Project Risk Management Checklist

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					   Integrated Project
     Management Exam
     Questions on
   Business and Project Risk
     Management Checklist
Integrated business risk management involves a whole set of activities that should be
embedded into the project planning process. Below we provide a risk checklist and associated
exam and assignment questions raised by the checklist.

      Action           What?             Why?              When?            Output?          Who?           Exam
Business Culture
Create Risk        Create          Confirm that it is Part of business   Policy          Executive and   What policies
Management         business intent important and back plan; underlies    statement on    program         and
Policy             to manage       it up              project process    how the         management      procedures will
                   risk                                                  business will   level           encourage
                                                                         Handle risk                     integrated
                                                                                                         Write a policy
                                                                                                         statement that
                                                                                                         across the
Assess             Find out how Survey workforce       Every 6 months    Workforce       HR/Project      What
Organization       aware                                                 awareness of    team            indicators of
Awareness          workforce is of                                       risk                            awareness
                   risk and risk                                         management                      would you use
                   response                                              report                          to survey
                   impacts                                                                               whether your
                                                                                                         organization is
                                                                                                         integrating its
                                                                                                         projects? What
Deliver Training   Design training Workforce will      Every year with   Certification   All pm, teams, Identify the key
Program            around          implement if they   refresher                         and technical training
                   practice        understand tools                                      personnel      courses that
                   planning tools;                                                                      you would
                   use to                                                                               provide to
                   introduce                                                                            encourage
                   business risk                                                                        integrated
     Action             What?             Why?               When?             Output?           Who?           Exam
Reward Effective Provide            Incentives motivate During project      Compensation Project      What kinds of
Risk Management rewards for                                                 reward       managers and behaviors or
                 good risk                                                               team members actions that
                 management                                                                           further
                 effort and                                                                           integration
                 effectiveness                                                                        would you
                                                                                                      reward? What
                                                                                                      rewards would
                                                                                                      you provide?
Risk Component of Provide for a     SWOT analysis;      Annual update of    Risk-based     Executives        How would
Business Plan     risk section in   threats = risks     business            business plan; and program       you include
                  the business      Translate to        strategic and       integrate with managements       risk in your
                  plan and          product line risk   business plan       financial and                    business plan;
                  communicate it    exposure                                profitability                    would it be a
                                                                            analysis                         separate
                                                                                                             section, or
                                                                                                             integrated into
                                                                                                             the whole plan,
                                                                                                             or both? Why?
Strategic           State           Measurable          Part of plan;       Set of 10 long Executives        Write a
Objectives          objectives in   strategy goals      communicate to      term objectives and program      strategic
                    terms of risk                       workforce                           managers         objective for
                                                                                                             organization of
                                                                                                             your choice,
Project Selection
Do Risk            In developing    Use PMBOK           Each time           Rank order        Program        How would
Assessment of      business         process; broad-     project portfolio   projects using    managers and   you evaluate
Candidate Projects portfolio of     brush risk          pipeline is         composite risk,   functional     candidate
                   projects, use    assessment          updated             alignment, cost   managers       projects – in
                   risk as one                                              and revenue                      terms of
                   criterion for                                            assessment                       whether they
                   project                                                                                   are integrated
                   selection                                                                                 - in the project
      Action         What?                Why?                   When?              Output?          Who?              Exam
Weigh Risk       Demonstrate       Trade off risk with      Each time            Analysis, data, Project           What
Against Revenues that risk has     opportunity for          pipeline is          documentation management          measures
and Alignment    been              profitability and        updated                              office, project   would you use
                 embedded in       taking advantage                                              team, business    to evaluate
                 business and      of business core                                              planning staff    projects on the
                 financial         competence                                                                      basis of
                 analysis                                                                                          whether their
                                                                                                                   analysis of
                                                                                                                   revenue risks?
                                                                                                                   What about
                                                                                                                   risks of
                                                                                                                   e.g. that the
                                                                                                                   project is
                                                                                                                   with the
                                                                                                                   goals and
Project Plan
Requirements      State customer   Risk that customer       During initial       Requirements    Project           How would
                  requirements     requirements do          concept phase,       document        manager,          you assess
                  in terms of      not reflect risk, or     part of project      stating         functional        whether a
                  customer risks   misunderstanding         plan                 customer        manager, and      project
                                   customer                                      requirements    customer          integrated
                                   perspective and                               and risks                         customer
                                   expectations on                                                                 requirements
                                   project risks                                                                   into scope and
WBS               Include risk     Because there is         During               WBS in         Project            How do you
                  contingencies    inherent risk in         development of       organization   manager            assess
                  from risk        missing major            the deliverable,     chart form and                    whether a
                  matrix in WBS    parts of the             the “work” should    outline in MS                     project WBS
                  work activity    deliverable in initial   include initial      Project                           has integrated
                                   planning; WBS            contingencies                                          all key work
                                   assures coverage         identified in risk                                     activities, e.g.
