2. Prepare a risk matrix. Using the WBS and the project schedule, rank all project tasks in terms of risk, designating them "high, medium, or low."
a. A high-risk ranking shows a high probability (>50%) of the risk actually occurring, and that the risk will have a relatively severe impact on schedule, cost, and/or quality.
b. A medium-risk ranking implies less probability (<50%) of happening and less schedule impact.
c. A low-risk ranking implies very low probability (<10%) that the task will occur and low impact.
3. Select the five highest task risks (or more if you have more tasks that present risks that you want to reflect in the risk-based schedule).
4. Calculate the risk-based schedule. The objective now is to calculate a risk-based schedule by taking into account each of the five highest-risk tasks and calculating a risk-based duration for each. Using Microsoft Project, here are the steps:
d. Pull the PERT Analysis Toolbar up from "View."
e. Highlight one of the high-risk tasks on the Gantt chart.
f. Go to the PERT Entry Form and enter duration estimates for that task for three scenarios—expected (use the duration in the original schedule), pessimistic (worst case impact if risk occurs), and optimistic (best case, all risk controlled with no impacts).
g. Then use the PERT Weight button to set the weights for each scenario (weights reflect the probability that a given risk and impact will happen). Microsoft Project uses a total weight scale of six points; the job is to divide the six points up among three scenarios—expected, pessimistic, and optimistic. Note that the Microsoft Project "default" is four for expected (based on the high probability that the actual duration will fall somewhere between the two extremes) and one each for pessimistic and optimistic. But you may want to change those weights based on the estimate of the relative probability that a given scenario is going to happen.
h. Once you have entered weights, go to the PERT Calculation button and calculate the risk-based duration for that task, based on inputs.
i. Now click the PERT Entry Sheet and you will see the newly calculated, risk-based duration for the task compared to the three scenario durations (expected, pessimistic, and optimistic).
j. Now repeat this procedure for the remaining high-risk tasks. k. The resulting "rolled up" schedule is now a risk-based schedule, reflecting a new project duration.
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What you need to know about… Project Management Made Easy! Project management consists of more than just a large building project and can encompass small projects as well. No matter what the size of your project, you need to have some sort of project management. How you manage your project has everything to do with its outcome.