A ‘Risk’ is any event that, should it occur, would negatively affect the project’s objectives. A risk has a root cause, which should be ferreted out as part of developing the detailed risk management plan. Identifying the root cause of each risk requires the isolation of each possible cause and the description of each risk event with relation to its…
After identifying the risk and estimating the exposure, it is necessary to determine an appropriate way to handle it. It is also necessary to prepare for the possibility that the risk will materialize by determining the most appropriate way to handle the problem that the project will face. Clearly, this process requires a lot of effort. It should therefore be…
After the risks have been identified, their potential impact on the project must be estimated. This is done by estimating the probability that these risks will be realized and the damage to the project should such a scenario become reality. Multiplying the ’realization probability’ by the ’degree of damage’ generates a ‘risk exposure’ measurement, according to which the risks will…
The risk identification process deals with the prediction of future events whose probability of realization is not 100%. None of us is a prophet and so the whole process relies on estimates - more or less accurate. A significant factor in the process of identifying risks is the project’s uncertainty level, which affects the ability to identify and evaluate potential…
A true risk is one that describes first and foremost an event that is: Risk is a Future Event One that has not yet happened. If it has already occurred and has negatively affected the project, we are dealing with a problem that must be solved, not a risk. Risk is a Future Event A problem requires corrective action, often…
