Tool Risk analysis Tool Risk analysis urpose and

Tool: Risk analysis

Tool: Risk analysis urpose and yield P • • Describes the risks that the project team can identify Considers how serious the individual risks are Prioritizes the risks involved Defines solutions to prevent or mitigate these risks When to use risk analysis in the project? • The risk analysis should be prepared as early as possible in the project and must be updated on an ongoing basis • Follow-up on the identified risks throughout the project is necessary The risk analysis is often conducted on two levels, but the method is the same • On an overall level, the analysis is done before the project is designed to set requirements for the project's design. That is, requirements for organization, professional skills, collaborators, approaches, plans, technology, funding, project strategy, etc. • When the project is designed and planned, the risk analysis must be carried out on the basis of the chosen design. Another design and another plan will provide another risk profile. It is important that the risk analysis used in the project is based on the current design and the current plan. Pitfalls and restrictions • The risk analysis does not cover all risks, only the risks that the group of people can imagine. Therefore, it is crucial that the right people with the relevant knowledge and experience contribute to the analysis. • Risks are events that occur. Risks are not the same as general uncertainty concerning time and resource consumption. Uncertainties must be handled using estimation methods. • The risk analysis must be expressed in specific preventive or mitigating measures that are incorporated into the plan. These measures must be followed up throughout the project process, otherwise the risk analysis is useless. • Get the acceptance of risks and additional resources for preventive or mitigating actions at management level. Management must understand the project's risks and be willing to pay the insurance.

Approach Who should attend? • If the overall risk analysis is carried out to ensure robust project design, project owners and steering committee members should participate. It is also relevant to involve key specialists and stakeholders. It is important to involve all the relevant knowledge and people who have to live with the possible risks. • When the project is designed and planned, the risk analysis is carried out by the project team. It is advisable to involve project owner and relevant specialists who are not regular members of the team. Project owner and steering committee members might not participate in this work but should at least accept the risk analysis, its consequences and resources for preventive and mitigating actions. How to do Gather the relevant participants and conduct a workshop with the following activities: 1. Conduct a brainstorm on the topic: "What can go wrong in the project? " Remember the brainstorming rules. You can use the inspiration list 1. 2. Describe all ideas for risks on cardboard or post-it notes. 3. Sort cards or post-it notes based on the two criteria: "The probability that it will happen" and "The consequence if it happens" (Template 1). The probability scale goes from 1 to 5, where 5 is most likely. Note that 5 does not mean 100% because then we are not talking about risks, but about something that will happen. Impact scale: 1 = Less disturbance in the project, 5 = The project does not deliver the desired or must be stopped. The scales are relative scales between the proposed risks. Instead of the visual prioritization of risks, a calculation of the individual risk can also be made. Risk = Probability x Consequence (Template 2). 4. Describe preventive and mitigating measures. At low probability, preventive measures may be all too resource-intensive. With major consequences, mitigating measures are important. When both probability and consequence is high, both preventive and mitigating measures are relevant. Consider several alternative actions in collaboration with the relevant participants (Template 3). 5. Evaluate the different actions and describe their ability to reduce the probability or consequence. Consider what each effort requires of resources in money and time (Template 4). 6. Select the most effective actions and add them to the project plan. Define which milestones (Risk Stones) that closes the risk, for example a test, a review or something else. Describe when this risk is closed and who is responsible (Template 5).

Template 1: Visual assessment of risks 5 Probability 4 3 2 1 2 3 4 Probability scale: 1 = Low probability, 5 = Relative probability. Consequence scale: 1 = Less disturbance in the project, 5 = The project does not deliver the desired or must be stopped Consequence 5

Template 2: Risk assessment based on calculation Risk Probability Score 1 - 5 Consequence Score 1 - 5 Risk ratio 1 - 25 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. As an alternative to Template 1, risks can be prioritized by calculating the risk ratio. Risks with the greatest risk ratio are the most serious. Risk ratio = Probability x Consequence

Template 3: Description of possible actions Risk Preventive measures Mitigation measures 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. Describe what preventive or mitigating actions that can reduce the individual risk

Template 4: Assessment of preventive and mitigating measures Risk Probability Consequence The consequence specified for example as a cost The risk is described by using the probability and consequence score. Then the consequence is specified with words or figures Describe alternative preventive or mitigating action Probability after action Consequence after action Resource demand for the action in question, for example time or money 1. 2. 3. 4. 5. 6. Describe the individual actions and assess how probability and consequence look when the action in question is completed. Describe the resource consumption to complete that action. Select the actions that have the best relationship between impact and resource consumption.

Template 5: Risk Stones for the project plan Risk Description of milestone that closes risk Date Responsible 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. Describe the different risk stones. Mark In the project plan when the various risks are closed. A risk is closed when there is no risk anymore. This can for example be when a particular test is completed. Describe who is responsible for ensuring that the risk in question is closed.

Principle: Project plan with Risk Stones Project plan Phase 1 Work stream 1 Phase 2 Phase 3 1 2 3 Work stream 2 Work stream 3 Work stream 4 Work stream 5 Work stream 6 Phase 4 5 4 7 6 8 9 10 Describe the different risk stones. Mark In the project plan when the various risks are closed. A risk is closed when there is no risk anymore. This can for example be when a particular test is completed. Describe who is responsible for ensuring that the risk in question is closed.

Inspiration list 1: Areas that can cause risks The project assignment • Need and situation • Definition of project objectives and scope • Technology, distinctive character, solution chosen • Products and quality • Anchoring • Time frame Surroundings • Market and competitors • Technology and surrounding systems • Physical environment • Access and transport conditions • Weather and other natural conditions • Political relations • Rules and standards • Price development, general development, local level, currency conditions Resources • Competencies in team and organization • People and their accessibility and commitment • Facilities, materials, equipment and premises • Materials and their quality • Money and authority to bind the company Project management and process • Management and leadership • The quality of planning, pessimism or optimism • The ability of the project organization, maturity, cooperation • The participants, competencies and commitment • Well-known activities or necessary learning • Changes along the way, uncertainty or predictability • Quality policy • Working conditions • Accidents, theft, vandalism, forgetting • Deliveries, goods and subcontractors • Time pressure • Resistance or support Stakeholders • Use and ownership • Will and drive • Resource use • Formula approvals • General acceptance • Interest contradictions • Stakeholders' attitude and activity • Disadvantages during execution (e. g. consideration for neighbors, traffic, space, etc. ) • The involvement of the authorities

References and links Connection to other tools • Milestones plan: The risk analysis will lead to adjustment of the plan. Preventive and mitigating measures must be incorporated into the plan, possibly as a risk stone • Agile visual plan: The risk analysis will lead to adjustment of the plan. Preventive and mitigating measures must be incorporated into the plan • Stakeholder analysis: The stakeholder analysis will often provide input to the risk analysis as stakeholder relationships and conflicts can develop into risks • Project Design: An overall level risk analysis will provide input for project design. A given project design will entail certain risks. Links • https: //www. pmi. org/pmbok-guide-standards/framework/practice-standard-project-risk-management • https: //www. pmi. org/learning/library/risk-analysis-project-management-7070 • https: //www. pmi. org/-/media/pmi/documents/public/pdf/certifications/risk-management-professional-handbook. pdf Referencer • Book: Power in Projects, Programs and Portfolio 1 st Edition: Risks are described on pages 152, 195 – 198, 202, 283, 358, 385 and 405 • Book: Practice Standard for Project Risk Management, PMI

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