Risk Action Plan or Risk Resolution
The last section of the risk management plan details the actions or steps to be taken when a risk is identified. For this section review the risk items with high rankings from Section 3 and determine if the significant risks will be accepted, transferred, or mitigated.
With the acceptance approach, no effort is made to avoid the risk item. This approach is usually employed because the risk items are the result of external factors over which you have no direct control. You can plan contingencies in case the risk does occur. Thus, the project team has a backup plan to minimize the effects of the risk event. Or you can take no action and accept responsibility if the risk event does indeed occur. In cases where risk resolution is adopted and changes made to a project plan, it is followed up with a Project Change Management document. In case external risks are foreseen as possibilities, there should be a Project Disaster Recovery Plan.
With the transfer approach, the objective is to reduce risk by transferring it to another entity that can better bear it. Two methods of transferring risk are the use of insurance and the alignment of responsibility and authority.
With the mitigation approach, emphasis is on actually avoiding, preventing, or reducing the risk. Some risks can be avoided by reducing the number of requirements or defining them more completely. For example, careful definition of the scope of a project can avoid the possible consequence of “scope creep," or indecisive, protracted, and uncertain scope objectives.
In this section, identify and describe in detail the actions that will be taken to transfer or mitigate risks that are prioritized as high. These actions should ultimately result in the reduction of project risk and should directly affect the project management plan and the metrics used for the project. Activities for reducing the effects of risk will require effort, resources, and time just like other project activities.
The risk management plan will need to be monitored and updated throughout the project life-cycle. With careful planning and execution the effective steps in a risk management plan can save any organization time and money.
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