Defining Technical Risks in Software Development

Challenges of technical risk assessment is difficult to address, while its success can benefit software organizations appreciably. Classical definition of risk as a "combination of probability and impact of adverse event" appears not working with technical risk assessment. The main reason of this is the nature of adverse event\´s outcome which is rather continuous than discrete. The objective of this study was to scrutinize different aspects of technical risks and provide a definition, which will support effective risk assessment and management in software development organizations. In this study we defined the risk considering the nature of actual risks, emerged in software development. Afterwards, we summarized the software engineers\´ view on technical risks as results of three workshops with 15 engineers of four software development companies. The results show that technical risks could be viewed as a combination of uncertainty and magnitude of difference between actual and optimal design of product artifacts and processes. The presented definition is congruent with practitioners view on technical risk. It supports risk assessment in a quantitative manner and enables identification of potential product improvement areas.