Preventive Risk Management For Software Projects

Preventive Risk Management for Software Projects Sanjay Murthi D eveloping large software systems is risky business.According to a report from The Standish Group,“CHAOS:A Recipe for Success,” only 28 percent of all software projects in 2000 were on time and within budget and had all their planned features—which means the other 76 percent either failed or did not meet original goals. This is scary in an economy where software systems can make or break the organization. Internet auction company eBay lost millions of dollars when its systems were unavailable for even a few hours. Software product companies like MicroA preventive soft and Oracle lose millions of approach to dollars when product releases risk management are late or do not work as expected. Even small to mediummakes it part of size projects suffer costs from delays.If the cost of each person development on a 10-person team is $100 per hour,a company spends $40,000 and emphasizes every week of delay.The cost flexible processes. for in terms of lost opportunities, lost sales, and dissatisfied customers could be even greater. Many companies have adopted detailed and heavily process-oriented methodologies, hoping to reduce delays and the number of failures. Unfortunately, these methods contribute their own overhead and delays, and frequently provide little guarantee of success.They are also generally prescriptive in that the team takes action (implements a cure) when they find a problem (illness). The cure is often worse than the disease. Senior management becomes aware of a problem when the team misses certain milestones or customers report software problems.They scramble to fix the problem by drastically reducing project scope, replacing project managers, hiring expensive con1520-9202/02/$17.00 © 2002 IEEE tractors, or taking resources from other projects. In the end, the company kills the project because the cu