Buisness

Analysis

Lecturer:
Arpita Pal
Arpita.Pal@ibat.ie
 Planning Projects

Risk Management
Communications Management
Learning Outcome
n Identify project risks
n Know the importance of good project risk management
n Describe risk management planning and the contents of a risk
management plan
n Describe risk identification process, tools and techniques to help
identify project risks
n Create a risk register

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Learning Outcome Cont’d

n Describe communications planning

n Create a communications management plan and perform a

stakeholder communications analysis

n Describe various methods for distributing project information

n Recognise the importance of good communications management
for stakeholder relationships and for resolving issues

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Risk Management

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What is Project Risk?
n An event that, if it occurs, causes either a positive or negative
impact on a project

n Keys attributes of Risk

n Uncertainty

n Positive and Negative

n Cause and Consequence

n Known v Unknown Risks

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What is Risk Management?

n A method of identifying, analyzing and managing risk

n Steps
n Risk Management Planning

n Risk Identification

n Risk Analysis

n Risk Response Planning

n Risk Monitoring & Control

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Risk Management Cycle

4.Monitoring & 1. Risk Identification

Control

3. Risk Response 2. Risk Analysis

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Risk Management Planning
n Risk Management Planning is the process of deciding how to
approach and conduct the risk management activities for a project
n Question you should ask:
n How risky is the project?

n Is it a new technology or something your organisation is

familiar with?
n Do you have past projects to reference?

n What is the visibility of the project?

n How big is the project?

n How important is the project?

n Output = Risk Management Plan

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The Risk Management Plan

n What should it include?

n Definitions of Risk

n Probability and Impact Matrix

n Roles and Responsibilities

n Frequency of risk planning

n When a risk is really a risk i.e. when to enact the risk plan

n Reporting requirements

n Monitoring, tracking and documenting strategies

n Budget for managing risks

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 What Went Wrong?

n KPMG, a large consulting firm, published a study in 1995 of

runaway projects — projects that have significant cost or
schedule overruns
n 55 percent did no risk management at all
n 38 percent did some (but half did not use their risk findings after the
project was underway)
n 7 percent did not know whether they did risk management or not

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Risk Identification
n The process of determining which risks might affect the project
and documenting their characteristics.
n Continuous, Iterative Process
n Review the schedule activities and identify what events that could occur that
would impact the completion of the activity in time and/or cost.
n Identify the triggers that will indicate that a risk event has occurred or is likely
to occur.
n Record in Risk Register
n Techniques to identify Risk
n Brainstorming
n Checklists
n Interviewing
n SWOT Analysis
n Cause & effect – Ishikawa or ‘Fishbone’
n Flow Charts
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Risk Identification - Fishbone

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Risk Identification - Fishbone
n Identify the main problem or issue to solve
n Establish the major categories or likely causes e.g.
n Methods
n Machines (equipment)
n People (manpower)
n Materials ’Why’ to generate deep levels of
n Measurement
n Environment
n Brainstorm all possible causes of the problem under each
category
n Include sub-causes if appropriate
n Ask ‘Why’ to generate deeper levels of causes
n Indicate any causal relationships

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Risk Register
n Risk identification process provides list of identified risks and
other information needed to begin creating a risk register
n A risk register is:
n A table or spreadsheet containing the results of various risk management
processes
n A tool for documenting potential risk events and related information

n Risk events refer to specific, uncertain events that may occur to

the detriment or enhancement of the project

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Analysing Risk-Probability
n Probability is the chance that a given risk will occur
n Steps:
n Look at your project plan and schedule.
n Based on the current plan, ask yourself how possible it is that this risk
will actually happen.
n On the probability of this risk. a scale of 1 to 5, with 5 being the most
probable, determine what number rating would you give

Score Probability
1 Very unlikely (1% - 24%)
2 Unlikely (25% - 49%)
3 Likely (50% - 74%)
4 Very likely (75% -94%)
5 Highly likely (95% or more)

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 Analysing Risk-Impact
n The definition of impact is the extent of damage that can be done to your
project if the risk actually happens.
n Steps:
1. Imagine the risk happening.
2. Imagine what would happen to your triple constraints because of this
risk happening.
3. On a scale of 1 to 5, with 5 being the highest impact to your project,
determine what number rating you would give the impact of this risk.

Score Impact
1 Unimportant
2 Less important
3 Important
4 Very important / serious
5 Catastrophic / critical

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Risk Register

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Risk Analysis
n The probability and Impact have been determined
n Determine which risks you will work on.
n Multiply the probability and impact numbers you've generated [PxI] giving a

risk rating
n Based on your companies risk appetite you decide to respond to the top 25

percent.
n So for the TTR case study it would mean responding to Risk 1,2 and 5.

