Risks, Issues, Change Requests, and Action Items › Manage Project Risks

Manage Project Risks

A risk management process includes identifying, analyzing, planning, tracking, and communicating risk. Risk management involves risks, issues, and change requests. Making informed decisions by consciously assessing potential problems and the severity of their impact is the heart of project risk management.

The project manager creates a risk or an issue based on the impact of the risk after identifying and analyzing the risk.

You can identify risks at any time during a project life cycle. You can escalate a risk to an issue when it appears likely to affect the project in a significant way. Change requests result from issues and can help facilitate effective resolutions.

The following diagram and this scenario, describe one way of managing project risks.

Example: Create and manage a project risk

In this example, the project team at Forward Inc. is developing a new product using a niche technology. The resources within the organization having experience with this technology are limited and so the team must use external resources to complete the project. Additionally, the product is bundled with third-party APIs for which legal approvals are required.

The team identifies two risks affecting their project in a significant way for analysis:

• A limited number of resources with the required experience
• Dependency on the approval process

After the analysis, based on the impact of the risk on the project, the project manager creates a risk for the limited resources and an issue for the dependency.

To manage project risks, perform these steps:

1. Review the Prerequisites.
2. Analyze Risk.
   • Create a Risk.
     1. Create a Response Strategy.
     2. Close the Risk.
     3. Create an Issue and Close the Risk.
   • Create an Issue.
     1. Close the Issue
     2. Create a Change Request.