Project Title Estimate Date Project PIN # Last Review Date Project Manager 09/23/08 PIN 06/14/12

Mr. Bob the builder dude 0.0$M

RISK MANAGEMENT SUMMARY RESULTS

Target AD date Estimated CN Duration Estimated PE Cost Estimated ROW Cost Estimated CN Cost

05/01/11 1.0Mo 1.0 $M 1.0 $M 1.0 $M

Planned and Actual Planned Cost to Respond Est. $ of Cost Avoided (via risk management) Actual Cost to Respond Est. Actual $ Cost Avoided (via risk management)

MIN

MAX

LIKELY
0.0 $M

0.0 $M

0.0 $M

0.0 $M 0.0 $M

Proactive Risk Management: Develop an action response strategy; assign risk owners to implement action; monitor and record effectiveness of the risk response action.

Risk Breakdown Structure (functional assignment)

Planned Likely Response Cost Cost Avoidance

Risk Breakdown Structure (functional assignment)

Planned Likely Response Cost Cost Avoidance

Enviromental 0.0 $M Str & Geotech 0.0 $M Design 0.0 $M Right Of Way 0.0 $M Utility 0.0 $M

0.0 $M 0.0 $M 0.0 $M 0.0 $M 0.0 $M

Railroad 0.0 $M Partner Stakeholder 0.0 $M Management 0.0 $M Contracting 0.0 $M Construction 0.0 $M Critical Issue

0.0 $M 0.0 $M 0.0 $M 0.0 $M 0.0 $M

Est $ Impact of Signficant Project Risks (exp. Value)

0.0 $M

0.0 $M

0.0 $M

Response Cost & Cost Avoidance
(based on estimated expected values) Estimated Calculated Actual Calculated Response $ Est. Cost Response $ Actual Cost Entered Avoidance Entered Avoidance

Risk Identification Project Phase--Date Identified Phase (pre CN, CN, or ROW)

Quantitative Analysis
Estimated Expected Risk Impact ($M) ([min + (4 X ML) + max] X [probability])/6

Qualitative Display of Most Likely Impact

Response

Monitoring and Control

Actual Cost to Respond [$M]

Summary Description Threat and/or Opportunity

Detailed Description of Risk Event (Specific, Measurable, Attributable, Relevant, Timebound) [SMART]

Risk Trigger

Risk Impact ($M or Mo)

Risk Matrix

ACTION TO BE TAKEN Response Actions including advantages and disadvantages include date

Risk Revie w Dates

Date, Status and Review Comments (Do not delete prior comments, therefore providing a history)

(1)

(2)

(3)

(4) Mar-06

(5)

(6) Threat Wetland mitigation may require additional R/W

(7)

(8)

(9) Cost

(10)

[10a] MIN

(11) 1.0$M 12.0$M 7.0$M 0.0Mo 4.0Mo 3.0Mo

(12) 4.8$M

(13)

(14) Very High Probability VH H M L VL VL Mo

(15)

(16)

(17)

(18) Design Leader/Enviro. mgr

(19) 2007-Jan-

(20)

(21)

(22)

(23) $0.7

(24)

EXAMPLE

Design/PS&E

Schedule

Very Low

MAX Most Likely 90% MIN MAX Most Likely

L

M Impact

H

VH

Threat Threat

NO RISK

VH Probability H M L VL VL L M Impact VH Probability H M L VL VL L M Impact VH Probability H M L VL VL L M Impact VH Probability H M L VL VL L M Impact VH Probability H M L VL VL L M H VH Acceptance $0.0 H VH Acceptance $0.0 H VH Acceptance $0.0 H VH Acceptance $0.0 H VH Acceptance $0.0

2006-Dec-2

1.9Mo

The mitigation ratio has not been finalized and also there could be additional impacts to wetlands which would increase the amount of R/W needed for the mitigation area.

70%

Environmental

If Wetland impact is larger than 1/2 acre and ratio exceeds 4:1.

MAX Most Likely MIN

$ Mitigation Finalize design to identify all wetlands that are impacted. Early coordination with the outside agencies to determine mitigation ratio.

EXAMPLE

$8.4 $4.9

As of Nov. 15, 2005 there are only two potential areas where there could be additional wetland impacts. As of Dec. 2, 2005 agency has initially determined that mitigation ration would be 4:1.

