What You Will Learn After this one-hour session, learners will be able to: Demonstrate to others how the risk management processes in A Guide to the Project Management Body of Knowledge (PMBOK® Guide) apply to your project’s environment Differentiate between Project and Program Risk Management and understand how they support one another Speaker Keith is a Senior Consultant, Trainer and Coach with over 25 years of successful management and consulting experience and business planning. Keith is a leader in Agile training, coach and transitioning to Agile and is well known for his public speaking skills and enthusiasm and has been a welcomed facilitator at numerous fortune 500 corporations, universities, and associations worldwide. He is engaging, energetic, entertaining and informative.

1. INTERNATIONAL INSTITUTE
FOR LEARNING, INC.
IMPROVING ORGANIZATIONAL PERFORMANCE WITH
INTELLIGENCE, INTEGRITY AND INNOVATION
Risk Management for Projects
and Programs July 5 ,2022 Noon BST

2. ©International Institute for Learning, Inc. All rights reserved.
Keith Wilson,
MBA, B.Comm., PMP, MCT, MCP, CSM, CSPO, SPC 5.0, KMP, DASSM, CDAI, CDC
Senior Agile Trainer/Coach
.
Over 30 years of
Management and Agile
Project Management
Consulting, Coaching
and Training
Experience.
Project Management &
Agile Transformation
Specialist

3. ©International Institute for Learning, Inc. All rights reserved.
• Define Risk Management
• The Risk Management Processes
• Governance and Program Risk
Management
• Challenges in Implementing Risk
Management
• Risk Management Planning
• Key Risk Management Planning
Activities
• Next Steps
Webinar Welcome and Agenda

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Poll Template
What is your experience with risk
management?
I have:
A. heard of it
B. taken classes
C. certification (PMI-RMP, PMP or other)
D. used practices

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Risk:
Remember, a risk is an uncertain event or condition that, if it occurs,
has a positive or negative effect on one or more project objectives.
• These can be:
⁃ Positive (opportunities)
⁃ Negative (threats)
What do we mean by “Risk”?
Adapted from PMBOK® Guide – Sixth Edition, Glossary

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Class Activity: Risk-related Definitions
Term Definition
1) Uncertainty / Risk
A) The risk that remains after risk responses have been
implemented.
2) Risk Management Plan
B) A component of the project, program, or portfolio
management plan that describes how risk management
activities will be structured and performed.
3) Risk Appetite
C) An event or situation that indicates that a risk is about
to occur.
4) Risk Trigger
D) An uncertain event or condition that, if it occurs has a
positive or negative effect on one or more project
objectives.
5) Risk Identification
E) Identifying individual and overall project risks and their
characteristics.
6) Residual Risk
F) The degree of uncertainty an organization or individual
is willing to accept in anticipation of a reward.
PMBOK® Guide – Sixth Edition, Glossary

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The Risk Management Process

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The purpose of using risk management on a project is to:
• Increase the probability and impact of opportunities or positive
events
• Decrease the probability and impact of threats or negative events
Project Risk Management

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• Protect project and program investments
• Facilitate the achievement of goals and objectives
• Help realize opportunities to increase project benefits and for program
benefits realization
• Provide early warnings to the business
• Help the business mitigate or avoid strategic losses
• Improve performance of and reduce stress on the project team
Rationale for Investing in Risk Management
Ignoring risk does not
make it go away.

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Look for threats where there is:
• An activity or a deliverable
• Need for integration of two or more
deliverables
• No responsible person assigned for any of
these
• No sign-off or acceptance of a deliverable
• No integrity check or sign-off of an
integration point
• A lack of definition and agreement about a
product
• A transfer of work responsibility
• An estimate being made
Specific Risk Event Exposure Areas

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Risk Management (RM) Roadmap
Monitor
Risks
Implement
Risk
Responses
Develop
Response
Strategies
Quantify
Risks
Qualify
Risks
Identify
Risks
Develop
RM Plan
Governance
Impacts
Part of the Project Management
Use the Risk Register

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Challenges in Implementing Risk Management

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Take a few minutes to reflect on this question,
based on your experience:
• What are the most frequent and critical
mistakes made when trying to implement risk
management for projects and programs?
Individual Activity: Classic Risk Management Pitfalls

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Avoidance of these pitfalls by using appropriate tools is especially important in the
context of high-risk projects:
• Risk process / team discontinuity (risk register)
• Incomplete or poor quality risk communication (Risk Mgmt. Plan)
• Inadequate risk definition (risk breakdown structure)
• Inadequate financial impact assessment (Monte Carlo simulation)
• Inadequate response strategies
(active strategies for both threats and opportunities)
• Nonexistent or inconsistent risk monitoring practices (integrated change control)
Debrief: Classic Risk Management Pitfalls

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Risk Management Planning

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RM Planning for Projects
Monitor
Risks
Implement
Risk
Responses
Develop
Response
Strategies
Quantify
Risks
Qualify
Risks
Identify
Risks
Develop
RM Plan
Governance
Impacts
Part of the Project Management
Use the Risk Register

