MS Project Management

Project Risk Management

Lecture 1
Introduction Lecture
TABJEEL ASHRAF, PE,PMP, PMI-RMP, Prince2 ® Practitioner
Fulbright / Humphrey Fellow
BSc. (Civil Engg), MSc (Civil Engg), MPM, SPURS, MASC(SCM)
MM (SCM), MM (DEDP)
MPEC,MPMI, MIEP, MASCE
0321-4514025 – tabjeel.a@gmail.com
https://pk.linkedin.com/in/tabjeel-ashraf-341077b
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Instructor Introduction - Academic

▰ MASCSupply Chain Management, MIT, USA

▰ MM Supply Chain Management, MIT, USA
▰ MM Data, Economics & Development Policy, MIT, USA
▰ Special Program of Urban & Regional Studies, DUSP, MIT,
USA
▰ MPM, COMSATS, Islamabad, Pakistan
▰ MSCivil Engineering, UET, Lahore, Pakistan
▰ Bsc Civil Engineering, UET, Lahore
▰ PMP, PMI USA
▰ PMI-RMP®, PMI USA
▰ Prince 2 ® Practitioner
▰ MPEC,MPMI, MIEP, MASCE
▰ Many certifications related to engineering, project
management, supply chain management, procurement
management 2
Instructor Introduction - Professional

▰ 2003-2006: Site / planning Engineer, CB, Gujranwala & Lahore

▰ 2006-2007: Project Engineer, DES, Lahore
▰ 2007-2010: Assistant Director, NHA, Islamabad
▰ 2010-2015: Project Director / Deputy Director, NHA, Islamabad
▰ 2015-2016: Consultant World Bank, USA
▰ 2016-2018: Director, NHA, Islamabad
▰ Since Feb 2018: Director General (Monitoring & Evaluation), GoPb

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 Instructor Introduction - Professional

▰ Ex. CEO, Consultancy Firm

▰ Currently, supervising a portfolio of 9450 Projects of Punjab Government
▰ Has worked in PMOwhich has managed three portfolios of 3000+ projects in NHA in
last five years
▰ Has successfully worked and completed nine (9) Programs
▰ Completed more than 100 projects in Transportation / Highway Planning,
Engineering & Management field in the capacity of individual consultant.
▰ Completed more than 50 projects in Project Management field in the capacity of
individual consultant.
▰ Has worked on three (3) projects with World Bank

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 Instructor Introduction - Teaching

▰ Project Management (MIT, Cambridge, USA)

▰ Project Risk Management (Bahria University, Islamabad)
▰ Construction Project Administration (NUST, Islamabad)
▰ Risk Management in Construction (NUST, Islamabad)
▰ Development & Management of Complex Projects (CIIT, Islamabad)
▰ Development & Management of Complex Projects (VComsats, Islamabad)
▰ Seminars in Project Management (VComsats, Islamabad)
▰ Project Cost Management (Different Institutions)
▰ Project Time Management (Different Institutions)
▰ Pavement Management System in Pakistan (Different Institutions)
▰ Procurement Management of projects (Different Institutions)
▰ MSProject 2007 & Primavera P6 (Different Institutions)
▰ Software Aided Quantitative Risk Analyses (NUST, Islamabad)
*(institutions include, CIIT, Islamabad. NUST, Islamabad. UET, Lahore. PIDE, Islamabad. 5IEP, Islamabad
Chapter. & different project executing government agencies)
PRM Course Conduct

16 Classes @ 3 Hours = 48 Hours

Course Material Available at different

Holistic Subject Perspective
Resources

Exposure to Risk Management body of

Review of Case Studies , Papers
knowledge & Methodology

Assignments, Quizzes , Sessional & Final

Completion of Course Outline
Examination

Excellent Course Text Books

Extensive Class Interaction
Supplemented by Handouts

Theme-Oriented MS PowerPoint All Lectures and Communications in

Presentations English

Guest Speaker and (Possible) Visit to a

Encourage Creative Thinking
Project Site

Research in Risk Management Field for

Extensive Software Trainings
Pakistan Project Management Industry 6
 Rules to be observed

▰ Do listen to lectures very attentively and carefully.

