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Practice Areas: Risk Management
Is contingency plan good enough?
Network:894



Is contingency plan good enough for specific unknown risks that cannot be managed proactively? What else can you do?
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Network:4285



No. Have a fallback plan.
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1 reply by David Hernandez
Nov 04, 2016 2:31 PM
David Hernandez
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Thanks
Network:59887



Unknown unknowns are things we haven’t thought of that could affect us, that is there are limitations to our knowledge or awareness. It is more or less assumed that, if we haven’t given these unidentified factors any thought and they could affect us, it will be bad for the project if they do occur although we can’t be certain because we are not sure what they are.

The plans you can set for those risks are limited, again, because you do not know much about their nature and that's why the associated cost estimates falls under Management Reserve which is not part of the cost baseline but it is part of the Overall Project Budget.
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1 reply by David Hernandez
Nov 04, 2016 2:31 PM
David Hernandez
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Thanks
Network:894



Nov 03, 2016 11:36 PM
Replying to Anupam Ganguly
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No. Have a fallback plan.
Thanks
Network:894



Nov 04, 2016 12:57 AM
Replying to Rami Kaibni
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Unknown unknowns are things we haven’t thought of that could affect us, that is there are limitations to our knowledge or awareness. It is more or less assumed that, if we haven’t given these unidentified factors any thought and they could affect us, it will be bad for the project if they do occur although we can’t be certain because we are not sure what they are.

The plans you can set for those risks are limited, again, because you do not know much about their nature and that's why the associated cost estimates falls under Management Reserve which is not part of the cost baseline but it is part of the Overall Project Budget.
Thanks
Network:1355



After a certain limit you have to accept risk and there is no plan to protect project from risk. If a Tsunami comes world cant remain in existing state. Only some damages can be saved.
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1 reply by David Hernandez
Nov 09, 2016 7:04 PM
David Hernandez
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Thanks alot, your comment is appreciated
Network:894



Nov 06, 2016 6:08 AM
Replying to AKSHAY JAIN
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After a certain limit you have to accept risk and there is no plan to protect project from risk. If a Tsunami comes world cant remain in existing state. Only some damages can be saved.
Thanks alot, your comment is appreciated
Network:66611



Understand your talking about a known-unknown risk.
After some mitigation action, the residual risk may need one or more contingency plan According to the risk. Could be a communication plan!
Network:61652



The contingency plan is for when a risk is triggered. A fallback plan, as suggested by Anupam, is for when your contingency plan fails.
Network:376



Hello David,
If you have a contingency plan in place and you are taking actions as per the plan then you are managing the risk proactively.
If you are having a contingency reserve for that particular risk and have no action plan to reduce the effect or probability, then you are accepting the risk passively. This is ok for small risks which fall within risk tolerance level of your organization or project.
If the effect is more than the tolerance level, then you need to have a contingency plan and implement the plan to reduce the impact to acceptable level or drop the project.
Network:532



Contingency Plan is very well prepared initially by giving % values to design, procurement and construction and commissioning based on corporate policy , and calculating and planning accordingly.
But however, as everybody knows, projects may not behave the way it was thought to be,
Hence mid course changes might have to be made while release of contingency with due approval process being followed as per corporate policy.

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