**7. Discussion**

#### 1. Findings

The paper presented three heuristic algorithms for risk response selection. In many cases, the ranking of risks is not enough for project managers and they need to know how to invest their risk management budget among the possible responses. We observe that for a limited budget the BSR algorithm is better than the MDR or MPR method, while for a budget that can cover all the risks, the MDR or MPR are better. Currently, in most projects, the customer asks to see the risk management plan. The above method adds the selection method of risks to be mitigated. It should be an essential part of the risk management plan.

A stronger result is that *risk ranking is no longer needed*. This saves the effort of ranking risks, which is usually subjective.

#### 2. Limitations

64 Risk Management – Current Issues and Challenges

**Figure 1.** The savings of each algorithm regarding the limited budget

**Table 6.** Distribution of success of each algorithm

**7. Discussion** 

0.000

50.000

100.000

150.000

**Accumulated Savings**

200.000

250.000

300.000

which is usually subjective.

1. Findings

The main conclusion from Table 6 is that there is no optimal heuristic algorithm. Moreover, if only part of the risks budget can be handled, it is recommended to use the BSR algorithm.

0.000 10.000 20.000 30.000 40.000 50.000 60.000 70.000 80.000

**Budget**

Algorithm 20% 40% 60% 80% 100%

Percentage of budget investment

BSR MDR MPR

MDR 0 0 0 0 1 MPR 4 3 7 23 97 BSR 96 97 93 77 2

The paper presented three heuristic algorithms for risk response selection. In many cases, the ranking of risks is not enough for project managers and they need to know how to invest their risk management budget among the possible responses. We observe that for a limited budget the BSR algorithm is better than the MDR or MPR method, while for a budget that can cover all the risks, the MDR or MPR are better. Currently, in most projects, the customer asks to see the risk management plan. The above method adds the selection method of risks

A stronger result is that *risk ranking is no longer needed*. This saves the effort of ranking risks,

to be mitigated. It should be an essential part of the risk management plan.

One limitation of the current paper is that estimating the probabilities and damages for each risk and response is usually considered to be a very difficult task. However, it is required by most of the risk management standards. Tools, like mathematical models and simulations, are available for this task and there are already many projects that include these estimations.

Another limitation is that we assume that responses with a negative expected savings cannot be selected. However, in reality, there are responses, like insurance, that are based on negative expected savings (otherwise, insurance company would not sell insurance policies).

A third limitation is the dependencies among risks. It might be that a delay in one task is not critical, while a delay in a second task, together with delay in the first task, might prove to be a severe problem.
