Risk Probability, Severity and ….
When we discuss risk in project management circles, we often discuss it in terms of severity and probability. There is much more to risk and how it impacts and the implications it may have on our project.
Risk Probability and Severity
As the saw goes, few things are certain, except death and taxes. The more probable or more likely the malady is to come to fruition the greater attention we may need to give to this potentiality. We couple this probability with severity. We all know about risk severity. The greater the negative impact on our project, the greater the severity. The greater the severity, the greater attention we may have to pay to this risk. When coupled with probability we have a method for prioritizing project risks. However, what you rarely see in many a project book is the discussion of the level of controllability.
Controllability is our ability to adapt accordingly to the risk when it comes to pass. Premeditated or control prior to the event, is called mitigation or risk reduction. That is we are taking controlling actions to eliminate or downplay the risk. However, there is an element of control that happens after the risk comes to pass. Do we have the ability to respond or control the outcome to an acceptable degree such that our project is not terribly impacted? That is the controllability to which we are writing. What will happen when the risk occurs, are we able to find alternate paths? The mere structure of our organization or our methods may improve or reduce this level of controllability. Controlling is just as important as identification of severity and probability in our view.
Risk Register Download
We have built a download excel sheet which demonstrates the use of the Failure Mode Effects Analysis technique used for product design (DFMEA) and manufacturing processes (PFMEA) in the automotive world applied to project management risk.