▰ Do ask questions or bring up relevant points for
discussion in the classroom
▰ Be inquisitive, analytical, critical and creative in your
approach to learning project management!
▰ Do read the prescribed course literature
▰ Don‘t be late to class
▰ Don‘t ask me to mark you present if you are going to
be absent in that class 7
 Rules to be observed

▰ Don‘t use cell phones in my class (I literally don‘t like

it)
▰ Don‘t chit-chat among yourselves, Don‘t distract the
attention of other participants
▰ Don‘t miss out on your assignments and
examinations
▰ Don‘t cheat in the sessional, Quizzes, Assignments
or final examinations
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 Recommended Books

Loosemore, M. Raftery, J. Reilly, C. Higgon, D. (2006). Risk Management in Projects. 2nd

Edition. Taylor & Francis, NY.

Smith, N.J. (1999) Managing risk in construction projects. Blackwell Science Ltd. Oxford.

Edwards, P.J. & Bowen, P.A. (2005) Risk Management in Project Organisations. UNSW
Press/Elsevier Science International

Institution of Civil Engineers. (1998). Risk Analysis and Management for Projects.
Thomas Telford Publishing, London.

Kerzner, Harold (2000). Project Management: A System Approach to Planning,

Scheduling, and Controlling. John Wiley & Sons, Inc.
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 Recommended Books

PMBOK 6th Edition, PMI, USA

Practice Standard for Risk Management, PMI, USA

Managing Successful Projects with Prince2. 2017 Edition

The Prince2, from Practitioner to Professional by Colin Bentley, 3rd Edition

HB 436: 2004. Risk Management Guidelines Companion to AS/NZS 4360. Standards

Australia. NSW.

AS/NZS4360 (2004) Risk management. Standards Australia. NSW. ISBN 0-7337-0147-7.

AS/NZS 3931 (1998) Risk analysis of technological systems-application guide.

Standards Australia. NSW. ISBN 0-7337-1711-X. 10
 Assessment of PRM Participants
(Distribution of Course Marks)

▰ 2 x Assignments (10 Marks)

Participants are expected to show that they can convincingly relate concepts discussed
in class with their respective project related professional work. Assignments can be
written in typed form and must be submitted in the next class or due date (if announced).
There is no limit on the length of pages to be submitted (but I like quality more!).

▰ 4 x Quizzes (15 Marks)

At least four quizzes will be conducted with /without mentioning the date and time in
advance. Quizzes may include fill in the blanks or true /false or multiple choice
questions.

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 Assessment of PRM Participants
(Distribution of Course Marks)

▰ 1 x Mid TermExamination (30 Marks)

Participants are expected to demonstrate a basic under standing of project risk
management and all subject material covered in class until the time of the examination,
which is of 1-2 hours duration. There shall be 2-3 questions in this examination. All
questions are mandatory.

▰ 1 x TermPaper / Research Proposal (5 Marks)

Each participants will work on a term paper. Term paper can be in the form of a project
report or preparation of a research proposal. Each student will present his/her term
paper. Submission of the term paper is one week in advance of the presentation. Length
of a term paper may range from 15 to 25 pages maximum.

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 Assessment of PRM Participants
(Distribution of Course Marks)

▰ Class Participation / Presentations (Bonus Marks)

Each participants will deliver one to two presentations on the assigned topic by the
instructor. Presentation may also be delivered in groups comprising of 4 students
maximum. Also students may be asked to write half page paper review and submit /
present / discuss.

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 Assessment of PRM Participants
(Distribution of Course Marks)

▰ End Semester Examination/Final Exam(40 Marks)

Participants will be required to creatively apply their PRM knowledge to answer five
mandatory questions, each carrying equal marks. In preparing for this two-hour long
examination, note that the entire course material is relevant and that the questions asked
may relate to any part of it. PRM participants who demonstrate excellent command over
all areas of the course and who can present innovative ideas and approaches to problem
situations can expect to perform very well in this examination which, given its weightage,
will primarily determine the PRM participant‘s overall GPA. Do not underestimate the
difficultylevel of this examination!

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Basic Terminology

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Basic Terminology

▰ Risk Many definitions for these

▰ Project Risk words have been proposed.

▰ Project Risk Management

▰Project Assumption Sample definitions along
with practical examples are
▰Project Fact contained in the following
slides.

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 What is a Risk?

Risk is a concept that denotes a potential

negative impact to some characteristic of value
that may arise from a future event, or we can say
that "Risks are events or conditions that may
occur, and whose occurrence, if it does take
place, has a harmful or negative effect”.

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What is a Project Risk?

Project risk is an uncertain event or condition

that, if it occurs, has a positive or a negative
effect on a project’s objectives.

