Project Management Risk Types are Inherent Risks, Residual Risks, Secondary Risks. These are listed here with examples for the detailed understanding.
In Project Management, we often encounter Risks, basically uncertain events. These Risks may positively benefit or negatively impact as well. To have better control on these Risks, we implement Risk Response strategies.
Project Management Risk Types for Known Risks can be classified in this direction as well. For any given Project it would be possible to identify/anticipate to an extent the Positive and Negative Risks. For Positive Risks, which help us to benefit, we establish and implement strategies such as Exploit, Enhance, Share, Accept. For Negative Risks, which may have downside, we establish and implement strategies such as Avoid, Transfer, Mitigate, Accept.
Project Management Risk Types defined by GlobalSkillup
Risks that are not acted upon with any risk response are known as Inherent Risks.
Risks that remain even after risk response have been implemented are known as Residual Risks.
New Risks that crop up due to implementation of Risk response to another Risk is known as Secondary Risk.
Let us understand the mentioned risks with an Example: In a Project, Key Resources Attrition could be a Risk.
Scenario 1: We know there is a resource attrition risk, however, we do not make any response plan for it. Such risk is known as Inherent Risk.
Scenario 2: To better control the key resource attrition, we could have outsourced the replacement to a staffing agency, such that replacement of key resource happens with in next 5 work days. In this case, the Risk itself is transferred to staffing agency. However, the Risk of resource attrition itself remains even after this strategy. This is Residual Risk.
Scenario 3: In case, the staffing agency replaces the key resource with in 5 work days, all fine. However, the staffing agency could not recruit and place a new resource in 5 days, the Project is impacted by the delay. This is now the Secondary Risk.
For learning more on the Risk Management, you may intend to check out the Risk Management section of Project Management Training offered by GlobalSkillup.com