Knowledge Area: Project Risk Management 

Risks are uncertain events which may occur during the project BRINGING about a POSITIVE or negative impact on the project OBJECTIVES of scope, time, cost and quality. If the event brings a positive impact, they are referred to as positive risks or opportunities, and if the event brings a negative impact, they are referred to as negative risks or threats.

Risks are potential future events or situations which may occur during the project life cycle. Managing such events proactively is critical to manage the project SUCCESSFULLY. Risk management will thus include maximising the opportunities and minimising the threats.

Risk management steps will include the following:

• Identify risks
• Analyse risks (their probability and impact)
• Prioritize risks
• Develop risk responses proactively for opportunities and threats

A risk REGISTER document is prepared which contains all the risk events, their probability and impact, ranking and response plan for each of the risk event. The risk register document becomes an important reference for completing the overall project schedule and cost estimates.

For better understanding of Project Risk Management, refer: Project risk management