Project Risk Management – Identify Risks

This process determines which risks may affect the project and documenting their characteristics. It documents existing risks and knowledge and ability it provides to the project team to anticipate events. All personnel should be encouraged to identify potential risks.

This process is iterative because new risks may evolve or become known as the project progresses. Each situation will have a variety in frequency and participation.  The risk statement should support the ability to compare the relative effect of one risk against the others.

Let’s take a look at the Inputs, Tools and Techniques, and Outputs of this process:

1)      Risk Management Plan

·         May include:

·   Assignments of roles and responsibilities

·   Provision for risk management activities in the budget and schedule

·   Categories of risk (aka. Risk breakdown structure)

2)      Cost Management Plan

·         Provides processes and controls that can be used to help identify risks across the project

3)      Schedule Management Plan

·         Provides insight to project time/schedule objectives and expectations which may be impacted by risks (known or unknown)

4)      Quality Management Plan

·         Provides a baseline of quality measures and metrics

5)      Human Resource Management Plan

·         Provides guidance on how project human resources should be defined, staffed, managed, and eventually released. It also has roles and responsibilities, project organization charts, and staffing management plan.

6)      Scope Baseline

·         Project assumptions are found in the project scope statement and any uncertainties should be evaluated as potential causes of project risk.

7)      Activity Cost Estimates

·         Identify risks as they provide a quantitative assessment of the likely cost to complete scheduled activities and ideally are expressed as a range with the width of the range indicating the degree(s) of risk.

8)      Activity Durations Estimates

·         Identify risks related to the time allowances for the activities or project as a whole

9)      Stakeholder Register

·         Key participants are useful for soliciting inputs to identify risks.

10)   Project Documents

·         May include:

·   Project charter

·   Project schedule

·   Schedule network diagrams

·   Issue logs

·   Quality checklist

·   Other information that is valuable

11)   Procurement Documents

·         If the project requires external procurement of resources then procurement documents become a key input. The level of detail of the documents should be consistent with the value of and risks associated with planned procurement.

12)   Enterprise Environmental Factors

·         May include:

·   Published information

·   Academic studies

·   Published checklists

·   Benchmarking

·   Industry studies

·   Risk attitudes

13)   Organizational Process Assets

·         May include:

·   Project files, including actual data

·   Organizational and project process controls

·   Risk statement formats or templates

·   Lessons learned

14)   Documentation Reviews

·         Review of plans, assumptions, previous project files, agreements and other information by looking for quality and consistency between plans.

15)   Information Gathering Techniques

·         Brainstorming – goal to obtain a comprehensive list of project risks

·         Delphi technique – A facilitator uses a questionnaire to solicit ideas anonymously about important project risks. Responses are summarized and then recirculated for expert comments. Consensus will be reached after a few rounds.

·         Interviewing – Interview experienced people to help identify risks

·         Root cause analysis – used to identify a problem, discover the underlying causes that lead to it, and develop preventive action

16)   Checklist Analysis

·         These are developed based on historical information and knowledge that has been documented from other projects. They should be reviewed from time to time so that they don’t get too detailed and include new items that were discovered.

17)   Assumptions Analysis

·         Explores the validity of assumptions as they apply to the project and identify risks to the project from inaccuracy, instability, inconsistency, or incompleteness of assumptions.

18)   Diagramming Techniques

·         Cause and effect diagrams – also known as Ishikawa or fishbone diagrams and are used to identify causes of risk

·         System or process flow charts – show how various elements of a system interrelate and the mechanism of causation

·         Influence - graphical representation of situations showing causal influences, time ordering of events, and other relationships among variables and outcomes.

19)   SOWT Analysis

·         Strengths, weaknesses, opportunities and threats (SWOT)

·         It helps identify opportunities for the project and examines the degree to which organizational strengths offset threats. 

20)   Expert Judgment

·         Should be consulted with to identify all aspects of the project and suggest possible risks based on their previous experience and areas of expertise.

21)   Risk Register

·         A document in which the results of risk analysis and risk response planning are recorded.

·   List of identified risks

·   List of potential responses

Source: PMBOK 5^th ed.