(project) risk management process september 5, 2008
TRANSCRIPT
(Project)RISK MANAGEMENT PROCESS
SEPTEMBER 5, 2008
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Purpose and Definition
a structured approach for the documentation and review and risks throughout the project
an approach for identification and management of mitigation strategies that can be put in place to reduce the probability of occurrence
identification of those risks with the highest probability of occurrence and impact to the project for communication to and involvement of the Steering Committee for action
The Risk Management Process ensures:
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Definitions
Risks are also categorized into the following project impact categories:
Unlikely Moderate Likely0 - 25% chance of occurrence
The risk is unlikely to occur even if no steps are taken to manage this risk.
25% - 75% chance of occurrence
The potential impacts are moderately likely to occur if no steps are taken to manage this risk.
> 75% chance of occurrence
The potential impacts are likely to occur if no steps are taken to manage this risk.
A risk is a possible future event which, if it occurs, is expected to have an undesirable impact on the project. Risks will be categorized into these probabilities of occurrence:
Low Impact on schedule for a limited number of tasks, but no delay to key dates. Minor increase to project expenditures, but no noticeable degradation in quality
Medium Impact on schedule for many tasks and minor delays on key dates. Major increase in project expenditures, Noticeable, but acceptable, degradation in quality, additional but acceptable risk exposure
High Major impact on key dates requiring a new overall schedule. Unacceptable increase in project expenditures, Unacceptable degradation in quality and risk exposure
Critical Complete project failure
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Guiding Principles
1) Risks should be proactively reviewed and managed by the Project Manager at lease once per month
2) The Risk Owners will be responsible for management and update of their risk mitigation plans
3) Risks should not be closed. They should live throughout the project with ongoing update to their mitigation plans and status
To ensure efficiency in the process, the following will serve as guidingprinciples:
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Risk Resolution Process
Is this a Risk?
Project Team
Project Manager
Legend
NO
RiskEscalation
Reqd?Identify the Risk
1
Qualify the Risk
Track As Task, Action Item, Issue
and/or Update Risk Mitigation
Log the Risk
2
Manage the Risk YES
YES
RiskDisposition
NO
Assigned to a Different Team?
NO
Communicate detail to Assignee with Risk Number
MITIGATERISK
YES
7
3
4
5
6
Mitigation Plan Accepted?
Propose Mitigation Plan
YES
NO
Execute Mitigation Action Items
END(Risk remains open)
Issue Management
Process
Update Risk & Log Issue
TRACK ASISSUE
2
1
8
9
10
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Process StepsRef ID Process Step Description Input/Output Time Horizon Owner
1 Identify the Risk A risk is an element that may cause uncertain danger to the RP&A project. When a risk is discovered, a team member must contact his/her lead with all the pertinent information regarding the risk
Input: Risk discoveryOutput: Detailed information about the Risk
As necessary Project Team
2 Log the Risk The lead must meet with the Project Manager to approve the risk and log it into the Risk log (Excel – short term or Document Repository Tool – long term). To minimize access to the log, only the Project Manager will have access to the log.
Input: Detailed information about the RiskOutput: Risk Management entry
As necessary Project Manager
3 Communicate detail to Assignee with Risk Number
If the Risk is to be assigned to a team other than the original team reporting the risk, Project Manager must communicate the Risk information to the Assigned Team Lead
Input: Risk logged Output: Reassignment of Risk to different team
As necessary Project Manager
4 Qualify the Risk The Project Manager must review the Risk and detail all the relevant problems that can occur from the Risk. They must identify all the teams impacted if the Risk were to occur, and all potential loss
Input: Risk logged Output: Updated Risk
As necessary Project Manager
5 Track As Task, Action Item, or Issue and Update Risk Mitigation
During Risk Qualification, the Project Manager may identify a Risk as being a Task, Action Item, and Issue in addition to being a Risk. If this occurs, a Task, Action Item, or Issue will be logged in Document Repository Tool, and the Risk Mitigation must contain the Task, Action Item, or Issue information. A Risk is NEVER closed
Input: Updated RiskOutput: Task, Action Item, and/or Issue resulting from Risk
As necessary Project Manager
6 Manage the Risk The “Assigned to Team” listed on the Risk will evaluate the Risk for a mitigation plan. This will involve proactively working with impacted teams and reporting out the mitigation plan tasks at least once per month. Risks will be reviewed within the Project Managers meeting at the first week of the month at a minimum but more frequently if warranted
Input: Updated RiskOutput: Possible escalation of Risk
At least once/ month
Project Team
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Process Steps
Ref ID Process Step Description Input/Output Time Horizon Owner
7 Risk Disposition If the Risk does not require any more escalation, the Project Manager will evaluate the continuing disposition of the Risk. If they feel it is still a Risk that requires a Mitigation Plan, they will choose to Mitigate the Risk. If the Risk Mitigation requires additional monies be spent, they will choose to Track the Risk as a Change Request. If the Risk should be tracked as an Issue, they will choose to Track the Risk as an Issue
Input: Updated RiskOutput: Decision on course of action (Create Mitigation Plan, Create Change Request, Create Issue)
As necessary Project Manager
8 Propose Mitigation Plan
The Project Team will update the Risk in Document Repository Tool with a detailed plan to mitigate the risk. If the Project Manager does not approve of the mitigation, the Project Team must work with the Project Manager to create an acceptable mitigation plan
Input: Updated RiskOutput: Detailed Mitigation Plan
Immediately upon identification
Project Team
9 Update Risk and Log Issue
If the Risk is actually an Issue, the Project Team must log an Issue in Document Repository Tool, update the Risk with the relevant information, and follow the Issue Management Process. The Risk should not be closed, but the Issue information listed as mitigation
Input: Updated RiskOutput: Logged Issue and Updated Risk
As necessary Project Team
10 Execute Mitigation Action Items
Once the Mitigation Plan is accepted, the Project Team must carry out the Action Items listed in their detailed Mitigation Plan.
Input: Detailed Mitigation PlanOutput: Action taken as directed by Mitigation Plan for Risk
As necessary Project Team
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Key Roles & Responsibilities
Role Responsibility
Project Manager
• Communicate with Project Teams regarding current and future potential Risks
• Accurately track the Risk with the appropriate process (Issue, Action Item)
• Continuously review the Risk with the Project Team to ensure the Mitigation Plan Action Items are completed
Project Team • Communicate Risks to Project Manager in a timely manner• Detail all possible problems that may result from this Risk• Complete the Mitigation Plan Action Items in a timely manner to
minimize the impact of the Risk on the RP&A Project
There are several key roles and responsibilities necessary to ensure effectiveness of the Risk Resolution Process:
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Contact Information
For additional information on this process, please contact…
Contact Name
Email Phone
Primary Steve Keane [email protected] 773-203-4486
Secondary
Deneeta Pope [email protected] 773-702-8869