                                   of major “chunks”        assessment                                             that it is a truly
                                   of work                                                                         integrated
      Action          What?              Why?                  When?               Output?            Who?            Exam
Task List         Include risk     Task list should       After WBS is          Task list in MS   Project         How do you
                  tasks and        include all            prepared, do          Project Gantt     management      assure that a
                  contingencies    anticipated            task list and link;   chart or          office and/or   project task list
                  in baseline      contingency            there is inherent     spreadsheet       project         is inclusive?
                  schedule         actions should risk    risk that linkages                      manager
                                   events occur           will be too “hard;”
                                                          allow for “soft”
Network Diagram   Show risk in     Arrow diagram          During                Arrow diagram     Project         Assessment of
                  network          shows critical and     translation of        in MS Project     management      risk options
                  diagram with 3   non-critical paths;    WBS to Gantt          or other          office          requires
                  scenarios,       risks inherent in      chart, prepared       software          template, or    estimation of
                  expected,        focusing on critical   to show                                 project         expected,
                  pessimistic,     path when              dependencies                            manager         pessimistic
                  and optimistic   resource               and paths                                               and optimistic
                                   constraints in non-                                                            alternatives,
                                   critical tasks may                                                             both in terms
                                   serve as                                                                       of weights and
                                   bottleneck – theory                                                            durations. How
                                   of constraints                                                                 do you assure
                                                                                                                  that these
                                                                                                                  estimates truly
                                                                                                                  reflect all the
                                                                                                                  impacting on
                                                                                                                  task duration
                                                                                                                  and risk?
Calendar Based    Relate network Histogram using          During                Graphics          Project         What is the
Diagram           to time to     arrows and               translation of        software or       manager         value of a
                  begin to see   calendar                 WBS to Gantt          Word                              calendar
                  schedule                                chart                 document                          based diagram
                  impacts and                                                                                     in transitioning
                  milestones                                                                                      from a task list
                                                                                                                  to a Gantt
Risk-based        Do risk-based    MS project Gantt       During initial        MS Project        Project         How do you
schedule          schedule using   chart showing          scheduling, then      schedule file     management      assure that
                  MS Project       calculated risk-       any time risk is      showing           office or       changes in
                  PERT analysis    based duration         identified and        calculated        project         task durations
                  tool             after weights and 3    contingency           durations for     manager         from PERT
                                   scenarios are          prepared              high risk tasks                   analysis are
                                   entered                                                                        integrated into
                                                                                                                  the project
                                                                                                                  team, e.g. that
                                                                                                                  project team
                                                                                                                  members are
                                                                                                                  made award of
                                                                                                                  new duration
                                                                                                                  estimates that
                                                                                                                  affect them?
      Action              What?                Why?                When?           Output?        Who?         Exam
Risk Management
Process (see
Risk Identification   Using input        Using data and        During business Risk matrix     Project      How do you
                      from business      information and       planning, project               management   assure that the
                      plan, identify     past experience,      and portfolio                   office or    risk
                      and rank           rank summary          selection, and                  project      identification
                      project tasks in   tasks in WBS          project WBS                     manager      process is
                      terms of risk      using risk matrix     scheduling                                   integrated with
                                                                                                            planning and
                                                                                                            and threats)
Risk Assessment       Assess risks       Complete risk         During business Risk matrix,    Project      How do you
                      using risk         definition, impact    planning, project updated       manager      assure that the
                      matrix format      (schedule, cost,      selection, and    monthly                    risk
                                         quality, business     project planning                             assessment is
                                         growth); make         and control                                  integrated with
                                         probability                                                        the project
                                         estimate (25%,                                                     WBS, e.g. that
                                         50%, 75%                                                           all tasks have
                                         probability),                                                      been reviewed
                                         severity on project                                                in the
                                         outcome, and                                                       assessment?
Risk Response         Prepare            Response is           During project    Risk          Project      How do you
                      contingency        planning through      planning,         contingency   manager      assure that the
                      actions and        definitive            responses and     actions                    risk response
                      include in         contingency plans     contingencies                                plan is
                      baseline           and tasks which       are designed to                              integrated with
                      schedule           are embedded in       address specific                             other project
                                         project schedule      risks and                                    and business
                                         as regular tasks –    recorded; this is                            planning?
                                         triggered if risk     where the team
                                         event occurs          anticipates what
                                                               might happen to
                                                               slow or delay the
                                                               project, what can
                                                               be done to
                                                               prevent it or
                                                               address it, and
                                                               tasks into the
      Action            What?                Why?                 When?               Output?          Who?             Exam
Risk Matrix         Prepare risk    The risk matrix is       During project        Risk matrix     Project          How do you
                    matrix as basis the basic checklist      planning a basic      following       manager and      assure that the
                    for scheduling item for risk             risk matrix file is   prescribed      team or task     risk matrix data
                                    throughout the           established and       format          managers         on each task
                                    process; it is the       appears with all                                       are integrated
                                    guide for action         project planning                                       across column
                                                             and project                                            headings for
                                                             review                                                 risk, impact,
                                                             documents                                              probability ,
                                                                                                                    severity, and
Decision Tree       Do decision        This is the way       During project        Decision tree   Project          How is the
                    tree analysis to   project managers      planning,             diagram with    manager          decision tree in
                    expected value     anticipate            decision tree         expected                         assuring that
                    of optional        decisions they will   analysis is           values                           all key
                    decisions          have to make          applied to high       calculated                       decision risks
                                       based on risk, and    risk tasks                                             are integrated
                                       what alternative                                                             with business
                                       paths and                                                                    risk and SWOT
                                       expected values                                                              data?
