Risk Management is concerned with identifying risks and drawing up plans to

minimize their effect on the project. Risk Management is the process of identifying and
migrating risk. A risk is a probability that some adverse circumstance will occur, and it
can affect to the schedule or resources, the quality or performance of the software being
developed and the organizing, developing or procuring the software. Risk is an
uncertain event that may have a positive or negative impact on the project.
Risk Management is very important because risk affects all aspect of your
project, your budget, your schedule, the agreed level of quality and so on, increase
probability of positive events and reduce the occurrence of negative event. Moreover,
there are examples of common project, product, and business risk like: staff turnover,
management change, hardware unavailability, requirement change, CASE tool
underperformance.
The Risk Management Process:

 Risk Identification- Is the process of determining risk that could potentially

prevent the program, enterprises, investment from achieving its objectives.
 Risk Analysis- Assess the likelihood and consequences of these risks.
 Risk Planning- Draw up lines to avoid or minimize the effect of the risks.
 Risk Monitoring- Monitor the risk throughout the project.

The following are the checklist of common risk may be used to identify risk
in a project.

 Technology risk
 People risk
 Organizational risk
 Tool risk
 Requirement risk
 Estimation risk.

However, in risk analysis, it should assess the probability and seriousness of

each risk, even the probability may be very low, low, high, and very high. It should also
assess the risk consequences it might be catastrophic, serious, tolerable or
insignificant.
The following are ways on how risk management done in a project:

 Make risk management part of your project.

 Identify risk early in your project.
 Communicate about risk.
  Consider both threat and opportunity.
 Clarify owners issue.
 Prioritize risk.
 Analyze risk.
 Plan and implement risk responses.
 Tract risk and associated task.

Moreover, there are strategies to help manage the risk. First, in organizational
financial problem, they should prepare a document for senior management showing
how the project is making a very important contribution to the goals of the business.
Second, in recruitment problem, they should alert customers to the potential difficulties
and the possibility of delays. Third, staff illness, they should reorganize the team so that
there is more overlap of work and people therefore understand each others job. Fourth,
defective components, they should replace potentially defective components of known
reliability. Lastly, requirement changes, in this risk, they should derive traceability
information to assess requirements change impact and maximize information hiding in
the design.
Further, to monitor the risk they should assess each identified risk; regularly to
decide whether or not it is becoming less or more probable. Also assess whether the
effect of the risk have change and each risk should be discussed at management
progress meeting.
The following are the benefits of risk management:
 Effective use of resources
 Promoting continuous improvement
 Fewer shocks and failure
 Strategic business planning
 Raised awareness of significant risk.
 Enhancing communication
 Reassuring stakeholder