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Probability/Impact Matrix
n A probability/impact matrix or chart lists the relative
probability of a risk occurring on one side of a matrix or axis on
a chart and the relative impact of the risk occurring on the
other.

n List the risks and based on rating, label each one as high,
medium, or low
n 0-1 Low
n 2-3 Med
n 4-5 High

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Sample Probability/Impact Matrix

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Analysing Risk - Quantitative
n Quantitative Risk Analysis – The process of numerically analysing
the effect on the overall project objectives of the identified risks.
n Large, complex projects involving leading edge technologies often
require extensive quantitative risk analysis
n Should be focused to highest risks as determined by Qualitative
Risk Analysis
n Main techniques include:
n Simulation
n Sensitivity analysis
n Decision tree analysis

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Decision Tree
n A decision Tree consists of 3 types of nodes:-
1. Decision nodes - commonly represented by
squares
2. Chance nodes - represented by circles
3. End nodes - represented by triangles
Perform Quantitative Risk Analysis – An Example
Risk Response Planning
n After identifying and quantifying risks, you must decide how to respond
to them
n Four main response strategies for Negative risks:
n Avoid - Eliminate it
n Transfer - Pawn it off
n Mitigate - Reduce probability or impact of it
n Accept - Do Nothing
n Four main strategies for Positive risks:
n Enhance - Increase probability and/or impact
n Exploit - Eliminate uncertainty
n Share - With 3rd Party to increase benefits
n Accept - Take advantage
n Strategy should be commensurate with risk
n Hint: Don’t spend more money preventing the risk than the impact of the risk

would be if it occurs
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Risk Response Planning
n Review your risk list and determine the appropriate strategy for
each of your top risks.
n Then decide what steps you will take to respond to the risk

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Risk Monitoring and Control
n The Process of tracking identified risks, monitoring residual risks,
identifying new risks, executing risk response plans, and
evaluating their effectiveness throughout the project life cycle.

n This is an ongoing process that is updated and maintained by the

Project Management Team.

n Main outputs of risk monitoring and control are:

n Requested changes.
n Recommended corrective and preventive actions.
n Updates to the risk register and project management plan

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Risk Monitoring and Control
n Create a risk owner for top risks on your response plan.
n Built a response plan for each risk.
n Two important steps :
n Risk Owner
n A risk owner provides accountability for the execution of the response
strategy
n Assign a member of your team who will be involved in the activities that
surround the risk.
n Alarms
n An alarm is sounded whenever the risk begins to occur.
n An alarm is placed only on risks that you have chosen to mitigate.
n An alarm describes what the risk looks like when it actually starts to happen.

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Using Software to Assist in Project Risk
Management

n Risk registers can be created in a simple Word or Excel file

or as part of a database
n More sophisticated risk management software, such as
Monte Carlo simulation tools, help in analysing project risks

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 Communication

Language is not only an instrument of communication or

even of knowledge, but also an instrument of power.

One seeks not only to be understood but also to be believed,

obeyed, respected, distinguished.
—Pierre Bourdieu

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Project Communications Management
n Project Communications Management includes the processes
required to ensure timely and appropriate generation, collection,
distribution, storage, retrieval and ultimate disposition of project
information.

n Effective communication creates a bridge between diverse

stakeholders involved in the project, connecting various cultural
and organisational backgrounds, different levels of expertise, and
various perspectives in the project execution and outcome.

The PMBOK® Guide 56h edition.

PMBOK is a registered mark of the Project Management Institute, Inc.

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Importance of Good Communications
n The greatest threat to many projects is a failure to
communicate

n 28% of projects fail due to poor communications

Other Reasons
28 for Failure

72 Project
Communications
Failures

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Project Communications Management
n Communications planning: determining the information and
communications needs of the stakeholders
n Performance reporting: collecting and disseminating
performance information, including status reports, progress
measurement, and forecasting
n Managing stakeholders: managing communications to satisfy
the needs and expectations of project stakeholders and to resolve
issues

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Communications Planning

n Who? Who needs to know?

n What? What do they need to know?
n When? How frequently?
n Where? Where are communications required?
n Why? Why is this important?
n How? How are they kept informed?

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n Who? Stakeholder Identification
n What? Stakeholder Analysis
n Tendency to send too much to too many –very easy to do with

electronic communications! Too much is as bad as too little – can’t

read everything.
n Target your audiences – and realise you may have more than one.

n When?
n How often?
n Morning & afternoon?
n Day of week?
n Day of month?
n Different intervals for various stakeholders
n Weekly for team members
n Bi-weekly for sponsor
n Monthly for Executives 36
n Where?
n Location for status meetings
n Location for team meetings
n Locations for information: Network drive, website, internal or external,
SharePoint, Google Docs
n Why?
n Need to know?
n Build buy in
n Provide information
n How?
n Emails
n Status reports
n Phone calls
n Meetings
n Face to Face, One to One

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Example Communications Plan
Who When Why What How
Project customer All phases Want them to know we Phase completed on 1. Regular monthly
are on track. time. All is well. status report.

