One of the most important factors in guaranteeing the success of software development projects is the proactive participation of involved stakeholders. This is necessary because of the numerous risks involved in the software development cycle. Risk can be defined as a potential future occurrence than can affect the outcome of a current event (Williams, 2004).
The negative outcomes of risk include financial loss, loss of property, loss of credibility and integrity, and loss of business opportunities. Risk management is an effective way of conducting proactive planning when carrying out software projects. The software industry is characterized by great losses that emanate from failures and delays.
Statistics show that only about 28% of all software projects succeed (Williams, 2004). Some are canceled before completion, while others cost more than the projected budget. This rate of failure is due to misplaced priorities or the late provision of feedback and response.
The risk management process is divided into two main phases, namely, risk assessment and risk control. Risk assessment refers to the process of identifying, analyzing, and prioritizing risk. On the other hand, risk control refers to the process of planning, mitigating, and monitoring risk. Risk identification involves brainstorming to find potential problems that could emerge during the period of doing the project.
Examples of risks include genetic risks, project risks, business risks, product-specific risks, and product risks. Certain risks should be considered when evaluating a project, product, and business risks. They include people risks, size risks, process risks, tools risks, customer risks, estimation risks, sales and support risks, and technology risks (Williams, 2004).
The team working on a software project can sue various methods to identify risks. These methods include meetings, checklists, decomposition, and comparison with past projects. People working on a project should be encouraged to report all risks in order to improve their management and monitoring. Risk analysis is conducted after risk identification. It involves the transformation of risks into information that can be used to enhance decision making.
The probability of a risk occurring and the possible consequences are determined. This step is very important, even though it is difficult to implement. Determining the probability of occurrence and the possible outcomes of risks is difficult. However, it is important for the success of the project. The outcome of the analysis is the creation of a risk table. The table contains sections that include risk, rank, probability, impact, and action.
Risk analysis is followed by risk prioritization. This is done through the use of a ranking system. This step is critical because not all risks are worth addressing because they vary in their impact. The team uses the ranking system to decide which risks should be considered first.
A complete table includes high probability and high impact risks at the top and low probability and low impact risks at the bottom. After risk prioritization, the manager leads the team in planning, mitigating, and monitoring the chosen risks. It is important to develop a risk management plan for each of the chose to risk.
This enhances the implementation of proactive plans and actions. After planning, the team focuses on mitigating the risks. Mitigation involves the development of strategies to reduce the possibility of the risk occurring or the impact it will have if it happens. Risk avoidance and risk protection are examples of mitigation strategies.
The monitoring of action plans is important because of the dynamics associated with risk management. It is important for the manager and team members to communicate regularly regarding their progress and findings in managing risks. Effective communication enhances the dissemination of information and as a result, promotes efficacious risk management.
The three major stakeholders involved in risk management include the developer, the manager, and the customer. They should all cooperate in order to improve the outcomes of risk management strategies and plans.
Risk management is also important in educational projects. Students can increase the probability of getting high grades by addressing the risks that are associated with their projects. The most common risks encountered in educational projects include lack of communication, overriding other people’s work, overwhelming responsibilities, lack of exposure to certain technologies, loss of a team member, inadequate time, and insufficient understanding regarding a project’s requirements (Williams, 2004).
Industrial projects experience more risks when compared to educational projects. Examples of risks encountered include personnel shortfall, development of wrong user interface, unpredictable changes in project requirements, unrealistic budgets and schedules, performance shortfalls, and poor service provided by external contractors.
Software development teams encounter many risks, one of which is the selection of an appropriate development methodology. The success of a project depends primarily on the software development methodology and associated practices chosen. The model to use to carry out the project should be chosen base on the severity of the risks involved. A five-step method developed by Barry Boehm and Richard Turner can be used.
Creating a team should be based on a thorough evaluation of the personal characteristics of individual members. In that regard, technology and domain expertise should be the benchmarks for evaluating the suitability of individuals. Success has been attained through the use of agile, plan-driven, and hybrid methods and approaches.
The five steps of the Boehm and Turner’s five-step risk-driven method include risk analysis, risk comparison, architecture analysis, tailor life cycle, and execution and monitoring (Williams, 2004). Risk analysis involves the evaluation of environmental, agile, ad plan-driven risks. The manager should ensure that adequate information is obtained regarding each of the aforementioned areas.
Risk comparison involves the assessment of different risks to find their similarities and differences. This step allows managers to choose the most appropriate method for their projects. Architecture analysis is optional and aims to address the existence of inconsistencies in certain aspects of the software development life cycle.
The tailor life cycle addresses the risks identified in the first step and utilizes risk patterns identified at the start of the project (Williams, 2004). Finally, it is necessary for the team to monitor the progress and effectiveness of different risk management strategies. The emergence of changes in risk profiles implies that the team needs to evaluate the effectiveness of their process model and make adjustments if necessary.
Risk management is an important aspect of project management. Managers need to be proactive with regard to managing risk, identify risks by collecting information from various stakeholders and develop effective communication channels. Communication between stakeholders is important throughout the development cycle because it enhances the process of risk management.
It is also important to prioritize risks by determining their probability of occurrence and their potential impact. Risk analysis should lead to high probability and low probability risks. Determining the types of risks that are likely to occur during the development cycle is an integral aspect of effective risk management.
Williams, L. (2004). Risk Management. Web.