Risk Management Plan –

Company ABC Widget

Production & Sales

Project Manager:
 DOCUMENT ACCEPTANCE AND RELEASE NOTICE

This is the release version of the Production and Sales of ABC Widgits Risk Management
Plan.

The Risk Management Plan is a managed document. For identification of amendments each
page contains a release number and a page number. Changes will only be issued as
complete replacement. Recipients should remove superseded versions from circulation. This
document is authorised for release once all signatures have been obtained.

PREPARED: Ruhi Gill, Production and Sales of ABC Widgits, Project Manager
DATE: December 4, 2018
(For acceptance)

ACCEPTED: Project Sponsor, Sunny Sharma on behalf of the Company ABC Production
and Sales of Widgits Steering Committee
DATE: December 4, 2018
(For release)
 1. BUILD STATUS (With Most Recent Amendment First):
Version Date Author Reason Sections
1.0 27-Oct-2018 Ruhi Gill Initial Release All
1.1 14-Nov-2018 Ruhi Gill Risk Analysis and Evaluation All
Update
1.2 4-Dec-18 Ruhi Gill  Risk Control & All
Monitoring Update
 Formation of Appendix
C

 The version number starts at one and increases by one for each release. It
shows the release number and a revision letter if in draft. The original draft is
0.A and subsequent drafts are 0.B, 0.C etc. The first accepted and issued
document is Version 1.0. Subsequent changes in draft form are 1.0A, 1.0B etc.
The accepted and issued second version is 1.1 or 2.0, depending on the
magnitude of the change.

2. DISTRIBUTION:
Type of Version Issue Date Issued To
Distribution
Electronic Copy 1.0 27-Oct-2018 Edward Snowden, ABC Company
Electronic Copy 1.1 14-Nov-2018 Edward Snowden, ABC Company
Electronic Copy 1.2 4-Dec-18 Edward Snowden, ABC Company
 Table of Contents

Risk Management Plan – Company ABC Widget Production & Sales.......................................1

Project Manager: Ruhi Gill............................................................................................................ 1

1 Executive Summary.................................................................................................................... 5

1.1 Steering Committee.......................................................................................................... 5

1.2 Project Manager................................................................................................................ 5
1.3 Project Team.................................................................................................................... 6

2 Introduction................................................................................................................................. 6

3 Risk Assessment........................................................................................................................ 6

3.1 Identification...................................................................................................................... 6
3.2 Analysis and Evaluation....................................................................................................8
Including which project team members were involved in the decision.........................12

4 Risk Control and Monitoring....................................................................................................12

Appendix A: Company ABC Widget Prodution And Sales Risk Register................................13

Appendix B: RISK IDENTIFICATION TECHNIQUES..................................................................15

Appendix C: RISK REVIEW AND CONTROL TECHNIQUES.....................................................16

 Company ABC Widget Production & Sales - Risk Management Plan

1 Executive Summary
The purpose of this document is to provide a management framework to ensure that levels
of risk and uncertainty are properly managed for the remainder of the project. As risk
management is an ongoing process over the life of a project, the Risk Register must be
considered a ‘snap shot’ of relevant risks at one point in time.

This document will achieve this by defining the following:

 the process that will be/has been adopted by the Project to identify, analyse and
evaluate risks during the remainder of the project;

 how risk response strategies will be developed and deployed;

 how often risks will be reviewed, the process for review and who will be involved;

 roles and responsibilities for risk management;

 how reporting on risk status, and changes to risk status, will be undertaken within the
Project and to the Steering Committee;

 a complete Risk Register containing all risks identified for the Project.

1.1 Steering Committee

The Steering Committee will review the high impact risks on a weekly basis via updated
information provided in the Project Status Reports and at the weekly steering committee
meetings. The Steering Committee will also be provided with an updated Risk Register for
consideration, as required, when additional threats emerge or the likelihood or potential
impact of a previously identified risk changes.

1.2 Project Manager

The Project Manager will be responsible for:

 Development (with the project team) and implementation of a Project Risk Management
Plan;

 Organization of regular risk management sessions with the project team so that risks
can be reviewed and new risks identified;

 Assessment of identified risks and developing strategies to manage those risks for each
phase of the project, as they are identified;

 Ensure that risks given a high risk rating are closely monitored; and

 Providing regular Status Reports to the Steering Committee noting any high risks and
specifying any changes to the risks identified during each phase of the project and the
strategies adopted to manage them.
 Company ABC Widget Production & Sales - Risk Management Plan

1.3 Project Team

All members of the Project Team will be responsible for assisting the Project Manager in the
risk management process. This includes the identification, analysis and evaluation of risks
and continual monitoring throughout the project life cycle.

