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The Risk Management Process Essay

1973 words - 8 pages

Risk Management Process Identify Risk
Risk identification, focuses on identifying which risks will affect a project, by looking at the project plan, the work breakdown structure, the project charter and other project related documents (PMBOK, 2008). Broad risk categories are human resources, technology changes, quality and performance issues, customers, vendors, management, funding, political, legal, market forces and environmental issues (PMBOK, 2008). Risk identification involves forward and creative thinking by project stakeholders (Hilson, 2003). Risk identification, should be done on a continuous basis and project team members and stakeholders should look for new issues that may affect the success of the project (Brewer & Dittman, 2009). It is impossible to eliminate risk regardless of detailed planning for a project. Project managers need to identify and analyze potential risk associated with a project. As Fleming (2005), indicated project managers need to look at the triple constraints of time, budget, resources, as well as quality to identify areas of risk.
Project managers need to understand the methods used to identify project risks and according to Hilson (2003) and supported by PMBOK (2008), they are a variety of techniques or methods used to identify risk such as brainstorming, interviews from experts, past history, SWOT analysis, and Delphi Technique. These risk identification methods can be done individually or as a group approach ( Hilson, 2003). Brainstorming is an informal method of generating a list of ideas regarding the project risks, where a complete list of various ideas are generated and then the group place them into priority based levels of priority. Fleming (2005), asserted that brainstorming is one of the most popular methods to identify project risks, whereby a project team or group attempts to generate ideas of possible risk to a project and then devise solutions for a specific identified project risk. Hilson (2003) indicated that opportunities are ignored in this process, however since he wrote this book in 2003 and based on the latest Project Management Body of Knowledge Book (2008) with regards to risk identification we see opportunity and treats are identified. Risks are both known and unknown and project managers need to minimize treats and maximize opportunities (PMBOK, 2008).
Brewer & Dittman (2009), indicated that the Delphi technique uses experts to identify and resolve issues and when used many of these issues are resolved because members do not meet face-to-face. The process becomes anonymous reducing interference of egos and personal problems. As stated by Fleming (2005), the Delphi Technique is an option to aid the project team to brainstorm ideas anonymously, and participants are unknown to each other. Electronic communication, are used to communicate with the group with a facilitator, and questions are presented electronically to each participant who then generates ideas and sends them...

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