Unit 4

What is Risk Management?

The risk in a software project is a powerful or important problem, in future that may be turnout as loss
of any kind i.e. poor performance of software, extra cost etc. and that may affect the result of the
project.
To tackle these risks there is Risk Management.
Management is a central point that plays a critical role by planning new strategies to overcome these
risks.
Risk Management actually a solution force for upcoming loses and to remove or minimize that lose.

When Risk Management Happens?

1. A software project or development always required the use of new advanced technology and
high level of knowledge.
2. Risk rises as with the missing of these two factors.
3. Instead of these factors, there will be some more external or internal risk for a manager.
4. Then to overcome future lose, overcome the risk or to stop risks becoming issues,
management called Risk Management will be in action.
Why Risk Management in Software Project Management is Important?
Ever software project contains some sort of riskiness that may threaten the success of a software
project. Risk Management is an important part of a Software Project in a way to overcome the
riskiness and to reduce or minimize the risks. A good Risk Management can plan good that may lead
the Software project to its high level of success. Risk Management is also important in a way to save
your project form future failures.

How does Risk Management work?

1. Risk Management works in various steps and the first one is to identify the risk, in this
process risk management makes the list of risk that might impact on the success of the
project.
2. Check the list of risk and believe that these ricks are actually effected the software project.
3. Making plans and strategies to avoid or to get rid or these plans must execute in a way the
management describes.
 4. Monitoring of project for reduction of more risks and to communicate with the software team
on every single problem project faces.
Examples of Risk Management in Software Project Management
Let’s look on another example, let suppose it looks like the time frame of project increase from the
time required or fixed for completion of the project due to short of missing of a key person, so Risk
Management will be in action to tackle this overflow of time.
Advantages of Risk Management in Software Project Management
1. You will be always aware of the upcoming risk, and be able to stop them from converting into
issues in the future.
2. Get rid of treats that software development may face during development time.
3. The project will be delivered on time when Risk Management will take the project out of risk.
4. Improves project planning and limits the project to the cost that is fixed for it and avoid form
overflow of cost.
5. Awareness about risks in upcoming projects or in the present project.
6. Achievement of goals as a result of quality software.
7. Satisfied customer and will be open new ways to expand your business.
Disadvantages of Risk Management in Software Project Management
1. Risk management includes difficult measures and calculations to identify, plan and execution
for reduction of risk.
2. Risk Management is so complex so it is difficult to understand there must be required some
extra knowledge to understand.
3. Maybe the cost will little increase because of the training of employees to understand the
complex structure of risk management.

Categories of Risk Management

1. Schedule Risk :
Schedule related risks refers to time related risks or project delivery related planning
risks. The wrong schedule affects the project development and delivery. These risks are
mainly indicates to running behind time as a result project development doesn’t progress
timely and it directly impacts to delivery of project. Finally if schedule risks are not
managed properly it gives rise to project failure and at last it affect to
organization/company economy very badly.
Some reasons for Schedule risks –
 Time is not estimated perfectly
 Improper resource allocation
 Tracking of resources like system, skill, staff etc
 Frequent project scope expansion
 Failure in function identification and its’ completion
2. Budget Risk :
Budget related risks refers to the monetary risks mainly it occurs due to budget overruns.
Always the financial aspect for the project should be managed as per decided but if
financial aspect of project mismanaged then there budget concerns will arise by giving
rise to budget risks. So proper finance distribution and management are required for the
success of project otherwise it may lead to project failure.
Some reasons for Budget risks –
 Wrong/Improper budget estimation
 Unexpected Project Scope expansion
 Mismanagement in budget handling
 Cost overruns
 Improper tracking of Budget
 3. Operational Risks :
Operational risk refers to the procedural risks means these are the risks which happen in
day-to-day operational activities during project development due to improper process
implementation or some external operational risks.
Some reasons for Operational risks –
 Insufficient resources
 Conflict between tasks and employees
 Improper management of tasks
 No proper planning about project
 Less number of skilled people
 Lack of communication and cooperation
 Lack of clarity in roles and responsibilities
 Insufficient training
4. Technical Risks :
Technical risks refers to the functional risk or performance risk which means this
technical risk mainly associated with functionality of product or performance part of the
software product.
Some reasons for Technical risks –
 Frequent changes in requirement
 Less use of future technologies
 Less number of skilled employee
 High complexity in implementation
 Improper integration of modules
5. Programmatic Risks :
Programmatic risks refers to the external risk or other unavoidable risks. These are the
external risks which are unavoidable in nature. These risks come from outside and it is
out of control of programs.
Some reasons for Programmatic risks –
 Rapid development of market
 Running out of fund / Limited fund for project development
 Changes in Government rules/policy
 Loss of contracts due to any reason

What is a milestone in a project?

