Software Engineering

Dr. Li Pei-Xing MathXP@163.com School of Mathematics & Computation Science, Sun Yat-sen University,Guangzhou,P.R.C.,510275

Software Engineering

Chapter 6. Risk Management

6.1 6.1Reactive Reactivevs. vs.Proactive ProactiveRisk RiskStrategies Strategies 6.2 6.2Software SoftwareRisks Risks 6.3 6.3Risk RiskIdentification Identification 6.4 6.4Risk RiskProjection Projection 6.5 6.5Risk RiskRefinement Refinement 6.6 6.6Risk RiskMitigation, Mitigation,Monitoring, Monitoring,and andManagement Management 6.7 6.7Safety SafetyRisks Risksand andHazards Hazards 6.8 6.8The TheRMMM RMMMplan plan
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Dr.Li Pei-Xing,MathXP@163.com,School of Math.&Comp.,Sun Yat-sen University,Guangzhou,P.R.C.,510275

Chapter 6. Risk Management

Overview
Risks Risksare arepotential potentialproblems problemsthat thatmight mightaffect affectthe thesuccessful successful completion completionof ofa asoftware softwareproject. project. Risks Risksinvolve involveuncertainty uncertaintyand andpotential potentiallosses. losses. Risk Riskanalysis analysisand andmanagement managementare areintended intendedto tohelp helpa asoftware software team teamunderstand understandand andmanage manageuncertainty uncertaintyduring duringthe thedevelopment development process. process. The Theimportant importantthing thingis isto toremember rememberthat thatthings thingscan cango gowrong wrongand andto to make makeplans plansto tominimize minimizetheir theirimpact impactwhen whenthey theydo. do. The Thework workproduct productis iscalled calleda aRisk RiskMitigation, Mitigation,Monitoring, Monitoring,and and Management ManagementPlan Plan(RMMM). (RMMM).
Dr.Li Pei-Xing,MathXP@163.com,School of Math.&Comp.,Sun Yat-sen University,Guangzhou,P.R.C.,510275

Chapter 6. Risk Management

Project Risks
What can go wrong? What is the likelihood? What will the damage be? What can we do about it?

Dr.Li Pei-Xing,MathXP@163.com,School of Math.&Comp.,Sun Yat-sen University,Guangzhou,P.R.C.,510275

Chapter 6. Risk Management

6.1 Reactive VS. Proactive Risk Strategies

Reactive strategies
very common, also known as fire fighting, project team sets resources aside to deal with problems and does nothing until a risk becomes a problem

Proactive strategies
risk management begins long before technical work starts, risks are identified and prioritized by importance, then team builds a plan to avoid risks if they can or minimize them if the risks turn into problems

Dr.Li Pei-Xing,MathXP@163.com,School of Math.&Comp.,Sun Yat-sen University,Guangzhou,P.R.C.,510275

6.1 Reactive VS. Proactive Risk Strategie

Proactive Risk Management

formal risk analysis is performed organization corrects the root causes of risk
TQM concepts and statistical SQA examining risk sources that lie beyond the bounds of the software developing the skill to manage change

Dr.Li Pei-Xing,MathXP@163.com,School of Math.&Comp.,Sun Yat-sen University,Guangzhou,P.R.C.,510275

6.1 Reactive VS. Proactive Risk Strategie

Risk Management Paradigm

control track

RISK
analyze

identify

plan

Dr.Li Pei-Xing,MathXP@163.com,School of Math.&Comp.,Sun Yat-sen University,Guangzhou,P.R.C.,510275

Chapter 6. Risk Management

6.2 Software Risks

Risk Characteristics
Uncertainty
The risk may or may not happen, that is, there are no 100% probable risks

Loss
If the risk becomes a reality, unwanted consequences or losses will occur

Dr.Li Pei-Xing,MathXP@163.com,School of Math.&Comp.,Sun Yat-sen University,Guangzhou,P.R.C.,510275

