ON “SOFTWARE ENGINEERING” SUBJECT TOPIC “RISK ANALYSIS AND MANAGEMENT” MASTER OF COMPUTER APPLICATION (5th Semester) Presented by: ANOOP GANGWAR SRMSCET, BAREILLY SUBJECT SEMINAR

CONTENTS:- What is Risk ? Risk Analysis. Risk Management. Methods and tool used in Current Industry. Conclusion.

Risk: What is it? The probability of an adverse event and the magnitude of the consequences… Risk is measurable, objective, and based on fixed criteria

WHAT IS RISK ? Risk: Definition: * Risk is an event that threatens the accomplishment of one or more future goals or objectives * A Risk is described by the likelihood that an event will occur and the severity of the consequence of that event should it occur. * Risk is about a possible future event and is often confused with issues and problems. If the likelihood is certain or near certain, then it is not a risk

Elements of risk  Probability (or likelihood, chance)  Consequences (or impact)  Uncertainty  Ability to manage There must be a potential ‘hazard’ for risk to exist

Performance Risk –Technical risks, normally tracked using technical performance measures. Inability to achieve technical requirements. Schedule Risk –Unforeseen delays in completing tasks. Cost Risk –Unforeseen cost overruns, often associated with performance and schedule risks. Project Risk –The potential of an adverse condition that will cause the project to not meet customer expectations Different Types of Risk

So, What is Risk Analysis? A systematic way of gathering, evaluating, and recording information leading to recommendations for a position or action in response to an identified hazard

Why do Risk Analysis? Before you can manage something you must be able to measure it

Risk Analysis should: Identify hazards Characterize risks Recognize uncertainty Summarize conclusions Recommend options Document the basis for decisions

Basic Risk Analysis Structure Evaluate –Value of computing and information assets –Vulnerabilities of the system –Threats from inside and outside –Risk priorities Examine –Availability of security countermeasures –Effectiveness of countermeasures –Costs (installation, operation, etc.) of countermeasures Implement and Monitor

RISK MANAGEMENT Risk Management: »Definition: Risk management is the formal process of identifying risks, assessing their magnitude, making decisions about how to handle, and then tracking the progress of the handling approach.

The risk management process

IN Risk management consist of three essential activities 1)Risk Identification 2)Risk Assessment 3)Risk Containment

1)Project Risk 2)Technical Risk 3)Business Risk RISK IDENTIFICATION

RISK ASSESSMENT Risk Assessment (about “a” risk) The process of estimating the probability and impact for each risk Assigning other relevant attributes to a risk Risk Analysis (about “all” risks)

RISK CONTAINMENT There are three main strategies used in Risk Containment.

STRATEGIES :- Accept –Take no action –Make contingency plans Avoid –Change requirement –Don’t do … Transfer –Give to someone else better equipped to deal with risk –Insurance underwriters

CONT… Mitigate –Reduce Likelihood –Reduce Consequence

TOOLS USED FOR RISK ANALYSIS AND MANAGEMENT Simple explanations of some tools Failure Mode Effects Analysis (FMEA) –Break down large complex processes into manageable steps Failure Mode, Effects and Criticality Analysis (FMECA) –FMEA & links severity, probability & detectability to criticality Fault Tree Analysis (FTA) –Tree of failure modes combinations with logical operators

TOOLS….. Hazard Analysis and Critical Control Points (HACCP) –Systematic, proactive, and preventive method on criticality Hazard Operability Analysis (HAZOP) –Brainstorming technique Preliminary Hazard Analysis (PHA) –Possibilities that the risk event happens Risk ranking and filtering –Compare and prioritize risks with factors for each risk

WHAT IS RISK ? Risk: Definition: * Risk is an event that threatens the accomplishment of one or more future goals or objectives * A Risk is described by the likelihood that an event will occur and the severity of the consequence of that event should it occur. * Risk is about a possible future event and is often confused with issues and problems. If the likelihood is certain or near certain, then it is not a risk Mitigate –Reduce Likelihood –Reduce Consequence