Different types of risks in Software

Project Development
Difficulty Level : Basic ● Last Updated : 26 Aug, 2020

Software development is a multi stage approach of design,

documentation, programming, prototyping, testing etc which

follows a Sof tware Development Life Cycle (SDLC) process.

Different tasks are per formed based on SDLC framework during

sof tware development. Developing and Maintaining sof tware

project involves risk in each step.

Most enterprises rely on sof tware and ignoring the risks

associated with any phase needs to be identified and

managed/solved other wise it creates unforeseen challenges for

business. Before analyzing different risks involved in sof tware

development, Let ’s first understand what is actually risk and why

risk management is impor tant for a business.

Risk and impor tance of risk management :

Risk is uncer tain events associated with future events which have

a probability of occurrence but it may or may not occur and if

occurs it brings loss to the project. Risk identification and

management are ver y impor tant task during sof tware project

development because success and failure of any sof tware project

depends on it.

Various Kinds of Risks in Software Development :

1. Schedule Risk :

Schedule related risks refers to time related risks or project

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deliver y related planning risks. The wrong schedule affects the

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project development and deliver y. These risks are mainly

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indicates to running behind time as a result project development

doesn’t progress timely and it directly impacts to deliver y of

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project. Finally if schedule risks are not managed properly it gives

rise to project failure and at last it affect to organization/company

economy ver y badly.

Some reasons for Schedule risks –

Time is not estimated per fectly

Improper resource allocation

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Tracking of resources like system, skill, staff etc
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Frequent project scope expansion

Failure in function identification and its’ completion

2. Budget Risk :

Budget related risks refers to the monetar y risks mainly it occurs

due to budget overruns. Always the financial aspect for the

project should be managed as per decided but if financial aspect

of project mismanaged then there budget concerns will arise by

giving rise to budget risks. So proper finance distribution and

management are required for the success of project other wise it

may lead to project failure.

Some reasons for Budget risks –

Wrong/Improper budget estimation

Unexpected Project Scope expansion

Mismanagement in budget handling

Cost overruns

Improper tracking of Budget

3. Operational Risks :

Operational risk refers to the procedural risks means these are

the risks which happen in day-to-day operational activities during

project development due to improper process implementation or

some external operational risks.

Some reasons for Operational risks –

Insufficient resources

Conflict between tasks and employees

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Improper management of tasks
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No proper planning about project

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Less number of skilled people ▲
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L ack of communication and cooperation

L ack of clarity in roles and responsibilities

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Insufficient training

4. Technical Risks :

Technical risks refers to the functional risk or per formance risk

which means this technical risk mainly associated with

functionality of product or per formance par t of the sof tware

product.

Some reasons for Technical risks –

Frequent changes in requirement

Less use of future technologies

Less number of skilled employee

High complexity in implementation

Improper integration of modules

5. Programmatic Risks :

Programmatic risks refers to the external risk or other

unavoidable risks. These are the external risks which are

unavoidable in nature. These risks come from outside and it is out

of control of programs.

Some reasons for Programmatic risks –

Rapid development of market

Running out of fund / Limited fund for project development

Changes in Government rules/policy

Loss of contracts due to any reason

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Ar ticle Contributed By :

Satyabrata_Jena
@Satyabrata_Jena

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Article Tags : Software Engineering

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