Subtitles of the Movie

Many times risk analysis is confused for the overall risk management process. It's not that you simply note down risks and then analyze them to figure out where to go next. That's a very simplistic look at risk analysis and honestly, it won't get you very far. In this movie I'll provide you with a clear definition of risk analysis and also highlight what we'll cover in this section. If you were to ask someone to specifically define risk analysis, they would answer something to the effect of analyzing risk on a numerical level. That's more descriptive of quantitative risk analysis than it is of risk analysis in general. There is more lumped into risk analysis than even many project managers realize who don't manage risk in the way that industry recommends or through the use of best practices. In fact, it's common to hear that risks aren't managed within a project at all, so you are definitely ahead of the curve already. Risk analysis heavily revolves around the impact and probability of risk, which is the second point on your screen. We're concerned with the impact of a single risk and a risk collectively. This is one of the reasons that we look at risk by category and why we're concerned with the areas of the project that are the most affected by risk. By the way, risk analysis is not a solo journey. The project or risk manager does not undertake risk analysis alone. It would be impossible because the involvement of experts, whether it's subject matter experts internal or external to the organization or individuals involved in performing activities that are knowledgeable about those activities and even risk experts, these individuals are necessary in assessing risk and in gathering the information needed to analyze risk. That's the third point on your screen. And of course, we have stakeholders who always play a key role in risk management, including risk analysis, such as understanding their priorities, their risk tolerance levels, agendas, et cetera. All of these things I mentioned are part of risk analysis and naturally they are part of risk management overall. Risk analysis involves the identification, assessment and numerical analysis of risk. That's right; it includes all of those things. In Part 1 of this course series, we covered the creation of the risk management plan and how risk probably and impact is defined and documented within the plan. Analyzing risk relies on this information for risk analysis to be useful. Risk analysis clarifies what areas of the project are most affected by risk and it guides us in developing more efficient and effective risk responses. Which risks require response, when and how drastic a response does it need to be? We really can't answer these questions and come to a resolution without analyzing risk first. Within this section, we'll touch on the following things: the goals and benefits of risk assessment, the benefits of risk analysis, overview of a risk analysis model, a brief note on risk analysis and how it fits into overall project managements and finally I'll touch on the risk analysis domain and this refers to the domain in terms of the PMI-RMP exam. And that wraps up this movie on introduction and broad definition of risk analysis.