(Practice Standard for Risk Management, PMI, USA)

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Project Risk Defines by Prince2

A risk is an uncertain event or set of events that,

should it occur, will have an effect on the
achievements of objectives.

(Managing Successful Projects by Prince 2, 2009 Edition)

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Dimension of Risk

This Risk definition includes two key

dimensions of risk:
I. uncertainty and
II. effect on a project’s objectives.
The uncertainty dimension may be
described using the term “probability”
and the effect may be called “impact”
(though other descriptors are
possible, such as “likelihood” and
“consequence”).
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 Individual Project Risk

Individual Project Risk is an uncertain event or

condition that, if it occurs, has a positive or negative
effect on one or more project objectives.
Project Risk Management aims to exploit or enhance
positive risks (opportunities) while avoiding or
mitigating negative risks (threats).
Unmanaged threats may result in issues or problems
such as delay, cost overruns, performance shortfall,
or loss of reputation.
Opportunities that are captured can lead to benefits
such as reduced time and cost, improved
performance, or reputation.
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 Individual Risks

Understanding individual risks can

assist in determining how to apply
effort and resources to enhance the
chances of project success.
Day-to-day Project Risk
Management focuses on these
individual risks in order to enhance
the prospects of a successful
project outcome.
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 Overall Project Risk

Overall Project Risk represents

the effect of uncertainty on the
project as a whole, arising
from all sources of uncertainty
including individual risks.
Overall project risk represents
the exposure of stakeholders
to the implications of
variations in project outcome,
both positive and negative.
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Overall Project Risk

Management of overall project risk aims to keep

project risk exposure within an acceptable range
by reducing drivers of negative variation,
promoting drivers of positive variation, and
maximizing the probability of achieving overall
project objectives.
It is an important component of strategic decision-
making, program and portfolio management, and
project governance where investments are
sanctioned or cancelled and priorities are set.
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Threat & Opportunity

Project Risk may have Negative or Positive effect

on project’s objectives, if they occur.

Threat: For uncertain events that would have a

negative impact on objectives.

Opportunity: For uncertain events that would

have a positive impact on objectives.
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Non-Event Risks

Non-event risks need to be identified and managed. There are

two main types of non-event risks:
i. Variability Risk: Uncertainty exists about some key characteristics of
a planned event or activity or decision.
Examples: productivity may be above or below target, the number of errors
found during testing may be higher or lower than expected, or unseasonal
weather conditions may occur during the construction phase.
ii. Ambiguity Risk: Uncertainty exists about what might happen in the
future.
Example: the project where imperfect knowledge might affect the project’s
ability to achieve its objectives include: elements of the requirement or
technical solution, future developments in regulatory frameworks,
or inherent systemic complexity in the project. 26
Risk is UNAVOIDABLE

 There is always at least some level of uncertainty in a

Project’s outcome.

 Technological and Social Projects are particularly

risky.

 Risks on Technological and Social Projects are

significant, and their numbers and severity increases.
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The Context of Risk

Risk is contextual:
a. It arises in the context of a person or
organisation.
b. It arises in the context of a situation.
c. It arises in the context of an objective, a task
or a commitment.
One person’s (organization's) risk threat may be
another’s risk opportunity.
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Project Risk Management

The objectives of Project Risk Management are to

increase the probability and impact of positive
events, and decrease the probability and impact
of negative events in the project.

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Project Assumption

There may be external circumstances or events

that must occur for the project to be successful.

If you believe such an event is likely to happen,

then it would be an assumption (contrast with the
definition of a risk).

Example of assumption is “budgets and resources

will be available when needed”
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Project Fact

If an event is within the control of the project

team, such as having pile testing complete by a
certain date, it is not an assumption. It is part of
the approach.

If an event has a 100%chance of occurring, it not

an assumption, since there is not 'likelihood' or
risk involved. It is just a fact.

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Risk

There may be external circumstances or events

that must not occur for the project to be
successful.

If you believe such an event is probable, then it

would be a risk. (Contrast with the definition of an
assumption.)

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 Risk Management Processes

Project Risk Management

processes are as follows:

▰ Plan Risk Management

▰ Identify Risks
▰ Perform Qualitative Risk Analysis
▰ Perform Quantitative Risk Analysis
▰ Plan Risk Responses
▰ Implement Risk Responses
▰ Monitor Risks 33
 END NOTE

“ Those who cannot remember the

past are condemned to repeat it

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THANKS!
Any questions?

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