2 Introduction
The objectives of the risk management approach in the Production and Sales of Company
ABC Widgits project are to identify, assess and mitigate risks where possible and to
continually monitor risks throughout the remainder of the project as other risks or threats
emerge or a risk’s impact or likelihood changes.

As risk management is an ongoing process over the life of a project, this Risk Management
Plan and Risk Register must be considered a ‘snap shot’ of relevant risks at one point in
time.

Where required, the process of risk identification, assessment and the development of
countermeasures will involve consultation with the Steering Committee members, other
relevant stakeholders and Project team members.

3 Risk Assessment
3.1 Identification
The identification section specifies the:

 Risk event;
 Cause of the risk;
 Effect or impact of the risk and technique used to identify the risk.

Risk ID Event Cause Effect Technique

or Used
Impact

1 Lack of Scope The Vendors skipped creating High Fishbone

Clarity the Business Requirements in Impact Diagram
order to speed up the project in
the planning phase and this is
going to create obstructions in
the execution phase of the
project and the project would not
be able to meet the 1 year
timeline.

Wee2 Lack of Project Vendors should create a project High Fishbone

Schedule schedule and have a track of Impact Diagram
achieved deliverables. Schedule
is required to avoid missing of
few activities and to keep
stakeholders informed about the
Company ABC Widget Production & Sales - Risk Management Plan

completion of project
deliverables.

3 Absence of Vendor’s project manager and High Brainstorming

Quality ABC Company’s project Impact
Standards managers should finalize on the
Measure quality standards of the software
in terms of performance, speed
and space consumption. In this
way, the Vendor’s project
manager would be able to
monitor and control quality in the
executing phase.

4 Over Budget Allocating budget without proper Medium Brainstorming

business requirements and Impact
without activities list like WBS,
may lead to over budget. No
contingency budget is allocated
for the risks that might occur in
future in the project. Failing to
allocate contingency budget
leads to increase in the overall
budget of the project, if that risk
occurs.

5 Inability to Not meeting the stakeholder High Fishbone

meet expectations can lead to failure Impact Diagram
Stakeholder of the project. Vendor’s project
Expectations manager should ensure that
appropriate communication plan
needs to be developed to
communicate the status of the
project to all the stakeholders.
Failure in communicating the
status of the project may lead to
misconceptions about the status
on the project.

6 Excessive Lack of scope signoff and proper High Delphi

Change business requests leads to Impact technique
requests excessive change requests and
Excessive change requests may
impact the overall budget and
schedule of the project.

7 Lack of If the project team doesn’t High Brainstorming

Business and understand the business and Impact
Technical technical requirements clearly,
Requirements that leads to different outcome or
unacceptable quality. Hence, the
knowledge transfer of the
application to the vendor team
should be accurate.
 Company ABC Widget Production & Sales - Risk Management Plan

8 Ignorance in Project Manager should ensure High Delphi

Resource that appropriate and efficient Impact Technique
Allocation resources are allocated to the
project, based on the budget and
schedule. Over allocation of
resources leads to increase in
the cost of the project and under
allocation of resources leads to
increase in the schedule of the
project.

9 Compressed Since, it can be seen that Vendor Medium Brainstorming

Timeline compressed the 1.5 year timeline Impact
of the project to 1 year which
may lead to increased
complexity of the project
because multiple tasks had to be
done simultaneously. Therefore,
Company ABC should give a
second thought to the expansion
of the timeline to 1.5 years.

10 Lack of Lack of business requirements Medium Brainstorming

Technical leads to allocation of people with Impact
expertise no proper technical expertise.
Lack of proper technical
knowledge leads to poor quality
standards and time taken by
team to expertize on the
technology leads to over budget.
On a whole, this risk might
impact the total quality, cost and
schedule of the project.

