Program Semester Subject Code Subject Name Unit number Unit Title Lecture Number Lecture Title

: MBA : IV : PM0016 : Project Risk Management :1 : Understanding Risk in Projects :1 : Understanding Risk in Projects

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Unit-1 Understanding Risk in Projects Understanding Risk in Projects Objectives : The objectives of this lecture are to: • • • • Define risk Analyse the risk management process Explain risk management plan Define risks management responsibilities 2 PREVIOUS HOME CNEXT onfidential .

Unit-1 Understanding Risk in Projects Lecture Outline • Introduction • • • • Risk Management Process Risk Management Process contd. Creating a Risk Management Plan Risk Management Responsibilities • • • • Risk Management Responsibilities I Risk Management Responsibilities II Summary Check Your Learning • Activity 3 PREVIOUS HOME CNEXT onfidential .

Therefore it is essential for a risk management process to determine and assess risks in a project. 4 PREVIOUS HOME CNEXT onfidential .Unit-1 Understanding Risk in Projects Introduction • • • • Risk is considered as a positive or negative effect of uncertainty for achieving project’s objectives. Project risk management is a strategic tool which can be used to deal with risks in order to achieve project objectives. The purpose of risk management is to reduce the possibility of failure or any uncertainty to meet the project's main objectives.

Unit-1 Understanding Risk in Projects Risk Management Process Phases of Risk Management Process 5 PREVIOUS HOME CNEXT onfidential .

The different contexts are as shown in the following figure.Unit-1 Understanding Risk in Projects Risk Management Process contd… Risk can be handled with the help of various contexts. Establishing the context Strategic Context Organisational Context Risk management Context Project Context Risk Appetite 6 PREVIOUS HOME CNEXT onfidential .

Unit-1 Understanding Risk in Projects Creating a Risk Management Plan Seven steps of risk management plan Involve Collate Assess Group Identify actions Create contingency plan Assign 7 PREVIOUS HOME CNEXT onfidential .

Unit-1 Understanding Risk in Projects Risk Management Responsibilities Responsibilities of the project risk manager • • • • Choosing a suitable project risk management method and implementing it Developing a strategy for handling project risk Implementing a strong environment for project risk management Handling project risk within the risk management context Responsibilities of project risk management team • • Helping to identify and analyse risks Guiding on any aspect of risk management process • Tracking the risk profile and provide feedback on risk profiles 8 PREVIOUS HOME CNEXT onfidential .

9 PREVIOUS HOME CNEXT onfidential . Reporting on any additional risks. Communicating with team members about a risk. Allotting project risk profile owners to each group. Ensuring all the resources to implement risk action plans successfully. Responsibilities of project risk custodians • • • Classifying all possible risks into specific groups.Unit-1 Understanding Risk in Projects Risk Management Responsibilities contd… Responsibilities of project risk profile owners • • • Incorporating risk management and risk action plans in the risk profiles.

• • Supporting the execution of action plans as defined by the project risk profile owners. • The implementation with the of risk management of process becomes successful processes. Reporting to risk management team about the newly occurred risks.Unit-1 Understanding Risk in Projects Risk Management Responsibilities contd… Responsibilities of project team members • Providing correct information of the risks. combination existing organisational 10 PREVIOUS HOME CNEXT onfidential .

risk profile owners.Unit-1 Understanding Risk in Projects Summary • • A project risk can be useful or harmful to the success of a project. 11 PREVIOUS HOME CNEXT onfidential . The project risk management is the responsibility of project team members. risk custodians. risk manager and the project risk management team.

• • Mention the fifth and sixth steps of risk management plan.Unit-1 Understanding Risk in Projects Check Your Learning 1. Ans: False-Project risks have both positive and negative effects on 12 PREVIOUS HOME CNEXT onfidential . Project risks have only negative effects on projects. a. projects. Identify actions Create contingency plan Ans: The fifth and sixth steps of risk management plan are: 2. State whether the following statement true or false.

Unit-1 Understanding Risk in Projects Activity Consider that you are the manager of transport department. List out the risks that can occur in a project of your department. 13 PREVIOUS HOME Confidential .