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Practical Risk Management

"What we anticipate seldom occurs: but what we least expect generally happens."
Benjamin Disraeli

Content
  -  Overview
  -  Risk Tools
  -  Risk papers and resources. 
 
 


Project Risk Overview:

   
Each risk is something in the future which might or might not occur. This is vital to a proper understanding of risk and planning its management. Risks do not yet exist, indeed they may never exist at all. This makes them quite different from things which have happened in the past or which currently exist in the present. They are different from issues, problems or constraints; past and present events can be analysed and measured, but future events can only be imagined or estimated by people and these estimates will be influenced by the people's perceptions and past experiences. To manage risk effectively you need to deal with both the positive and negative uncertainties that matters by following a structured process that takes into account the affected people's risk tolerance.

The PMBOK® Guide focuses on the Probability of a risk occurring and its likely Impact if it happens. Practical risk assessments expand on these basic elements to define a more complete range of criteria and the effect of cognitive bias on peoples ability to make rational assessments of any potential gain or loss. In addition to these known unknowns that can be assessed, there are also two types of unknown unknown; knowable unknowns and unknowable unknowns (or Black Swans).  Knowable unknowns can be identified and brought into an effective risk management process but there will always be some Black Swans waiting to surprise you.

The ultimate aim is to manage the risk affecting your project, not to simply list and analyse them; therefore,
a risk process which does not lead to the implementation of actions to deal with the identified risks is incomplete and useless. The resources on this page focus on practical risk management. We define this as applying sufficient effort to achieve a realistic modification in the risk exposure of your project (or program) whilst recognising it is impossible to remove all risk and any effort spent on risk minimisation should be offset by an increase in the likely value of the project.
   
For a simple explanation of many statistical calculations, including probability, see: http://www.khanacademy.org/  



Practical Risk Management Tools

                  
PMI R.E.P.

We are a PMI approved Registered Education Provider (R.E.P.)

Mosaic's Risk Training:
Our 1 Day Risk Management Workshop will provide trainees with the framework needed to effectively manage risk in a project environment.

This course includes calculations based on Decision Trees, EMV, PERT, etc and an in-depth analysis of the case study using Mosaics Excel templates for the Risk Register and Risk Management Plan.

Download Sample Spreadsheet
Price:
- Australian    $44.00
Risk Register:  RiskWS - Excel Template
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A practical template for identifying and prioritising the risks associated with a project or program. For each risk:
-  Define the risk category and short name.
-  Describe the risk using an effective 'risk meta language'. All you have to do is 'fill in the gaps'.
-  Prioritise the risk using a powerful qualitative assessment process developed for a US1 billion oil project.
-  Determine the optimum response.
 
The spreadsheet compiles the risk data for transfer into the risk management plan.
 
The spreadsheet contains a comprehensive 'help' page focused on implementing effective risk management (included in the Sample).
 
This is a very robust, easy to use tool that ensures that all of the identified risks are effectively managed (maximum number of risks per spreadsheet = 200).
 
Download a free sample: Download Sample Spreadsheet  (to purchase a fully functional spreadsheet
click on the 'cart' or choose from the purchasing options below)

Download Sample Spreadsheet
Price:
- Australian    $22.00
Risk Management Plan:  RMP - Excel Template
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A practical template for pro-actively managing the risk treatments outlined in the risk register. For each risk you:
-  Copy the information from the risk register focusing on the urgent and important risks.
-  Define the actions needed to implement an effective risk treatment.
-  Allocate a responsible manager for each action (as well as for the overall risk).
-  Monitor the status of the action including the transfer of appropriate information into the project schedule and cost plan.
-  Keep notes to track decisions and sequence actions.
 
This is a simple tool that provides the critical link between identifying risks in the Risk Register and implementing the actions needed to treat the risks.
 
Download a free sample: Download Sample Spreadsheet   (to purchase a fully functional spreadsheet
click on the 'cart' or choose from the purchasing options below)

PMI_Risk_Std The Practice Standard for Project Risk Management 

Price: $60.50
+ Delivery charges $13.20

The Practice Standard for Project Risk Management covers risk management as it is applied to single projects only and is consistent with other PMI standards. Written for project practitioners,
this practice standard can be used to validate the risk management process being employed in a specific situation, project or organization. Topics include:
 •  Plan Risk Management
 •  Identify Risks
 •  Perform Qualitative Risk Analysis
 •  Perform Quantitative Risk Analysis
 •  Plan Risk Responses
 •  Monitor and Control Risks 
Buy on Line
 
     

Practical Risk Management Papers

A full listing of all risk resources: Visit our Project Managment Knowledge Index.
 
Key Risk White Papers & Articles:
Risk Published Papers:
  • A Simple View of ‘Complexity’ in Project Management Complexity theory helps understand the social behaviours of teams and the networks of people involved in and around a project. This paper traces the development of ‘Complexity Theory’ from its origins in Chaos Theory and develops a range of practical suggestions for improving the effectiveness of both communication practice and risk management practice within project management practice based on insights derived from ‘complexity theory’. [View Abstract]
     
  • Construction - A Risky Business - The Australian construction industry is suffering from low and declining profits, this paper identifies some of the factors causing the decline and suggests ways to better align risk and reward by utilising modern forms of contract such as 'Collaborative Working Agreements'. [View Abstract]
     
  • (The) Meaning of Risk in an Uncertain World - Risk management is one of the least appreciated aspects of modern management with most organisations are excessively risk averse. This paper describes the key aspects of risk management needed from the client, the contracting organisation and the project to optimise overall risk management and places risk management within a 'Complexity Theory' and stakeholder management framework. [View Abstract]
     
  • Risk Attitudes in the Construction Industry - Avoidance Does Not Work Risk management is one of the least appreciated aspects of modern construction management with most client organisations are excessively risk averse. This paper describes the key aspects of risk management needed from the client, the contracting organisation and the project to optimise overall risk management. [View Abstract
     
  • Risk Management and Complexity Theory - The Human Dimension of Risk This paper describes the key aspects of risk management from 'complexity theory' and the human perspective. Particular focus is on the risk attitudes and competencies required at each level of management to optimise risk. The paper concludes by developing a range of practical suggestions for improving the effectiveness of risk management practice within projects based on an understanding of ‘complexity theory’ applied to the project environment. [View Abstract]
      
Schedule Risk Tools: Visit our Planning & Scheduling page.

Risk Blog Posts:

 

Mosaic publishes a wide range of papers discussing project management topics
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