Project management risk assessment by Derek Hendrikz works with probability, impact, mitigation, contingency ratios as well as risk remedies and quantification techniques. www.derekhendrikz.com

1. Project Risk Assessment
derek hendrikz
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2. Copyright © 2014
Derek Hendrikz Consulting
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3. Risk…
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4. …the absence of certainty in a future or current
event defines the risk of such event…
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5. Level of Risk = Level of Uncertainty

6. Project
Risk…
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7. An event or situation which can endanger all or part
of the project.
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8. Risks can be both internal – arising from
within the project – and external – arising
from the context or environment of the project.

9. ▪ It definitely will happen.
▪ It probably won’t happen.
▪ It doesn’t matter anyway.
▪ Disaster if it happens.
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10. Disaster
Doesn’t matter
Probably won’t happen
Definitely will happen
1
2
3
4
5
1 2 3 4 5
Impact
Event
Probability
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11. Probability
Impact
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12. Contingency
Plan
Mitigation
Plan
Probability
Impact
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13.  What can we do to mitigate (lessen the
harshness) the risk in terms of frequency and
severity...
 Mitigation plans are mostly part of a risk
management initiative.
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14.  What can we do to manage an unplanned
event or occurrence when it happens or how
we can deal with it once it has happened...
 Contingency plans are mostly part of a
disaster management initiative.
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15. Mitigation
Contingency
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16. The Risk Management Process:
Step 1: Risk Identification
Analyse the project to identify sources of risk
Step 2: Risk Assessment
Assess risk in terms of:
 Severity of impact
 Likelihood of occurring
 Controllability
Step 4: Risk Response Control
 Implement risk strategy
 Monitor and adjust plan for new risks
 Change management
Step 3: Risk Response Development
 Develop a strategy to reduce possible damage
 Develop contingency plans
Known Risks
Quantified Risk
Managed Risk
New Risks
New Risks
New Risks
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17. Understand Quantify Manage
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18. Level 1Triggers =We are warned before the event!!!
Level 2Triggers =We are warned during the event!!
Level 3 Triggers =We are warned after the event!
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19. Take the RISK
or
Don’t take the Risk!!!
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20. Risk
Management
Take the Risk
Retain Mitigate
Don’t take
the Risk
Transfer Avoid
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22. Failure Mode and Effects
Analysis
FMEA
Impact x Probability x Detection = Risk Value
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23.  Risk = Probability x Impact
(scale of the threat).
 Reduction = Mitigation x Contingency
(ability to manage the threat).
 Exposure = Risk – Reduction
(the amount of risk that you simply cannot avoid).
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