Active

ROW

High

YES

2

$0.0 $0.0 $0.0

0.0$M

Cost

Pre-construction

1

Schedule

MAX Most Likely

Threat Threat

Pre-construction

MAX Most Likely

NO RISK

0.0$M

MIN Cost

NO RISK

0.0Mo

MIN

NO RISK

Active

$0.0 $0.0 $0.0

2

Schedule

MAX Most Likely

Threat Threat

Pre-construction

MAX Most Likely

NO RISK

0.0$M

MIN Cost

NO RISK

0.0Mo

MIN

NO RISK

Active

$0.0 $0.0 $0.0

3

Schedule

MAX Most Likely

Threat Threat

Pre-construction

MAX Most Likely

NO RISK

0.0$M

MIN Cost

NO RISK

0.0Mo

MIN

NO RISK

Active

$0.0 $0.0 $0.0

4

Schedule

MAX Most Likely

Threat Threat

MAX Most Likely

NO RISK

0.0$M

MIN Cost

NO RISK

0.0Mo

MIN

NO RISK

Active

$0.0 $0.0 $0.0

5

Schedule

MAX

NO RISK

0.0Mo

MIN

NO RISK

Active

Est. Actual Costs Avoided [$M]
(25) $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0

Planned Cost to Respond [$M]

(Expected Value of Risk) - (Est. Cost to Respond)

(enter single number estimate)

Is Risk on Critical Path?

Est Cost Avoided [$M]

Risk Owner

RBS Group

Probability

Probability

Strategy

Impact

Status

Risk #

Type

Risk Identification Project Phase--Date Identified Phase (pre CN, CN, or ROW)

Quantitative Analysis
4.8$M 0.0Mo([min + (4 X ML) + max] X [probability])/6
Estimated Expected Risk Impact ($M)

Qualitative Display of Most Likely Impact

Response

Monitoring and Control

Critical Issue

Estimated Calculated Actual Calculated Response $ Est. Cost Response $ Actual Cost Entered Avoidance Entered Avoidance

Actual Cost to Respond [$M]

Acceptance Strategy

Summary Description Threat and/or Opportunity

NO RISK Probability

5

Active

Detailed Description of Risk Event (Specific, Measurable, Attributable, Relevant, Timebound) [SMART]

Risk Trigger

Risk Impact ($M or Mo)

Risk Matrix

ACTION TO BE TAKEN Response Actions including advantages and disadvantages include date

Risk Revie w Dates

Date, Status and Review Comments (Do not delete prior comments, therefore providing a history)

Cost Schedule

Very High RISK NO

(1)

(2)

(3)

(4) Mar-06

(5)

(6) Threat

(7)

(8)

(9)

(10)

[10a] Most Likely

(11)

(12)

(13)

(14) Probability

(15) Impact

(16)

(17)

(18) Design Leader/Enviro. mgr

(19) 2007-Jan-

(20)

(21)

(22)

(23)

(24)

EXAMPLE

2006-Dec-2

The mitigation ratio has not been finalized and also there could be additional impacts to wetlands which would increase the amount of R/W needed for the mitigation area.

70%

If Wetland impact is larger than 1/2 acre and ratio exceeds 4:1.

Finalize design to identify all wetlands that are impacted. Early coordination with the outside agencies to determine mitigation ratio.

As of Nov. 15, 2005 there are only two potential areas where there could be additional wetland impacts. As of Dec. 2, 2005 agency has initially determined that mitigation ration would be 4:1.

EXAMPLE

Environmental

Mitigation

Active

ROW

High

YES

2

Est. Actual Costs Avoided [$M]
(25)

Planned Cost to Respond [$M]

(Expected Value of Risk) - (Est. Cost to Respond)

(enter single number estimate)

Is Risk on Critical Path?

Est Cost Avoided [$M]

