Select Page

Categories

What are the Components of Risk?

What are the Components of Risk?
By Abhilash Gopi

Risk has three components. These components need to be considered separately when determining on how to manage the risk

Risk Components are:

  • The event that could occur – the risk,
  • The probability that the event will occur – the likelihood,
  • The impact or consequence of the event if it occurs – the penalty (the price you pay).

About Abhilash Gopi In his own words

I got smitten by the Project Management bug when I was working under K.U. Harsha, my first Project Manager and have been lucky since then to work under democratic managers (Purushottam Sitla, Rekha Varma). I could learn on-job from these wonderful managers and has been equally successful in applying these principles.

I am currently working as a Senior Test Manager with Cordiant Technologies, Kochi, India. Cordiant (www.cordiant.com) is an Offshore Product Development Services provider for ISVs and Web Startups and its innovation is spearheaded by our President & CEO, Dennis Paul. Read the Complete Article

Risk Management Processes According to the PMBOK

Risk Management Processes According to the PMBOK
By Abhilash Gopi

Risk Management is the process used to identify, analyze, and respond to a risk by identifying, analyzing, and prioritizing risks, It requires knowledge of business functions and user involvement.

The Project Management Institute’s PMBOK defines the following 4 processes to address risk management issues:

  • Risk Identification
  • Risk Quantification
  • Risk Response Development
  • Risk Response Control

About Abhilash Gopi In his own words

I got smitten by the Project Management bug when I was working under K.U. Harsha, my first Project Manager and have been lucky since then to work under democratic managers (Purushottam Sitla, Rekha Varma). I could learn on-job from these wonderful managers and has been equally successful in applying these principles.

I am currently working as a Senior Test Manager with Cordiant Technologies, Kochi, India. Cordiant (www.cordiant.com) is an Offshore Product Development Services provider for ISVs and Web Startups and its innovation is spearheaded by our President & CEO, Dennis Paul. Read the Complete Article

Risk Characteristics

Risk Characteristics
By Abhilash Gopi

Situational

Changes in a situation can result in new risks. Such changes include replacing a team member, undergoing a reorganization, changing the scope of the project.

Time based

In this case, the probability of the risk occurring at the beginning of the project is very high (due to the unknown factor), and diminishes along as the project progresses. In contrast, the impact (cost) from a risk occurring is low at the beginning and higher at the end.

Interdependence

Within a project, many tasks and deliverables are interdependent on each other. These delay in these tasks will have a cascading effect on the other related tasks, and the result could be a domino effect.

Magnitude Dependent

The relationship of probability and impact are not linear in this case, and the magnitude of the risk makes a lot of difference. For example, consider the risk of spending $1 for a 50/50 chance to win $5 versus the risk of spending $1000 for a 50/50 chance of winning $5000. Read the Complete Article

Categorization of Risks in Project Risk Management

Categorization of Risks in Project Risk Management
By Abhilash Gopi

Risks can be categorized from 2 perspectives:

Perspective #1

  • Technical: risks categorized based on complexity, requirement changes, unproven
    technology etc.
  • Programmatic or Performance: such as safety, skills, regulatory changes, material
    availability etc.
  • Supportability or Environment: such as people, equipment, reliability, maintainability etc.

Perspective #2

  • Cost: such as sensitivity to technical risk, overhead, estimating errors etc.
  • Schedule: such as degree of concurrency, number of critical path items, sensitivity to cost etc.

About Abhilash Gopi In his own words

I got smitten by the Project Management bug when I was working under K.U. Harsha, my first Project Manager and have been lucky since then to work under democratic managers (Purushottam Sitla, Rekha Varma). I could learn on-job from these wonderful managers and has been equally successful in applying these principles.

I am currently working as a Senior Test Manager with Cordiant Technologies, Kochi, India. Read the Complete Article

Contributors

PM Hut currently has 570 contributors! Please contact us in case you’re interested in publishing your Project Management articles on PM Hut and joining the list below!

An article published on PM Hut may be eligible for PMI PDU credits under the Category D of the CCR Program (Giving Back to the Profession). This category is capped to 45 PDUs per 3 years. Authors claiming their PM Hut published articles for PMI PDUs are required (by PMI) to supply PM Hut’s physical address in their application. Please contact us for this information.

Please note that it is the responsibility of the author to handle the whole process for claiming the PDUs, PM Hut’s role is currently only limited to supplying its own physical address to the author.

1 – A1 Enterprise 286 – Karl Fischer
2 – Aaron Sanders 287 – Kathlika Thomas
3 – Abdulla Alkuwaiti 288 – Katy Whitton
4 – Abhijat Saraswat 289 – Kay Wais
5 – Abhilash Gopi 290 – Kaz Young
6 – Adam Leggett 291 – Keith Custer
7 – Ade Miller 292 – Keith L.
Read the Complete Article

Recommended PM App

Recommended PM App

Categories