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5.4 Organization Structure and Risk Management

Organization structures can categorize employees into verticals or groups based on functional areas or projects. Companies structure groups differently depending on their services. Risk management is important for software projects to develop software on time and with profits. Risks include project risks like delays, technical risks like changing requirements, and business risks. Risks are assessed based on likelihood and impact, and then prioritized. Risks are then contained through avoidance, transfer, or reduction strategies.
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0% found this document useful (0 votes)
45 views

5.4 Organization Structure and Risk Management

Organization structures can categorize employees into verticals or groups based on functional areas or projects. Companies structure groups differently depending on their services. Risk management is important for software projects to develop software on time and with profits. Risks include project risks like delays, technical risks like changing requirements, and business risks. Risks are assessed based on likelihood and impact, and then prioritized. Risks are then contained through avoidance, transfer, or reduction strategies.
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© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Organization Structures

Employees in S/W organization are often categorized in to


different verticals or groups. The grouping differs among
companies depending on type of service they provide.

S. S. Satapathy

Organization
Functional format
Structures
– the development staff are divided based on the functional group to which they
belong. The different projects borrow engineers from the required functional groups
for specific phases to be undertaken in the project and return them to the functional
group upon the completion of the phase.
– Advantages: Ease of staffing; Production of good quality documents; Job
specialization; Efficient handling of the problems associated with manpower
turnover
• Project format
– In the project format, the project development staff are divided based on the project
for which they work.
– Preferred in smaller organization because of ease in job rotation among the project
team member.
Top Management Top Management

Specifications Project 1
Design
Project 2
Coding .
Testing . Project Project Project
Proj. mgmt. . …
1 2 n
Maintenance
Project n
Functional format Project format
Team Structures
• Chief programmer
– A hierarchy is maintained among the members
• Democratic
– No formal team hierarchy. At different times, different members of
the group provide technical leadership.
• Mixed team organizations
Project Project
Manager Manager

Senior Engineers

Reporting

Software Engineers Software Engineers Software Engineers


Chief programmer team Democratic team Mixed team
structure structure structure
Characteristics of a good software
engineer
• Exposure to systematic techniques: familiarity with
software engineering principles.
• Domain knowledge: Good technical knowledge of the
project areas.
• Good programming abilities.
• Good communication skills. These skills comprise of oral,
written, and interpersonal skills.
• High motivation.
• Sound knowledge of fundamentals of computer science.
• Intelligence.
• Ability to work in a team.
• Discipline, etc.
Risk Management

Software development is often associcated with different


risks. Proper management of risk is essential to develop
software in time with profit.

S. S. Satapathy
Risk Management
• A software project can be affected by a large variety of risks. There are
three main categories of risks those can affect a software project:
• Project risks:
– Project risks concern varies forms of budgetary, schedule, personnel,
resource, and customer-related problems.
– An important project risk is schedule slippage (failure to meet a standard or
deadline). Unlike any manufacturing project, the project manager can not
physically visualize the software product. Thus it is not easy to assess the
progress of the work and control it.
• Technical risks:
– Technical risks concern potential design, implementation, interfacing,
testing, and maintenance problems.
– Technical risks also include ambiguous specification, incomplete
specification, changing specification, technical uncertainty, and technical
obsolescence.
– Most technical risks occur due to the development team’s insufficient
knowledge about the project.
• Business risks:
– This type of risks include risks of building an excellent product that no one
wants to purchase, losing budgetary or personnel commitments, etc.
Risk Assessment
• The objective of risk assessment is to rank the risks
in terms of their damage causing potential. For risk
assessment, first each risk should be rated in two
ways:
– The likelihood of a risk becoming true (denoted as r).
– The consequence of the problems associated with that
risk OR the sensitivity of that risk (denoted as s).
– Based on these two factors, the priority of each risk (p) can
be computed as:
p=r*s
– If all identified risks are prioritized, then the most likely
and damaging risks can be handled first and more
comprehensive risk abatement procedures can be designed
for these risks.
Risk containment
• After all the identified risks of a project are assessed, plans
must be made to contain the most damaging and the most
likely risks.
• Different risks require different containment procedures. In
fact, most risks require ingenuity on the part of the project
manager in tackling the risk.
• There are three main strategies to plan for risk containment:
– Avoid the risk: This may take several forms such as (i) discussing
with the customer to change the requirements to reduce the
scope of the work, (ii) giving incentives to the engineers to avoid
the risk of manpower turnover, etc.
– Transfer the risk: This strategy involves (i) getting the risky
component developed by a third party, (ii) buying insurance
cover, etc.
– Risk reduction: This involves planning ways to contain the damage
due to a risk. For example, if there is risk that some key personnel
might leave, new recruitment may be planned.
Risk Leverage
• To choose between the different strategies of
handling a risk, the project manager must
consider the cost of handling the risk and the
corresponding reduction of risk. For this the risk
leverage of the different risks can be computed.
• Risk leverage is the difference in risk exposure
divided by the cost of reducing the risk. More
formally,
• risk leverage = (risk exposure before reduction –
risk exposure after reduction) / (cost of
reduction)
Risk related to schedule slippage
• Risks relating to schedule slippage arise (failure to meet a
standard or deadline) primarily due to the intangible
nature of software product.
• Therefore, these can be dealt with by increasing the
visibility of the software product.
– Visibility of a software product can be increased by
– Producing relevant documents during the development
process wherever meaningful and getting these documents
reviewed by an appropriate team.
– Milestones should be placed at regular intervals through a
software engineering process to provide a manager with regular
indication of progress.
– Divide every phase in to reasonable-sized tasks and schedule
milestones for these tasks too.
• A milestone is reached, once documentation produced as part of a
software engineering task is produced and gets successfully reviewed.
Milestones need not be placed for every activity. An approximate rule of
thumb is to set a milestone every 10 to 15 days.

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