Create a risk management plan

Step 1: Access the template

To use the template for this course item, click the link below and select Use Template.

Activity Template_ Risk management plan

DOCX File

Step 2: Fill in the document details

At the top of the document, write your name (or simply project manager) next to Author. Then record the status of the plan next to Status (mark it as a draft for now).

Step 3: State the objective

Now consider the purpose of a risk management plan and what it is designed to do. Write a sentence or two summarizing this purpose under Objective.

Step 4: Write an executive summary

Write a 3-4 sentence introduction outlining the project goals and milestones, and include potential risks in the tables provided under Executive Summary in the template.

Step 5: List budget risks

Now go to the budgetary risk chart and add the three potential budgetary risks under Scenario.

Step 6. Assess the impact of each budget risk

Next, determine the inherent risk level of each budgetary risk. Remember that inherent risk is the measure of a risk calculated by its probability and impact. To do this, go to the Appendix section of the template:

First, consult the Probability chart to determine whether the risk has a low, medium, or high chance of occurring.

Next, use the Impact chart to identify whether each risk poses a low, medium, or high impact to finances, operations, or people.

Finally, use the Probability and Impact Matrix to calculate the inherent risk as low, medium, or high.

Enter the inherent risk rating under Risk to project in the budgetary risk chart. You can color-code the rating for clarity (green for low, yellow for medium, and red for high).

For example, in the first budgetary risk scenario the two delivery trucks cost more than initially estimated:

Your team estimates a 50% chance this risk will occur. According to the Probability chart, 50% is a high probability.

Your team estimates a $32,000 overage. According to the Impact chart, $32,000 is a high financial impact.

Because the probability and impact are both high, according to the Probability and Impact Matrix, the inherent risk is high.

Step 7: Develop mitigation plans for budget risk scenarios

Now that youve calculated inherent risk ratings, consider how to mitigate each risk. Remember, you can choose to deal with each risk in one of the following ways:

Avoid

Accept

Reduce or control

Transfer

Once youve decided how to handle each risk, write "avoid," "accept," "reduce or control," or "transfer" in the Mitigation Plan column. Then explain how you plan to deal with the risk. Be sure to consider all the options when developing your mitigation plans.

For example, imagine there is a risk that a vendor might not have the right plants in stock consistently. If the inherent risk level is low you could choose to monitor the situation and research alternative sources for particular plants. If the inherent risk level is high, you could choose to avoid it altogether by switching vendors.

Note: Your mitigation plans will likely differ from those of your fellow learners. Thats okaythere are a lot of factors to account for and no one right way to deal with them.

Step 8: Develop mitigation plans for schedule risk scenarios

Repeat Steps 5-7 for the three schedule risks.