This article contains most of the important information you need to know about Plan Risk management process in order to answer questions related to this topic in the PMI-RMP Exam, I recommend you review this type of articles 1 week before your exam date, all information mentioned are based on PMBOK Guide 5th edition , Practice Standard for Risk Management and Risk Management Tricks of the trade for Project Managers and PMI-RMP Exam Prep Guide , 2nd Edition by Rita Mulcahy ., ITTO refers to Inputs, Tools & Techniques and outputs.
This process is a part of Planning Process group and Risk Management Knowledge Area with the following ITTO’s
- Project Management Plan
- Project Charter
- Stakeholder Register
- Organizational Process Assets
- Enterprise Environmental Factors
Tools & Techniques:
- Expert Judgment
- Analytical techniques
- Planning sessions
- Risk Management Plan
- The main purpose of this process is to develop the overall risk management strategy for the project, to decide how risk management will be planned m executed and controlled; it involves deciding who should be involved, when risk activities should be performed and how frequently they should be done.
- It may include how you will measure the success of Risk management efforts and creation of metrics to measure against such as , number of unidentified risks, amount of extra reserves needed … there is 2 categories of success criteria for risk management , Project related criteria ( Refers to project in general ) and process related criteria ( Refers to the Risk management ) .
- Project Manager Role on Risk management is Directive while everybody should participate.
- Project Management office within the organization may support Risk management activities by providing policies and procedures, Standard probability and impact scales , risk reporting templates …
- For Big projects a Risk management department may be created to address project risk , and the organization itself may have a Governance Body .
- Risk Team can be created for large projects as well, a well-chosen risk team is one of the keys to identify risks , It may include Project team members , key stakeholders ,Sponsor and customer .
- Risk related communications occurs at two levels , within the project team and between the project team and other project stakeholders , principles for each of these categories should defined in risk management plan.
- Planning sessions is one of the most important techniques which can help build common understanding of project risk approaches , participants should include Project manager , selected team members , subject matter experts , board members of organization and key stakeholders.
- If your organization has no experience with risk, you can use risk consultants and experts who are specialized in risk identification.
- State of art and one of kind projects requires more attention of risk management.
- As a project manager you should adapt the risk management processes and activities as per the need of your project, it depends on the priority of the project within the organization, the project complexity, Risk tolerances and if the project was done before or not.
- Risk management activities budgets and schedules should be created after the initial budget and schedule for the project and before the final schedule and budget are created in schedule development and cost budgeting.
- Critical Success factors of plan risk management includes but limited to :
- Identify and address barriers to successful project risk management, and that can include a clear definition of project objectives, organization recognize the benefits of managing risk and then adding value of it.
- Project Stakeholders involvement in project Risk management , disagreements between stakeholders about risk tolerances and evaluation measures should be addressed and resolved as early as possible.
- Risk management Plan is the Major output of this process , it should include the following :
- Project Description , with project size and complexity level …
- Methodology, Defines how you as a project manager will perform risk management for a particular project.
- Roles and responsibilities “Who will do what “.
- Budget, this section of the risk management plan should include the cost of the risk management process.
- Timing, when to do risk management for the project?
- Risk Categories, the main source where you can find common risk categories is the historical records of similar projects and Risk breakdown structure .
- Definition of probability and Impact , the definition of probability and impact matrix help standardize the risk rating and help comparing risks between projects .
- Stakeholders Tolerances, stakeholders tolerances should be considered and mentioned in the risk management plan and sometimes it is collected while collect requirements process.
- Reporting formats, this section includes reports related to risk management that will be used and what they will include.
- Tracking, it means how the risk process will be audited and documented.