Project Management

Risk Reward

From the ProjectsAtWork Blog
Breaking barriers and building bridges to better manage projects and lead teams.

About this Blog


Recent Posts

The Youthquake Arrives

Demand Diversity

Driving Innovation from Within

Make the Most of Virtual Meetings

Listen Up!

Categories: culture, risk

Risk is everywhere. Crossing the street. Changing lanes. Joining a pickup basketball game. Digging in the yard. Some risk we take for granted—most drivers observe the red light, so we go ahead and cross the street; after all, we want to get to the other side.

On projects, risk gets more complicated. There are unmarked roads to navigate with possible bumps or ditches around every curve. The consequences of being surprised can be costly. But managing projects in fear can also be damaging because risks are tied to rewards. And so risk management is part discipline, part art—a balancing act that requires courage on the part of project managers, teams and stakeholders.

Successful organizations understand that managing risk is as important as managing the schedule, budget or scope. They know unaddressed risks can threaten a project but also recognize that many risks carry potential benefits that can improve the outcome beyond original expectations.

In one sense, risk management at its best is an entrepreneurial endeavor. Data-gathering, analysis and identification are fundamental, but the big payoffs come when new decisions lead to redefined project plans that capitalize on the learnings and opportunities that risks can bring. The huge challenge for most organizations is to build an infrastructure that allows, in fact encourages, creative responses to risk.

Unfortunately, in many organizations risks are handled like hot potatoes—juggled and tossed from person to person, or buried. No one want to hear the bad news, but the silence can be deafening and far from golden. In this environment, stakeholders often receive much worse news later, when it is much more damaging.

A related barrier to better risk management is mistrust—or perhaps, just a lack of faith in new ideas or approaches. Sponsors are uncomfortable with redefining a project in the middle of it. They feel they are losing control.

But to manage uncertainty on transformative projects where unknowns are the rule, not the exception, continuous redefinition is the only way to go. There is still oversight, but it observes other criteria. You're no longer solely monitoring progress to the goal; you're also monitoring—and responding to—what you are learning along the way.

At its heart and soul, risk management is a conversation. It's looking at tradeoffs with your partners and stakeholders and saying, 'Here are the things that could happen. Do we need to take action now? Do we need to change our project plan? Do we go for it?'"

But if political realities, resource limits or a silo infrastructure conspire to make that conversation difficult if not impossible, project managers still should do everything possible to keep the discussion alive on their teams. Most team members are eager to talk about risk once they believe they can do so openly without being tagged complainers.

So let's be risk-aware, not risk-averse. Let's be risk opportunists, not risk opponents. It's a shift in mindset that offers great rewards.



Posted on: June 14, 2019 11:14 AM | Permalink

Comments (16)

Please login or join to subscribe to this item
Great. Thanks, Aaron. Embrace risks, leverage for opportunities.

I love this .. So let's be risk-aware, not risk-averse. Let us create an open culture for conversations and find opportunities in risks !

Great post Aaron, your last paragraph summed it up perfectly. Here’s my summary to tag on to yours: Managing and Embracing risk finds reward, rejecting risk is an illusion.

Very interesting, thanks for sharing

Interesting and Nice Post . thanks .

Fantastic post thanks for sharing

Wonderful post. Thank you Aaron !!

Perfect. Thank you for sharing

Risk Aware Risk Adverse! Thank you for sharing the above. Great post!

Great article. I really relate to the "Hot Potato" example I agree we do need to embrace the risk rather than run from it. That puts risk right behind you and you don't. see it until it runs you over.

Great tips about common problem: risk

Agree that we are generally risk adverse. Think the challenge for PMs is to teach our teams that bringing risks to leadership isn't a bad think. We have to emphasize that its ok and better to bring an issue forward so that we can deal with it, hopefully proactively.

And we have to underwrite an honest mistake and help the team fix it versus using a hammer to crush the messenger.

Thanks for giving us this Risks approach....will b helpful.

Dear Aaron
Interesting your perspective on the topic: "Risk Reward"
Thanks for sharing

Very important tip: "But if political realities, resource limits or a silo infrastructure conspire to make that conversation difficult if not impossible, project managers still should do everything possible to keep the discussion alive on their teams .."

Please Login/Register to leave a comment.


"The golden rule is that there are no golden rules."

- George Bernard Shaw