6.2 Software Risks

Software Risks Categories

Project Projectrisks risks--threaten threatenthe theproject projectplan plan Technical Technicalrisks risks--threaten threatenproduct productquality qualityand andthe thetimeliness timelinessof ofthe the schedule schedule Business Businessrisks risks--threaten threatenthe theviability viabilityof ofthe thesoftware softwareto tobe bebuilt built (market (marketrisks, risks,strategic strategicrisks, risks,management managementrisks, risks,budget budgetrisks) risks) Known Knownrisks risks--predictable predictablefrom fromcareful carefulevaluation evaluationof ofcurrent currentproject project plan planand andthose thoseextrapolated extrapolatedfrom frompast pastproject projectexperience experience Unknown Unknownrisks risks--some someproblems problemssimply simplyoccur occurwithout withoutwarning warning

Dr.Li Pei-Xing,MathXP@163.com,School of Math.&Comp.,Sun Yat-sen University,Guangzhou,P.R.C.,510275

Chapter 6. Risk Management

6.3 Risk Identification

Risk Types
Product-specific risks
the project plan and software statement of scope are examined to identify any special characteristics of the product that may threaten the project plan

Generic risks
are potential threats to every software product (product size, business impact, customer characteristics, process definition, development environment, technology to be built, staff size and experience)

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Dr.Li Pei-Xing,MathXP@163.com,School of Math.&Comp.,Sun Yat-sen University,Guangzhou,P.R.C.,510275

6.3 Risk Identification

Risk Impact
Risk Risk components components
performance, performance,cost, cost,support, support,schedule schedule

Risk Riskimpact impact

negligible, negligible,marginal, marginal,critical, critical,catastrophic catastrophic

The Therisk riskdrivers driversaffecting affectingeach eachrisk riskcomponent componentare are classified classifiedaccording accordingto totheir theirimpact impactcategory categoryand andthe the potential potentialconsequences consequencesof ofeach eachundetected undetectedsoftware software fault faultor orunachieved unachievedproject projectoutcome outcomeare aredescribed described
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Dr.Li Pei-Xing,MathXP@163.com,School of Math.&Comp.,Sun Yat-sen University,Guangzhou,P.R.C.,510275

6.3 Risk Identification

Risk Due to Product Size

Attributes that affect risk:
estimated size of the product in LOC or FP? estimated size of product in number of programs, files, transactions? percentage deviation in size of product from average for previous products? size of database created or used by the product? number of users of the product? number of projected changes to the requirements for the product? before delivery? after delivery? amount of reused software?
Dr.Li Pei-Xing,MathXP@163.com,School of Math.&Comp.,Sun Yat-sen University,Guangzhou,P.R.C.,510275

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6.3 Risk Identification

Risk Due to Business Impact

Attributes that affect risk:
affect of this product on company revenue? visibility of this product by senior management? reasonableness of delivery deadline? number of customers who will use this product interoperability constraints sophistication of end users? amount and quality of product documentation that must be produced and delivered to the customer? governmental constraints costs associated with late delivery? costs associated with a defective product?
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Dr.Li Pei-Xing,MathXP@163.com,School of Math.&Comp.,Sun Yat-sen University,Guangzhou,P.R.C.,510275

6.3 Risk Identification

Risks Due to the Customer

Questions that must be answered:
Have you worked with the customer in the past? Does the customer have a solid idea of requirements? Has the customer agreed to spend time with you? Is the customer willing to participate in reviews?

Is the customer technically sophisticated? Is the customer willing to let your people do their jobthat is, will the customer resist looking over your shoulder during technically detailed work? Does the customer understand the software engineering process?
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Dr.Li Pei-Xing,MathXP@163.com,School of Math.&Comp.,Sun Yat-sen University,Guangzhou,P.R.C.,510275

6.3 Risk Identification

Risks Due to Process Maturity

Questions that must be answered:
Have you established a common process framework? Is it followed by project teams? Do you have management support for software engineering Do you have a proactive approach to SQA? Do you conduct formal technical reviews? Are CASE tools used for analysis, design and testing? Are the tools integrated with one another? Have document formats been established?

