Risk Management: Concepts and Guidance, Fifth Edition, 5th Edition (Hardback) book cover

Risk Management

Concepts and Guidance, Fifth Edition, 5th Edition

By Carl L. Pritchard, PMP, PMI-RMP, EVP

Auerbach Publications

474 pages | 47 B/W Illus.

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pub: 2014-12-17
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Description

This new edition of Risk Management: Concepts and Guidancesupplies a look at risk in light of current information, yet remains grounded in the history of risk practice. Taking a holistic approach, it examines risk as a blend of environmental, programmatic, and situational concerns. Supplying comprehensive coverage of risk management tools, practices, and protocols, the book presents powerful techniques that can enhance organizational risk identification, assessment, and management—all within the project and program environments.

Updated to reflect the Project Management Institute’s A Guide to the Project Management Body of Knowledge (PMBOK® Guide), Fifth Edition, this edition is an ideal resource for those seeking Project Management Professional and Risk Management Professional certification.

Emphasizing greater clarity on risk practice, this edition maintains a focus on the ability to apply "planned clairvoyance" to peer into the future. The book begins by analyzing the various systems that can be used to apply risk management. It provides a fundamental introduction to the basics associated with particular techniques, clarifying the essential concepts of risk and how they apply in projects. The second part of the book presents the specific techniques necessary to successfully implement the systems described in Part I.

The text addresses project risk management from the project manager’s perspective. It adopts PMI’s perspective that risk is both a threat and anopportunity, and it acknowledges that any effective risk management practice must look at the potential positive events that may befall a project, as well as the negatives.

Providing coverage of the concepts that many project management texts ignore, such as the risk response matrix and risk models, the book includes appendices filled with additional reference materials and supporting details that simplifying some of the most complex aspects of risk management.

Table of Contents

RISK PROCESSES AND PRACTICES: WHY RISK MANAGEMENT?

Risk Management Practices

A Systematic Process

Summary

Risk Concepts

Risk Attitudes and Appetites

Classifying Risk

Risk Breakdown Structure

Risk Taxonomy

Risk Facets

Other Risk Categories

Taxonomically Developed Risks

Other Relevant Considerations

Risk Management Perspectives

Realities of Project Management

Summary

The Risk Management Structure

Risk Management Planning

Description and Project Summary

Risk Environment

Approach to Risk Management

Application Issues and Problems

Other Relevant Plans

Risk Governance

Approach Summary

Bibliography

Approvals

Identify Risks

Documentation Reviews

Information-Gathering Techniques

Checklists

Assumptions Analysis

Diagramming Techniques

Perform Qualitative Analysis

Baselining Risk

Rating Schemes and Definitions

Assumptions Testing

Risk Modeling

Using Analogies

Conducting Data Quality Assessments

Risk Categorization

Risk Urgency Assessment

Perform Quantitative Analysis

Expert Interviews

Expected Monetary Value (EMV)

