Project Management

Risk Management

risk event: what can go wrong

consequence: how to minimize impact

anticipation: what to do before

contingency plan: what to do when

4 Steps in Risk Management Process

1. identification

2. assessment

3. response development

4. response control

Step 1: Risk Identification (3)

analyze project to identify risk:

1. generate list of possible risk

2. uses risk breakdown structure (RBS) to identify and analyze risk

3. risk profile: list of q addressing uncertainty

Step 2: Risk Assessment (3 & 3)

assess risk in terms of: severity, likelihood, controllability
do this by developing: risk assessment form, risk severity matrix, probability analysis

Step 3: Risk Response Development (2)

develop strategy & contingency plans

5 Risk Responses (MATER)

mitigating - reducing impact (up-front)

avoiding - changing project to eliminate risk

transferring - paying to pass risk to another party

escalating - notify people of threat

retaining (accepting)

5 Ways to Handle Positive Risk (EEESA)

exploit - take away uncertainty

share - allocate ownership to another party

enhance - (opposite of mitigate) take action to increase opportunity

escalate - notify higher-ups of opportunity

accept - willing to take advantage of it, not trying to pursue it

8 Parts of Change Management System (CARTINAL)

communicate changes

assign responsibility

review/approve
track changes
identify changes
negotiate conflicts
adjust schedule & budget
list effects (schedule & budget)

4 Benefits of Risk Managment

clear ownership and accountability

risk review is ongoing activity
risks are accepted on informed basis

increase chance of success

Resource and cost scheduling at NOT

1. project network times are NOT a schedule until resources have been assigned

2. cost estimates are NOT a budget until they have been time-phased

Resource Smoothing

Delay noncritical tasks to balance resources and avoid overload

Resource-constrained scheduling

not enough resources for peak demand, delay late tasks, project may take longer

Technical or Logical Constraints

tasks must follow a set network order

Resource Constraints

shortage of or special ties between resources force certain activity order

3 Types of Constraints

people

materials

equipment

3 Parts of a Time-Constrained Project

1. completed by imposed date

2. time is fixed, resources are flexible

3. (if required) resources can be added

3 Parts of Resource-Constrained Project

cannot raise resource levels

resources are fixed, time is flexible

time can be added

Limiting Assumptions

once activity starts, must be completed (no splitting activities) - resource levels cannot change

Heuristics (Priority Rules) - MSL

1. minimum slack

2. smallest duration

3. lowest activity identification number

Goals of Smoothing Resource Demand (3) & Downsides (2)

goals: reduce peak demand, reduce number of resources, minimize fluctuation of resource demand
downside: no flexibility, more critical activities

Crash

Shortening a project or task to finish faster

Reasons to Attempt to Reduce Duration of a Project

market pressure, weather, bonus for early completion, politician’s promise, overhead cost, pressure to reassign resources

Options for accelerating a project when resources are NOT constrained (AOSED)

add resource

outsource project work

schedule overtime

establish core project team

do it twice

Options for accelerating a project when resources are constrained (FURIC)

fast tracking

use critical-chain management

reduce project scope

improve project team efficiency

compromise quality

Project Indirect Costs

costs not assigned with any work activity or package (overhead costs)

Project Direct Costs

costs assigned directly to work package or activity (labor, materials, equipment, subcontractors)

3 Steps for constructing a project cost-duration graph

1. find total direct costs

2. find total indirect costs

3. sum direct and indirect costs

Commonly used options for cutting costs are (ROOB)

reduce project scope
owner takes more responsibility

outsource project activities or even the entire project

brainstorm cost savings options

Management vs. Leadership

m - maintain, administrate, control, focus without challenging status quo
l - aligning, motivating, inspiring to challenge status quo

Engaging stakeholders

people who are actively involved in project and whose interest may be positively or negativity affect the project

5 Characteristics of Effective Project Managers (IAERI)

initiate

anticipate

encourage

reinforce

intervene

4 Steps Controlling a Project

1. setting baseline plan

2. measuring progress and performance

3. comparing plan against actual

4. taking action

Earned Value Management

combines scope, schedule, and resource measurement to assess project performance and progress

EVM Acronyms & Meaning

EV - earned value
PV - planned value
AC - actual cost
CV - cost variance
SV - schedule variance

5 Types of Project Closure

normal

premature

perpetual

failed project

changed priority

Project closures include 6 major activities

1. customer accepts delivery

2. release resources

3. reassign team

4. pay bills/close accounts

5. deliver project

6. write final report

2 Types of Project Audits

in-process project audits - project progress and performance

post-project audits - more detail and depth, how to improve future projects

Audit Process Steps

1. Initiation & Staffing

2. Data Collection & Analysis

3. Reporting

Traditional PM Approach

up-front planning, high degree of predictability

Agile PM Approach

iterative, incremental development, explore, active collaboration

12 Guiding Principles of Agile PMs (AACCFSSSTWW)

adjust

agility

collaboration

continuous

face-to-face

simplicity

shorter timescale/frequent

self-organizing

sustainable

trust

welcome change

working

Scrum Method

work is divided into sprints

roles - product owner (defines priorities), scrum master (facilitates process), team (builds product)

Limitations and Concerns of Agile PM (NIDCA)

not simple

incompatible with corporate cultures

does not satisfy

contribute to scope creep

active customer