Risk Management for Grown-ups: Presented by Tim Lister
Risk Management
Is Project Management
For Grown-ups
Presented by Tim Lister
For David Anderson…
This is a risk…
This is a risk… This is a problem.
NO!
What Does it Cost
to Build a Swimming Pool?
2 Ways to Think About Risk…
•
A
risk
is a potential problem.
•
A
risk
is any variable on your project that,
within its normal distribution of possible
values, could take on a value that is
detrimental, even fatal, to your project.
2 Ways to Think About Risk…
W
e
C
a
n
’
t
A
v
o
i
d
R
i
s
k
.
.
.
•
All projects with benefit but no risk were
completed long ago.
•
You can
’
t control many of the variables
that could be risks.
Version 8.0
Will be ready
when you
need it!
Avoiding a risk usually lowers
the value of the product.
(Value inside a Risk.)
A Risk Ritual...
•
Identify risks
•
Assess risk exposure
•
Determine which risks to manage
•
Form action plans for
direct
risks.
•
Form mitigation plans for
indirect
risks.
•
Determine contingency fund.
•
Build tripwires into project plan.
•
Keep the process going...
Identify Risks
•
Don
’
t start with a blank sheet --
www.sei.cmu.edu
then
“
software risk
management
”
•
McConnell
’
s
Rapid Development
•
Sweep for risks
using brainstorms
•
Keep tribes separate
Assess Risk Exposure
•
Determine probability of risk becoming
problem.
•
Determine cost/effort if it does become a
problem.
O
h
,
t
h
a
t
o
n
-
c
o
m
i
n
g
t
r
a
i
n
!
Determine Which Risks to
Manage
•
Is there a profitable trade-off here?
•
Are there any actions I can take now that
will either lower the probability or the
cost?
•
Should I try to contain this risk by
building some contingency into my plan?
abulia, also aboulia \uh-BOO-lee-uh; uh-BYOO-\, noun:
Loss or impairment of the ability to act or to make decisions.
Form Action Plans
for Direct Risks
•
Some risks you can mitigate immediately.
•
This mitigation will cause you to change
project plan, product definition, staffing
plan…something!
Form Mitigation Plans
for Indirect Risks
•
Some risks you can
’
t mitigate now.
•
Determine actions if the problem
manifests.
•
Determine tripwire for risk-problem
transition.
•
Build in contingency.
I
n
d
i
r
e
c
t
R
i
s
k
M
i
t
i
g
a
t
i
o
n
…
R
i
s
k
3
:
A
l
l
f
u
n
c
t
i
o
n
a
l
i
t
y
m
a
y
n
o
t
b
e
r
e
a
d
y
t
o
g
o
a
t
s
t
a
r
t
o
f
n
e
w
f
i
s
c
a
l
y
e
a
r
.
M
i
t
i
g
a
t
i
o
n
:
B
u
i
l
d
“
b
r
i
d
g
e
c
o
d
e
’
b
e
t
w
e
e
n
o
l
d
s
y
s
t
e
m
a
n
d
n
e
w
,
u
s
i
n
g
s
u
b
-
s
y
s
t
e
m
s
3
a
n
d
4
o
f
o
l
d
u
n
t
i
l
a
l
l
i
s
r
e
a
d
y
.
P
r
o
b
a
b
i
l
i
t
y
:
5
0
%
T
r
i
p
w
i
r
e
:
I
f
a
l
l
D
D
R
s
a
r
e
n
o
t
p
a
s
s
e
d
b
y
1
2
/
2
1
/
1
9
9
9
,
w
e
b
u
i
l
d
b
r
i
d
g
e
.
C
o
s
t
:
A
l
+
2
c
o
n
t
r
a
c
t
o
r
s
=
6
w
o
r
k
m
o
n
t
h
s
=
$
1
7
0
,
0
0
0
.
Keep the Process Going
•
No reason to believe that you can identify
all risks in one go.
•
Review risks for changes in likelihood
and opportunities for new actions.
•
Retire a risk; they all move up the list.
Good Luck on your project…
Good Luck on your project…
Just don
’
t count on it!
Tim Lister
The Atlantic Systems Guild, Inc.
3143 Broadway, 2B
New York NY 10027 USA
212 620-4282
lister@acm.org
systemsguild.com
Essential aspects of risk management in project execution. Discover how to identify, assess, and manage risks effectively to ensure project success. Learn valuable insights and strategies from industry expert Tim Lister."
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Presentation Transcript
Risk Management Is Project Management For Grown-ups Presented by Tim Lister
What Does it Cost to Build a Swimming Pool?
2 Ways to Think About Risk A risk is a potential problem.
2 Ways to Think About Risk A risk is any variable on your project that, within its normal distribution of possible values, could take on a value that is detrimental, even fatal, to your project.
We Cant Avoid Risk... All projects with benefit but no risk were completed long ago. You can t control many of the variables that could be risks. Version 8.0 Will be ready when you need it!
Avoiding a risk usually lowers the value of the product. (Value inside a Risk.)
A Risk Ritual... Identify risks Assess risk exposure Determine which risks to manage Form action plans for direct risks. Form mitigation plans for indirect risks. Determine contingency fund. Build tripwires into project plan. Keep the process going...
Identify Risks Don t start with a blank sheet -- www.sei.cmu.edu then software risk management McConnell s Rapid Development Sweep for risksusing brainstorms Keep tribes separate
Assess Risk Exposure Determine probability of risk becoming problem. Determine cost/effort if it does become a problem. Oh, that on-coming train!
Determine Which Risks to Manage Is there a profitable trade-off here? Are there any actions I can take now that will either lower the probability or the cost? Should I try to contain this risk by building some contingency into my plan? abulia, also aboulia \uh-BOO-lee-uh; uh-BYOO-\, noun: Loss or impairment of the ability to act or to make decisions.
Form Action Plans for Direct Risks Some risks you can mitigate immediately. This mitigation will cause you to change project plan, product definition, staffing plan something!
Form Mitigation Plans for Indirect Risks Some risks you can t mitigate now. Determine actions if the problem manifests. Determine tripwire for risk-problem transition. Build in contingency.
Indirect Risk Mitigation Risk 3: All functionality may not be ready to go at start of new fiscal year. Mitigation: Build bridge code between old system and new, using sub-systems 3 and 4 of old until all is ready. Probability: 50% Tripwire: If all DDRs are not passed by 12/21/1999, we build bridge. Cost: Al + 2 contractors = 6 work months = $170,000.
Keep the Process Going No reason to believe that you can identify all risks in one go. Review risks for changes in likelihood and opportunities for new actions. Retire a risk; they all move up the list.
Good Luck on your project Just don t count on it!
Tim Lister The Atlantic Systems Guild, Inc. 3143 Broadway, 2B New York NY 10027 USA 212 620-4282 lister@acm.org systemsguild.com
