Cause, Risk, Effect

A Risk in software development project is an event that may have an impact on the outcome of the project. Risk differs from problems or issues because a risk refers to the future potential of loss/benefit. Problems or issues, however, are conditions or states of affairs that exist in a project at present time.

Risks should be identified for the following reasons:

• Schedule can be developed more realistically based on accurate Risk planning
• Budget is more accurate when it includes reservations for possible Risks
• Specification is unambiguous when Risks are revealed in advance
• Outcomes are more predictable if the project team is prepared to handle unexpected negative interruptions

Risks are found and identified by the project team, project manager and you during the whole project lifecycle. Risk management is an iterative process. The sooner a Risk is identified, the faster it can be managed and mitigated.

Major Risk identification activities are performed during the Inception Phase. Risk Strategies and Risk response plans are baselined on a LCO Milestone.