Standard project risk analysis approach

Abstract

Background: To stay competitive in a highly unpredictable market of today, companies must be able to manage project risks effectively. The basis for an effective risk management is a thorough risk analysis. Despite the availability of many different risk analysis approaches, companies can be reluctant to use them, since the models are usually complex and very time consuming. Objectives: The main objective is to present a simple, yet effective risk analysis approach that can also serve as a useful basis for resolving project risks. Methods/Approach: The proposed standard risk analysis approach is based on a standard risk model that deals with risk events and impacts separately and therefore allows for a separate planning of preventive and corrective measures. To classify risks and to represent them graphically, a risk map is used. Results: The use of the proposed approach is illustrated on a die-cast tool development project. The approach proved to be very simple to use and it served as a useful basis for resolving the identified risks. Conclusions: The main advantage of the proposed approach is its simplicity and clarity. It can also be used as a quick decision-making tool in a subsequent risk resolving process.