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Dr.Li Pei-Xing,MathXP@163.com,School of Math.&Comp.,Sun Yat-sen University,Guangzhou,P.R.C.,510275

6.3 Risk Identification

Technology Risks
Questions that must be answered:
Is the technology new to your organization? Are new algorithms, I/O technology required? Is new or unproven hardware involved? Does the application interface with new software? Is a specialized user interface required? Is the application radically different? Are you using new software engineering methods? Are you using unconventional software development methods, such as formal methods, AI-based approaches, artificial neural networks? Are there significant performance constraints? Is there doubt the functionality requested is "do-able?"
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Dr.Li Pei-Xing,MathXP@163.com,School of Math.&Comp.,Sun Yat-sen University,Guangzhou,P.R.C.,510275

6.3 Risk Identification

Staff/People Risks
Questions that must be answered: Are the best people available? Does staff have the right skills? Are enough people available? Are staff committed for entire duration? Will some people work part time? Do staff have the right expectations? Have staff received necessary training? Will turnover among staff be low?

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Dr.Li Pei-Xing,MathXP@163.com,School of Math.&Comp.,Sun Yat-sen University,Guangzhou,P.R.C.,510275

Chapter 6. Risk Management

6.4 Risk Projection(Estimation)

Establish Establish a a scale scale that that reflects reflects the the perceived perceived likelihood likelihood of of each each risk risk Delineate Delineate the the consequences consequences of of the the risk risk Estimate Estimate the the impact impact of of the the risk risk on on the the project project and and product product Note Note the the overall overall accuracy accuracy of of the the risk risk projection projection to to avoid avoid misunderstandings misunderstandings
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Dr.Li Pei-Xing,MathXP@163.com,School of Math.&Comp.,Sun Yat-sen University,Guangzhou,P.R.C.,510275

6.4 Risk Projection(Estimation

Building a Risk Table

Risk Category

Probability

Impact

RMMM

Risk Mitigation Monitoring & Management

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Dr.Li Pei-Xing,MathXP@163.com,School of Math.&Comp.,Sun Yat-sen University,Guangzhou,P.R.C.,510275

6.4 Risk Projection(Estimation

Risk Table Construction

List Listall allrisks risksin inthe thefirst firstcolumn columnof ofthe thetable table Classify Classifyeach eachrisk riskand andenter enterthe thecategory categorylabel labelin incolumn columntwo two Determine Determinea aprobability probabilityfor foreach eachrisk riskand andenter enterititinto intocolumn columnthree three Enter Enterthe theseverity severityof ofeach eachrisk risk(negligible, (negligible,marginal, marginal,critical, critical, catastrophic) catastrophic)in incolumn columnfour four Sort Sortthe thetable tableby byprobability probabilityand andimpact impactvalue value Determine Determinethe thecriteria criteriafor fordeciding decidingwhere wherethe thesorted sortedtable tablewill willbe be divided dividedinto intothe thefirst firstpriority priorityconcerns concernsand andthe thesecond secondpriority priority concerns concerns First Firstpriority priorityconcerns concernsmust mustbe bemanaged managed(a (afifth fifthcolumn columncan canbe be added addedto tocontain containa apointer pointerinto intothe theRMMM) RMMM)
Dr.Li Pei-Xing,MathXP@163.com,School of Math.&Comp.,Sun Yat-sen University,Guangzhou,P.R.C.,510275

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6.4 Risk Projection(Estimation

Assessing Risk Impact

Factors Factorsaffecting affectingrisk riskconsequences consequences
nature nature(types (typesof ofproblems problemsarising), arising),scope scope(combines (combinesseverity severity with withextent extentof ofproject projectaffected), affected),timing timing(when (whenand andhow howlong long impact impactis isfelt) felt)

If Ifcosts costsare areassociated associatedwith witheach eachrisk risktable tableentry entry Halstead's Halstead'srisk riskexposure exposuremetric metriccan canbe becomputed computed (RE (RE= =Probability Probability**Cost) Cost)and andadded addedto tothe therisk risktable. table.

