Risk Management Plan Page 7
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10strategies that cost less than risk probability calculation should be given serious consideration.
The possible response options are:
• Avoidance – Change the project to avoid the risk. Change scope, objectives, etc.
• Transference – Shift the impact of a risk to a third party (like a subcontractor). It does not
eliminate it, it simply shifts responsibility.
• Mitigation – Take steps to reduce the probability and/or impact of a risk. Taking early action,
close monitoring, more testing, etc.
• Acceptance – Simply accept that this is a risk. When choosing acceptance as a response the
IMPD is stating that given the probability of occurring and the associated impact to the project
that results, they are not going to take any actions and will accept the cost, schedule, scope, and
quality impacts if the risk event occurs.
• Deferred – A determination of how to address this risk will be addressed at a later time. The
results of the risk assessment process are documented in each Risk Statement and summarized in
the Risk Register which will be reported on a monthly basis.
2.5 Risk Mitigation
Risk mitigation involves two steps:
• Identifying the various activities, or steps, to reduce the probability and/or impact of an adverse
risk.
• Creation of a Contingency Plan to deal with the risk should it occur.
Taking early steps to reduce the probability of an adverse risk occurring may be more effective
and less costly than repairing the damage after a risk has occurred. However, some risk
mitigation options may simply be too costly in time or money to consider.
Mitigation activities should be documented in the Risk Register, and reviewed on a regular basis.
They include:
• Identification of potential failure points for each risk mitigation solution.
• For each failure point, document the event that would raise a “flag” indicating that the event or
factor has occurred or reached a critical condition.
• For each failure point, provide alternatives for correcting the failure.
2.6 Risk Contingency Planning
Contingency planning is the act of preparing a plan, or a series of activities, should an adverse
risk occur. Having a contingency plan in place forces the project team to think in advance as to a
course of action if a risk event takes place.
• Identify the contingency plan tasks (or steps) that can be performed to implement the mitigation
strategy.
• Identify the necessary resources such as money, equipment and labor.
• Develop a contingency plan schedule. Since the date the plan will be implemented is unknown,
this schedule will be in the format of day 1, day 2, day 3, etc., rather than containing specific
start and end dates.
• Define emergency notification and escalation procedures, if appropriate.
• Develop contingency plan training materials, if appropriate.
• Review and update contingency plans if necessary.
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