The basic idea behind Risk Management in SDLC is through a regular planning and assessment of risk that are measured based on the probability and impact on the Software Project Development Plan or schedule along with the proposed risk mitigation strategies to avoid risks and their impact on SDLC processes.

All risks can never be fully avoided or mitigated simply because of financial and practical limitations. Therefore all organizations have to accept some level of residual risks." Risk Management involves the following activities.

·         Risk Identification – This is the step where a risk is identified before it becomes a problem, or, rather a hindrance to the success of any Software Project.

·         Risk Analyzing – This is a step that determines which risks are the most important ones to address based on their priority and impact. Once the risks are prioritized based on their importance, the adverse effects that they can inject into the SDLC process and their probability of occurrence is analyzed. The most critical risks are of higher priority and should be mitigated first compared to the ones that are of lesser priority.

·         Risk Planning – Risk Planning involves a decision making process that prioritizes the risks and creation of Risk Mitigation Plans. Risk Prioritization involves the quantitative measurement of risks and estimating the probability of their re-occurrence and the relative loss that they could incur in the SDLC process.

·         Risk Response Actions - This identifies and describes the action (such as acceptance, transfer, avoidance, or mitigation) and the necessary response strategies to address the risks based on the priority of the identified risks. This is the step that also identifies the target date for completion of the risk response action and the resource(s) who is/are responsible for the same.

·         Risk Monitoring - This phase monitors the risks and their evaluation of their current status based on the defined metrics so as to ensure that the risks identified are addressed as per the stated timelines in the SDLC process of a Software Project.

·         Control – This process controls the Risk Action or the Risk Mitigation Plans and improves the overall Risk Management Process. It involves the tracking of the progress of the SDLC process towards resolving the risk items that have already been identified.

·         Risk Reporting and Communication - This is a step that defines the methodologies that are used to report risk mitigation activities, review and present the Software Project risks and communicate the risks and their status effectively.