PROJECT RISK MANAGEMNT

PM(BBA 302)

Presented By:-
Sandip Kr. Bharti
OVERVIEW
Introduction to Project Risk
Management
Risk Identification
Risk Analysis
Risk Response Planning
Risk Monitoring and Control
Conclusion
INTRODUCTION
 A project risk is an uncertain event that may or may
not occur during a project. If it occurs it has a
positive or negative effect on a project objective.
 The notion of project risk involves two concepts:
 The likelihood that some problematic event will
occur.
 The impact of the event if it does occur.
Types of Project Risk
A. External risk:
 Mainly outside the control of the project manager and in most case
the organization.
Examples:
 Market risks- include competition, foreign exchange, internal rate
risk
 Government regulatory changes
 Disaster such as flood, fire, earthquake, or other natural disaster
 Risk associated with labor strikes, and civil unrest

B. Cost Risk:
 Directly or indirectly under project manager’s control
 Cost risk usually arise due to poor cost estimation, accuracy and
scope creep
Examples:
 Cost overruns by project team or subcontractors, vendors, and
C. Schedule Risk
 Can cause project failure by missing or delaying a market
opportunity for a product or service
 Slippages in schedule typically increase cost, delay the receipt of
project benefits
 Schedule risk are caused by:
 Inaccurate estimation, resulting in errors
 Increased effort to solve technical, operational, and external
problems
 Resource shortfalls, including staffing delays, insufficient resources

D. Technology risk
 Failure to meet system target functionality or performance
expectations
 It is the risk that project will fail to produce results consistent with
project specifications
Examples:
 Problems with immature technology
 Use of wrong tools
 Software that is untested or fails to work properly
 Risk Identification
 The first step in project risk
management is identifying
potential risks. This can be done
through brainstorming sessions
with project team members,
reviewing historical data from
similar projects, and conducting
risk assessments.
 Once risks have been identified,
they should be documented and
categorized based on their
likelihood and impact. This
information can be used to
prioritize risks and determine
which ones require further analysis
and response planning.
 Risk Analysis
 After risks have been identified, the
next step is to analyze them in more
detail. This involves assessing the
probability of each risk occurring, as
well as the potential impact it could
have on the project if it does occur.
 Risk analysis can be done using
various techniques, such as qualitative
analysis (which uses subjective
judgments) or quantitative analysis
(which uses statistical data). The
results of the analysis can be used to
develop risk response plans.
 Risk Response Planning
 Once risks have been identified
and analyzed, the next step is to
develop risk response plans. These
plans outline the actions that will
be taken to mitigate or avoid each
risk, as well as who will be
responsible for implementing
them.
 There are four main strategies for
responding to risks: avoidance
(eliminating the risk), mitigation
(reducing the likelihood or impact
of the risk), transfer (shifting the
risk to another party), and
acceptance.
 CONCLUSION
 Project risk management is a critical component of project
management. as it helps ensure that projects are
completed successfully. By identifying, analyzing, and
responding to potential risks, project teams can minimize
the impact of unexpected events and keep projects on
track.
 Effective project risk management requires a proactive
approach, ongoing monitoring and control, and a
willingness to adapt and adjust as needed. By following
these principles, project teams can increase the likelihood
of project success and deliver value to stakeholders.
THANK YOU