Decision Tree Analysis

Program Evaluation and Review Technique

Sensitivity Analysis

Simulations

Plan Risk Responses

Risk Avoidance

Risk Transference

Risk Mitigation

Risk Acceptance

Opportunity Exploitation

Opportunity Sharing

Opportunity Enhancement

Opportunity Acceptance

Monitor and Control Risks

Summary

RISK MANAGEMENT TECHNIQUES

Expert Interviews

Technique Description

When Applicable

Inputs and Outputs

Major Steps in Applying the Technique

Use of Results

Resource Requirements

Reliability

Selection Criteria

Resource Requirements

Applications

Outputs

Summary

Planning Meetings/The Risk Management Plan

Technique Description

When Applicable

Inputs and Outputs

Major Steps in Applying the Technique

Use of Results

Resource Requirements

Reliability

Selection Criteria

Resource Requirements

Applications

Outputs

Summary

Risk Practice Methodology

Technique Description

When Applicable

Inputs and Outputs

Major Steps in Applying the Technique

Use of Results

Resource Requirements

Reliability

Selection Criteria

Resource Requirements

Applications

Outputs

Summary

Documentation Reviews

Technique Description

When Applicable

Inputs and Outputs

Major Steps in Applying the Technique

Use of Results

Resource Requirements

Reliability 100

Selection Criteria

Resource Requirements

Applications

Outputs

Summary

Analogy Comparisons

Technique Description

When Applicable

Inputs and Outputs

Major Steps in Applying the Technique

Use of Results

Resource Requirements

Reliability

Selection Criteria

Resource Requirements

Applications

Outputs

Summary

Plan Evaluation

Technique Description

Using the WBS for Risk Identification

Using Specifications for Risk Identification

Using Statements of Work (SOWs) for Risk Identification

Developing a Technical Risk Dictionary or Risk Register

Using Other Plans for Risk Identification

When Applicable

Inputs and Outputs

Major Steps in Applying the Technique

Use of Results

Resource Requirements

Reliability

Selection Criteria

Resource Requirements

Applications

Outputs

Summary

Delphi Technique

Technique Description

When Applicable

Inputs and Outputs

Major Steps in Applying the Technique

Use of Results

Resource Requirements

Reliability

Selection Criteria

Resource Requirements

Applications

Outputs

Summary

Brainstorming

Technique Description

When Applicable

Inputs and Outputs

Major Steps in Applying the Technique

Use of Results

Resource Requirements

Reliability

Selection Criteria

Resource Requirements

Applications

Outputs

Summary

Crawford Slip Method (CSM)

Technique Description

When Applicable

Inputs and Outputs

Major Steps in Applying the Technique

Use of Results

Resource Requirements

Reliability

Selection Criteria

Resource Requirements

Applications

Outputs

Summary

SWOT Analysis

Technique Description

When Applicable

Inputs and Outputs

Major Steps in Applying the Technique

Use of Results

Resource Requirements

Reliability

Selection Criteria

Resource Requirements

Applications

Outputs

Summary

Checklists

Technique Description

When Applicable

Inputs and Outputs

Major Steps in Applying the Technique

Use of Results

Resource Requirements

Reliability

Selection Criteria

Resource Requirements

Applications

Outputs

Summary

Risk Breakdown Structure

Technique Description

When Applicable

Inputs and Outputs

Major Steps in Applying the Technique

Use of Results

Resource Requirements

Reliability

Selection Criteria

Resource Requirements

Applications

Outputs

Summary

Root Cause Identification and Analysis

Technique Description

When Applicable

Inputs and Outputs

Major Steps in Applying the Technique

Use of Results

Resource Requirements

Reliability

Selection Criteria

Resource Requirements

Applications

Outputs

Summary

Risk Registers/Tables

Technique Description

When Applicable

Inputs and Outputs

Major Steps in Applying the Technique

Use of Results

Resource Requirements

Reliability

Selection Criteria

Resource Requirements

Applications

Outputs

Summary

Project Templates

Technique Description

When Applicable

Inputs and Outputs

Major Steps in Applying the Technique

Use of Results

Resource Requirements

Reliability

Selection Criteria

Resource Requirements

Applications

Outputs

Summary

Assumptions Analysis

Technique Description

When Applicable

Inputs and Outputs

Major Steps in Applying the Technique

Use of Results

Resource Requirements

Reliability

Selection Criteria

Resource Requirements

Applications

Outputs

Summary

Decision Analysis–Expected Monetary Value

Technique Description

When Applicable

Inputs and Outputs

Major Steps in Applying the Technique Use of Results

Resource Requirements

Reliability

Selection Criteria

Resource Requirements

Applications

Outputs

Summary

Estimating Relationships

Technique Description

When Applicable

Inputs and Outputs

Major Steps in Applying the Technique

Use of Results

Resource Requirements

Reliability

Selection Criteria

Resource Requirements

Applications

Outputs

Summary

Network Analysis (Excluding PERT )