A milestone is a specific point of progress as you move along your project timeline. This checkpoint
highlights the successful completion of major tasks and events within your project.
Milestones are not events, as many define them. The Project Management Institute (PMI) notes that
they should describe what you want to achieve and when you get there. However, many people avoid
this level of precision. When they define milestones as events, their attention diverts from what the
project is supposed to deliver.
Why project milestones?
Project teams strive to hit milestones to finish work on time and reach the rest of the goals. They use
them to divide a timeline into stages to signify the overall progress.
These checkpoints are typically defined during the planning phase. They help to break down the
project into manageable sections and systematize everything so that the team can feel less
overwhelmed or stressed.
They are also helpful when you care about creating a project plan from the ground up. They allow for
a clear schedule that includes all significant events to expect along the way.
Milestones help to spot potential bottlenecks. When the deadlines are not being hit, managers can
define why and what blockers the team may be experiencing that are holding up the entire process.
Since the use of any concepts and tools is better understood through practical cases, we recommend
you delve deeper into the most widely used milestones project management examples.
14 examples of milestones in project management
There are different milestones for various projects and industries, from construction to the IT sector.
Among the most used construction PM milestones examples, we can define:
 Customer approval.
 Tendering the construction contract.
 Securing permissions.
 Securing the funds.
 The acquisition of a site.
If you are looking for the software development milestones examples, you will indeed find the cases
related to:
 Requirements gathering.
 Pre-development planning.
 Support.
 Quality assurance testing.
 User acceptance testing.
 Deployment.
Besides, project teams set these checkpoints in such industries as:
 Education.
 Technology.
 Event management.
 Financial services.
 Healthcare.
 Law.
No matter how big or small your project is, here are some major project milestones examples that you
can set as a way to keep your team on track.

What Is Project Tracking?

Project tracking is a project management method used to track the progress of tasks in a project. By
tracking your project, you can compare actual to planned progress, and identify issues that may
prevent the project from staying on schedule and within budget.

Project tracking helps project managers and stakeholders know what work has been done, the
resources that have been used to execute those tasks, and helps them create an earned value analysis
by measuring project variance and tracking milestones.

Key to project tracking is the use of project tracking tools and project management techniques. For
example, a Gantt chart allow managers to track project progress by providing an overview of tasks,
workload and milestones at any point of the project life cycle. Other types of project reports
like status reports can gather extra details that provide further insight into deliverables, risks and
performance. This data can then be distributed to the project team and stakeholders to keep them
updated.

What Is a Project Tracker?

A project tracker is a tool that lets managers measure the progress of their team as they execute tasks
and use resources. It’s an essential tool to keeping projects on schedule and within their budgets.

Project tracker templates can be used as a single source of data for the project’s progress. The project
team can input details about the project’s progress on the template, which can then be shared to show
the project manager and stakeholders the project status at that time.

The more robust option, however, is using project management software to track projects. Online
tools are updated in real time, and that data is shared throughout the software. It can then create
reports with live data to help you make better decisions. ProjectManager makes tracking your projects
from start-to-finish simple. Sign up for a free trial today!

ProjectManager tracks projects with live dashboards—learn more.

How to Track Project Progress

Tracking the progress of your project can seem like a daunting task, but by laying out the process and
planning ahead, you can set yourself up for success. The following are a few things you can do now to
get on track:

 Create deliverables and milestones

 Set realistic, clear and measurable goals

 Use a project tracking software to keep track of time, costs and tasks

 Meet regularly with team and stakeholders

 Have clear deadlines

 Support transparency

These suggestions are structural and should be set up for every project. They can work with project
tracking software or a project tracking template to give project managers the details they need to hold
their teams to the planned schedule and budget.

Additionally, with project tracking, it’s important to remember the triple constraint (time, cost and
scope). The key to managing these interrelated variables is proper estimation and control. You first
estimate your costs to create a project budget, the time that tasks will take to create a project timeline
and the project scope to create your project schedule. Then you have to control them during the
execution phase by using a project tracker that allows you to track time, costs and tasks.

SCM
Software Configuration Management

The best practices of Software Configuration Management are as follows

• Identify and store artifacts in a secure repository
• Control and audit changes to artifacts
• Organize artifacts into versioned components
• Components reduce complexity
• It is easier to identify the quality level of a particular component baseline than that of numerous
individual files
• Instantiating a physical component object in a tool helps institutionalize component sharing and
reuse
• Mapping logical design components to physical SCM components helps preserve the integrity of
software architectures
• Create baselines at project milestones
• Record and track requests for change
• Organize and integrate consistent sets of versions using activities
• Maintain stable and consistent workspaces
• Support concurrent changes to artifacts and components
• Integrate early and often
• Ensure reproducibility of software builds

Managing Contracts

Contract management refers to the process of managing contracts from partners, vendors, customers
and employees. The process supports any process that contributes, create and utilizes contract data.
Depending on how it's done, contract management can be an asset or a liability to a company. The
level of success for any contract management process is in how integrated and digitalized the process
is.
It can therefore involve certain infrastructure like self-service portals, the availability of pre-approved
templates, electronic signatures and even legal playbooks. This is the type of infrastructure that makes
the process more manageable and easy to maintain.

Contract Management Process

The following is a description of a typical contract management process.

