The decision-making process of a manager can be broken down into six distinct steps. Although each step can be examined at length, managers often run through all of the steps quickly when making decisions.
Combined with a world-class project management methodology, a good risk management process can be essential in diminishing unexpected project risks. Risk management planning should be completed early during the project planning stage since it is crucial to successfully performing the other project management phases.
The risk management plan identifies and establishes the activities of risk management for the project in the project plan. By definition, projects are a risky endeavor. They aim to create new products, services, and processes that do not currently exist.
With that much at stake, a solid risk management plan is critical to the success of a project.
Below is a six step practical approach to creating a risk management plan. The 6 Step Process Step One: This can be done from various reports, project documents, through various departments and also from prior project reports.
The project scope is the rule book that guides the project, therefore all possible risks that the scope indicates will also have to be documented. All documentation of risks will have to be done in the Risk Register.
Risk Analysis Methods Every project is faced with risks. There are risks that creep up at various phases of the project that the team has to be vigilant and ready to handle.
However, while some risks may be beneficial, in that the sponsor and all team members have to take them to reach the end product, there are many risks that harm and hinder the project. The risks that are identified have to be analysed for their probability and impact using the PI Matrix and also translated into numerical values so as to accurately know the outcome of these risks on the cost, time and resource factors.
There are two methods of risk analysis; Qualitative and Quantitive Risk Analysis. Identify Risk Triggers Divide the risk management planning team into subgroups and assign segments of the master risk list to each subgroup.
The job of each subgroup is to identify triggers, or warning signs, for each risk on its segment of the master list. Again, it is important to document all triggers associated with each risk.
Three triggers per risk are standard. Risks are unknown events that are inherently neutral. They can be characterized as either positive or negative. No organization should overlook the chance to benefit from any opportunities that present themselves. Risk Resolution Action Plan In Step Five, based on the collective ideas of all the departmental teams, the project manager will have to decide on a plan of action to bring about risk resolution.
Risks with a high P-I value will have to be treated with utmost urgency while those with the least probability or impact can just be monitored without having any real action plan.
Identifying the most serious risks at the onset of a project saves time, cost and resources, and likewise identification of such risks also trigger the resolution plan at the earliest moment.
Responsibility and Accountability The last step in writing a risk management plan is assigning an owner for each risk on the master list. Use the Responsibility Assignment matrix.
Using this chart, various teams and team members may be assigned responsibility for carrying out the risk resolution plans.The various stages in the process of planning are as follows: 1.
Goal setting: Plans are the means to achieve certain ends or objectives. Therefore, establishment of organizational or overall objectives is the first step in planning.
Management: Planning Function Planning is a major function of management. Planning may be the most important of all management functions. Planning involves a six-step process that assists an organization in setting goals and determining how to accomplish them best (Allen, ).
Whether you are writing your business plan for the first time or rewriting it for the twentieth, there are certain steps you can follow in order to make the process easier 2 / Six Steps Of Management Planning Situational analysis is the beginning of the six step organizational planning process.
Essay on Human Resource Planning – Role, Objective, Importance, Steps. If they cannot handle the complaints, they can take them to senior management. There are six steps in human resource planning. These include; Analyzing the objectives of the organization.
There are six practical steps to creating a risk management plan. This approach meets the essential requirements for drawing up a risk management plan. It covers assembling a team, identifying risks, assigning weight to the risks, proposing solutions, and assigning ownership for the particular risk.
Management can integrate the ideas of the middle management with their planning, as per the legal, ethical and corporate responsibility. This strategic planning will be helpful in the success of the company (Galbreath, ).