Managing Uncertainty and Risk on the Project - Revision history

Tkokotas at 15:25, 18 December 2018

2018-12-18T15:25:33Z

← Older revision		Revision as of 15:25, 18 December 2018
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			''Developed by Daniel Agervig Krogh''


	One of the most challenging aspects in projects is to manage the risk and the uncertainty. Yet with the knowledge we possesses, it is a topic, which for many is difficult to handle. Many stakeholders are involved in the projects and therefore might have different opinions of what is the best solution approach is. The majority of people tends to think in deterministic terms of an optimal solution instead of probabilistic terms of a robust solution. This article will highlight the main differences of the risks and the uncertainties, which relates to ([https://en.wikipedia.org/wiki/Project_management Project management]. The risk management processes will be clarified in its four stages, where the identification of the problem, assessment of the risks, how to respond to the risks and lastly how to control the risks. To assess the risks, a risk-management process tool will be utilized and further explained and management a tool, impact/probability matrix, will be applied to be a part of the process.		One of the most challenging aspects in projects is to manage the risk and the uncertainty. Yet with the knowledge we possesses, it is a topic, which for many is difficult to handle. Many stakeholders are involved in the projects and therefore might have different opinions of what is the best solution approach is. The majority of people tends to think in deterministic terms of an optimal solution instead of probabilistic terms of a robust solution. This article will highlight the main differences of the risks and the uncertainties, which relates to ([https://en.wikipedia.org/wiki/Project_management Project management]. The risk management processes will be clarified in its four stages, where the identification of the problem, assessment of the risks, how to respond to the risks and lastly how to control the risks. To assess the risks, a risk-management process tool will be utilized and further explained and management a tool, impact/probability matrix, will be applied to be a part of the process.

DanielKrogh: /* Application */

2015-09-28T21:34:34Z

Application

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	== Application ==		== Application ==
	[[File:Matrix.jpg\|300px \| thumb\|right \|'''Figure 6:''' A stakeholder matrix, mapping stakeholders by their power and interest, towards a project. <ref name="Construction"> Winch Graham M. (2010) ''Managing Construction Projects” An Information Processing Approach'', Second edition, PP. 3-8 and PP. 346-366</ref>]]		[[File:Matrix.jpg\|300px \| thumb\|right \|'''Figure 6:''' A stakeholder matrix, mapping stakeholders by their power and interest, towards a project. <ref name="Construction"> Winch Graham M. (2010) ''Managing Construction Projects” An Information Processing Approach'', Second edition, PP. 3-8 and PP. 346-366</ref>]]
			This section will guide the reader through the different stages there is when using the impact/probability matrix tool. The tool is being used every day whether either consciously or unconsciously.
	The purpose of impact/probability matrix is used to rank the risk sources, risk events and the treatments based on the level of the risk. <ref name="Assessment"> (2009) “ISO 31010” – Risk Assessment Techniques, Edition 1.0 </ref> It is a common tool when screening a project for many risks which makes it is easier for the management team to plan how and when to handle the risk sources and risk events. The tool is illustrated in Figure 6.		The purpose of impact/probability matrix is used to rank the risk sources, risk events and the treatments based on the level of the risk. <ref name="Assessment"> (2009) “ISO 31010” – Risk Assessment Techniques, Edition 1.0 </ref> It is a common tool when screening a project for many risks which makes it is easier for the management team to plan how and when to handle the risk sources and risk events. The tool is illustrated in Figure 6.
	The tool is also a great when it comes to communication. It helps the organization with the decision about the risk appetite on the specific project.		The tool is also a great when it comes to communication. It helps the organization with the decision about the risk appetite on the specific project.

DanielKrogh: /* Strengths and Limitations */

2015-09-28T21:31:22Z

Strengths and Limitations

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	=== Strengths ===		=== Strengths ===
	The tool is an easy tool to use and does not need to educate the users to use it in practice. It gives a good overview of the risks and therefore makes it easier to scrutinise the project to a desired level.		The tool is an easy tool to use and does not need to educate the users to use it in practice. It gives a good overview of the risks and therefore makes it easier to scrutinise the project to a desired level.
	Moreover, it is a good tool to communicate with when it comes to decision making about what to do regarding the different risk sources that might occur.		Moreover, it is a good tool to communicate with when it comes to decision making about what to do regarding the different risk sources that might occur. <ref name="Assessment"></ref>

	=== Limitations ===		=== Limitations ===

DanielKrogh: /* Strengths */

2015-09-28T21:29:23Z

Strengths

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	=== Strengths ===		=== Strengths ===
	The tool is an easy tool to use and does not need to educate the users to use it in practice. It gives a good overview of the risks and therefore makes it easier to scrutinise the project to a desired level.		The tool is an easy tool to use and does not need to educate the users to use it in practice. It gives a good overview of the risks and therefore makes it easier to scrutinise the project to a desired level.
	It is a good tool to communicate with when it comes to decision making about what to do regarding the different risk sources that might occur.		Moreover, it is a good tool to communicate with when it comes to decision making about what to do regarding the different risk sources that might occur.