1. Request
This is the actual creation of a contract which can involve templates if a company is using the latest
digital contract management system.
2. Negotiate
Negotiations are the next step. This is where the terms and conditions that are in the final contract are
determined.
3. Approval
This where the contract is sent to legal for approval before it can be signed by the stakeholders. Once
it has been approved and signed, the contract's terms and conditions are set into effect and stored.
4. Search and Report
Occasionally a contract will be required. If you use the traditional filing cabinet form of storage, the
contract usually can't be located which leads to the manual analysis of a contract which can lead to
human error.
5. Comply/ Amend
It is also likely that sometimes you may need to check if both parties are holding up their end of the
deal. This can take some time when all transactions need to be reviewed manually. If the contract
period comes to an end, the terms may need to be renegotiated. Unless there is proper contract
management, this period can pass without notice.
Stages of Contract Management

One of the purposes of breaking contract management into distinct stages is to make it easier to
analyze contract workflows and processes. Since the entire process is separated into recognizable
steps, this allows managers and teams to identify broad trends and locate areas of improvement.
Here are the seven essential stages of contract management.

1. Planning stage
Before you can implement a process, it’s important to develop a system that will best suit your
company’s needs and resources. To keep things streamlined and organized, it’s also important to
develop contract management processes that can be implemented company-wide.
Your contract management strategy is a flexible roadmap consisting of processes that account for all
types of company agreements, from standard employment contracts to the paperwork from highly
specific and complex deals. The first step to developing your strategy is to determine your needs,
including answering the following:
What types of contracts do you have to manage and in what volume?
Are there standard agreements you use again and again? What needs to be included in these?
Who is responsible for each stage of contract management and what do they need to perform their
job?
Who has the final say on the contract approval process?
What common problems have occurred in the past, or what issues might arise during the management
of a typical contract?
What resources are required to implement your contract strategy?

What contract data are you tracking? Where is it stored? How is it reported?
Understanding the remaining stages of contract management will help to inform your processes. If
you’re currently unable to answer the questions listed above, you may need to adjust your contracting
processes. Check out our change management checklist to learn how.

2. Implementation stage
Once you have outlined your contract management workflow, you will need to implement your plan
before you can start using it. This includes deploying contract lifecycle management software to help
you to execute contract-related tasks, as well as migrating your contracts to a centralized repository.
A crucial part of your implementation plan is onboarding – making sure everyone involved
understands your vision and objectives for contract management and is comfortable with the CLM
software they will be using.

3. Pre-contract stage
Now that you have your contract management foundation set up, you can begin to implement it for
new contracts. That means developing new contracts or implementing boilerplate agreements for
more standard situations. The key challenge of this stage of contract management is developing a
specific document that will deliver what you need and reduce your risks.
For standard situations, this stage may be as simple as finding the right contract type, entering the
relevant information, and perhaps making a few tweaks. More unusual or complex contracting
scenarios may require the development of a whole new document. Developing a contract from scratch
can be made easier by looking at other agreements that might be applicable and adapting those
terms. Leverage ChatGPT or another GPT-3 technology to speed up specific steps of drafting and
contract creation. Don’t forget to carry over any important requirements such as compliance
obligations or branding standards. Once you have agreed on the terms and developed your contract, e-
signatures can keep things moving.

4. Handover stage

It’s common – especially in larger companies – that the individuals involved in executing a contract
are not the same as those who negotiated it. Thus, in order to ensure the contract is fulfilled as
expected, it’s important to ensure a smooth handover. Rather than assuming stakeholders have
everything they need, it’s useful to spend some time walking through all of the contract details and
confirming roles, responsibilities and milestones.

5. Contract stage

The contract stage is when all of the goals of your contracts come to life, assuming you manage them
properly. And the previous contract management steps you’ve completed so far are setting you up to
do just that.
But the contract stage doesn’t manage itself – it’s here where you must play close attention to all of
the terms laid out within your agreement and perform regular monitoring to make sure everything is
happening as it should. It’s useful to have a plan for doing so, with a clear sense of key milestones and
performance metrics that will let you confirm everything is on track – or provide an early warning
system if any problems arise.
 6. Pre-renewal stage

Nothing lives forever – not even your contracts. But there are several ways your agreements may
come to an end: one-off agreements may wind down to a natural conclusion, you may renew an
agreement, or choose to terminate it. Often there are specific terms – and even possibly penalties or
default actions, should you fail to do anything – that can affect the outcome, which is why it’s
important to start thinking about the end of your contract in a proactive and timely manner. Now is the
time to evaluate how your contract performed and decide whether you want to renew and/or make any
changes. Make sure all stakeholders are aware of termination and renewal dates and that you have
enough time to consider all the information before you get locked into any decisions.

7. Post-contract stage

Once a contract ends, there is still some housekeeping to do to ensure that everything is wrapped up
properly. This includes ensuring termination conditions have been met, issuing or paying final
invoices, and archiving your contract. It’s also useful to perform a contract post-mortem, which can
provide valuable information and learnings that can improve the results of future contracts.