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    Project Risk Management: The Most Important Methods and Tools for Successful Projects
    Project Risk Management: The Most Important Methods and Tools for Successful Projects
    Project Risk Management: The Most Important Methods and Tools for Successful Projects
    Ebook163 pages2 hours

    Project Risk Management: The Most Important Methods and Tools for Successful Projects

    By Roland Wanner

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    About this ebook

    Projects fail because of risks that are discovered too late, are ignored or simply are not sought. This statement seems trivial at first glance, but it is not so obvious for many stakeholders. With effective risk management, you keep your project under control and eliminate 90% of all project problems before they occur.

    This book describes the most important methods and tools how to successfully apply risk management in projects in a practical and easy-to-use way. You will receive hands-on instructions and tips that you can immediately implement in your project. The terminology described herein follows the generally accepted PMBOK® Guide Fifth Edition (2013). With this knowledge, you can make your projects even more successful and protect your project life from many problems.

    In this book, you will learn how to implemented risk management in projects. You will receive hands-on instructions and tips on how you make your project even more successful.

    • Why Risk Management?
    • The Risk Management Process
    • Step 1: Risk Management Planning
    • Step 2: Risk Identification
    • Step 3: Qualitative and Quantitative Risk Analysis
    • Step 4: Risk Response Planning
    • Step 5: Risk Monitoring and Control
    • Step 6: Risk Communication and Documentation

    An essential book for project managers who want to keep their projects under control. This book about project risk management should be on the desk of each project manager.

    LanguageEnglish
    PublisherRoland Wanner
    Release dateMar 18, 2013
    ISBN9781301991976
    Project Risk Management: The Most Important Methods and Tools for Successful Projects
    Author

    Roland Wanner

    Roland Wanner has been in the project business for over 30 years and has been involved in many projects—successful and failed. After his education as a mechanical engineer and industrial engineer, he first worked as a project manager for 5 years and then as a project controller and project portfolio manager in mechanical and plant engineering for several years.For more than 10 years, he has worked as a project management specialist, project portfolio manager and as a project office manager in the banking and insurance sector, where he has also supported various Scrum projects.With his many years of experience in projects, Roland Wanner has published several successful project management books as an author. More info can be found at: https://www.rolandwanner.com

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    • 5/5
      Simple to understand and apt to understand the concept . Thanks a lot
    • 5/5
      A very straightforward guide to project management. Is explains steps and follow thru activities that can be implement for new and also experience Risk Managers.

    Book preview

    Project Risk Management - Roland Wanner

    Compact Knowledge

    Project Risk

    Management

    The Most Important Methods and Tools for Successful Projects

    ROLAND WANNER

    Published by Roland Wanner at Smashwords

    Risk Arrow Contact the Autor:

    Roland Wanner E-Mail: info@pm-risk.com

    Internet: www.pm-risk.com

    Disclaimer

    This publication is designed to provide competent and reliable information regarding the subject matter covered. However it is not intended as a substitute for legal or other professional services. Readers are urged to consult a variety of sources and professional expert assistance. While every effort has been made to make this book accurate, it may contain typographical and content errors.

    The information expressed herein is the opinion of the author, and is not intended to reflect upon any particular person or company. The author and publisher shall have no responsibility or liability with respect to any losses or damage caused, or alleged to be caused, by the information or application of the information contained in this book.

    For any questions about the book or the author, please refer to contact details at www.pm-risk.com

    Copyright © 2013 by Roland Wanner

    All rights reserved. No part of this book may be reproduced, extracted or transmitted by any means, electronic or mechanical, including but not limited to photocopying, recording or by any information storage and retrieval system, without prior written consent of the author.

    Version 1.0 : February 2013

    Proconis Logo

    Table of Contents

    Preface
    Introduction

    Why do Projects and Risks belong together?

    Can you even Manage Risks?

    Threat or Opportunity?

    Why Risk Management

    The Significance of Risk Management for Businesses

    Too Expensive, too Late ... Cancelled!

    Suppressing Risks is our biggest Enemy!

    What is the Benefit of Risk Management?