	=== Limitations ===		=== Limitations ===

DanielKrogh: /* Strengths and Limitations */

2015-09-28T21:29:08Z

Strengths and Limitations

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	== Strengths and Limitations ==		== Strengths and Limitations ==

	=== Strengths ===		=== Strengths ===
	The tool is an easy tool to use and does not need to educate the users to use it in practice. It gives a good overview of the risks and therefore makes it easier to scrutinise the project to a desired level.		The tool is an easy tool to use and does not need to educate the users to use it in practice. It gives a good overview of the risks and therefore makes it easier to scrutinise the project to a desired level.
			It is a good tool to communicate with when it comes to decision making about what to do regarding the different risk sources that might occur.

	=== Limitations ===		=== Limitations ===

DanielKrogh: /* Strengths and Limitations */

2015-09-28T21:27:03Z

Strengths and Limitations

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	== Strengths and Limitations ==		== Strengths and Limitations ==
			=== Strengths ===
	The tool is an easy tool to use and does not need to educate the users to use it in practice. It gives a good overview of the risks and therefore makes it easier to scrutinise the project to a desired level.		The tool is an easy tool to use and does not need to educate the users to use it in practice. It gives a good overview of the risks and therefore makes it easier to scrutinise the project to a desired level.
	A matrix can be design for different purposes, which is why the same tool exists in different forms depending on which kind of project it is. It is hard to make a common matrix that fits every project, and can therefore have limitations if uses the tool wrong. The scales can be understood differently and therefore the ratings/decisions can vary depending on who is rating the consequences and impact on the project. Another limitation on the tool is that if a low impact risk is being repeated, then the level of impact can be a medium impact but the tool does not consider those elements on a project.

			=== Limitations ===
			A matrix can be design for different purposes, which is why the same tool exists in different forms depending on which kind of project it is.
			It is hard to make a common matrix that fits every project, and can therefore have limitations if uses the tool wrong. The scales can be understood differently and therefore the ratings/decisions can vary depending on who is rating the consequences and impact on the project. Another limitation on the tool is that if a low impact risk is being repeated, then the level of impact can be a medium impact but the tool does not consider those elements on a project.
	The results differs depending on how detailed the analysis is. The more detailed the scenarios are, the lower is the risk event to actually occur. It is for this important for the raters to define the risk and which factors that applies. <ref name="Assessment"></ref>		The results differs depending on how detailed the analysis is. The more detailed the scenarios are, the lower is the risk event to actually occur. It is for this important for the raters to define the risk and which factors that applies. <ref name="Assessment"></ref>

DanielKrogh: /* Definition */

2015-09-28T21:13:20Z

Definition

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	== Definition ==		== Definition ==
	[[File:Billede_1.jpg\|300px\|thumb\|right\|'''Figure 1:''' The relationship between risk, uncertainty and the opportunities <ref name="Elec"> Yu Shiwang, Guo Na (2013) ''Lecture Notes in Electrical Engineering'', Vol.218 PP.815-822</ref>]]		[[File:Billede_1.jpg\|300px\|thumb\|right\|'''Figure 1:''' The relationship between risk, uncertainty and the opportunities <ref name="Elec"> Yu Shiwang, Guo Na (2013) ''Lecture Notes in Electrical Engineering'', Vol.218 PP.815-822</ref>]]
	Risk and uncertainty has many different definitions and can be hard to settle down to only one way to define it. Risk management had their origins in the insurance industry in USA in the 1940s. ~~([https://en.wikipedia.org/wiki/Project_management~~ Project management]) can be explained as a discipline where projecting or planning, organizing, motivating and controlling resources to achieve specific goals and meet the specific criteria’s. When talking about risk, people often link it together with uncertainty, while others refer to it as opportunity. Risk can also be defined as a combination of the probability of an event and its consequences. There is a relationship between risk, uncertainty and opportunities. This is illustrated in Figure 1. <ref name="Elec"> Yu Shiwang, Guo Na (2013) ''Lecture Notes in Electrical Engineering'', Vol.218 PP.815-822</ref>		Risk and uncertainty has many different definitions and can be hard to settle down to only one way to define it. Risk management had their origins in the insurance industry in USA in the 1940s. Project management can be explained as a discipline where projecting or planning, organizing, motivating and controlling resources to achieve specific goals and meet the specific criteria’s. When talking about risk, people often link it together with uncertainty, while others refer to it as opportunity. Risk can also be defined as a combination of the probability of an event and its consequences. There is a relationship between risk, uncertainty and opportunities. This is illustrated in Figure 1. <ref name="Elec"> Yu Shiwang, Guo Na (2013) ''Lecture Notes in Electrical Engineering'', Vol.218 PP.815-822</ref>

