Basics of Software Risk Management
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by Arindam Ghosh
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Types of Risks

Proposal Risks

There are some risks that are just in-built in the venture. Thus, an RFP for such a project has in-built risks no matter which contractor undertakes the development.

Performance Risks

These are the risks inherent in the proposed approach.


Programmatic Risks

These are the risks that impose an impact on program governance and performance. Risks that impact on program performance generally flow from issues of organizational culture, competence, experience, and skills of the management team.

Schedule Risks

Schedule risks are due to lack of being able to deliver within a scheduled time with the resources allocated.

Cost Risks

Cost risk is when there is a funding problem for completing the job within the scheduled time. This can be for various reasons like low bids, lack of understanding the customer’s requirements, wrong allocation of resources and bad management decisions in terms of accuracy of estimates.


There are times when the non-performance of systems lead to problems. This is a type of performance risk.


We are aware of the fact that most systems cost more to sustain than to develop. The supportability risk is that an otherwise acceptable system will just cost too much to operate and maintain over its life cycle in terms of time and personnel.

Development Risks

A development effort always entails a measure of risk because such an effort always involves aspects that are new to the performing organization. Multiple risks situations are major challenges and are the most interesting from a management perspective.


One of the first risk situations facing such a team is that it invariably requires additional staffing. When new people are hired, some of the negative aspects are that the collective awareness of the nuances of the program is diluted and people start making decisions with less than complete understanding of the nuances of the program, the company or the customer. The only and simple solution is to communicate clearly and have regular staff meetings. It is also recommended that each new employee get a thorough introduction to the roles.

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