    Risk Management Standards and Guidelines for Projects

    The Risk Management Process

    Risk Management is a Process

    Risk Management Definitions

    The Levels of Risk Management

    Risk Management before Project Start

    Risk Management Planning

    Only What is Planned, Will Also be Carried Out

    The Risk Management Plan

    Risk Identification

    The Most Important Step in Risk Management

    Describe Risks Clearly

    Identifying Opportunities

    From Risk Management to Problem Management

    Methods of Risk Identification

    When Risks Occur After Project Completion

    Qualitative Risk Analysis

    Objective of the Qualitative Risk Analysis

    Determine Probability and Impact

    The Risk Matrix

    Quantitative Risk Analysis

    The Goal of Quantitative Risk Analysis

    Rating Risks in Dollars and Days

    Response Planning

    Response Planning for more Security

    Response Planning is Teamwork

    Risk Response Strategies

    Cope with Risks in Four Stages

    Define Actions in Detail

    The Risk Response Plan

    Reserves for Risks

    Risk Monitoring and Control

    The Goal of Risk Monitoring and Control

    How to Effectively Monitor Risks

    Risk Control

    Risk Reviews/Risk Management Audits

    Risk Management and Project Control

    Risk Communication and Documentation

    Risk Communication

    Risk Documentation

    How to Encourage Team Involvement

    Appendix

    Preface

    There's hardly an area of activity in project management in which demand, acceptance, and practice greatly differ from the way it does in risk management. In this book, you will find out more about the many different reasons for this. An important point, however, is that many stakeholders have not recognized some basic facts: Projects collapse under risks! This statement seems trivial at first glance but it is not so obvious for most stakeholders. Upon closer consideration, you would recognize that risks brought imbalance to your project or steered it into a catastrophe. It was risks that were not recognized, ignored, not taken seriously, underestimated or simply neglected.

    Do not wait until the next Project Crisis!

    How much tension and excitement can you handle during your project? If you do not practice risk management, then I promise you that you will experience a highly interesting project! Something will always be going on and you will never get some peace. It may still be exciting to correct problems on multiple project areas in the beginning – but as time goes by, you will be so stressed that you would rather throw everything down. Do you really want it to come this far?

    The next project crisis will definitely come again. Do not remain idle; you should instead practice precaution through active risk management! Risks belong to projects as does air to breath. Nevertheless, risks are gladly being ignored. You act in the illusion of safety of numbers and plan values, based on which all makes the best impression. Furthermore, there are short-term individual interests, politics, and greediness – everything that distorts the clear view of the actual circumstances. No one wants to know anything about risks once the pressure is large enough . You fall into the role of the worrier too fast. Something like this just happens every now and then, is usually the standard comment. That sounds like irrevocable fate, as if success or failure of a project is somehow predetermined.

    Risks do not arise on their own; there are reasons, which usually make themselves known so you can do something about them. Managing risks does not mean to react to random events without a plan and then wait and see what happens. Rather, it means to systematically and actively search for risks and then seize the appropriate actions against them.

    What is often forgotten is that risk management is not only concerned with dangers but also with opportunities. Risks are directly connected with opportunities. If you factor the opportunities in to the risk disclosure, you are additionally increasing the chances for your project’s success.

    Professional project risk management is, unfortunately, a very rarely constant in business, and if it is available, it is only half-heartedly put into practice. This has many reasons: an important reason is the business culture and the maturity of project management. A person who avows to risk management, has to reduce acceptance obstacles, want a culture of openness, transparency and team spirit and not view risk management as a contradiction.

    If you practice risk management in your projects as project manager, then you have to act out of conviction. If it doesn't seem to make sense to you, then you should leave it at that. It will only become an alibi exercise.

    Don't wait for the next project crisis. Pursue prevention through active risk management! This book is packed with essential knowledge how to successfully apply risk management in projects. You will receive hands-on instructions and tips that you can immediately implement in your project. With this knowledge, you can make your projects even more successful and protect your project life from many problems.

    This book describes the most important methods and tools how to successfully apply risk management in projects in a practical and easy-to-use way. You will receive hands-on instructions and tips that you can immediately implement in your project. The terminology described herein follows the generally accepted PMBOK® Guide Fifth Edition. With this knowledge, you can make your projects even more successful and protect your project life from many problems.

    I wish you good luck with your next project, but don't rely on it alone!

    Introduction

    Why do Projects and Risks belong together?

    Wouldn't it be nice if projects didn't have any risks? It would make the project life for a lot of project managers easy – Easy Project Life!. You could spare a lot of work, stress and surprises. Unfortunately, projects are afflicted with risks by nature. The following project characteristics therefore have a strong influence on the risk level of a project:

    Uniqueness: The project includes at least some elements that have never been done before.

    Complexity: Diverse associated requirements in the technical or commercial area, at interfaces or in organizational areas.

    Assumptions and Constraints: The future development, both pronounced (open) and implicit (hidden) could prove to be false.

    People: The project team and senior management, customers, suppliers and subcontractors are all unpredictable to a certain extent.

    Requirements of Stakeholders: Their expectations and goals can change, overlap, or sometimes contradict.

    Changes: Each project changes and moves slightly from the known presence in an unknown future.

    Environment: Both, the internal, organizational environment, and the external environment, in which changes occur, can often not be controlled by the project.

    These project characteristics

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