Risk Life Cycle

The life cycle involved the below stages

    • Risk Identification.
    • Risk prioritization.
    • Risk planning.
    • Risk monitoring.

In Risk identification stage, all the members of the projects do a brain storming and identify the possible risks for the project. Few risks will also be included from the risk database that is maintained by the organization.

In Risk prioritization stage, the impact would be measured using a formula that includes the probability and the impact. Depending on this prioritization would be done to focus on the high severe risks. During this stage few risks will be eliminated if they don’t have a considerable impact on the project variables.

In Risk planning stage, the mitigation and contingency plans for each of the prioritized risks will be identified and implemented.

In Risk monitoring stage, all the risks will be monitored to ensure that the mitigation plan that is in plan is yielding results and the risks doesn’t occur or if occurred the impact is minimized. If the mitigation plan is not yielding the expected results then the plan would be changed and few more controls would be placed to ensure that the impact is minimized. Also risk identification would be done regularly during the course of the project to identify new risks and then the life cycle follows

Risk

Risk Definition

Risk is the possibility that an unforeseen event will occur.

Risk has three components

    The risk – the event that has occurred.
    The probability that the event will occur.
    The impact of the event occurs.

Risk once occurred would have the impact on the project variables which is not expected. Hence Risk management is an activity that has to be performed which involves the activities of defining, measuring, prioritizing, and managing risk in order to eliminate or minimize the impact of it. There can be positive or negative impacts on the project variables. Hence all risks need be eliminated or addressed.