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Risk Identification

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PMI defines risk identification as determining which risk events are likely to affect the project and documenting the characteristics of each. This process involves identifying three related factors: (1) potential sources of risk (schedule, cost, technical, legal, and so on), (2) possible risk events, and (3) risk symptoms.

The timing of risk identification is also of vital importance. PMI® advocates that risk identification should first be accomplished at the outset of the project and then be updated regularly throughout the project life cycle. 

Who is responsible for Identifying risk?

Risk Identification determines which risks might affect the project and documents their characteristics. Participants in risk identification activities can include the following:

  • Project manager
  • Team members
  • Risk management team (if one exists)
  • Subject matter experts 
  • Customers
  • End users
  • Stakeholders
    While these personnel are often key participants for risk identification, all project personnel should be encouraged to identify risks.


How are Project Risks Identified?

  • Brainstorming - Generally completed together as a project. The risks are identified in broad terms, characteristics detailed, categorized
  • risk-delphi.gifDelphi Technique - This is an anonymous method of querying experts about foreseeable risks within a project, phase, or component of a project. The results of the survey are generally analyzed by a third party, organized, and then circulated to the experts. There will usually be several rounds of surveys. The Delphi Technique is an anonymous method to query experts about foreseeable risks within a project, phase, or component of a project. The results of the survey are analyzed by a third party, organized, and then circulated to the experts. There can be several rounds of anonymous discussion with the Delphi Technique—without fear of backlash or offending other participants in the process. The Delphi Technique is completely anonymous and the goal is to gain consensus on project risks within the project. The anonymous nature of the process ensures that no one expert’s advice overtly influences the opinion of another participant.

 

 

  • Interviewing - Through questions and discussion, the person being interviewed shares his/he insight on what risks are perceived in the project.
  • Root Cause Identification – The essence of this method is to continuously ask “Why”. When the question is asked enough time eventually it cannot be answered. The cause if the last “Why” answered is what needs to be fixed.
  • risk-swot-analysis.gif

    SWOT Analysis - SWOT means strengths, weaknesses, opportunities, and threats. SWOT analysis is the process of examining the project from each of the characteristic’s point of view. For example, a technology project may identify SWOT as:
  1. Strengths The technology to be installed in the project has been installed by other large companies in our industry.
  2. Weaknesses We have never installed this technology before.
  3. Opportunities The new technology will allow us to reduce our cycle time for time-to-market on new products. Opportunities are things, conditions, or events that allow an organization to differentiate itself from competitors and improve its standing in the marketplace.
  4. Threats The time to complete the training and simulation may overlap with product updates, new versions, and external changes to our technology portfolio.

 

Note: Risk identification happens early in the project to allot time for risk response planning. Risk identification also happens throughout the project. The project manager, the project team, customers, and other stakeholders are involved in the process. There are several methods to risk identification, though interviews and the Delphi Technique are two of the most common approaches.

 

Read 7555 times Last modified on Thursday, 10 December 2009 22:15

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