	The definition of uncertainty is:		The definition of uncertainty is:

DanielKrogh at 21:12, 28 September 2015

2015-09-28T21:12:57Z

← Older revision		Revision as of 21:12, 28 September 2015
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	One of the most challenging aspects in projects is to manage the risk and the uncertainty. Yet with the knowledge we possesses, it is a topic, which for many is difficult to handle. Many stakeholders are involved in the projects and therefore might have different opinions of what is the best solution approach is. The majority of people tends to think in deterministic terms of an optimal solution instead of probabilistic terms of a robust solution. This article will highlight the main differences of the risks and the uncertainties, which relates to ~~project~~ management. The risk management processes will be clarified in its four stages, where the identification of the problem, assessment of the risks, how to respond to the risks and lastly how to control the risks. To assess the risks, a risk-management process tool will be utilized and further explained and management a tool, impact/probability matrix, will be applied to be a part of the process.		One of the most challenging aspects in projects is to manage the risk and the uncertainty. Yet with the knowledge we possesses, it is a topic, which for many is difficult to handle. Many stakeholders are involved in the projects and therefore might have different opinions of what is the best solution approach is. The majority of people tends to think in deterministic terms of an optimal solution instead of probabilistic terms of a robust solution. This article will highlight the main differences of the risks and the uncertainties, which relates to ([https://en.wikipedia.org/wiki/Project_management Project management]. The risk management processes will be clarified in its four stages, where the identification of the problem, assessment of the risks, how to respond to the risks and lastly how to control the risks. To assess the risks, a risk-management process tool will be utilized and further explained and management a tool, impact/probability matrix, will be applied to be a part of the process.

	== Definition ==		== Definition ==

DanielKrogh: /* Practice of managing risk and uncertainty */

2015-09-28T21:11:17Z

Practice of managing risk and uncertainty

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	* Respond to the risks sources and decide what to do about them if they occurs.		* Respond to the risks sources and decide what to do about them if they occurs.
	* Control the risks throughout the whole project, so that they have minimum impact on the project.		* Control the risks throughout the whole project, so that they have minimum impact on the project.
	The process is like a loop learning model, where it is a process through time.		The process is like a loop learning model, where it is a process through time. <ref name="Construction"></ref>

	<div style="clear:both"> </div>		<div style="clear:both"> </div>

DanielKrogh: /* Strengths and limitations */

2015-09-28T21:10:00Z

Strengths and limitations

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	All the observations during the project should be recorded so that it can be evaluated what went good and bad. This could help the organization in the future projects and also improve the management culture. <ref name="Principles"> </ref>		All the observations during the project should be recorded so that it can be evaluated what went good and bad. This could help the organization in the future projects and also improve the management culture. <ref name="Principles"> </ref>

	== Strengths and ~~limitations~~ ==		== Strengths and Limitations ==
	The tool is an easy tool to use and does not need to educate the users to use it in practice. It gives a good overview of the risks and therefore makes it easier to scrutinise the project to a desired level.		The tool is an easy tool to use and does not need to educate the users to use it in practice. It gives a good overview of the risks and therefore makes it easier to scrutinise the project to a desired level.
	A matrix can be design for different purposes, which is why the same tool exists in different forms depending on which kind of project it is. It is hard to make a common matrix that fits every project, and can therefore have limitations if uses the tool wrong. The scales can be understood differently and therefore the ratings/decisions can vary depending on who is rating the consequences and impact on the project. Another limitation on the tool is that if a low impact risk is being repeated, then the level of impact can be a medium impact but the tool does not consider those elements on a project.		A matrix can be design for different purposes, which is why the same tool exists in different forms depending on which kind of project it is. It is hard to make a common matrix that fits every project, and can therefore have limitations if uses the tool wrong. The scales can be understood differently and therefore the ratings/decisions can vary depending on who is rating the consequences and impact on the project. Another limitation on the tool is that if a low impact risk is being repeated, then the level of impact can be a medium impact but the tool does not consider those elements on a project.