Project Risk Management Using the Project Risk FMEA

Abstract:Identifying and mitigating project risks are crucial steps in managing successful projects. This article proposes the extension of the Failure Mode and Effects Analysis (FMEA) format to quantify and analyze project risks. The new technique is labeled the project risk FMEA (RFMEA). The RFMEA is a modification of the well-known process, product, and service FMEA technique. In order to use the FMEA format for projects, the detection value of the standard FMEA is modified slightly for use in the project environment. The new approach is illustrated in a case study from the electronics industry. By adding the detection value to the risk quantification process, another measure beyond the typical risk score is made available to the project team. The benefits of the RFMEA include an increased focus on the most imminent risks, prioritizing risk contingency planning, improved team participation in the risk management process, and development of improved risk controls.Keywords:: Risk ManagementRisk MatrixRisk AnalysisProject Management