2. Face to face every

two weeks.
All events Major milestones are all Milestone completed. All 1. TTR newsletter,
on track. is well. announcing milestone.
E-mail.
Project sponsor All phases Want them to know we Phase completed on 1. Regular monthly
are on track. time. All is well. status report.

2. Face to face every

two weeks.
All events Major milestones are all Milestone completed. All 1. TTR newsletter,
on track. is well. announcing milestone.
E-mail.
CSR supervisors Feasibility Need them to be ready Provide requirements. 1. Weekly face-to-face
to sign off. Provide who has been meeting.
involved. Describe the
process.

Requirements sign-off Their work on Requirements 1. TTR newsletter,

requirements is completed. Who signed announcing milestone.
completed. off. E-mail.

2. Celebration and
thank-you lunch.

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Distributing Information in an Effective and
Timely Manner

n Don’t bury crucial information

n Don’t be afraid to report bad information

n Oral communication via meetings and informal talks helps bring

important information—good and bad—out into the open

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Personal Preferences Affect Communication
Needs
n Introverts like more private communications, while extroverts like
to discuss things in public
n Intuitive people like to understand the big picture, while sensing
people need step-by-step details
n Thinkers want to know the logic behind decisions, while feeling
people want to know how something affects them personally
n Judging people are driven to meet deadlines, while perceiving
people need more help in developing and following plans

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Personal Preferences Affect Communication
Needs

https://www.youtube.com/watch?v=li4mCDH0eUE
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Other Communication Considerations

n Rarely does the receiver interpret a message exactly as the

sender intended

n Geographic location and cultural background affect the complexity

of project communications
n Different working hours

n Language barriers

n Different cultural norms

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 Culture and Communication
n Culture is a set of shared bonds
n Can be High-Context or Low-Context
n Personal bonds
n Face to Face Communications
n Detailed Agreements
n Can be Time Sequential or Synchronic
n One logical thing after another
n Late – Disrespect, Punctuality – Childish Impatience
n Can be Affective or Neutral
n Emotions on Display
n Emotions carefully controlled

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Setting the Stage for Communicating Bad News
Dear Mom and Dad, or should I say Grandma & Grandpa,

Yes, I am pregnant. No, I’m not married yet since Larry, my boyfriend, is
out of a job. Larry’s employers just don’t seem to appreciate the skills he
has learned since he quit high school. Larry looks much younger than
you, Dad, even though he is three years older. I’m quitting college and
getting a job so we can get an apartment before the baby is born. I
found a beautiful apartment above a nightclub with good insulation so
the noise won’t bother us.

I’m very happy. I thought you would be too.

Love, Ashley

P.S. There is no Larry. I’m not pregnant. I’m not getting married. I’m not
quitting school, but I am getting a “D” in Chemistry. I just wanted you to
have some perspective. 44
Setting the Stage for Communicating Bad News
Dear Mom and Dad, or should I say Grandma & Grandpa,

Yes, I am pregnant. No, I’m not married yet since Larry, my boyfriend, is
out of a job. Larry’s employers just don’t seem to appreciate the skills he
has learned since he quit high school. Larry looks much younger than
you, Dad, even though he is three years older. I’m quitting college and
getting a job so we can get an apartment before the baby is born. I found
a beautiful apartment above a nightclub with good insulation so the noise
won’t bother us.
I’m very happy. I thought you would be too.
Love, Ashley

P.S. There is no Larry. I’m not pregnant. I’m not getting married. I’m not
quitting school, but I am getting a “D” in Chemistry. I just wanted you to have
some perspective.

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Stakeholder Management

Project Management Institute, A Guide to the Project Management Body of Knowledge, (PMBOK® Guide)

.
– Sixth Edition, Project Management Institute Inc.

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Stakeholder Engagement

Project Management Institute, A Guide to the Project Management Body of Knowledge, (PMBOK® Guide)
– Sixth Edition, Project Management Institute Inc.,
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Stakeholder Engagement Assessment Matrix

Project Management Institute, A Guide to the Project Management Body of Knowledge, (PMBOK® Guide)
– Sixth Edition, Project Management Institute Inc.,
48
Performance Reporting
n Performance reporting keeps stakeholders informed about
how resources are being used to achieve project objectives
n Status reports describe where the project stands at a specific
point in time

n Progress reports describe what the project team has

accomplished during a certain period of time

n Forecasts predict future project status and progress based on

past information and trends

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Managing Stakeholders
n Project managers must understand and work with various
stakeholders
n Need to devise a way to identify and resolve issues
n An important tool to use is the issue log:

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Suggestions for Improving Project
Communications
n Manage conflicts effectively
n Develop better communication skills
n Run effective meetings
n Use e-mail and other technologies effectively
n Use templates for project communications

n https://www.youtube.com/watch?v=8rXQNFNziY0
n https://www.ted.com/talks/david_grady_how_to_save_the_world_or_at_least_yourself_from_bad_meetings

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