Technique Description

When Applicable

Inputs and Outputs

Major Steps in Applying the Technique

Use of Results

Resource Requirements

Reliability

Selection Criteria

Resource Requirements

Applications

Outputs

Summary

PERT

Technique Description

When Applicable

Inputs and Outputs

Major Steps in Applying the Technique

Use of Results

Resource Requirements

Reliability

Selection Criteria

Resource Requirements

Applications

Outputs

Summary

Other Diagramming Techniques

Technique Description

When Applicable

Inputs and Outputs

Major Steps in Applying These Techniques

Flowcharts

Ishikawa (Fishbone) Diagrams

Force Field Diagrams

Use of Results

Resource Requirements

Reliability

Selection Criteria

Resource Requirements

Applications

Outputs

Summary

Rating Schemes

Technique Description

When Applicable

Inputs and Outputs

Major Steps in Applying the Technique

Scheme Development

Scheme Application

Use of Results

Resource Requirements

Reliability

Selection Criteria

Resource Requirements

Applications

Outputs

Summary

Urgency Assessment

Technique Description

When Applicable

Inputs and Outputs

Major Steps in Applying the Technique

Use of Results

Resource Requirements

Reliability

Selection Criteria

Resource Requirements

Applications

Outputs

Summary

Futures Thinking

Technique Description

When Applicable

Inputs and Outputs

Major Steps in Applying the Technique

Use of Results

Resource Requirements

Reliability

Selection Criteria

Resource Requirements

Applications

Outputs

Summary

Risk Modeling

Technique Description

When Applicable

Inputs and Outputs

Model Development

Model Application

Major Steps in Applying the Technique

Model Development

Model Application

Use of Results

Resource Requirements

Reliability

Selection Criteria

Resource Requirements

Applications

Outputs

Summary

Sensitivity Analysis

Technique Description

When Applicable

Inputs and Outputs

Major Steps in Applying the Technique

Use of Results

Resource Requirements

Reliability

Selection Criteria

Resource Requirements

Applications

Outputs

Summary

Monte Carlo Simulations

Technique Description

When Applicable

Inputs and Outputs

Major Steps in Applying the Technique

Use of Results

Resource Requirements

Reliability

Selection Criteria

Resource Requirements

Applications

Outputs

Summary

Risk Factors

Technique Description

When Applicable

Inputs and Outputs

Major Steps in Applying the Technique

Use of Results

Resource Requirements

Reliability

Selection Criteria

Resource Requirements

Applications

Outputs

Summary

Risk Response Matrix /Pugh Matrix

Technique Description

When Applicable

Inputs and Outputs

Major Steps in Applying the Technique

Use of Results

Resource Requirements

Reliability

Selection Criteria

Resource Requirements

Applications

Outputs

Summary

Performance Tracking and Technical Performance Measurement

Technique Description

When Applicable

Inputs and Outputs

Major Steps in Applying the Technique

Use of Results

Resource Requirements

Reliability

Supplemental Information

Technical Performance

Schedule Performance

Cost Performance

Selection Criteria

Resource Requirements

Applications

Outputs

Summary

Risk Reviews and Audits

Technique Description

When Applicable

Inputs and Outputs

Major Steps in Applying the Technique

Use of Results

Resource Requirements

Reliability

Selection Criteria

Resource Requirements

Applications

Outputs

Summary

Other Common Techniques

Cost Performance Reports Analysis

Independent Technical Assessment

Technique Description

When Applicable

Inputs and Outputs

Major Steps in Applying the Technique

Use of Results

Resource Requirements

Reliability

Selection Criteria

Independent Cost Estimates

Glossary

Appendix A:Contractor Risk Management

Appendix B:An Abbreviated List of Risk Sources

Appendix C:Basic Probability Concepts

Appendix D:Quantifying Expert Judgment

Appendix E:Special Notes on Software Risk

Index

About the Author

Carl L. Pritchard is the principal of Pritchard Management Associates and is a widely recognized risk management authority and lecturer. He was the lead chapter author for the risk management chapter of A Guide to the Project Management Body of Knowledge (PMBOK® Guide), Fourth Edition. Mr. Pritchard’s publications include courses in risk management, The Risk Management Memory Jogger (GOAL/QPC, 2012), as well as Project Management: Lessons from the Field (iUniverse, 2009), The Project Management Communications Toolkit, Second Edition (Artech House, 2012), How to Build a Work Breakdown Structure, and Precedence Diagramming: Successful Scheduling in the Team Environment. He co-produced (with ESI’s LeRoy Ward) the landmark 9-CD audio collection The Portable PMP® Exam Prep: Conversations on Passing the PMP® Exam (Fourth Edition). He is the U.S. correspondent for Project Manager Today, a project management journal published in the United Kingdom.

Mr. Pritchard also designs and develops project management programs and was the original architect of ESI International’s landmark offerings in project management in a distance-learning format. He is a trainer both online and in the classroom.

In his role as lecturer, Mr. Pritchard speaks regularly at national symposia on project management and serves as the "speaker’s coach" for several national conferences, providing guidance on how most effectively to share the project management gospel.

He is active in professional project management associations and is a certified Project Management Professional (PMP®), a certified Risk Management Professional (PMI-RMP®), and an Earned Value Professional (EVP), as certified by the Association for the Advancement of Cost Engineering (AACE) International. Mr. Pritchard earned a B.A. in journalism from The Ohio State University.

Mr. Pritchard can be reached via e-mail at carl@carlpritchard.com.

Subject Categories

BISAC Subject Codes/Headings:
BUS101000
BUSINESS & ECONOMICS / Project Management
COM032000
COMPUTERS / Information Technology
COM051230
COMPUTERS / Software Development & Engineering / General