Risk Owner

RBS Group

Probability

Impact

Status

Risk #

Type

Project Risk Management Plan Spreadsheet (RMP) – User’s Guide
A convenient tool for tracking risk management of projects. The top part of the risk management plan spreadsheet (rows 1 thru 6) require the user to enter project information in boxes shaded yellow; information that must be entered includes: Project Title, Estimate date, Project PIN, Last review date, Project Manager, Target AD date, Estimated CN duration, Estimated PE Cost ($M), Estimated ROW Cost ($M), Estimated CN Cost ($M). Risk Management is a key component of Project Management. Risk Management is comprised of the following steps: 1) Risk Management Planning (this is a part of the project management plan) The remaining steps are captured in the RMP spreadsheet: 2) Risk Identification (this is the eight column sections of the spreadsheet) 3) Qualitative Risk Analysis (depicted with the risk matrix red-yellow-green chart) 4) Quantitative Risk Analysis (captured in four column sections following risk identification) 5) Risk Response (strategy: avoid/transfer/mitigate/accept) and (action to be taken) 6) Risk Monitoring and Control (who owns the risk andproject objectives. Risk identification occurs Risk Identification: focus on significant risks that affect will track the response to it?) througout project development as old risks are successfully mitigated and retired new ones can emerge. The Risk Identification section includes: (1) Risk # (the spreadsheet is setup for 12 - more can be added if desired) (2) Status of the risk event, there are three status scenarios to choose from: Active , when the risk is being actively monitored and controlled Dormant , when the risk is low priority but may become high priority in the future Retired , when the risk is demised for any reason. (3) RBS Group = Risk Breakdown Structure category (the RBS is found on the website) (4) Date Identified and Project Phase, represents the date when the risk was first identified and the phase of the project when the risk was first identified. Valid entries for the project phase are: Scoping, Design/PS&E and Construction. (5) Phase: Pre-construction, Construction or Right-Of-Way. (6) Summary Description (threat/opportunity). · Threat = if event occurs it negatively impacts objectives (increase cost or schedule) · Opportunity = if event occurs it positively impacts objectives (decrease cost or schedule) (7) Detailed Description of Risk Event (SMART Column) stands for Specific, Measurable, Attributable (a cause is indicated), Relevant and Time bound. It presents detailed risk description. Take some time and thought to fill this out thoroughly - so that others reading it, who are not familiar with the project, can understand the risk event being (8) Risk Trigger presents symptoms and warning signs that a risk event is about to occur. This information is used to determine when to implement the Risk Response Strategies.

Risk Analysis Strategy prioritizes risks based on the “Probability and Impact Risk Matrix.” The section has two major segments: Quantitative Analysis and Qualitative Analysis. § (9) - (15) Includes Qualitative depiction of Quantitative Analysis of most likely impacts. The key features are: impact affects cost, schedule or both? Probability of occurrence and the impact range (min, max, most likely) if it does occur. § (9) Type of risk (does it affect cost and/or schedule?) § (10) Probability of Occurrence § (11) Risk Impact in $M and/or Months; (min, max, most likely). § (12) Estimated Expected value of impact (min + 4*ML + max)/6 § (13) Qualitative description of probability (based on % that is entered) § § (14) Qualitative description of impact (based on figures for risk event and project cost) (15) Qualitative graphicaly display risk event (red/yellow/green risk matrix)

Risk Response Strategy (16) - (18) (16) The project manager and Project Team identify which strategy is best for each risk, and then design specific actions to implement that strategy, and determine who owns the risk and will make sure risk response action is taken. These strategies and actions include: THREAT REPONSES · Avoid: The team changes the project plan to eliminate the risk or to protect the project objectives from its impact. The team might achieve this by changing scope, adding time, or adding resources (thus relaxing the so-called “triple constraint”). These changes may require WSDOT upper management approval. · Transfer: The team transfers the financial impact of risk by contracting out some aspect of the work. Transference reduces the risk only if the contractor is more able to taking steps to reduce the risk and does so. · Mitigate: The team seeks to reduce the probability or consequences of a risk event to an acceptable threshold. They accomplish this via many different means that are specific to the project and the risk. Mitigation steps, although costly and time-consuming, may still be preferable to going forward with the unmitigated risk. OPPORTUNITY REPONSES · Exploit: Action taken to insure the benefit of an opportunity is realized. Taking action to make the opportunity happen, such actions include: assigning more talented resources to a project to reduce time to completion, and/or to provide better quality than originally planned.

· Share: Allocating risk ownership for an opportunity to another party who is best able to handle it, in terms of maximizing probability of occurrence and benefits if it does occur. Transferring threats and sharing opportunities are similar in that a third party is used. Those to whom opportunities are allocated should also be allowed to share in the potential benefits. · Mitigate: Enhance the opportunity by increasing the probability and/or impact thereby maximizing benefits realized for the project. If the probability can be increased to 100% this is effectively an exploit response. Fortify the cause of the opportunity by proactively promoting the trigger conditions. Also look at what is driving the impact drivers to increase the project’s susceptibility to the opportunity.

