Introduction

• General
  • What is risk?
  • 6 questions to define the project
  • The key areas of concern
  • What should risk analysis provide?
  • 3 Ways to view risk management
  • General comments on risk assessment
  • Accountability
  • General comments on planning
  • What are the core process steps to assess a risk?
  • Simple process outline
  • What are the basic overall process steps?
  • Stakeholders
  • Success measures
  • Why carry out Risk Assessment?
• Project Life Cycle
  • Project Life Cycle
  • Project Life Cycle - concept
  • Project Life Cycle - plan
  • Project Life Cycle - execute
  • Project Life Cycle - termination
  • Project Life Cycle - general points

• Terminology
  • Clarification of terms
  • Basic statistical terms

The Risk Management process

• General
• Define
  • Define the project
  • Define the project management process
• Identify the risks and responses
• Organise - prioritise risks and responses
• Ownership - risks, responsibilities and contractors
• Estimation
  • Size the risks
  • Simple estimating of risk
  • Cumulative probability graph
  • Simple estimating of risk - more detail
  • Simple estimation problems
  • Obtaining the estimates
  • Breakdown of variables
• Evaluation
  • Estimates
  • Independent correlation
  • Cumulative probability graph
  • Positive correlation
  • Cumulative probability graph
  • Negative correlation
  • Conditional correlation
  • Cumulative probability graph
  • Cumulative probability graph 2
• Planning
  • Ways to modify plans
  • Plans and strategies
  • Types of plans
  • Dependencies - 4 basic types
  • Dependencies - 4 basic types
    part 2
  • Manage - plans and strategies

Risk issues

• General
  • Identify risk issues
  • Other issues
  • The contractor
  • Other aspects
  • Risk combination
• Assessment of risk
  • Common methods of assessing risk
  • Common methods of assessing risk 2
  • Issue based
  • Checklists
  • Qualitative method
  • Quantitative method
  • Quantitative method part 2
  • Quantitative method part 3
  • Quantitative method part 4

Modelling

• Cost models
  • Simple cost model
  • Cost model
  • Cost model part 2
• Monte Carlo model
  • Monte Carlo simulation
  • Monte Carlo simulation 2
  • Monte Carlo simulation - output
  • Monte Carlo distribution
  • Monte Carlo risk distribution
  • How do we carry out the simulations?
  • Probability density function - PDF
  • PDF - Simplified version

Events

• Uncertain
  • Uncertain events
  • Uncertain events part 2
  • Uncertain events part 3
  • Uncertain events part 4
• Corellated
  • Risk of exceeding the target cost
  • Correlated events
  • Correlated events part 2
  • Correlated events part 3
• 3 point model
  • 2 pathways
  • Simple probability estimation
  • Collecting task information
  • Documentation
  • Task probability
  • Monte Carlo risk distribution
  • Multiple variables

Networks and branching

• Network
  • Simple network
  • Simple network - no lag
  • Simple network - with lag
• Branching
  • Simple branching
  • Complex branching
  • Complex branching part 2
  • Multiple branching
  • Multiple branching part 2
  • Multiple probability branching
  • Multiple probability branching
    part 2
  • Nodes and branching networks
  • Branching networks
• Production example
  • Production example
  • Production example part 2
  • Risk of exceeding target duration

Other

• Business forecast
  • Business forecast
  • Business schedule risk
  • Business revenue and profit risk
  • Business revenue and profit risk 2
  • Business profit simulation
• Other areas to consider when reviewing risk
• Markov chain
• General points to consider
• Task information
  • Risk assessment of a task
  • Risk assessment of a task part 2
• Human relations
  • Negatives
  • Benefits

Ways to modify plans

Reduce to only one critical path

If you have more than one critical path you will need to eliminate one of them.

By its very nature the critical path contains all of the tasks, which can affect the completion date of the project should they alter.
In the real world most tasks are dependent on others completing before they can start. The amount of time that a task can be delayed before it affects another is called ‘float or slack’. There are two basic types:

Note: That for tasks with no dependencies free and total slack are the same in terms of definition because their delay can only affect the project end date. On the assumption that they have to be completed before the project can end, otherwise there would be little point in having them in the schedule. Strictly speaking these tasks would have only one dependency and that would be the project end date.
The special criteria for tasks on the critical path is that they have zero slack. Any change will affect the completion date.
On this basis the critical path is always the longest in the schedule.

A project should only have one critical path. The Project Manager does not want to be focussing on more than one critical path. Simplistically, there are a few ways to eliminate one of these paths affording only one critical path.

You can modify the tasks to achieve only one critical path by:

Either reducing tasks (so that they are no longer critical, for the path not desired) or extending them (so that the tasks remain critical, for the desired path). By definition extending any task on an already critical path will extend the project completion date.

This would have the effect of removing both critical paths and introducing ‘slack’. It should be carried out along with extending one or more tasks to restore a single critical path (see first approach above).

It may be appropriate to review these. If a particular dependency is modified this will have the effect of removing one path or promoting the other to become critical.

Clearly, any modification which extends the completion date would need to be considered very carefully.

Examine the critical path

You may wish to consider the following when eliminating one critical path and reviewing the remainder:

• Activities: More activities may mean more risk.
• Skill level of people: The least skilled path may hold more risk.
• Technical risk: The path with the highest technical risk may need more float.
• Weather/uncontrollable: Give more float to uncontrollable activities.
• Cost: Consider giving float to activities that cost more.
• Historical data: For tasks supported by the least data or previously gave a problem give more float.
• Backup plan: Give more float to areas of the plan with no obvious backup plan.
• Business cycle: Give float to those areas likely to become hectic.
• Difficulty: Give more float to the most difficult activities.

Modifying task durations

• Increasing efficiency: Apply more productive/skilled personnel.
• Reducing the scope: Do less, alter the product or task specification.
• Applying extra effort: Increase resources, number, overtime. You can also increase the resource initially reducing this as the task gets back on track.
• Change the process: How and what is done within the activities.

When the amount of work done decreases without an increase in mistakes, it is possibly due to people carrying them out at their own speed.
When mistakes increase it is often due to tiredness.

Modifying task dependencies

You may need to review task dependencies and see if more tasks can be done in parallel. This may mean extra resource in terms of modified cash flow or more equipment.

General

You may need to draft contracts and term and conditions to allow more flexibility so as not to interrupt the work pattern.
Additional or more modern equipment may improve efficiency.