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Risk Management

Risk Management. Proactive strategies for minimizing the effects of bad things. Software Risk Management: Principles and Practices. Barry Boehm IEEE Software, Jan1991 text pp443-452. Survey. 35% of 600 firms “had at least one runaway software project”

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Risk Management

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  1. Risk Management Proactive strategies for minimizing the effects of bad things

  2. Software Risk Management:Principles and Practices Barry Boehm IEEE Software, Jan1991 text pp443-452

  3. Survey • 35% of 600 firms “had at least one runaway software project” • In most cases “their problems would have been avoided or strongly reduced if there had been an explicit early concern with identifying and resolving their high-risk elements”

  4. Risks • Bad things that might happen • two characteristics • uncertainty - probability of happening • loss - cost if it happens

  5. Risk Management • Risk Assessment • Risk Identification • Risk Analysis • Risk Prioritization • Risk Control • Risk-management Planning • Risk Resolution • Risk Monitoring

  6. Risk Categories • Project risks • budget, schedule, personnel, requirements • Technical risks • design, implementation, interface, testing problems • Business risks • product viability

  7. Risk Exposure • A. the possibility of catastrophic loss • B. probability times potential loss • C. the factors that distinguish successful projects from unsuccessful projects • D. decision tree

  8. Risk Exposure Example • Is it better to play game 1 or game2 with a die? • 1 - pay $3 upfront and get paid $1 per dot • 2 - roll die and pay $3 for 1, $2 for a 2, get paid $3 for a 6, get paid $2 for a 4

  9. L12aS9 Individual Task • In figure 1, p444, what is the combined risk exposure if “the experiment team could reduce its critical-error probability to less than 0.04”? Assume all the remaining ratios are the same. • Due Thursday, 7/12 (off due Monday, 7/16)

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