The risk management cycle
Every project is subject to constant change in its business and wider environment. The risk environment is constantly changing too.
The project’s priorities and relative importance of risks will shift and change. Assumptions about risk have to be regularly revisited and reconsidered, for example at each end stage assessment.
The figure to the right and below show the main steps through the risk management cycle.
This step identifies the potential risks (or opportunities) facing the project. It is important not to judge the likelihood of a risk at this early time.This is done in a controlled manner in a later step.
Attempting to form judgements while ‘brainstorming’ a list of potential risks may lead to hurried and incorrect decisions to exclude some risks.
Once identified, risks are all entered in the Risk Log. This contains details of all risks, their assessment, owners and status.
The Risk Log is a control tool for the Project Manager, providing a quick reference to the key risks facing the project, what monitoring activities should be taking place and by whom.
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