Types of Risks

1. Project risks– Impact schedule and cost– Includes budgetary, schedule, personnel,

resource, customer, requirement problems

2. Technical risks– Impact the quality, timelines, and cost– Implementation may become difficult or

impossible– Includes design, implementation, interface,

verification and maintenance problems– Arise due to leading edge technology

Recap

Software Engineering II

Lecture 19

Fakhar Lodhi

Types of Risks

3. Business risks– Marketability– Alignment with the overall business

strategy– How to sell– Budget or personnel commitments

Risk Identification

• Identify known and predictable risks• Generic risks and product specific risks

• Generic risks – threats to every project• Product specific risks – what special

characteristics of this project may threaten your project plan?

• Risk item checklist

Risk Item Checklist

• Product size• Business impact• Customer characteristics• Process definition• Development environment• Technology to be built• Staff size and experience

• Questions relevant to each of the topics can be answered for each software project

Assessing Overall Project Risks

• Have top software and customer managers formally committed to support the project?

• Are end-users committed to the project and the system/product to be built?

• Are requirements fully understood?• Have customers been involved fully in

requirement definition?• Do end-users have realistic expectations?

Assessing Overall Project Risks

• Does the software team have right mix of skills?

• Are project requirements stable?• Does the project team have experience with

the technology to be implemented?• Is the number of people on the project team

adequate to do the job?

Risk components and drivers

1. Performance risks– Degree of uncertainty that the product will

meet its requirements and be fit for its intended use

2. Cost risks– The degree of uncertainty that the project

budget will be maintained3. Support risks

– Resultant software will be easy to correct, enhance, and adapt

Risk components and drivers

4. Schedule risks– Product schedule will be maintained

• Four impact categories1. Negligible 2. Marginal 3. Critical4. Catastrophic

Performance Support Cost Schedule

Catastrophic Failure to meet the requirements will result in mission failure

Results in increased cost and schedule delays. Expected value in excess of $500K

Significant degradation

Non-responsive or unsupportable

Budget overrun likely

Unachievable

Critical Would degrade performance to a point where mission success is questionable

Results in operational delays and or increased cost with expected value of $100K-$500K

Some reduction in technical performance

Minor delays Possible overrun

Possible slippage

Marginal Result in degradation of secondary mission

Expected value <$100K

Small reduction

Responsive Sufficient financial resources

Realistic

Negligible Inconvenience Minor

No reduction Supportable Budget under run possible

Achievable

Row 1–Consequences of errors Row 2–Failure to achieve desired outcome

Risk ProjectionConcerned with risk estimation

– Attempts to rate risks in two ways• Likelihood and consequences

– Four risk projection activities• Establish a scale that reflects the

perceived likelihood of risk• Delineate the consequences• Estimate impact• Note the overall accuracy of risk projection

Risk Category Probability

Impact RMMM

Size estimate may be significantly lowLarger number of users than plannedLess reuse than plannedEnd-users resist systemDelivery deadline will be tightenedFunding will be lostCustomer will change requirementsTechnology will not meet expectationsLack of training on toolsStaff inexperiencedStaff turnover will be high

PSPSPSBUBUCUPSTE

DESTST

60%30%70%40%50%40%80%30%

80%30%60%

23232121

322

1: Catastrophic 2: Critical 3: Marginal 4: Negligible

Risk mitigation, monitoring, and management plan