Pragmatic Methods to Control Risk
Frankly, there is not much material in this paper that should come as a revelation. We present concepts such as Accomplishment Value (a variation on Earned Value Analysis), PERT Durations, Schedule Contingency, and Cost Contingency. We draw these techniques together here to present a set of common sense options for risk avoidance and risk management.
Essentially, this paper concentrates on low-tech, common sense methods to address potential risk issues, for time, cost, and technology. For the more statistically oriented project managers, there is still the option of proven Monte Carlo risk analysis techniques.
All techniques can be supported by readily available software that is inexpensive to acquire and simple to use.
First, let's agree that it is better to avoid risk (via better planning, not avoidance of opportunity) than it is to manage risk (or problems arising out of insufficient planning and contingency). That is; Risk control requires pro-active management, rather than re-active management.
Some people define avoidance of risk as avoidance of opportunity. That is, rather than taking calculated risks, they avoid anything that contains any risk. This, of course, reduces the number of options that are available to achieve stated objectives. In development projects, it often means that the product is weakened by excluding the latest technical advances. A "safer", risk-free strategy can lead to an unsuccessful project just as much as a project with risk. When we talk about risk avoidance, we are talking about qualifying risk, not avoiding risk.