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Uses and Benefits of RBS 

The main uses and benefits of the RBS are outlined in this section. 

Risk identification aid 

Risk Breakdown Structure is used as a list that includes all project risks during risk identification phase, irrespective of the risk identification method being used.  

For example, brainstorming through various elements of the RBS enables participants to identify risks under each of the RBS areas. The RBS structures the risk identification interviews, and also schedules for discussion between the facilitator and interviewees. 

The identified risks are mapped into the lowest level of the RBS, which breaks possible gaps and exposes any duplication. This ensures that the risk identification method has covered all possible risk. The RBS ensures that all possible sources of risk to the project are explored.   

Risk assessment 

The identified risks are allocated to various elements of RBS, which enables you to identify  the most crucial source of risk to the project. This identification of the risk can also be done by counting the risks in each RBS area. However, mere counting of risk can also mislead, as the count of relative severity of risks may sometimes go wrong. Thus some areas of RBS may have minor risks, while other areas may have major risks. A "risk score" is created based on the size or scale of each individual risk within the RBS. This risk score is compared with those risks within each area to evaluate the concentration of risks within RBS. This in turn helps in indicating which RBS areas give more risks to project. 

The simple list of risks or the list of risks prepared based on their priorities do not help in the assessment of risk exposure to the project. The insights of the risk can only be obtained by categorising the risks according to the Risk Breakdown Structure.  

Comparison of projects or tenders 

Risk Breakdown Structure (RBS) provides common framework to compare the exposure of risk on different projects or any competing tenders. The risks identified on each project are also structured in the RBS. In case of tenders, competing tenders helps to identify risks which is then structured in the RBS. The amount and type of risk associated with each tender are represented in consistent format. This allows you to select the preferred tender while considering the relative risk exposure. The risk exposure of the individual projects is also compared using a common RBS framework in order to prioritise them based on the relative risk exposure. 

Risk reporting 

The RBS provides the risk information, on each individual project, to the senior management and also provides access to the required report on the project team actions. The reports generally include total number of risks or the total risk scored in higher-level RBS areas. The report is basically represented in metrics or graphical form. By selecting appropriate RBS areas, project team members are notified of risks present within their project. The RBS also provides  cross-project or multi-project information to senior management by removing all possible misunderstanding or confusion between projects. The risks within the same RBS area are directly compared across project, which is further advanced using RBS based numbering scheme. 

Lessons learnt for future projects 

The Risk Breakdown Structure can also be a common platform for analysing risk-related information from each project once the project is complete. Analysis based on this structure helps to reveal risks that occur frequently. The generic risk along with their effective response is also recorded for future reference. Accordingly, preventive responses can also be developed, implemented and referred for future projects.  

Project Management, Management Studies

  • Category:- Project Management
  • Reference No.:- M9508989

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