Project risk is an uncertain event or

condition that if it occurs, has positive or

negative effect at least one project objective,
such as time, cost, scope or quality.
Two Components of Risk:

1. The probability or likelihood

2. The effect, impact or consequence

Types of Risk:

• Cost risk, typically escalation of project costs due to poor cost

estimating accuracy and scope creep.

• Schedule risk, the risk that the activities will take longer than
expected. Slippages in schedule typically increase cost and,
also, delay the receipt of project benefits, with a possible loss
of competitive advantage.

• Management Related risk, before you begin a project you need to

be sure that you have sufficiently skilled staff and that you
have adequately defined their roles and responsibilities.
Types of Risk:

• Operational risk includes risks from poor

implementation and process problems such as
procurement, production, and distribution.

• Environmental risk include natural disaster, weather,

and seasonal implications. These risks are
commonly overlooked when people are unfamiliar
with local conditions.
Types of Risk:

• Safety risk includes risks from poor implementation of

safety management. Failure to install adequate
health and safety procedures can result in serious
injuries or fatalities.