PMP® EXAM
KNOWLEDGE AREA
RISK
MANAGEMENT
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OVERVIEW
Risk management is essential in project management,
involving the identification, analysis, and response to
risks.
While the core principles are the same, the approach
and implementation differ between Agile and Waterfall
methodologies
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IN WATERFALL
Plan>Identify>Analyse>Response>Monitor&Control
In Waterfall projects, risk management is comprehensive
and heavily front-loaded. Risks are identified early in the
project planning phase and meticulously documented in
a risk register. The risk response strategies avoid,
transfer, mitigate, accept are crafted early on and
monitored throughout the project's lifecycle.
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DETAILS
Planning
A formal Risk Management Plan is developed upfront.
Identify
Risks are identified upfront during planning.
Analysis
A structured, quantitative approach prioritizes risks
initially based on their potential impact.
Response Planning
Strategies (avoid-transfer-mitigate-accept) are
developed early and documented in the Risk
Management Plan.
Monitor & Control
Conducted through periodic reviews and meetings to
track identified risks.
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RISK MANAGEMENT
PLAN
In Waterfall, a Risk Management Plan is a formal
document that outlines how risks will be identified,
assessed, and managed throughout a project. It serves
as a roadmap for the project team to ensure that risks
are systematically addressed. The Risk Management Plan
is crucial for ensuring that the project team remains
proactive in addressing risks, thus minimizing their
impact on project objectives.
The Risk Management Plan is typically developed during
the project planning phase.
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IN AGILE
Plan>Identify>Analyse>Response>Monitor&Control
In Agile projects, risks are managed continuously and
iteratively. Each sprint brings new insights, and the
project team can quickly adapt to emerging risks. Agile
promotes adaptive risk management, real-time risk
identification and mitigation, and collaboration between
the team and stakeholders ensures swift action.
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DETAILS
Planning
While there isn't a formal Risk Management Plan, Agile
incorporates risk management through continuous
identification and collaboration.
Identify
Ongoing identification occurs throughout the project
lifecycle.
Analysis
Focuses on qualitative insights, adapting as new risks
emerge.
Response Planning
Strategies evolve dynamically with each sprint, allowing
for adaptive responses.
Monitor & Control
Integrated into daily stand-ups and sprint reviews for
real-time adjustments.
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RISK ADJUSTED
BACKLOG
A Risk-Adjusted Backlog is a vital tool in Agile risk
management that integrates risk considerations into the
product backlog, allowing teams to prioritize user stories
and tasks based on value and risks. By assessing risks
during sprint planning and backlog refinement, teams
can elevate high-risk items, ensuring they are addressed
proactively alongside valuable features. This approach
enhances visibility into challenges, promotes informed
decision-making, and fosters better communication with
stakeholders, enabling Agile teams to navigate
uncertainty while delivering quality results.
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