3.2 Analysis and Evaluation

The analysis and evaluation section identifies the likelihood/seriousness of the risk (see
appendix for grade), risk response strategy and contingency:

Risk Likeliho Risk *Strategy Contingency Owner Cost Date &

ID od & Respons Reasoning Update
Serious e
ness Strategy
1 Very Avoid Lack of scope Signing/approvi Project $500 Novemb
High clarity is a risk ng the scope Manag 0 er 14,
that has a very statement by er 2018
high impact on sponsor and
the scope of project
the project. manager
This risk can finalizes the
be avoided scope of the
 Company ABC Widget Production & Sales - Risk Management Plan

completely by project. This

appropriate avoids change
contingency requests and
plan. any
misconceptions
on the scope of
the project.
2 High Avoid Risk of project Proper Project $250 Novemb
scheduling is coordination Manag 0 er 14,
due to lack of among the er 2018
proper team members
coordination is possible only
can be with the proper
completely definition of
avoided by the business
appropriate requirements
contingency and
plan. communication
among the
team members.
Appropriate
implementation
of this plan
avoids the risk
of project
scheduling.
3 High Mitigate Risk of failure Application Vendor $300 Novemb
to maintain the developed by 0 er 14,
appropriate the people with 2018
quality less technical
standards can expertise leads
be largely to poor quality
reduced but standards.
could not Also, improper
avoided or testing of the
transferred. application
This can be leads to poor
reduced by the quality
following standards.
contingency Hence, clear
plan. definition of
business
requirements
and appropriate
testing of all
cases of the
application
largely reduces
the risk.
4 Mediu Mitigate Over budget Lack of Vendor $500 Novemb
m can be a complete er 14,
possible risk in business 2018
the project this requirements is
can occur due one of the
 Company ABC Widget Production & Sales - Risk Management Plan

to several reason for the

reasons. The over allocation
impact of this of budget and
risk can be failing to
reduced to a include the
larger extent contingency
but could not budget might
be avoided. lead to over
budget. Hence,
proper
definition of
business
requirements
and allocating
contingency
budget reduces
the risk of over
allocation of
budget.
5 Mediu Avoid Stakeholder Stakeholder Project $100 Novemb
m management is register is the Manag er 14,
one of the most most important er 2018
risks that document
impact the total which consists
project. This of the complete
risk can be information of
completely each and every
avoided by stakeholder.
following the Appropriate
contingency communication
plan. plan is to be
developed to
communicate
the status of
the project to
stakeholders.
This plan
avoids the lack
of stakeholder
management.
6 Very Mitigate Excessive Proper Sponso $100 Novemb
High change definition of r 0 er 14,
requests may business 2018
occur due to requirements
various and agreement
reasons. This on the scope
risk cannot be statement
avoided reduces the
completely but risk of
can be excessive
reduced. change
requests.
7 High Avoid Complex Defining the Project $300 Novemb
design is due business Manag 0 er 14,
 Company ABC Widget Production & Sales - Risk Management Plan

to the lack of requirements er 2018

clear business clearly avoids
requirement conceptions on
can be the business
completely requirements
avoided by the and the
following application
appropriate design is based
plan on the business
requirements.
Hence, this risk
can be avoided
completely by
clear business
requirements.
8 High Mitigate Risk of Clear business Project $200 Novemb
ignorance in requirements Manag 0 er 14,
resource assist the er 2018
allocation lead project
to the delay in manager in
schedule of the allocating the
project. This required
risk cannot be resources. But
completely there might be
avoided but a possibility of
can be reduced resource
largely by unavailability.
defining the However, clear
proper requirements
business assist in
requirements. allocating the
required
resources and
reduce the risk
to a large
extent.
9 Mediu Mitigate Because the The project Project $500 Novemb
m Vendor manager Manag er 14,
compressed should create a er 2018
the 1.5 year Project
timeline of the Timeline which
project to 1 is effective and
year which efficient.
may lead to
increased
complexity of
the project
because
multiple tasks
had to be done
simultaneously.
Therefore,
Company ABC
should give a
second thought
 Company ABC Widget Production & Sales - Risk Management Plan

to the
expansion of
the timeline to
1.5 years.
10 Mediu Mitigate There might be Defining proper Vendor $100 Novemb
m a possibility of business 0 er 14,
resources with requirements 2018
less technical allows the
expertise in the project
team. This kind manager to
of risk can be recruit the
mitigated but resources with
cannot be best technical
avoided. expertise.
Hence, clear
defining of the
business
requirements
reduces the
risk of
recruiting
people with
less expertise.

