• Name the sources of risks and opportunities.
• Identify risks and opportunities.
• Record these in the register.

45 min.

A11.KCI-2. Identify risks and opportunities

1. Identification methods can be top-down or bottom-up. The top-down approach uses past projects and experiences to guide current ones, often through checklists or brainstorming. It can start from the project proposal stage, helping senior management decide to invest funds in the project's planning phase.

2. Bottom-up planning, typically conducted toward the end of the planning phase or before starting a new stage, involves a detailed approach. It includes refining the final project management plan and creating a detailed plan for the next stage.

3. We then examine the detailed risk with respect to:

•  Product descriptions: The nature of the project's outcome significantly influences its risk level. For example, projects delivering tangible products carry less risk than organizational mergers.
• Planning people and resources: Planning people and resources: Assess the allocation and availability of key personnel and resources.
•  Risks associated with the knowledge and experience of assigned individuals.
•  Purchased and outsourced products/services: Evaluate negotiation effectiveness and expected quality from external suppliers.
•  Research historical information: Review project files and databases from similar past projects within the organization.

4. The risk register is a central database for all identified risks and opportunities, crucial for effective management. It's structured with columns detailing relevant information such as:

• Identification code
• Title of the risk
• Description
• Cause or source
• Warning signals
• Stakeholder owner(s)
• Qualitative estimate (probability and impact)
• Quantitative estimate (probability and impact)
• Number of times it can occur
• Proximity or horizon
• Responses taken
• Action holder(s)
• Estimate of the residual risk (probability and impact)
• Other comments

5. We regularly update the risk register in Oracle Primavera Cloud to maintain a central source for assessing the project's risk profile.

To validate the application of this key competence indicator, Identify risks and opportunities, in the IPMA certification, individuals in project management have to demonstrate:

• how they identified the sources of risks and opportunities.
• how they identified risks and opportunities.
• how they recorded risks and opportunities in the register.