Risk Analysis and Risk Charter by batmanishere

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									                            Risk Analysis and Risk Charter


Methodology:
To identify the risks, we will use the probability/impact matrix. After we identify the
risks, we will perform the risk management on this project using the data that we have
collected by interviewing 200 of our clients. This data sample is small, however, big
enough to give us the trend, and so the probability of the risk occurrence. We will use MS
Excel with Crystal Ball to perform the Monte Carlo analysis if necessary.


Roles and Responsibilities:
Following are the responsibilities assigned to the Dreamteam’s project manager and his
team:

Name          Roles and Responsibility
Dan Brown     Make sure that team members are performing their tasks related to the
              risks in a timely manner
Rhett Walton  Make sure that the financial information is accurate and predictions are
              realistic, and that the DT can really afford the project.
Laura Martone Responsible for analyzing the current technology available. Also, doing
              a general and local environmental analysis to make sure that our clients
              will be satisfied with the new method.
Khurram Mirza Make sure that developing team is working efficiently, and the
              consultant programmers are doing their job according to our agreement.
Fred Smith    Make sure that all the data is transferred to the new system without any
              compromise with the integrity of the sensitive data.


Budget and Schedule
Our estimated cost based on the performance of the risk related activities is following:

                                                       Pay
                    Activities                 Hours   Rate/hr   Cost
                    Meetings regarding
Dan Brown           security                     48     $150      $7,200
Rhett Walton        Financial Analysis          128      $75      $9,600
Laura Martone       Business Analysis            96      $75      $7,200
Khurram Mirza       Software development        280      $80     $22,400
Fred Smith          Software development        300      $60     $18,000
                                                       Total     $64,400
Risk Categories
Market Risk: Some other competitor might create the same system that we are planning
to introduce.
Financial Risk: Can we really meet the expense of the project? Is our NPV, ROI, and Pay
back criteria tell us that we will afford the project?
Technology Risk: Will the right kind of technology available to us on time to meet the
project’s objectives.
People Risk: Do we have the right kind of people and skills? Our senior management has
to be supportive.
Structural Risk: Are we going to continue to send the statement with old method, along
with our new secure online-statement method.


Risk Probability and Impact
In the qualitative risk analysis, we have used the probability/impact quadrate to find the
high risk items that we will monitor throughout the life of our project.


Risk Documentation
We will maintain the risk register to continuously monitor our high risk activities and
decisions.


Probability/Impact Matrixes
     Probability




                    High

                   Medium                           Risk R40            Risk R43

                                                                        Risk R15
                    Low                             Risk R38
                                                                        Risk R48
                                   Low              Medium                 High

                                                   Impact
We have identified high risk activities by plotting all the risks from low to high as a
function of their probability. Fig. 1 has the summary of our risk analysis.


                                                        Risk Probability Chart
                                                        Risk Probability Chart

                                0.9
                                0.9                                                       High
                                                      Medium                              Risk
                                0.8
                                0.8
                                                      Risk Area                           Area
     Probability of occurence




                                0.7
     Probability of occurence




                                0.7
                                0.6
                                0.6
                                0.5
                                0.5   Low Risk
                                                                                                  Probability
                                                                                                  Probability
                                0.4
                                0.4
                                0.3
                                0.3
                                0.2
                                0.2
                                0.1
                                0.1
                                 0
                                 0
                                      0
                                      0         0.2
                                                0.2        0.4
                                                           0.4       0.6
                                                                     0.6            0.8
                                                                                    0.8    1
                                                                                           1
                                                      Consequences if occured
                                                      Consequences if occured



