A Method for Risk Response Planning in Project Portfolio Management

Abstract

To improve the effectiveness of project portfolio risk management, a portfolio-wide approach is required. Implementing a proactive strategy, this article presents a method based on mathematical optimization to select an appropriate set of a priori local and global responses to address risks that threaten a project portfolio considering key factors, such as cost, budget, project preference weights, risk-event probabilities, interdependencies among work packages, and both occurrence and impact dependencies among risk events. As the proposed method has new features compared to the existing methods developed for a single project, it can also be used in project risk management.