Defining and Documenting Risks

Once we are done with the Analysis part, we have to record the definition in the form of structured documentation. This process provides us clarity about the what are the risks that need to be minimized to ensure successful project delivery.

Defining the Project Risks

After the above activities are done, risks are defined and categorized into different types. Risks can be classified as technical, operational, financial, or external. So, this step of Agile Risk Identification makes the entire process structured and efficient. In other words, risks, that can take any form need to be recognized and understood in this process. So, the classification of the risks guides the project in the right direction along with the strategies and monitoring mechanisms throughout the project lifecycle.

1. The definition phase ensures that all potential risks are defined clearly and have a shared understanding among project stakeholders.
2. It also classifies potential risks based on their likelihood, impact, and urgency. Due to this, the prioritization of the tasks becomes easy.

Risk Register Creation

Post the project risks definition, the project experts record them in the document called the risk log or risk register. It includes detailed information about each risk, such as its description, potential impact on the project, likelihood of occurrence, and appropriate mitigation strategies. This document provides a structured framework for systematically organizing and managing risks throughout the project.

1. It is important to note that the Risk Register is not a static record, it is dynamic. It means that we have to update the risk register by making changes in the project’s context, scope, or external environment.
2. Risk Register acts as a real-time reference for the project team and it allows them to communicate and inform decision-making related to risk management.

Probability Analysis

Probability analysis is just like a quantitative parameter that tells us about the likelihood of each identified risk occurring during the project. In this process, the project professionals assign a probability value to each risk that denotes its occurrence on a scale. Generally, they are expressed as percentages. Thus, the entire process of probability analysis becomes standardized.

1. To find the probability values, project experts consider multiple factors such as historical data, expert judgment, and other project-specific factors.
2. It helps in the prioritization of the risk mitigation plans as per the likelihood or probability of occurrence. Thus, you can optimize resource allocation by addressing the most critical risks first.

Involving Stakeholders

This process is all about encouraging stakeholder contribution in Agile Risk Identification. Stakeholders come from different domains with diverse skill sets. Hence, the collaborative approach from the stakeholders and project team allows the project professionals to analyze the risks from a 360-degree perspective. In this process, different stakeholders bring their insights into potential risks associated with their interests or roles.

1. The inputs from the stakeholders are valuable, not only for the risk analysis but also for assigning roles and responsibilities in the risk mitigation plan.
2. In addition to this, regular communication and collaboration with stakeholders the entire process transparent and relevant to the project objectives.

When the Agile project begins, the stakeholders and product owners focus on executing the project plan iteratively. However, they tend to ignore small mistakes which may lead to project failure. Risk is not like a big or significant error or bug. It is just a small issue that is not fixed on time, due to which it becomes a severe risk. Hence, it does not matter what Agile Methods we are using to deliver the project.

Whatever you implement should be risk-free so that stakeholders become satisfied with the project outcomes. So, let us learn how to identify the project risks, which is covered in part 1 of the Agile Risk Identification.