incompleteness of assumptions.

Diagramming Techniques. Risk diagramming techniques may include:

o   Cause-and-effect diagrams. These are also known as Ishikawa or fishbone diagrams, and are useful for identifying causes of risks. These are frequently used in projects.

o   System or process flow charts. These show how various elements of system interrelate, and the mechanism of causation. Seeing the flow sometimes triggers someone to identify a risk that may have slipped through the cracks.

o   Influence diagrams. These are graphical representations of situations showing causal influences, time ordering of events, and other relationships among variables and outcomes.

Working Groups are great way to analyze a particular area or topic in a discussion process to identify risks that may not be obvious to the risk identification group. The working group is usually a separate group of people working a particular area within the project that is conducting the risk identification.

Experiential Knowledge is the collection of information that a person has obtained through their experience. Caution must be used when using any knowledge based information to ensure it is relevant and applicable to the current situation.

Documented Knowledge is the collection of information or data that has been documented about a particular subject. This is a source of information that provides insight into the risks in a particular area of concern. Caution must be used when using any knowledge based information to ensure it is relevant and applicable to the current situation

Risk Trigger Questions are lists of situations or events in a particular area of a municipality that can lead to risk identification. These are situations or areas where risks have been discovered within the organization. These trigger questions may be grouped by areas such as performance, cost, schedule, software, etc.

Lessons Learned is experiential knowledge that has been organized into information that may be relevant to the different areas within the organization. This source of information may guide you in identifying risk in your municipality. Caution must be used when using this type of information to ensure it is relevant and applicable to the current situation.

Outputs from Risk-Oriented Analysis - There are various types of risk oriented analysis. Two such techniques are fault tree analysis and event tree analysis. These are top down analysis approaches that attempt to determine what events, conditions, or faults could lead to a specific top level undesirable event. This event with the associated consequence could be a risk for your program

Historical Information is basically the same as documented knowledge. The difference is that historical information is usually widely accepted as fact.

PEOPLE INVOLVED IN RISK ANALYSIS:

Not only should the project manager and the project team be involved, engage other relevant stakeholders. For example, if you are identifying threats associated with the development of a data center, you should include representatives of 3rd party vendors. If you are managing a project to move a leasing company from Canada to a U.S. location, include HR representatives from both locations.

The project team should be involved in the process so that they can develop and maintain a sense of ownership of, and responsibility for, the risks and associated risk response actions. Not only should the project manager and the project team be involved, engage other relevant stakeholders.

For example, if you are identifying threats associated with the development of a data center, you should include representatives of 3rd party vendors. If you are managing a project to move a leasing company from Canada to a U.S. location, include HR representatives from both locations.

FACTORS TO BE CONSIDERED:

The common Project Risk List Reference below which are divided into a number of risk categories are samples of potential risks of a project may be exposed to and should only be used by the Project Team as a reference and starting point for risk identification during the project risk management planning.

Risk Category : Schedule

Risk Category : Requirement Risk

Risk Category : Project Management Risk

Risk Category : Product/Technology Risk

Risk Category : Customer Risk

Risk Category : Human Resources & Contractors Risk

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