1. PMP Study Guide Chapter 6: Risk Planning

2. Chapter 6 Risk Planning Planning for Risks Plan Risk Management Identifying Potential Risk Analyzing Risks Using Qualitative Techniques Quantifying Risks Developing a Risk Response Plan

3. Planning for Risks Risks are events that pose opportunities or threats to the project Risk is uncertainty—the more that’s known about risk, the better

4. Chapter 6 Risk Planning Planning for Risks Plan Risk Management Identifying Potential Risk Analyzing Risks Using Qualitative Techniques Quantifying Risks Developing a Risk Response Plan

5. Plan Risk Management The Plan Risk Management process determines and documents how to plan for risks The Plan Risk Management process establishes an agreed- upon basis for evaluating risk Determine and document stakeholder risk tolerance levels

6. Chapter 6 Risk Planning Planning for Risks Plan Risk Management Identifying Potential Risk Analyzing Risks Using Qualitative Techniques Quantifying Risks Developing a Risk Response Plan

7. Identifying Potential Risk Budgets/funding Schedules Scope or requirements changes Project plan Technical issues Personnel issues Hardware Contracts Political concerns Business risk Legal risk Environmental risk

8. Identifying Potential Risk Tools and techniques of the Identify Risk process: –Documentation reviews –Information-gathering techniques –Checklist analysis –Assumptions analysis –Diagramming techniques –SWOT analysis –Expert judgment

9. Identifying Potential Risk Information-gathering techniques include: –Brainstorming –Delphi technique –Nominal Group technique –Interviewing –Root cause identification SWOT analysis

10. Identifying Potential Risk Diagramming techniques include: –Cause-and-effect Fishbone diagram or Ishikawa diagram –Flowcharts –Influence diagrams

11. Identifying Potential Risk Risk register is the output of the Identify Risk process. Risk register should contain: –List of identified risks –List of potential resources

12. Chapter 6 Risk Planning Planning for Risks Risk Management Planning Identifying Potential Risk Analyzing Risks Using Qualitative Techniques Quantifying Risks Developing a Risk Response Plan

13. Analyzing Risks Using Qualitative Techniques Risk probability and impact assessment Probability and impact matrix Risk data quality assessment Risk categorization Risk urgency assessment Expert judgment

14. Risk Impacts Rating Matrix 5.1

15. Probability and Impact Matrix

16. Analyzing Risks Using Qualitative Techniques Risk register is updated at the end of the Perform Qualitative Risk Analysis process with: –Risk ranking (or priority) for identified risks –Risks grouped by categories –Causes of risk –List of risks requiring near-term responses –List of risks for additional analysis and response –Watch list of low-priority risks –Trends in qualitative risk analysis results

17. Chapter 5 Risk Planning Planning for Risks Risk Management Planning Identifying Potential Risk Analyzing Risks Using Qualitative Techniques Quantifying Risks Developing a Risk Response Plan

18. Quantifying Risk Tools and techniques of the Perform Quantitative Risk Analysis process include: –Data gathering and representation techniques Interviewing Probability distributions –Quantitative risk analysis and modeling techniques –Expert judgment

19. Quantifying Risk Perform Quantitative Risk Analysis and Modeling Techniques –Sensitivity analysis –Expected monetary value analysis –Decision tree analysis –Modeling and simulation

20. Quantifying Risk Sensitivity Analysis Tornado diagram

21. Quantifying Risk Decision Tree Analysis

22. Chapter 6 Risk Planning Planning for Risks Risk Management Planning Identifying Potential Risk Analyzing Risks Using Qualitative Techniques Quantifying Risks Developing a Risk Response Plan

23. Strategies for Negative Risks: Avoid Transfer Mitigate Accept Strategies for Positive Risk: Exploit Share Enhance

24. Developing a Risk Response Plan Plan Risk Response Outputs –Risk register updates –Risk-related contract decisions –Project management plan updates –Project document updates

25. Developing a Risk Response Plan Risk Register contains: –Prioritized list of risks –Risk ranking –Risk owners and responsibility –Outputs from Perform Qualitative Analysis –Agreed-upon response strategies –Actions needed to implement response plans...

26. Developing a Risk Response Plan Risk register continued: –Cost and schedule activities needed to implement risk responses –Contingency plans –Fallback plans –List of residual and secondary risks –Contingency reserves

27. Chapter 6 Summary Risk management plan Where potential risks may occur Tools and techniques to identify risks Qualitative techniques Quantitative techniques Strategies for negative risks Strategies for positive risks Risk register contents