Option #1: Collaboration: Risk Breakdown Structure for a Food
Bank Project
Identifying and managing project risks are critical tasks for project managers. From a
project management perspective, risks must be managed from the start of a project until
its completion; therefore, the Risk Breakdown Structure (RBS) is an important tool that
project managers use to successfully complete projects. Assume that you are a project
manager assigned a project to set up a food bank facility for your local community within
a two-month period, starting from today. Develop a risk breakdown structure that
identifies sources of project risks. Consider Figure 11-4 below and the tasks that might
be associated with this project.
- Identify the risks in the form of “cause-risk- effect,” as described below:
One of the most common risk-identification mistakes is considering things to be risks
when they are not. One approach is to treat anything with a probability of greater than
80 percent as a certainty. “Lack of resources” is not a risk, nor is “not enough time to
complete the project.” If it is known that the length of time required to complete a project
is shorter than the time allocated, then this is not a risk—it’s a fact. Such facts should be
addressed in the project management plan through crashing, fast tracking, re-
estimating, removing scope, using other forms of schedule compression, and bringing
the situation to management, but not as part of risk management.
“To differentiate risks from facts and to adequately define risks, use the ‘cause-risk-
effect’ format for naming risks: As a result of (definitive cause), (uncertain event) may
occur, which would/could/may lead to (effect). Such definition of risks provides enough
information for the team to follow the rest of the project management process. See the
following examples of risks in the cause-risk-effect format:
a. As a result of lack of clear direction for the scope of work for the XYZ
component, there could be rework and wasted efforts, which could delay the
project completion from two to four weeks.
b. As a result of the amount of work the customer is trying to accomplish on
many projects during this project’s completion, a delay in the response to our
requests for approvals may occur, which could result in a two-week delay in
project completion. Effects could relate to project objectives, project
constraints, and risk tolerances.” (Mulcahy, 2003, p. 90) - Discuss and analyze the importance of each of the four types of risk identified in
Figure 11-4 (technical, management, commercial, and external). - Create a risk breakdown structure and attach as an appendix (see attached sample
and use the blank RBS linked under this assignment in Module 2). - Discuss the importance of creating an RBS.
RBS LEVEL RBS LEVEL 1 RBS LEVEL 2
0
- ALL
SOURCES
OFPROJEC
T RISK - TECHNICAL
RISK
1.1 Scope definition
1.2 Requirements definition
1.3 Estimates, assumptions, and
constraints
1.4 Technical processes
1.5 Technology
1.6 Technical interfaces
Etc.
- MANAGEMENT
RISK
2.1 Project management
2.2 Program/portfolio
management
2.3 Operations management
2.4 Organization
2.5 Resourcing
2.6 Communication
Etc.
- COMMERCIAL
RISK
3.1 Contractual terms and
conditions
3.2 Internal procurement
3.3 Supplies and vendors
3.4 Subcontracts
3.5 Client/customer stability
3.6 Partnerships and joint
ventures
Etc.
- EXTERNAL
RISK
4.1 Legislation
4.2 Exchange rates
4.3 Site/facilities
4.4 Environmental/weather
4.5 Competition
4.6 Regulatory
Etc.
(Source: PMI, 2017, Figure 11-4)
Your well-written paper should meet the following requirements:
Be 3-4 pages (900-1200 words) in length, not including the cover page,
references page, or appendix. (Remember that the appendix follows the
references page.)
Cite a minimum of three sources to support your responses, two of which
should be current academic, peer-reviewed, scholarly sources. Note: Current
research in this class means the most recent five-year period. Although
research older than five years may be used, it will not count toward the
assignment requirement.
Demonstrate thoughtful consideration of the ideas and concepts that are
presented in the course, and provide new thoughts and insights related
directly to this topic.