                                                                           Fig. 1



                                                            List of DT’s Prioritized Risks


 Ranking     Name                                             Potential Risks (Description)          Category Owner
 1       Client’s                                           Our clients may not like the secure      Business Project
         Rejection                                          Online Statement.                        Risk      Manager
                                                                                                               (Dan
                                                                                                               Brown)
 2                                        Financial         Our estimated cost may not be            Financial Rhett
                                          Constraints       enough to cover the cost of the          Risk      Walton
                                                            programmers we will hire. We might
                                                            need to buy more servers.
 3                                        Information       Our system will rely on the un-       System        Khurram
                                          Breach            trusted channel (internet) to allow   security      Mirza
                                                            our clients to log onto our site. Our
                                                            clients can become a target of
                                                            phishing frauds.
 2          Lack of         If the project sponsor doesn’t          People      Dan
            project         support this project as expected, it    Risk        Brown
            sponsor         will affect the progress. The project
            support         champion is dealing with several
                            initiatives in the organization.
                            Failure to support this effort could
                            have negative impact.
 2          Inaccurate      Inaccurate cost estimate would          Executive Rhett
            Project         impact delivery of solution             Risk      Walton
            Estimates



                                    Risk Register

No.:               R15
Rank:              1
Risk:              Clients’ Rejection
Description:       Our clients may not like the secure Online Statement. We might have
                   difficulty in explaining the benefits of our new system.
Category:          Business Risk
Root cause:        We have started a project without doing extensive research.
Triggers:          We have assumed that our new method is going to be successful.
Risk Responses:    Project manager should make sure that there is a genuine need for this
                   system; that our clients are going to support it. Dan Brown should
                   have a meeting with Laura Martone and review the business case
                   carefully.
Risk Owner:        Project Manager (Dan Brown)
Probability:       Low
Impact:            High
Status:            Project Manager has scheduled a meeting with the marketing
                   manager next week.




No.:               R40
Rank:              2
Risk:              Financial Constraints
Description:       Our estimated cost may not be enough to cover the cost of the
                   programmers we will hire. We have calculated the cost based on the
                   standard rate of the consultant programmers that is going to design
                   the system for us. We might have to hire more people and buy more
                   equipment.
Category:          Financial Risk
Root cause:       We cannot be 100% accurate about the cost
Triggers:         Our estimated cost is only an assumption
Risk Responses:   Financial key client division head should make sure that cost
                  assessment is done after studying the ROI, NVP, IRR and Payback
                  criteria.
Risk Owner:       Rhett Walton
Probability:      Medium
Impact:           Medium
Status:           Rhett will personally review the financial reports


No.:              R48
Rank:             3
Risk:             Information Breach
Description:      Our system will rely on the un-trusted channel (internet) to allow our
                  clients to log onto our site. Our clients can become a target of
                  phishing frauds
Category:         System security
Root cause:       We are going for the option that is quite vulnerable to security
                  threats.
Triggers:         If we fail to implement high encryption to our web site we will be
                  leaving holes in our system.
Risk Responses:   Khurram Mirza will have to closely work with the developing team to
                  make sure that there is no compromise with the sensitive information
                  or our clients.
Risk Owner:       Khurram Mirza
Probability:      Low
Impact:           High
Status:           PM has schedule a meeting with Khurram and the system
                  development team




No. :             R38
Rank:             2
Risk:             Lack of project sponsor support
Description:      If the project sponsor doesn’t support this project as expected, it will
                  affect the progress. The project champion is dealing with several
                  initiatives in the organization. Failure to support this effort could
                  have negative impact.
Category:         People Risk
Root cause:       We have assumed that we will get the full support from the Project
                  Sponsor.
Triggers:         Project Sponsor has declined the last two meetings.
Risk Responses:   Set up one on one meeting with PM and Sponsor to stress the
                  importance of the support to the project.
Risk Owner:       Dan Brown
Probability:      Medium
Impact:           High
Status:           PM scheduled to meet one on one with Sponsor next week.


No.:              R43
Rank:             2
Risk:             Inaccurate Project Estimates
Description:      Inaccurate cost estimate would impact delivery of solution
Category:         Execution Risk
Root cause:       Future is uncertain
Triggers:         N/A
Risk Responses:   Project Manager will monitor risk and report out on project financials
                  weekly.
Risk Owner:       Khurram Mirza
Probability:      Medium
Impact:           High
Status:           Project Financials being reported

								
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