Case Study: Risk Management Models By The Project Manager

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Register to read the introduction… Risk is managed using seven subprocesses, namely (1) risk management planning, (2) risk identification, (3) qualitative risk analysis, (4) quantitative risk analysis, (5) risk response planning, (6) risk monitoring and control, and (7) the risk management register [ [3] ]. Risk management planning entails planning a strategy to manage risk in the project. Risk identification is done to recognize the risks that the project can encounter as well as documenting them. A qualitative risk analysis is done to prioritise the risk’s influence on project goals. A quantitative risk analysis is done to approximate the likelihood and effect of risk and their impact on the project. Risk response planning is done in order to develop methods to decrease threats and increase the chances of project success. Project monitoring and control is done to identify new risks, carry out risk reduction plans and monitor their effectiveness. The risk management register is a permanent documentation of identified risks and methods that were used to alleviate or remove them [ [3] …show more content…
Examples of risk management models are the risk cube, the Risk Burndown Chart, GANTT chart, Milestone chart, Program Evaluation and Review Technique (PERT) or Critical Path Method (CPM), Probabilistic Risk Assessment (PRA), SWOT (Strengths, Weaknesses, Opportunities and Threats ) analysis, GAP analysis, Value Chain analysis, Failure Mode and Effect Analysis (FMEA), Decision Tree Analysis, and Monte Carlo Simulation. Risk management software such as Active Risk Manager, Risk Matrix, and Risk+ is also used [ [1] ] [ [3] ] [ [4] …show more content…
It assumes a sequence of events, which means that it does not take into consideration unexpected failures that do not occur in a certain order. Sometimes in complex systems failures do not occur because of a sequential chain of events. This method is also not good at predicting common-cause failures. In addition, since Human Reliability analysis forms part of PRA, more uncertainty is introduces since there can be no accurate model predicting human behaviour [ [8] ]. This necessitates that a project manager considers the actual historical risk before making decisions based on the PRA numbers [ [9] ].

4.8 SWOT Analysis
This technique examines risk by looking at the strengths, weaknesses, opportunities and threats of a project [ [2] ].

4.9 GAP Analysis
This analysis uses two axis and four quadrants. The labelling of the axis are not limited, and can be anything that the project manager wishes to investigate. The project manager fills in each quadrant according to occurrence of a variable, with a dot that is of proportional size. Any gap in a quadrant or an over-population can either indicate an opportunity or a threat [ [4] ]. An illustration of this analysis can be observed in Figure 3.5.

Figure 3.5: GAP Analysis [ [4] ]

4.10 Value Chain Analysis
Value chain analysis is done to assess the value added to the customer by the business or project functions [ [4]

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