Project Risk Management Page 12
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17Step 5: RISK RESPONSE PLANNING: This step involves figuring out - What
are we going to do about it? It involves finding ways to make the negative
risk smaller or eliminate it entirely, as well as finding ways to make positive
risks more likely or greater in impact. All risk on a project cannot be
eliminated. During this step:
Strategies are agreed upon in advance by all parties
Primary and backup strategies are selected
Risks are assigned to individuals or groups to take responsibility
Strategies are reviewed over the life of the project for
appropriateness as more information about the project becomes
known
RISK OWNER: Each risk must be assigned to someone who will help develop
the risk response and who will be assigned to carry it out or “own” the risk.
The risk owner is then free to take predetermined action when risks occur,
resulting in faster action and less cost, time and other impacts on the
project.
RISK RESPONSE STRATEGIES: developing options and determining actions
to enhance opportunities and reduce threats. This may involve changing the
planned approach to completing the project – e.g. changing to the WBS,
quality plan, schedule and budget. These strategies cannot eliminate all
risk. In each case, communication of risks and strategies is necessary as
apart of the strategy.
The choices include:
AVOIDANCE – eliminate the threat by eliminating the cause
MITIGATION - reduce the probability or the consequences of an
adverse risk and increase the probability or consequences of an
opportunity
ACCEPTANCE – Do nothing and say, “if it happens, it happens”
Active acceptance may involve the creation of contingency plans
and passive acceptance may leave actions to be determined as
needed. A decision to accept a risk must be communicated to
stakeholders.
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