Risk Management Game

What can students learn from this?

Students will learn how to collaborate in order to assess and classify risks. Moreover, because the activity is conducted in a team, the collaboration within the group will ensure a broad categorization and identification of risks.

Lastly, due to the exercise of prioritisation of risks, they are also involved in planning activity and risk management.

How can I do this in class?

Step 1: IDENTIFY RISKS

• Gather the class together.
• Meet them in front of a white board with sticky notes and sharpies.
• Give the students a social business idea (e.g. social restaurant employing disadvantaged people)
• Have everyone start writing risks associated with that business idea on the sticky notes, one risk per note. Allow for about 5 minutes for this activity.
• Have a volunteer read off their risks one by one and place them on the white board
• Have another volunteer read off their risks and put the sticky notes on the white board. If they identified an identical risk to one that has already been listed, the volunteer should place that note on a note that already exists on the white board. Continue until all the risks are on the white board.
• Have the group gather at the white board and look through all of the risks, grouping together any duplicates that haven’t already been identified.

Step 2: CATEGORIZE RISKS

• Gather the sticky notes together and put them in a pile.
• Draw a pair of Axises on the white board: X Axis is impact, Y Axis is probability.
• A volunteer takes the first sticky note off the pile and places it on the white board in relative position based on its anticipated Probability and Impact.
• The next volunteer has three options:
  1. Place the next risk on the board relative to the first one
  2. Move an existing risk somewhere else on the board. If the team member chooses this option they should explain why they are moving the risk.
  3. Pass– this choice should really only be used when the number of sticky notes is getting low.
• Repeat this until all the risks have been placed on the board and everyone has passed.

Step 3: ADDRESS RISKS

• Discuss each of those risks and identify a plan to address. In order to issue the plan, 4 options are available:
  1. Avoid – Take steps to ensure that the risk does not happen
  2. Transfer – Find someone outside the team who is better positioned to take care of the risk
  3. Accept – Realize that you have done all you can to address the risk. Take no action and be comfortable with the results
  4. Mitigate – Take steps to reduce the impact and/or probability of the risk.

For each risk, a team member should volunteer to own that risk (make sure it is getting addressed) and by when so that the team knows when to check back.

Reflection tips

In order to facilitate the Step 2, the two Axis can be divided into three levels (Low, Medium, High) creating a matrix and students have to classify them according to these levels.

This will also facilitate Step 3: in order to address risks let them start with the ones located in the upper right hand quadrant of the chart (with high impact and high probability).

Those are the risks that you should address first.

To guide the students identifying and classifying the risks connected to their fictional social enterprise, they can follow this strategy:

1. Have them identify their business tasks, the tasks which are necessary to let them run the business e.g. requirements, coding, testing, training, implementation, resource management etc.
2. If they still have some difficulties in identifying risks, prompt them with some examples:

Budget risks (e.g. budget exceed, unanticipated expenditure…)

Scope risks (e.g. scope poorly defined..)

Schedule risks (e.g. schedule overruns, tasks omitted from schedule..)

Technical risks (e.g. lack of technical requirements, software algorithm malfunctioning…)

Personnel risks (e.g. team is under-resources, skills gap..)

Quality risks (e.g. the software’s interface is cumbersome or inexplicable…)

Communication risks (e.g. poor communications, stakeholders’ dissatisfaction…)

Resource risks (e.g. materials shortage, machinery unavailable..)

Environmental risks (e.g. bad weather results, weather delays progress, adverse environmental effect…).

You can perform this activity for the first time with the whole class to ensure their confidence with the activity. Once they are comfortable with the rules and the risk management approach you can create different teams within the class (max 10 students per team) and allocate them to the risk management of different social enterprises.

When each team has completed the activity, they can present the results to the other teams who have to ask questions, make suggestions, raise issues and express their agreement or disagreement with the team strategy.

Relevant useful material

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Risk management game