Risk assessment is a critical aspect of a project. Although difficult, it becomes manageable and easier when a form is used to identify, document and analyze the potential risks that may surface up during the project execution.
Risk, which is often equated with uncertainty and constraints, cannot be completely removed. However, a thorough understanding of the risks using a risk assessment form helps in finding propositions to subdue the risks to a great extent.
Get a Handle on Your Risks
Risk assessment offers a way to document and understand the risks that are likely to retard or stop the project from continuing normally. The risk assessment form is a tool that helps in determining the intensity of the risk in terms of the probability of occurrence and the impact of the risk. Accordingly, the project team can redirect its efforts to either completely prevent the occurrence or to reduce the impact of the risk.
By and large, risk assessment forms are used only when someone in the project team points towards a likely risk, but it’s always advisable to use this form as a customary part of the project management process. Early identification of the risks allows timely risk mitigation.
The risk assessment form contains not only the list of tentative risks and details regarding their likelihood and impact, but also information on what proactive measures can be taken to substantially reduce the risks and their impact. Here is a list of the things that must be recorded in the risk assessment form:
- The area, part of phase of the project for which a risk has been identified.
- The type of risk and who or what all things will suffer from the risk.
- The probability of occurrence and the intensity of the impact of the risk.
- The preventive measures that can nullify or reduce the impact intensity and the occurrence probability of the risk.
Sample Risk Assessment Form
To understand how to fill up a risk assessment form, a sample risk assessment form template can be downloaded for free from Bright Hub's Project Management Media Gallery at the following location: Risk Assessment Form
Here are the details you will be required to fill in into the risk assessment form:
Problem Area or Activity: The phase, area or activity that is likely to face risks.
Risks Identified: A list of the likely risks associated with each of the activities identified in column one.
Description: A short description of the kind of risk and the possible damages it can cause.
Probability of Occurrence:The risks can be categorized as very likely, probable and unlikely based on the likelihood of these risks cropping up, where
- Likely means 70-100% chances of its occurrence
- Probable means 30-70% chances and
- Unlikely can be used for risks which have less than 30% chance of occurrence.
Impact Intensity: The impact intensity of the risk can be categorized as High, Medium and Low depending on how critical the risk and its effects can be.
Priority: Based on the probability of occurrence then the intensity of the impact, the risk factors can be assigned a priority level using a scale ranging from 1 to 5, where 1 means high priority and 5 means least important.
Existing Measures: The policies, procedures and resources which are already available to prevent or reduce the impact of the risk.
Mitigation Strategy:After analyzing all the aspects of the risks and the existing preventive measures that can be used, the project team needs to decide on the mitigation strategy to deal with the risk. There can be four different mitigation strategies:
- Deflection: in this the risk is managed by transferring the risk handling to a third party or agency,
- Control: device a plan and work out strategies so as to prevent, minimize or bye-pass the risk.
- Avoidance: This strategy is used when the risk factor does not pose any considerable threat. The basic idea here is to ignore the risk, do nothing and accept the consequences.
Additional Measures: This field needs to be filled in only for those risks for which control mitigation strategy is decided.
Contingency Plan: A contingency plan can also be added for high impact risks with a high probability of occurrence, just in case the basic measures fail to perform.
Using this sample risk assessment form, project teams can identify risks and plan out strategies to prevent or suppress the risks that a project is likely to face. Knowing about the probable risks and having risk fighting plans mage in advance prevent shocks and damages when the actual risks arise, during project execution.
If you're looking for sample forms and downloadable templates, check out Bright Hub's resource guide Over 50 Free Project Management Templates and Sample Forms.
Screenshot Taken By: Sidharth Thakur