How would you define these terms? What are the differences? Saving Changes...
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Bill BiglerProject Scheduler| Booz Allen HamiltonCentreville, Va, United States
In my projects, I define risk according to the PMBOK and use that process for dealing with risks.
Issues are often the items that create risk because a choice is involved and their are risks with each choice. However the issue itself is something that is not completly defined. For instance, justification of resources for a project extension may be an issue. If I get the all of the resources, I have certain risks; if I get half, I have other risks, etc. I have defined this as an issue because I have a lot of unknowns about it or it is highly visible.
To provide the justification, I have a series of activities in my project schedule to provide the justification. However, some actions may be required that I especially want status reported. For instance, I need to get the format for a resource justification and the normal source failed. So I have assigned my junior analyst to find the format. At the next team meeting, I expect him to report his status.
In on Integrated Product Team, that I serve as secretary, the chair makes every issue requiring some off-line action, an action item. Issues which are discussed and no action required is dropped from further consideration.
This is an interesting topic. There are many opinions and options. My recommendation is to collect as many definitions as possible and apply those that fit your experience and your organization best. It will be easier to get your organization to apply consistent terms if you define them close to terms that are currently used.
Action Item Something agreed to be done as a result of a discussion at a meeting and usually recorded in the minutes of that meeting.
Issue Something in dispute or to be decided.
Risk #1 The probability of an undesirable outcome.
Risk #2 (Project Risk) The cumulative effect of the chances of uncertain occurrences which will adversely affect project objectives. It is the degree of exposure to negative events and their probable consequences. project risk is characterized by three risk factors namely: risk event, risk probability and the amount at stake. Risk is the opposite of opportunity.
Risk #3 The possibility that something can go wrong and interfere with the completion of the work.
I feel that these definitions match my experiece well, and are generally accepted in the PM world. Your specific industry or application area may have different definitions. Choose the definitions that you think will be easiest to use in your job, but remember, others may use different terms to mean the same thing.
This is, indeed, an interesting topic. Coincidentally, I was discussing a similar topic with some peers just last week.
While William and Roger have provided great information on the definition of "actual" risk as it is associated with projects and their success, we were exploring the discussion of risk at the enterprise level.
While project risk and enterprise risk are relatively synonymous for initiated projects (schedule, budget, resources), there are a couple of enterprise risk sub-categories that differ from project risk categories, which I wanted to highlight to see if they belong in this discussion:
1) Calculated risk: An enterprise has to look at terms of calculated risk. That is, can the company or business unit engage in a number of projects that *may* fail if the success of even one of the projects will move the company forward? This balancing requires finding both projects that have a 99.9% chance of success as well as projects that have a lesser chance of success.
2) Risk associated with a non-project or "What do we risk by not engaging in this project?": A bit of a brain-bender, but the fact remains that in these times when budgets are small and eyes are bigger than stomachs, it becomes just as important to evaluate the risk of not doing something as it does to evaluate the risk associated with funding and resourcing other projects.
Sorry to go off on a tear. This just seemed like a good place to add these thoughts and get some good feedback. Unfortunately, in my mind, the thoughts seemed to be both complementary and conflicting with typical definitions of risk. I hope they address the original question. Your thoughts, criticism, and definitions will definitely help bring this thinking into a more solid form.
