What is the "RISK RESPONSE " most used in your projects ?

Most risks are anticipated  and included in the project plan. In a way, we accept the risks.

mitigate

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Today, effectively managing risk is an essential element of

successful project management. Proper risk management

can assist the project manager to mitigate against both

known and unanticipated risks on projects of all kinds. Failure to

perform effective risk management can cause projects to exceed

budget, fall behind schedule, miss critical performance targets, or

exhibit any combination of these troubles.

Certainly there are a number of factors that determine

whether a project will be a success, but it seems likely that

failing to perform adequate risk management will increase the

possibility of failure. The old axiom, “failing to plan is planning

to fail,” appears to apply to risks. Having an effective method

to plan for and manage project risks that is easy for the project

team to understand, use, and apply is critical. As projects increase

in complexity and size, taking a multidisciplinary approach to

project management requires giving proper attention to risk

management. This article proposes a simple risk management

tool that has been shown to be benefi cial to managing project

risks and improving project success

Risk analysis techniques include expert interviews, expected

monetary value, and response matrices, along with more advanced

risk techniques such as the Monte-Carlo method. Pritchard (2001)

and Raz and Michael (1999) provide comprehensive information

about and references to risk analysis techniques for various

applications and requirements. One risk management technique

multiplies probability of the risk occurring with the expected

impact of the risk. This leads to an evaluation for each risk. In

this work, the method of using the risk probability multiplied by

the risk impact value is expanded by also multiplying a detection

value for each risk.

Multiplying three values of likelihood of occurrence (or

probability), severity (or impact), and detection is the familiar

format of the failure mode and effects analysis (FMEA) used

for process, design, and service planning. The FMEA technique

dates back to the United States military procedure MIL-P-1629

(1949). Bongiorno (2001) provides an overview of a design

FMEA (DFMEA), as well as the basic mechanics of the FMEA

technique. Currently, the technique is an integral part of ISO-

9000 and QS-9000 quality certifi cation levels. It is used within the

comprehensive framework of product and process development

with such tools as FTA, APQP, QFD, DOE, SPC,8-D, and the like

(FMEAC.COM,2003). The FMEA method is a natural addition

to the project risk management process due to its ease of use,

familiar format, and comprehensive structure.

In the method of applying the FMEA format to project

risks, it is defined here as the project risk FMEA or RFMEA. The

RFMEA technique is not just another way of analyzing project

risks but helps focus the risk contingency planning required early

in the project on critical risks. Pritchard (2000) first identified

the FMEA technique as an advanced format capable of capturing

project risks. The use of the FMEA technique is developed

here with terminology, along with a detailed methodology. In

addition, the method of using the RFMEA with simple graphical

analysis techniques is introduced for risk priority planning.

First, the most common risk terminology in the literature is

reviewed with the reader. Second, definitions for using the

RFMEA are provided. The method of creating the RFMEA is then

explained. The benefi ts of the RFMEA are discussed to help the

engineering manager, project manager, and team members realize

the importance of this method. A case study of the RFMEA in

use is shown as an example for the reader. The conclusion

highlights the importance of such a method to the engineering

management community

While the literature on risk management is plentiful, the

defi nitions and meanings of a few key similar terms within

the fi eld are inconsistent.

A Guide to the Project Management

Body of Knowledge PMBOK® Guide

(PMI,2000) defines the risk management process as being comprised of six steps: risk

management planning, risk identification, qualitative risk

analysis, quantitative risk analysis, risk response planning, and risk

monitoring and control. A project risk is defined as “an uncertain

project riskisdefinedas“an uncertain project risk event or condition that,

if it occurs, has a positive or negative effect

on a project’s objectives” (PMI,2000). Authors have used various

terms for depicting the probability attribute of a risk event such

as, “probability,” “likelihood,” “probability of occurrence,” and

“occurrence frequency.” Scales used for these probability ratings

range from low, medium, and high,1 to10,0 to1.0, or some other

nonlinear or linear scale. Although these terms and scales are all

correct, inconsistent use and terminology creates confusion.

The discrepancies do not stop with the probability value. A

second attribute typically associated with a risk event is what is

called the “impact,” “severity,” “consequence,” or the “amount at

stake.” Even the

PMBOK® Guide

(2000) mixes the words impact

PMBOK® Guide

(2000) mixes the words impact

PMBOK® Guide

and consequences in the discussion on tools and techniques

for qualitative risk analysis under section11.3.2.1. The impact

attribute is defi ned as “the effect on project objectives if the risk

event occurs” (PMI,2000).

To add to the confusion, the meaning of the combined

probability and impact value varies. Depending on the authors’

preference for naming these two risk attributes, the combination

Mitigate (reduce). Sometimes you do not have budget to eliminate a risk or cannnot be eliminated. you cannot accept the risk because of its level.

Knowing and acceptance of the expected risks in the Project and having cover to such Risks.

( reduce ) 

as far as possible

Behind every risk stands an individual or body of individuals. So the first response to mange a risk is to explore  the possibility for dialogue and meetings with the concerned parties. The best tools for successful dialogue is knowledge about related rules and laws, presentation skill and the  ability to project the benefit which would outpace the risks.

1- Time reserves or buffers

2- Contingency reserves of cost

A Risk Management Plan is a document that a project manager prepares to foresee risks, estimate impacts, and define responses to issues. It also contains a risk assessment matrix.

A risk is "an uncertain event or condition that, if it occurs, has a positive or negative effect on a project's objectives."[1] Risk is inherent with any project, and project managersshould assess risks continually and develop plans to address them. The risk management plan contains an analysis of likely risks with both high and low impact, as well as mitigation strategies to help the project avoid being derailed should common problems arise. Risk management plans should be periodically reviewed by the project team to avoid having the analysis become stale and not reflective of actual potential project risks.

Most critically, risk management plans include a risk strategy. Broadly, there are four potential strategies, with numerous variations. Projects may choose to:

• Avoid risk — Change plans to circumvent the problem;
• Control/Mitigate risk; — Reduces impact or likelihood (or both) through intermediate steps;
• Accept risk — Take the chance of negative impact (or auto-insurance), eventually budget the cost (e.g. via a contingency budget line);
• Transfer risk — Outsource risk (or a portion of the risk - Share risk) to third party/ies that can manage the outcome. This is done e.g. financially through insurance contracts or hedging transactions, or operationally through outsourcing an activity.

Sharing (Transfer)