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3 ways managing project risks can suck the life out of you

In every project that you’re involved in, there are plenty of risks that you need to consider. By not planning ahead, your project will most likely end in failure. But you knew that already right?

Project failure is not the only issue. With £96 million being wasted for every £790 million invested due to poor project performance there are clear financial consequences to ignoring risks. It is not hard to see why so much time and effort is put into the risk management of a project.

But let’s face it, risk management can be a stressful business. Here are just some of the reasons why managing project risks can suck the life out of you.

It affects all aspects of your project

managing project risks

If you thought that risk management only covers a small portion of your project, (such as budget for example,) then you’re wrong. VERY wrong.

Risks can affect one aspect of a project and have a knock-on effect on another part. Or they could just be related to one area. This makes it incredibly difficult for you to plan your response to a potentially serious situation.

There is no exact science to overcome this unfortunately. However, there are some common areas that you should consider:

  • Budget
  • Your schedule
  • Your scope
  • The agreed level of quality

Working on previous projects should give you a substantial list of common risks. Once you have this, you can then talk to other stakeholders and team members to see if they have any suggestions, (using a stakeholder management tool is a great way to do this.)

Also, don’t make the mistake of thinking that you only have to list risks at the beginning of a project. You should consider this an ongoing process and actively encourage your team members to come forward at any point with their suggestions.

You’re worried about taking ANY risks

the beatles

You would probably expect that in a blog post about managing project risks, the emphasis would be placed on being as cautious as possible. We may have given you this impression from the first point above in fairness.

But it doesn’t have to be this way! Although there is potential for risk management to go wrong, this shouldn’t stop you from taking any risks during your project.

How often have you heard of great ideas being rejected initially, but then turned out to be a huge success? Famous examples include The Beatles being rejected by Decca Records and Hewlett Packard rejecting Steve Job’s and Steve Wozniak’s idea for a personal computer. History would have been quite different if someone hadn’t taken a risk on them!

The same principles can be applied to your project. Sometimes it IS appropriate to take risks. Especially when the culture of your organisation is to look at the overall picture and can therefore accept short term failures in order to achieve long term success.

It goes without saying that if you’re working on a project where public safety is critical, then you will need to tread more carefully.

Managing your stakeholders

managing project risks

When you’re identifying risks at the beginning and during your project, it is important to also take your stakeholders into account. We all know how difficult they can be to manage sometimes!

Learn how to resolve stakeholder conflict with our tip sheet

Project Smart lists three questions that you should ask to help you to understand your stakeholders and develop a strategy for keeping them informed about possible risks:

  • Who cares?
  • What do they care about?
  • What am I going to do about it?

Which they then compare to the classic risk management process:

  • Identify risks
  • Analyse and quantify the risk
  • Develop a risk response

The similarities are there to see. Look back at the stakeholder engagement analysis that you conducted at the beginning of your project. You should know who your stakeholders are, what level of influence they have and how you should communicate with them.

Now look at the risks that you have identified, analysed and developed a response for. Which stakeholders will these risks affect? Is your planned response sufficient enough? Answering these questions will help to put their mind at rest and ensure that they continue to see you and your project in a positive light.

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