Risk management - Risk Management PROJ 600 Dr Ziping Wang...

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Risk Management PROJ 600 Dr. Ziping Wang
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Risk Risk Uncertain or chance events that planning can not overcome or control. Project risk any possible event that can negatively affect the viability of a project
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Risk Management Risk Management the art and science of identifying, analyzing, and responding to risk factors throughout the life of a project and in the best interest of its objectives. What can go wrong (risk event). How to minimize the risk event’s impact (consequences). What can be done before an event occurs (anticipation). What to do when an event occurs (contingency plans).
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Risk Event Graph Project life cycle Low High Risk Cost Chances of risks occurring Costs to fix risk event
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Phase 1 Conceiv e (C) Phase 2 Develop (D) Phase 3 Execute (E) Phase 4 Finish (F) Time $ Value Increasing Risk Total Project Life Cycle Amount at stake Plan Produce Opportunity and risk Period of highest risk impact Combined risk impact
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Risk Management’s Benefits A proactive rather than reactive approach. Reduces surprises and negative consequences. Prepares the project manager to take advantage of appropriate risks. Provides better control over the future. Improves chances of reaching project performance objectives within budget and on time.
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The Risk Management Process Step 1 Risk Identification Analyze the project to identify sources of risk Know risks Step 2 Risk Assessment ( Analysis of probability and consequences ) Assess risks in terms of: Severity of impact, likelihood of occurring, and controllability
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