Including which project team members were involved in the decision

4 Risk Control and Monitoring

This section specifies:

 The frequency of reviewing the Risk Registers – Weekly and Bi-Weekly depending
upon the risks

 Names of individuals involved in the risk reviews found in the table below;

 Frequency of risk monitoring found in the table below;

 Risk review technique(s) and reasoning for selecting it;

Risk ID Review Reviewers Risk Review Risk Review Technique Reasoning

Frequency Technique(s)
1 Weekly Project Risk Audit Lack of scope clarity is the risk
Manager event. This risk can be avoided
and Project by getting the approved scope
Sponsor statement by both sponsor and
project manager. Hence, Risk
audit is used as technique to
review how effectively the
response strategy is being
implemented. Risk Audits assists
in identifying if the response
Company ABC Widget Production & Sales - Risk Management Plan

strategy is not effectively

implemented or any strategy
needs to be changed.
2 Weekly Project Variance and Lack of Project Schedule is the
Manager of Trend Analysis risk event and avoid is the
the Vendor response strategy. When the
and Project variance is observed as
Sponsor increasing, the project is highly
impacted by the risk. Hence,
variance and trend analysis is
used as the review and control
technique to take care of this risk.
3 Weekly Quality Risk Risk Assurance involves
Assurance Assurance continuous identification of risks
Officer and controls them. To assure
quality of products Risk
Assurance should be performed
weekly.
4 Bi-Weekly Project Reserve Reserve analysis is used as the
Manager Analysis risk reviewing technique because
and Project this technique aids in identifying
Sponsor the contingency/reserve budget is
allocated or not for any risks that
might damage the project. Over
budget is caused when there is
no reserve budget and any
negative risk impacts the project.
Hence, reserve analysis
technique is used to control this
risk.
5 Weekly Project Meetings Ability to meet Stakeholder
Manager Expectations is possible with
frequent status meetings
communicating the status of the
work and issues going on with the
stakeholders. This risk can be
avoided by using meetings
technique.
6 Weekly Project Meetings Excessive change requests can
Manager be controlled by conducting
and Project meetings with the sponsor and
Sponsor clearly describing the project
current status and deliverables
met. Also, this risk can be
controlled by frequent meetings in
the initial phase for the approval
on requirements and scope.
Hence, Meetings are used as the
Risk review technique.
7 Monthly IT Manager Technical Technical Performance
Performance Measurement allows to compare
Measurement the deliverables with planned
functional requirements and
identify the risks and control
Company ABC Widget Production & Sales - Risk Management Plan

them.
8 Twice in a Inventory Risk Risk Assurance involves
Month Manager Assessment continuous identification of risks
and controls them. To assure
quality of products Risk
Assurance should be performed
weekly.
9 Monthly Vendor’s Variance and This tool allows us to track and
Project Trend Analysis compare the deliverables met at
Manager completion to the planned
timeline. Hence, the timelines of 1
year can be met successfully.
10 Weekly Team Risk Lack of Technical expertise is the
Leader and Reassessment risk event and the response
Project strategy is to mitigate this risk.
Manager Risk reassessment is used as the
review technique because this
risk will be evaluated on a regular
basis and proper response
strategy will be used to mitigate.
Current risks will be evaluated
and closed after appropriate
measures are taken.
APPENDIX A: COMPANY ABC WIDGET PRODUTION
AND SALES RISK REGISTER
Relative or Numerical Scale
Impact Rating Cost Time Scope Quality
1 Very low 5% Cost <5% Very 5% Scope Very insignificant quality
Increase insignificant changes – degradation
increase in Very
time. insignificant
changes
2 Low 10% Cost 5% Time 10% Scope Minor degradation in the
increase increase changes – quality
minor
changes in
scope
3 Medium 15% Cost 10% Time 20% Scope Major degradation in the
increase increase Changes – quality standards.
Major
changes in
scope.
4 High 25% Cost 15% Time 25% Scope 10% - Quality reduction
Increase increase Changes – is unacceptable to
Unacceptabl sponsor.
e to the
sponsor
5 Very High 30% Cost 20% Time 35% Scope 15% - Deliverables are
Increases increases Changes – useless.
Deliverables
unaccepted

Fig. Impact Rating Scale

Risk ID Probability Impact Overall Ranking

Scope Time Cost Quality
1 5 5 4 4 4 85
2 5 4 5 4 4 85
3 4 4 4 5 5 72
4 3 2 2 4 2 30
5 3 2 2 2 2 24
6 3 3 3 3 2 33
7 5 4 4 4 4 60
8 3 2 2 2 2 24
9 3 4 5 4 4 56
10 4 2 4 2 4 48
Fig. Impact Rating

