Software Architect's Handbook

Transferring the risk to another party

Another technique in risk management is to transfer the risk to another party. An example of this might be a project team that hires a subcontractor to implement parts of a project, such as the design and development of a user interface for a web application. There is a risk that the subcontractor may not complete their deliverables on time or that their deliverables may not meet certain quality standards. One way to handle this risk would be to transfer it to the subcontractor by building penalties into the contract that will be incurred if the deliverables are late or do not meet the level of quality desired.