Studies have shown that when project managers take the time to incorporate risk management into their projects, the projects tend to become much more successful. As the name suggests, risk management involves the control of the various risk factors which are related to a project. It requires you to not only monitor the project, but take the time to review potential risks, as well as making crucial decisions which involve dealing with potential dangers to the project.

The combination of risk management in conjunction with project management is quite new, particularly when it comes to both software and product development. The PMs must be involved from the beginning of the project until the end.

There are a number of important roles that come with risk management. To understand the importance of risk management, you must develop a deeper understanding of projects themselves. First off, a project is responsible for helping an organization reach its goals.

Projects are defined in a way which allows them to have scopes for work which are quite distinct, and they must have both start and end dates which are agreed upon by those who create it. Project managers are responsible for the creation of fresh roles and responsibilities within risk management. The risk management should be placed within a document, called the project management plan.

There are three important individuals who play a pivotal role in project management, and these people are the software project manager, the software development manager, and the risk owner. The project manager is the person who is directly responsible for making sure the project is successfully executed and completed.

The PM is not only the leader of the project, but is the project manager for its entire duration. This person is heavily responsible for risk management within the project, and they have the ability to approve of any changes which are made in regards to the risk control plans. The role of the software development managers is a bit different from this.

Software Development Manager and Risk Owner

The risk owner is the person who has been picked by the software development manager as being the person who is responsible for controlling and analyzing the risk. In effect, the risk owner actually "owns" the risk so that they can lower the amount of probability while impacting information at the same time.

The risk manager must be capable of creating risk mitigation, as well as contingency plans which will give them the ability to offer status information in regards to any issues which are related to risk. They must also be capable of evaluating the effectiveness of any risk control procedures. The risk owner may document various risk factors, and is responsible for locating new risks.

In many projects, the plan is created for the risk each time the system is developed, and the assessment will generally be taken for that risk. The managers and the other personnel are responsible for creating risk plans for any existing projects, and these plans must be based on data which is historical.

At the same time, many of the risks which will be identified may be forgotten as the team move’s further into the life cycle of the project. These risks will be collected and placed on what is called a watch list, but they are generally not dealt with until they become prevalent issues. To avoid this, every project review must provide status for contingency plans.

Risk Control Attributes

In general, there are three ways in which a risk can be handled, and these are to take actions which are based on the risk, get rid of the risk completely, or simply retire it. They also have the option of monitoring the risk, though this should be done only in situations where the risk doesn’t have a major danger or potential impact.

Teams will typically use a spreadsheet for the purpose developing a risk management plan which captures the data for risk planning, and which offers a method for collecting and reporting the status of the risk. To evaluate risks properly for any given project, one has to do more than simply measure the probability and impact of the risk.