PMI North Area PMP Exam Study Group - PowerPoint PPT Presentation

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PMI North Area PMP Exam Study Group

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Risk Identification. Qualitative Analysis. Quantitative Analysis. Risk Response Planning ... Decision Tree Analysis. Quantitative Analysis Tool ... – PowerPoint PPT presentation

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Title: PMI North Area PMP Exam Study Group


1
PMI North Area PMP Exam Study Group
  • Risk Presentation
  • Prepared by Denise Robertson
  • 15 March 2003

2
Risk Management Processes
  • Process I/O and Tools/Techniques emphasized on
    exam, so memorize them
  • Memorize process in order
  • Risk Management Planning
  • Risk Identification
  • Qualitative Analysis
  • Quantitative Analysis
  • Risk Response Planning
  • Risk Monitoring and Control

3
Risk Concepts
  • Risk tolerance
  • Risk adverse
  • Risk factors
  • Probability
  • Impact
  • Range of possible outcomes
  • Expected timing in project life cycle

4
Unknowns
  • Risks are also called Unknowns
  • Known Unknowns are identified during Risk
    Management and are documented in the project plan
  • Can be planned for with Risk Response
  • Unknown Unknowns are unanticipated risks
  • Cannot be planned for in advance

5
Policy Level
  • Organizations Risk Management Policy on how to
    approach risk is now part of PMBOK
  • Policy describes
  • Level of tolerance
  • Level of acceptable risk

6
Project Status
  • 3 possible statuses
  • In Jeopardy
  • Committed to
  • Approved

7
Risk Probability/Impact Matrix
  • 2-D rating system that rates
  • Likelihood (probability) of a risk occurring
    between 0.0 and 1.0 or 100 certainty
  • Impact of risk should it occur
  • Impact scale can be
  • Ordinal (ordered)
  • Cardinal (assigned numeric values)
  • Risk Score Probability Impact

8
Evaluating Project Data for Use in Assessing Risk
  • Assumption Testing Criteria
  • Stability of assumption
  • Impact to project if assumption proves false
  • Data Precision Ranking Accuracy Dependencies
  • Extent risk is understood
  • Data available about risk
  • Quality of data
  • Reliability and integrity of data

9
Monte Carlo Simulation
  • Used in Quantitative Risk Analysis and Cost
    Analysis
  • Evaluates the project, not the tasks, however
  • Provides probability of completing project on any
    specific day or for any specific task
  • Provides probability of any task actually being
    on the critical path
  • Provides percent probability that each task will
    be on critical path
  • Takes into account path convergence
  • Translates uncertainties into impacts to total
    project
  • Can be used to assess cost and schedule impacts
  • Results in probability distribution

10
Decision Tree Analysis
  • Quantitative Analysis Tool
  • Diagram describes decision and probabilities
    associated with choices
  • Determines aggressive or conservative route to
    highest Expected Monetary Value (EMV)
  • Total of Probabilities Consequences for a
    Choice Event EMV

11
Cost Reserve
  • PMI recommends at least 10
  • OR
  • Based on EMV
  • Total of Probability Risk Cost for all risks
  • Remember risk can be negative or positive

12
Risk Response Techniques
13
Residual and Secondary Risks
  • Outputs from Risk Response Planning
  • Residual Risks are those that remain after
    Avoidance, Transference, and Mitigation have been
    taken.
  • Secondary Risks arise as a direct result of
    implementing a risk response
  • Secondary risks should be identified and
    responses planned
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