PMO Knowledge Sharing

Risk Management

-Raghavendra Sureddi
 Risk Management
• Common issues /errors during software
development

• What is Risk Management?

• Risk Management Process

• Risk Matrix
 Risk Management
Common issues /errors during software
development
• Overly optimistic schedules
• Shortchanged quality assurance
• Unrealistic expectations
• Confusing estimates with targets
• Excessive multi-tasking
• Abandoning planning under pressure
 Risk Management
Overly optimistic schedules:
Setting an overly optimistic schedule sets a project up for failure by under scoping the project,
undermining effective planning, and abbreviating critical upstream development activities such as
requirements analysis and design. It also puts excessive pressure on developers, which hurts developer
morale and productivity.

Shortchanged quality assurance:

Projects that are in a hurry often cut corners by eliminating design and code reviews, eliminating
test planning, and performing only small testing. This often results in the project reaching its
feature-complete milestone but then still being too buggy to release.

Unrealistic expectations:

One of the most common causes of friction between developers and their managers is unrealistic
expectations. Sometimes project managers or developers ask for trouble by getting project approval
based on optimistic estimates.
 Risk Management
Confusing estimates with targets:
Some organizations set schedules based purely on the desirability of business targets without also
creating analytically-derived cost or schedule estimates. While target setting is not bad , some
organizations actually refer to the target as the ‘estimate,’ which lends it an unwarranted and misleading
foundation for creating plans, schedules, and commitments.

Excessive multi-tasking:
When software developers are assigned to more tasks, they must ‘task switch’ as they
change their focus from one object to another. This causes major impact on the task, as developers have
to drain themselves to complete all the tasks. (Most of them stay late and work in uneven hours , also
end up in finding many QA issues etc)

Abandoning planning under pressure:

Projects make plans and then routinely abandon them when they run into schedule
trouble. This would not be a problem if the plans were updated to account for the
schedule difficulties. The problem arises when the plans are abandoned with no
substitute, which tends to make the project slide into code-and-fix mode.
 Risk Management

What is Risk Management?

• Risk Management is the name given to a
logical and systematic method of identifying,
analyzing, treating and monitoring the risks
involved in any activity or process.
• In layman terms a risk is a probability that
some adverse circumstance will occur.
 Risk Management
Risk Management Process

• Risk identification
– Identify project, product and business risks;
• Risk analysis
– Assess the likelihood and consequences of these risks;
• Risk planning
– Draw up plans to avoid or minimise the effects of the
risk;
• Risk monitoring
– Monitor the risks throughout the project;
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Risk management Process

Documentation
 Risk Management
Risk identification
• Technology risks.
• People risks.
• Organisational risks.
• Requirements risks.
• Estimation risks.
 Risk Management
Risks and Risk Types
Risk type Possible risks
Technology The database used in the system cannot process as many transactions
per second as expected.
People It is impossible to recruit staff with the skills required.
Key staff are ill and unavailable at critical times.
Required training for staff is not available.
Organisational The organisation is restructured so that different management are
responsible for the project.
Organisational financial problems force reductions in the project budget.
Requirements Changes to requirements that require major design rework are proposed.
Customers fail to understand the impact of requirements changes.
Estimation The time required to develop the software is underestimated.
The rate of defect repair is underestimated.
 Risk Management
Risk Analysis
• Assess probability and seriousness of each
risk.
• Probability may be very low, low, moderate,
high or very high.
• Risk effects might be catastrophic, serious,
tolerable or insignificant.
 Risk Management
Risk Planning
• Consider each risk and develop a strategy to
manage that risk.
• Avoidance strategies
– The probability that the risk will arise is reduced;
• Minimisation strategies
– The impact of the risk on the project or product will
be reduced;
• Contingency plans
– If the risk arises, contingency plans are plans to deal
with that risk;
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Risk Monitoring
• Assess each identified risks regularly to decide
whether or not it is becoming less or more
probable.
• Also assess whether the effects of the risk
have changed.
• Each key risk should be discussed at
management progress meetings.
 Risk Management
• Risk Management will not prevent bad things
from happening . But when bad things
happen, risk management may have
anticipated them and reduced their negative
effects.
Risk Management

Thank you