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Dr.Li Pei-Xing,MathXP@163.com,School of Math.&Comp.,Sun Yat-sen University,Guangzhou,P.R.C.,510275

6.4 Risk Projection(Estimation

Risk Assessment
Define Definereferent referentlevels levelsfor foreach eachproject projectrisk riskthat thatcan can cause causeproject projecttermination termination(performance (performancedegradation, degradation, cost costoverrun, overrun,support supportdifficulty, difficulty,schedule scheduleslippage). slippage). Attempt Attemptto todevelop developa arelationship relationshipbetween betweeneach eachrisk risk triple triple(risk, (risk,probability, probability,impact) impact)and andeach eachof ofthe thereference reference levels. levels. Predict Predictthe theset setof ofreferent referentpoints pointsthat thatdefine definea aregion regionof of termination, termination,bounded boundedby bya acurve curveor orareas areasof ofuncertainty. uncertainty. Try Tryto topredict predicthow howcombinations combinationsof ofrisks riskswill willaffect affecta a referent referentlevel level
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Dr.Li Pei-Xing,MathXP@163.com,School of Math.&Comp.,Sun Yat-sen University,Guangzhou,P.R.C.,510275

Chapter 6. Risk Management

6.5 Risk Refinement

Process Process of of restating restating the the risks risks as as a a set set of of more more detailed detailed risks risks that that will will be be easier easier to to mitigate, mitigate, monitor, monitor, and and manage. manage. CTC CTC (condition-transition-consequence) (condition-transition-consequence) format format may may be be a a good good representation representation for for the the detailed detailed risks risks (e.g. (e.g. given given that that <condition> <condition> then then there there is is a a concern concern that that (possibly) (possibly) <consequence>). <consequence>).
Dr.Li Pei-Xing,MathXP@163.com,School of Math.&Comp.,Sun Yat-sen University,Guangzhou,P.R.C.,510275

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Chapter 6. Risk Management

6.6 Risk Mitigation, Monitoring, and Management

mitigationhow can we avoid the risk? monitoringwhat factors can we track that will enable us to determine if the risk is becoming more or less likely? managementwhat contingency plans do we have if the risk becomes a reality?

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Dr.Li Pei-Xing,MathXP@163.com,School of Math.&Comp.,Sun Yat-sen University,Guangzhou,P.R.C.,510275

Chapter 6. Risk Management

6.7 Safety Risks and Hazards

Risks Risksare arealso alsoassociated associatedwith withsoftware softwarefailures failuresthat that occur occurin inthe thefield fieldafter afterthe thedevelopment developmentproject projecthas has ended. ended. Computers Computerscontrol controlmany manymission missioncritical criticalapplications applicationsin in modern moderntimes times(weapons (weaponssystems, systems,flight flightcontrol, control, industrial industrialprocesses, processes,etc.). etc.). Software Softwaresafety safetyand andhazard hazardanalysis analysisare arequality quality assurance assuranceactivities activitiesthat thatare areof ofparticular particularconcern concernfor for these thesetypes typesof ofapplications applicationsand andare arediscussed discussedlater laterin in the thetext. text.
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Dr.Li Pei-Xing,MathXP@163.com,School of Math.&Comp.,Sun Yat-sen University,Guangzhou,P.R.C.,510275

Chapter 6. Risk Management

6.8 The RMMM PLAN

Risk Information Sheets
Alternative to RMMM in which each risk is documented individually. Often risk information sheets (RIS) are maintained using a database system. RIS components
risk id, date, probability, impact, description, refinement, mitigation/monitoring, management/contingency/trigger, status, originator, assigned staff member.

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Dr.Li Pei-Xing,MathXP@163.com,School of Math.&Comp.,Sun Yat-sen University,Guangzhou,P.R.C.,510275

6.8 The RMMM PLAN

Recording Risk Information

Project: Embedded software for XYZ system Risk type: schedule risk Priority (1 low ... 5 critical): 4 Risk factor: Project completion will depend on tests which require hardware component under development. Hardware component delivery may be delayed Probability: 60 % Impact: Project completion will be delayed for each day that hardware is unavailable for use in software testing Monitoring approach: Scheduled milestone reviews with hardware group Contingency plan: Modification of testing strategy to accommodate delay using software simulation Estimated resources: 6 additional person months beginning 7-1-96

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Dr.Li Pei-Xing,MathXP@163.com,School of Math.&Comp.,Sun Yat-sen University,Guangzhou,P.R.C.,510275