***Overall Ranking= (Probability X Scope) + (Probability X Time) + (Probability X Cost) + (Probability X Quality)

Page 15
 90% Risk 6,7,10 Risk 1,2
Probability 75% Risk 3
50% Risk 5,8 Risk 4,9
25%
10%
10% 25% 50% 75% 90%
  Impact
Fig. Probability and Impact Matrix

Page 16
APPENDIX B: RISK IDENTIFICATION TECHNIQUES

Delphi Technique: This technique is used to identify the likelihood of future events
by a group of experts who express their perspective individually. An assistant
prepares a summary of all the views of experts. Using this technique, following risks
are identified.

I. Software Installation
II. Resource allocation
III. External factors

Fishbone Diagram: Fishbone diagram is also called as the cause and effect
diagram. As per the case study, project failed as the vendor couldn’t finish the
project within timeline and budget. The causes for this effect are identified using the
fishbone diagram.

I. Improper scope statement leads to scope creep and impacts cost and
schedule.
II. No proper communication among stakeholders leads to misconceptions on
the status of the project as well as on the scope, cost and budget.
III. Quality assurance contract assists both the parties to monitor the quality of
software that is being developed.
IV. Milestone list assists in tracking the customer’s requirements and the
project’s current status.

Brainstorming: Brainstorming technique is an approach to generate ideas on a

problem, from a group of people within short period of time. People who have some
programming knowledge formed as a group and identified the following risks.

I. Application Knowledge – If the developers don’t have precise knowledge on

the functioning of application, development cannot be done within stipulated
cost and schedule.
II. Application Design complexity – Design of the application could be simple to
understand and develop. More complexity leads to more time and work which
impacts on the cost and schedule.
III. Application programming language – Appropriate programming language
should be chosen to develop the application which avoids training resources
on new languages and spending time and cost on training.

Page 17
APPENDIX C: RISK REVIEW AND CONTROL
TECHNIQUES

Risk Review Risk Review Reasoning of Risk Review Technique

ID Frequency Technique
1 Weekly Risk Audit Lack of Scope Clarity can be avoided by getting the
approved scope statement by both sponsor and
project manager. Hence, Risk audit is used as
technique to review how effectively the response
strategy is being implemented. Risk Audits assists in
identifying if the response strategy is not effectively
implemented or any strategy needs to be changed.
2 Weekly Variance and Variance and trend analysis is used to identify the
Trend Analysis variances between schedules and costs. When the
variance is noticed as increasing, the project is
highly impacted by the risk occurred. Hence,
variance and trend analysis is used as the review
and control technique for project scheduling.
3 Weekly Risk Risk Assurance involves continuous identification of
Assurance risks and controls them. To assure quality of
products Risk Assurance should be performed
weekly.
4 Bi-Weekly Reserve Over budget is the risk event and the response
Analysis strategy used is to mitigate this risk is Reserve
analysis because this technique aids in identifying
the contingency or reserve budget allocated or not
for any risks that might damage the project. Over
budget is caused when the reserve budget is not
allocated and any negative risk impacts the project.
Hence, reserve analysis technique is used to control
this risk.
5 Weekly Meetings Avoid is the risk response used for Inability to meet
expectations. It is possible with frequent status
meetings communicating the status of the work and
issues going on and can be avoided by using
meetings technique. Hence, Meetings is the review
and control technique for this risk.
6 Weekly Meetings Excessive change request risk can be controlled by
conducting meetings with the sponsor and clearly
describing the project’s current status and
deliverables met so far. Hence, Meetings are used
as the Risk review technique.
7 Monthly Technical Technical Performance Measurement allows to
Performance compare the deliverables with planned functional
Measurement requirements and identify the risks and control them.
8 Twice in a Risk Risk Assurance involves continuous identification of
Month Assessment risks and controls them. To assure quality of
products Risk Assurance should be performed
weekly.
9 Monthly Variance and This tool allows us to track and compare the
Trend Analysis deliverables met at completion to the planned

Page 18
 timeline. Hence, the timelines of 1 year can be met
successfully.
10 Weekly Risk Lack of Technical expertise is the risk event and the
Reassessment response strategy is to mitigate this risk and Risk
Reassessment is used as the review technique
because this risk will be evaluated on a regular
basis and appropriate response strategy will be
used to mitigate.

Page 19
<Project Title> - Risk Register (as at dd/mm/yy)

Page 20