                                       will follow each
                                       decision path
Integrate Risk
Into Project
Basic Project       Assure that        Because risk          Business              Online and      Project          How do you
Manual              risk is not        should not be         establishes a         hardcopy        management       assure that the
                    treated            treated separately    system of basic       manual          office (PMO)     manual calling
                    separately, but    from project          project manuals       including basic                  for the
                    seen as part of    management            as part of            project                          integration of
                    the way            process; manual       “projectizing” the    planning and                     risk into project
                    projects are       captures how risk     organization          risk                             planning and
                    planned and        is integrated into                          management                       operations is
                    controlled         process                                     tools and                        implemented?
Provide Software    Train and          Much of the risk      Business          Software            IT and project   How do you
Tools               provide            analysis can be       establishes a     library             managers         assure that
                    software           done through          support system                                         training
                    analysis tools     spreadsheets and      of risk                                                materials are
                    in manual          decision tree         management                                             integrated with
                                       analysis software;    application                                            other company
                                       workforce needs to    software and                                           software?
                                       know how to use       trains
                                       them                  appropriate staff
      Action             What?               Why?                 When?             Output?         Who?            Exam
Define                Assure that      Because project        Business         WBS file         Functional       The generic
Product/technical     business has     risk management        establishes a                     managers         WBS is
Development           defined the      cannot be              generic WBS of                                     intended to
Process in Generic    core, product    successful unless      technical                                          capture and
WBS                   development      both technical and     processes; these                                   integrate with
                      and technical    product                are recorded and                                   all company
                      processes        development/testin     updates so that                                    business
                      which it uses    g requirements are     all project WBS                                    practices and
                      to produce       conducted to           and schedule                                       processes,
                      products and     control risk, and      information, and                                   e.g. budgeting,
                      services, e.g.   management             risk data, is                                      accounting,
                      engineering,     impacts, e.g.          taken from the                                     performance
                      construction,    schedule and cost,     generic model                                      evaluation,
                      system           are applied to the     and tailored                                       etc.; how do
                      development,     real industry                                                             you assure
                      standardizing    processes that                                                            that it does?
                      where possible   create customer
Project Codes         Provide for      Because once you       When generic        Coding system Accounting,      How do you
                      coding actions   have identified all    WBS is set up,      integrated with project        assure that
                      in WBS so that   tasks and risk         codes are added     time sheets     management     project codes
                      costs can be     contingencies, you     at the              and                            assigned to
                      captured         will want to capture   appropriate level   accounting                     various levels
                                       costs against those    to capture costs    system                         of the WBS
                                       codes to build a                                                          are workable
                                       history of risk                                                           and integrated
                                       management and                                                            with normal
                                       mitigation costs                                                          personnel
                                                                                                                 practices and
Identify Customer
Risk Tolerance
Assess Customer       Solicit          Because customer When               Customer risk        Customer
Perspective on        customer input   may have different requirements are analysis             representative
Business and          on customer      and valuable          being written                      and functional
Project Risk and      risks and        insight on business                                      and project
How Much Risk         uncertainties    and project risks                                        managers,
Customer is Willing                    that have been                                           jointly
to Assume                              part of the
                                       expectations but
                                       not reflected in real
      Action          What?               Why?             When?            Output?         Who?            Exam
Lessons Learned
Risk Audit        Do a project      Because insights At project close-   Risk audit     Project          How do you
                  risk audit        and documents       out              report to      management       assure that
                  following         that can lead to                     project        office, audit    risk audits are
                  selected          better risk                          manager        staff, project   integrated with
                  projects to       management in the                                   and functional   project reviews
                  evaluate          future will be lost                                 managers         and lessons
                  success in        unless a risk audit                                                  learned
                  anticipating      team builds a                                                        sessions?
                  and managing      history of the
                  risk              project, how risk
                                    decisions were
                                    made, and how
                                    effective risk
                                    management was
Lessons Learned   Prepare and       Because the best At close-out        Lessons          Project        How do you
Meeting and       communicate       lessons and                          learned report, manager         assure that
Report            short report on   insights are going                   referencing                     lessons
                  what project      to be lost unless                    systems,                        learned
                  team members      someone facilitates                  decisions, risk,                outcomes are
                  and customers     a lessons learned                    outcomes, but                   integrated with
                  learned in the    session and report                   no names                        future
                  project that                                                                           business and
                  would reduce                                                                           program
                  risks in a                                                                             planning?
                  similar future

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