Chapter 11 Project Risk Management

Brainstorming Interviewing SWOT analysis

How to identify risks including residual and secondary risks?

quantitative risk

Often follows qualitative risk analysis, but both can be done together. Large, complex projects involving leading edge technologies often require extensive quantitative risk analysis

risk-averse

Tolerance decreases for people who are

Probability x Output.

What is expected monetary value? And how is it calculated and used?

secondary risks

are a direct result of implementing a risk response

residual risks

are risks that remain after all of the response strategies have been implemented

positive risk

are risks that result in good things happening; sometimes called opportunities

negative risk

involves understanding potential problems that might occur in the project and how they might impede project success

risk breakdown structure

is a hierarchy of potential risk categories for a project Similar to a work breakdown structure but used to identify and categorize risks

watch list

is a list of risks that are low priority but are still identified as potential risks

Negative risk management

is like a form of insurance; it is an investment

Risk utility/tolerance

is the amount of satisfaction or pleasure received from a potential payoff

project risk management

is the art and science of: Identifying, Analyzing and Responding to risk throughout the life of a project

impact/probability matrix

lists the relative probability of a risk occurring on one side of a matrix or axis on a chart and the relative impact of the risk occurring on the other

goal of project risk

minimize potential negative risks while maximizing potential positive risks

Decision tree analysis Simulation Sensitivity analysis

quantitative risk techniques

risk-seeking

their satisfaction increases when more payoff is at stake