Methodology

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Portfolio Risk Management Plan

 

 

 

 

 

 

Methodology

 

 

Table of Contents

 

[How to Use this template – This template includes suggested sections for the portfolio risk management plan with sample wording. A risk management plan is a requirement for the portfolio risk management process.  The portfolio leader will either use this plan as a template or as a guideline to create his or her own format.  If the portfolio leader decides to use this template, he or she should delete any text shown in [ ]s.  Additional sections can be added to this plan as deemed necessary by the portfolio leader.]

Portfolio Risk Management Process

 

The KRMC risk management process includes identifying, assessing, mitigating and  contingency planning and execution, monitoring, and closing risks. The portfolio leader will begin risk identification by reviewing the portfolio strategic goals with the portfolio department managers. Each portfolio department manager will then provide the portfolio leader with potential risks based on the strategic objectives prior to a portfolio risk review meeting. The portfolio leader will then create a risk register for review by the department and program  managers. The risk register will follow the template provided on the Project Management Knowledge Base. The portfolio leader is accountable for the assessment, monitoring, mitigation, and contingency planning of these risks. Methodology

 

[Include this section only if you decide to do the identification and assessment process found in The Methodology.]  KRMC will also take advantage of the portfolio risk identification and assessment process found on the Project Management Knowledge Base.  On a yearly basis, after identifying a qualified assessor, the portfolio leader will kick-off the process.  The assessor will complete the process and report findings to the portfolio leader.

 

The portfolio leader will review the portfolio risk register on a monthly basis to ensure mitigation plans are effective. The portfolio leader will make necessary changes to the risk register and review those changes with the portfolio department leaders at the quarterly portfolio status meetings making changes to impact and likelihood, mitigation strategy, contingency plans, and close risks as required.Methodology

 

Budgeting

 

Portfolio risk management  will require funding for:

• Travel to XXX to perform risk interviews and mitigation,
• Contingency funds,
• Reason 3

The expected cost is $nnnn.nn.

 

[If there is no specific funding required for risk management, delete this section.]

 

 

Risk Register Scoring and Interpretation

 

Risks are evaluated on a scale of one to five for impact and likelihood. The portfolio leader will complete the impact and likelihood columns in the risk register in collaboration with portfolio department managers. The portfolio leader will use the following risk tolerances. [Tolerances should be adjusted for the portfolio objectives when completing this plan.]

 

Impact

 

4-5 (High)

Strategic vision will not be met

Operational impact will include a stop or near stop of some functionality

Financial loss will be nn% of budget

Compliance – noncompliance will exist

Methodology

3 (Moderate)

Strategic vision will be partially met

Operational impact will include a slow down or inability to perform some functionality without work-arounds

Financial loss will be nn% of budget

Compliance – noncompliance is likely

 

1-2 (Low)

Strategic vision will be met

Operational loss is manageable

Financial loss will be less than 1% of budget

Compliance – noncompliance is probable but can be mitigated

 

Likelihood

 

4-5 (High)

Realization of this risk is inevitable. Risk mitigation is weak and there is minimal to no effective contingency plan.

 

3-4 (Moderate)

Realization of the risk is likely. Risk mitigation does not cover all areas of the risk and contingency plans are inadequate.

 

1-2 (Low)

Realization of the risk is unlikely but still possible. Mitigation plan is strong, contingency plan is effective.

 

Internal Risk Controls

 

The portfolio leader will determine if any internal risk controls exist that could help mitigate portfolio risks and add a description to the risk register with a ranking for its effectiveness.  Effectiveness is rated on a scale of one to five with one being most effective and five having minimal effect.

 

Plan and Implement Risk Responses

 

Mitigation and Contingency Plans

 

The portfolio leader will include mitigation and contingency plans, with an effectiveness rating on the mitigation plans, in the risk register.  Contingency plans will be outlined as soon as the risk is identified and not delayed until the risk is realized.

 

If a risk is realized the portfolio leader will ensure that the appropriate contingency plan is activated. The exact steps will depend on the contingency plan.

 

Monitoring Risks

 

The portfolio leader will review the portfolio risk register on a quarterly basis with the portfolio department leaders. At those meetings, the members will discuss the effectiveness of the mitigation and contingency plans and make adjustments to the risk register, if necessary.

 

The portfolio leader will roll up all medium and high portfolio risks to the EPMO Director for the KRMC risk report, as requested.  The EPMOi Director will decide which risks are appropriate for the Observatory risk register.

 

Closing Risks

 

Once a risk is mitigated or realized it will remain in the risk register but moved the closed status.

 

 

Training

 

Any portfolio staff member requesting risk management training will be directed to the online training in the Project Management Knowledge Base.  If more in-depth training is required, the team member’s manager will be notified and will work with the team member to obtain the training externally.

 

Timing

 

When will activities take place?

 

 

Roles and Responsibilities

 

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