Risk Management – Managing Milestones

Half of designing for risk involves allocating every identified risk to a project milestone. Very typically a milestone is attached to a payment, so a risk can conjointly have an accurate worth connected to it. By its nature, each risk can impact, if in the slightest degree, at a bound time. For example, Milestone 1 is “Delivery of Software X, Issue A to the Client”. If this risk impacts, we tend to can not receive the Milestone one payment from the Customer. This payment has been planned to cover costs of staffing, materials, sub-contractor payments and a selection of different project expenses as well as finance charges up to the current point. The value of this risk, or any other related to this Milestone, impacting is basically the value of borrowing that amount of cash, from the time it ought to have been received up until the time when it’s really received.

So as to manage this risk, regular project meetings will be held, a half of that will cowl the progress of identified risks. The danger owner will report on every risk with their assessment of the likelihood its occurring. If the likelihood of any risk impacting increases, steps can be taken to implement the mitigation measures already identified. Within the case of this example, the mitigation measures may be “Introduce interim acceptance testing to identify problems early”. Let us assume that the introduction of this mitigation measure has become necessary and also the interim acceptance testing has shown that the software is far from ready for delivery. This will mean that fall-back or contingency plans should be implemented. This is a terribly undesirable state of affairs however such plans would possibly be: “Introduce further software engineering effort to identify and resolve bugs” or, assuming we tend to do not have the personnel on the market to throw additional resources at the problem “Place project software engineers on overtime so as to spot and resolve bugs”. In themselves, these contingencies will, in fact, have a price however this must be weighed up against the possibility of delaying the milestone payment and worse, failing to satisfy the milestone timescale. Once one milestone is late, it’s terribly onerous to catch up and a lot of rescheduling is needed so as to still meet the tip delivery date. Failing to satisfy milestones is usually terribly unpopular with the Client and by no means likely to try and do the company’s name any good. On the up side, if a risk does NOT impact and also the milestone with that it’s associated is met, that risk can be deleted and forgotten, leaving time and house to concentrate on the next one.