· Accept: The project manager and the project team decide to accept certain risks. They do not change the project plan to deal with a risk, or identify any response strategy other than agreeing to address the risk if it occurs. (17) Describe specifically what action will be taken and by whom. (18) RISK OWNER Enter the name of the person responsbile for monitoring the risk event and insuring that the risk response action is effectively implemented. Risk Monitoring and Control Strategy (Columns 19-21) To insure risk response actions are followed through and monitoring and reporting of the effect of the risk response action occurs. The Risk review dates should be identified as well as that status of each review. The list of project risks changes as the project matures, new risks develop, or anticipated risks disappear. Periodic project risk reviews repeat the tasks of identification, analysis, and response strategies. The project manager regularly schedules project risk reviews, and ensures that project risk is an agenda item at all Project Team meetings. Risk ratings and prioritization commonly change during the project lifecycle. If an unanticipated risk emerges, or a risk’s impact is greater than expected, the planned response strategy and actions may not be adequate. The project manager and the Project Team must perform additional response strategies and actions to control the risk. Risk control involves: q Choosing alternative response strategies q Implementing a contingency plan q Taking corrective actions q Re-planning the project The risk owner assigned to each risk reports periodically to the project manager on the effectiveness of the plan, any unanticipated effects, and any mid-course correction that the Project Team must take to mitigate the risk.

Monitoring and Control - Risk Management Performance Measurements Response Cost and Cost Avoidance (Columns 22-25) provides a convenient and succinct record of risk management, monitoring and control. It is very important for project managers and project teams to understand that response to a risk is a pro-active endeavour. The primary benefit of risk management is to pre-empt the threat and/or maximize the opportunity by taking action as soon as possible after the risk event has been identified. Risk management is not a recovery plan that is implemented after a risk event occurs but is an action plan to be utilized long before the risk event occurs. (Column 22) Planned Cost to Respond – This is the amount the project manager plans to spend to respond to the risk. The action taken to minimize the threat or maximize the opportunity typically will have some dollar cost associated with it. The amount spent to respond should of course be less than the estimated value of the risk event. NOTE: Even if your response action is successful, in many cases a residual risk remains. (Column 23) Estimated Cost Avoided – (MIN.) – This is a calculated figure as follows: Cost is avoided by reducing/evading impact of a threat or exploiting an opportunity.
Planned Cost Avoidance = (Risk Impact Value X Probability of Occurrence) – Planned Cost to Respond (Column 23) = (Column 10 X Column 11) – Column 22

Note: For column 10 the figure used will be estimated from the workshop uncertainty forecasts. Note: For column 11 the figure used will be the most likely impact as identified in the workshop.

The calculated planned cost avoidance figure represents an estimated amount of cost burden the project has successfully avoided by taking action to pro-actively respond to the risk event. AFTER THE PROJECT IS COMPLETED (Column 24) Actual Cost to Respond – This is the amount actually spent to respond to the risk. Once the project is complete, the actual cost to avoid, mitigate, or transfer the risk is known and can be entered. (Column 25) Estimated Actual Cost Avoidance – (MIN.) – calculated as follows:
Actual Cost Avoidance = (Risk Impact Value X Probability of Occurrence) – Actual Cost to Respond (Column 23) = (Column 10 X Column 11) – Column 24

Note: For column 10 the figure used will be estimated from the workshop uncertainty forecasts. Note: For column 11 the figure used will be the most likely impact as identified in the workshop.

The actual cost avoidance figure represents an estimated amount of the actual cost savings based on the estimated cost of the risk minus the actual cost to avoid the risk.
NOTE: Even if your response action is successful, in many cases a residual risk remains.

GENERAL NOTES: · The RMP spreadsheet, for purposes of simplicity, assumes zero residual risk. As noted above in many cases there may be residual risk after the response and the project manager will need to insure the project team is aware of this. · The last four columns in the spreadsheet provide a metric of the effectiveness of the risk response efforts. This allows the project manager to monitor and control risk management throughout the life of the project.

·

The RMP spreadsheet also serves as a nice project performance measurement tool.

If you have questions about this spreadsheet or other issues related to Project Risk Management

Project Risk Management Plan Spreadsheet (RMP) – Foreword
The Washington State Department of Transportation manages 7,000 miles of road in the state. We have a mandate to build roads on time, keep them safe and to prudently use the monetary funds we receive for this purpose. Every year there are new road building projects. Every project has a unique set of circumstances and risks that must be confronted and dealt with before the project is successfully completed. Over the course of the project, some of the risks will decrease, some will remain potential, and some will actually happen. Current thinking is that we better serve our mandate if we carefully manage the costs of the road projects. That means managing the risks. Accordingly, we have found the project 'Risk Management Plan' spreadsheet to be a very useful tool to help keep costs manageable. Here we describe how risk management is structured and performed on a WSDOT project. The RMP is a subset of the Project Management Plan and serves as a tool to identify, analyze, respond or monitor risk.
If you have questions about this spreadsheet or other issues related to Project Risk Management

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