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Plan Risk Management – Defined
Plan Risk Management
The process of defining how to conduct risk
management activities for a project
Key
Benefit?
PMBOK® Guide – Sixth Edition, Glossary

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Governance and Program Risk Management

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Governance – A Context for Risk Planning (1 of 2)
11.1
Plan Risk
Management
11.2
Identify Risks
11.3
Perform
Qualitative
Risk Analysis
11.4
Perform
Quantitative
Risk Analysis
11.5
Plan Risk
Responses
11.6
Implement
Risk
Responses
11.7
Monitor Risks
Governance
Adapted from: PMBOK® Guide – Sixth Edition, Part 1, Figure 11-1, p. 396

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Governance – A Context for Risk Planning (2 of 2)
Governance
Organization
Management
Program
Management
Process
Management

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Program budget management
⁃ Too many projects / Insufficient funds
⁃ Lack of analysis leading to
inappropriate project selection
Program resource management
⁃ Too many projects
⁃ Insufficient resources
Project authorization
⁃ “Fuzzy” decision criteria
⁃ Ineffective gating process
Program Management and Project Risk

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Key Risk Management Planning Activities

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Project managers need to:
• Be accountable for a project’s risks
• Encourage discussion of risks
• Instill trust and confidence
into the process
⁃ Do listen and encourage feedback
⁃ Do not practice project management by
“shouting louder” or “shooting the
messenger”
• Integrate the risk process into the mainstream
of
project team activities
The Role of Project Managers

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To develop an appropriate Risk Management Plan
once the governance questions have been
answered:
• Assess key stakeholders’ roles / attitudes /
interests
• Determine stakeholders’ risk tolerance
• Identify and prioritize objectives
• Develop a project risk profile
• Adapt a Risk Management Plan template
• Document a Risk Management Plan
appropriate
to the project’s specific characteristics
Key Risk Management Planning Activities

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Stakeholders’ Attitudes Toward Risk
Pursue risk
(seeking)
Avoid risk
(averse)
Tolerate risk
(neutral)

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Start with the classic competing constraints
Identify and Prioritize Project Objectives
Stakeholders

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Develop a Preliminary Project Risk Profile (1 of 2)
Key Project Risk Dimensions
Component Levels of Risk
L=1 M=3 H=5
Project Scope Complexity
Technical Requirements Complexity
Project Plan and Estimates
Resources and Dependencies
Business Case Soundness
Sponsorship and Commitment
Organizational Impact
Component
risk score:
2 + 9 + 10 = 21 = 2 x 1 = 3 x 3 = 2 x 5
X
X
X
X
X
X
X

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Develop a Preliminary Project Risk Profile (2 of 2)
Overall Risk Profile
Level
Total Component Risk
Score
High 28-35
Moderate 15-27
Low 7-14
Our example had a
total component risk
= 21
Which translates
into a
Moderate
Risk Profile Level

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Risk Profile
Risk Tolerance
Seeking Neutral Averse
Low Lightweight RM Plan Basic RM Plan Basic RM Plan
Moderate Basic RM Plan Basic RM Plan Enhanced RM Plan
High Enhanced RM Plan Enhanced RM Plan Consider no-go
recommendation / pursue
creative strategies now
Adapting a Risk Management Plan to Project Circumstances

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Next Steps

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Develop a Risk Management Plan
Risk Management
Plan
Methodology
Roles and Responsibilities
Risk Categories
Risk Management Funding
Contingency Protocols
Frequency and Timing
Stakeholder Risk Tolerances
Risk Tracking and Audit
Definitions of Probability
Definitions of Impact
Probability and Impact Matrix
Snyder, Cynthia Stackpole,
A Project Manager’s Book of Forms, p. 104 - 108

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Reference: Project Risk Analysis and Management (PRAM)
Guide,
Association for Project Management, 1997
Sample Risk Management Plan Template (1 of 2)
Contents of a Risk Management Plan
1. Introduction
2. Project description
– The project and key success parameters
3. Purpose and scope of risk management
– Aims and objectives
– In and out of scope
4. Risk management organization
– Responsibilities, roles, budget for effort

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Contents of Risk Management Plan (continued)
5. Risk management processes and ownership:
– Qualitative and / or quantitative, separate risk office or
management by project team
6. Key deliverables
– Reports, plans, metrics for success, etc., communications plan
Appendix
a. Corporate risk management guidelines and this project
b. Tools and techniques proposed, data sources
c. Standard forms (e.g., risk ID form, risk register, risk response plan)
Sample Risk Management Plan Template (2 of 2)

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Preferably with your team, complete
the following activities:
• Create the outline of a risk
management plan that supports:
⁃ Project objectives
⁃ Stakeholders’ risk tolerance
⁃ Project risk profile
After this Session – Draft a Risk Management Plan

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Worksheet: The Risk Management Plan (RMP)
Your RMP Outline
Risks Benefits

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For a free consultation
email learning@iil.com or visit www.iil.com
https://www.linkedin.com/in/keith-wilson-6604806/