Plan to Manage Risk

Why risk management must be part of your project plan

April 14, 2016

As we said in Part 1, the first phase of managing a project is Project Initiation. Early in the project, you define the project’s product or end point in sufficient detail that you can both satisfy the customer’s view of product quality and plan the creation process realistically for implementing at a global level. Without a well-defined end product, estimating resources and time is very difficult.

Part 2 included an introduction to a project’s quality plan, scope boundaries, and resources. Now that you’ve gotten this far it’s time to focus your energy on developing a strategy for the project’s Execution Phase.

This means asking the all-important question: Is risk management a part of your strategy?

If you haven’t accounted for risk, your product may not reach completion. Risks have the potential to affect your project. Start risk management early. You can uncover risk possibilities before a problem occurs. Identifying things that could go wrong can help you spot problems when they do.

You can outline ways to handle possible roadblocks, shortages, and other risks in a Risk Plan.  Involve your team in identifying risks. Use representatives of different groups to spot risks you might have missed. Seek out and plan for larger risks. Use the risk list to work in some prepared responses for your team to use in case the anticipated risk becomes a real problem.

Put a review point in your task plan. Keep risks present in your mind and in the minds of your team members by regularly updating your risk list. List the risk, the response, and the team member in the risk management plan. Use the risk list to work in some prepared responses for your team to use.

Add reviews and risk responses for major risks to your overall management plan as a safety-net. When the risk becomes a problem, take action. Planning for error or interference puts you one step ahead of a problem so you can deal with it using thoughtful action instead of throwing a panic switch. When the time for the anticipated risk has passed, eliminate it from the plan and add risks and responses for the next phase.

While you’re still in the early stages, there is more flexibility to redefine both the product and the project you will use to create it. It’s better to consider these factors at the start, rather than running into an unforeseen barrier or having to redefine the product halfway through project execution. Changing a plan is much cheaper than changing a product!

TIP:  Organize your project to include Risk Management at the start of product development.  You will spend less money and you’ll be able to identify resource priorities, interdependencies, and challenges in both the business environment and in the economy. Identifying risks early will help you use resources more efficiently to create a successful product.

by Helen S. Cooke

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