Risk Explained

Risk is an event that might occur during the course of a project. This event might have a positive or a negative impact.

So for a risk one should analyze:

1) Probability of the risk occuring.

2) Impact of the risk will cause if it occurs.

3) Frequency of risk occuring.

4) When the risk might happen.

Risk can be categorized in many ways - Business risk, Technical Risk, External Risk, Unforeseen risk etc.Risks need to be identified first. Then the risks need to be anlaysed both qualitatively - Probability and Impact matrix, Risk categorization etc and quantitatively- Monte Carlo analysis, Determining the probability and impact etc.

Then the risk response needs to be planned.

1) Avoiding the occurance of risk

2) Decrease/Increase the probability of occurance/impact of risk - Mitigation.

3) Transfer the risk to someone else.

4) What to do if it occurs - Contigency Plan.

5) what to do if contigency fails/not effective - fallback plan.