**6.5 Monitoring and controlling risks: inputs**

Inputs to monitoring and controlling of risks are presented in **Table 11**.

*6.5.1 Monitoring and controlling risks: tools and techniques*

Tools and Techniques for monitoring and controlling risks are furnished in **Table 12**.


#### **Table 8.**

*Strategies for mitigating negative risks.*


#### **Table 9.**

*Risk mitigation strategies for positive risks/opportunities.*


#### **Table 10.**

*Contents of risk response: outputs.*


**195**

*Process of Risk Management*

Earned value analysis

Technical performance measurement

*Source: [11].*

**Table 12.**

*DOI: http://dx.doi.org/10.5772/intechopen.80804*

**Parameter Explanation**

**7. Benefits with risk management**

*Monitoring and controlling risks: tools and techniques.*

adequat**e**

supported on a more genuine basis

• To maximise the efficiency of risk management, the risk management process

Risk reassessment Monitoring and controlling of risks will result in identification of new risks,

Risk audits The purpose of risk audits is to examine and document the effectiveness of

may indicate potential impact of threat/opportunities.

Reserve analysis This compares the amount of contingency reserves available at any time to the

Status meetings Project risk management should be an agenda item at all status review meetings. The

degree of technical risk faced by the project

reassessment of current risks and closing of risks that are not a threat to project. Project risk assessment is to be performed regularly. The frequency and depth of assessment depends on how the project progresses relative to the objectives.

risk responses in dealing with identified risks and their root causes as well as effectiveness of the risk management process meetings. A separate risk audit meeting may be held or it may be included in routine project review meetings.

Variance analysis is done by comparing the planned results with actual. Trends in execution of a project are reviewed using performance information and based on earned value analysis, deviation from cost and schedule targets is determined which

This measures technical accomplishments during project execution and will help in forecasting degree of success in achieving the project scope and it may expose the

amount of risk remaining in the project to determine whether the reserves are

amount of time for any item will depend on risks that have been identified, their priority and difficulty of response. Frequent discussions about risk make it more likely that concerned stakeholders will identify risks and opportunities.

• The benefits from risk management finally go to the stakeholders involved. A clear understanding and awareness of potential risks in the project contributes to better management of risks by suitable mitigation techniques. Another benefit of working with risk management is increased level of control over the whole project and more efficient problem solving processes which can be

• Risk management when conducted effectively, reduce sudden surprises. The advantage with risk management is that the stakeholders are aware as to the risk that they have to bear among all the risks that have been identified in a project and can prepare themselves accordingly, should any eventuality occur. No doubt, this formal exercise may translate into extra cost for an activity, but if taken in holistic manner, the benefits will far outweigh the costs. This has another advantage in that there is no passing of buck as risks are either shared/ retained or transferred depending upon the ability of the stakeholder to handle the risk. The three approaches to risk management are normally risk natural firm which does not invest much in risk management but is still aware of important risk, risk averse firm where no investments are made and the last one is risk seeker wherein the organisation is prepared to face all risks and is often called gambler. The outcome of the objectives of project naturally depends upon

the path adopted by the firms in their approach to risk management.

should be continuously developed during the entire project.

#### **Table 11.** *Monitoring and controlling risks—inputs.*


#### **Table 12.**

*Perspectives on Risk, Assessment and Management Paradigms*

Exploit This strategy is selected for risks with positive impacts where the organisation wishes to

completion or providing at a lower cost than originally planned Share Sharing a positive risk involves allocating some or all of the ownership of the opportunity

Enhance This strategy is used to enhance the positive impact of an opportunity. Identifying and

Accept Accepting an opportunity means willing to take advantage if it comes along, but not

adding more resources to an activity for completing it before scheduled time

1 Identified risk. Their descriptions, areas of project affected, their causes and how they affect project

6 Fallback plans as a reaction to a risk that has occurred and primary response proved to be inadequate 7 Contingency reserves to be calculated based on quantitative risk analysis of the project and the

Risk register The key inputs to risk register includes identified risks and owners of risk, agreed

forecasting the likely date of completion of project

upon risk responses, specific actions to be implemented, symptoms/warning signs of any risk, residual/secondary risks, list of low priority risks and contingency measures

The risk management plan should contain risk tolerances, assignment of manpower including bearer of risk, time and other resources to project risk management

Work performance information related to various performance results is to be quantified in terms of deliverable status, schedule progress and costs incurred.

Performance reports will be analysed for variance analysis, earned value data and

3 Prioritised list of project risks based on the outputs from quantitative analysis reports 4 Agreed upon response strategies and specific actions taken to implement the strategy

sharing, joint ventures, etc. are examples of this strategy

ensure that the opportunity is realised. This strategy seeks to eliminate the uncertainty associated with a particular risk by ensuring that the opportunity is exploited. **Examples** are assigning the most talented resources of the organisation to the project to reduce the time for

to a third party capable of capturing the opportunity for the benefit of the project. Risk

maximising key drivers of risks may increase their probability of occurrence. **Examples** are

Some responses are designed for implementation only if certain events occur. It is appropriate for the project team to prepare a contingency response plan that will be executed under certain predefined conditions if there will be sufficient warning to implement the plan

Expert judgement is from knowledgeable individuals pertaining to the actions to be taken on

**Description**

pursuing it actively.

*Source: Project Risk Management, Van Well Stam et al. 2008.*

*Risk mitigation strategies for positive risks/opportunities.*

2 Risk owners and assigned responsibilities

threshold risk of the organisation.

5 Triggers, symptoms and warning signs of risks occurrence

in terms of time/cost

a specific and a defined risk.

**Risk mitigation strategy**

Contingent response strategies

Expert judgement

**Table 9.**

**Sl. No**

**Table 10.**

**Contents**

objectives

*Contents of risk response: outputs.*

Risk management

Work performance information

Performance reports

plan

*Source: [10].*

**Table 11.**

**Parameter Inputs**

*Monitoring and controlling risks—inputs.*

**194**

*Monitoring and controlling risks: tools and techniques.*
