Risk Management | Risk Management Process | Software Engineering | BSc.CSIT 6th Sem

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Risk ManagementRisk Management definition & Risk Management Process,
Software Engineering Notes | Sixth Semester,
BSc.CSIT | Tribhuvan University (TU)

Risk management
Risk management is the identification, assessment, and prioritization of risks followed by coordinated and economical application of resources to minimize, monitor, and control the probability or impact of unfortunate events. It is concerned with identifying risks and drawing up plans to minimize their effect on a project. It deals with identifying risks which may affect the project and planning to ensure that these risks do not develop into major threats and does not deflect the endeavor from the business goals.

A risk is a probability that some adverse circumstance will occur and project risks affect schedule or resources. For example; What if experienced designer leave the project? Product risks affect the quality or performance of the software being developed. For example; failure of purchased component to perform as expected. Business risks affect the organization developing or procuring the software. Let’s take example, a competitor introducing a new product is a business risk.

The risk management process:

  • Risk identification
  • Identify project, product and business risks;
  • Risk analysis
  • Assess the likelihood and consequences of these risks;
  • Risk planning
  • Draw up plans to avoid or minimize the effects of the risk;
  • Risk monitoring
  • Monitor the risks throughout the project;

risk management process

Risk identification:
It is the first stage of risk management. It is concerned with discovering possible risks to the project. Risk identification may be carried out as a team process using a brainstorming approach or may simply be based on experience. There are six types of risk that can arise:

  • Technology risks.
  • Resource risks.
  • Organizational risks.
  • Requirements risks.
  • Estimation risks.

Risk analysis

  • During risk analysis process, assess probability and seriousness of each risk.
  • Probability may be very low, low, moderate, high or very high.
  • Risk effects might be catastrophic, serious, tolerable or insignificant.

Risk planning

  • The risk planning process considers each of the key risks that have been identified and identifies strategies to manage the risk.
  • Consider each risk and develop a strategy to manage that risk.

Risk monitoring

  • It involves regular assess each identified risks regularly to decide whether or not it is becoming less or more probable.
  • Also assess whether the effects of the risk have changed.
  • Each key risk should be discussed at management progress meetings.
  • Risk monitoring should be a continuous process, and, at every management progress review, we should consider and discuss each of the key risks separately.
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