How important is risk management in a project?
If there is an adequate identification of the risks, what recommendations exist for the proper management of them later?
What about the new risks or those not initially considered? Saving Changes...
Stéphane ParentSelf Employed / Semi-retired| Leader MakerPrince Edward Island, Canada
There is no point in identifying risks if you are not going to manage them.
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1 reply by Carlos Eduardo Escobar Muentes
Nov 22, 2017 9:04 AM
Carlos Eduardo Escobar Muentes
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That is the point, totally agree. But I have seen cases in which there is a registry but there it remains, perhaps because of "compliance", or that only the risks identified initially exist and will not exist during the course of the project.
Thanks
There is no point in identifying risks if you are not going to manage them.
That is the point, totally agree. But I have seen cases in which there is a registry but there it remains, perhaps because of "compliance", or that only the risks identified initially exist and will not exist during the course of the project.
Thanks
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1 reply by Vincent Guerard
Nov 22, 2017 10:45 PM
Vincent Guerard
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Like other activities you can make a smokescreen of risk management. Comply with some organization rules and hope nobody notice.
There is no reason for keeping a registry, if it is just for the sake of it. Risks if not recognized in time or left to sit in a register column can and will jeopardize a project, sometimes even before the project begins. Many organizations ignore risks and do not plan or keep funds for their mitigation/ management (though all risk responses do not require funds sometimes it may be compliance to certain regulation) and end up in failed projects. Risk identification and planing their responses should be a proactive and continuous activity till the end of project.
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2 replies by Carlos Eduardo Escobar Muentes and Stéphane Parent
Nov 22, 2017 10:14 AM
Stéphane Parent
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Just to clarify on Najam's answer.
Any action I plan on taking before the risk happens, such as mitigtion, will go into my project schedule and budget.
Actions that will happen after the risk happens, such as contingency or fall back, will go into my contingency reserve. (Please note that the contingency reserve is part of the project budget.)
Risks that were not identified will be covered by the management reserve, which is not part of the project budget.
Nov 22, 2017 6:35 PM
Carlos Eduardo Escobar Muentes
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Thank you very much for the contribution
I believe that in many cases the response plan to the initially identified risks is advanced, but there is no evaluation and identification of new risks that may appear during the development of the project.
regards
Saving Changes...
Stéphane ParentSelf Employed / Semi-retired| Leader MakerPrince Edward Island, Canada
Nov 22, 2017 10:02 AM
Replying to Najam Mumtaz
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There is no reason for keeping a registry, if it is just for the sake of it. Risks if not recognized in time or left to sit in a register column can and will jeopardize a project, sometimes even before the project begins. Many organizations ignore risks and do not plan or keep funds for their mitigation/ management (though all risk responses do not require funds sometimes it may be compliance to certain regulation) and end up in failed projects. Risk identification and planing their responses should be a proactive and continuous activity till the end of project.
Just to clarify on Najam's answer.
Any action I plan on taking before the risk happens, such as mitigtion, will go into my project schedule and budget.
Actions that will happen after the risk happens, such as contingency or fall back, will go into my contingency reserve. (Please note that the contingency reserve is part of the project budget.)
Risks that were not identified will be covered by the management reserve, which is not part of the project budget.
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2 replies by Carlos Eduardo Escobar Muentes and Vincent Guerard
Nov 22, 2017 6:38 PM
Carlos Eduardo Escobar Muentes
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You are Right
The explanation is very clear.
We must continue to push for better attention to risk management in organizations
Nov 22, 2017 10:51 PM
Vincent Guerard
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Exactly.
Risk need to be revisited on a regular basis. But at that time it might not be possible to revisit the project budget. The management reserve I’ll be use.
Saving Changes...
Mansoor MustafaSenior PM| Government DepartmentRawalpindi Punjab, Pakistan
It is not only important but very vital for project to do risk management for project. it is one important role of PM to do risk management as it effects many part of project including cost, schedule, user satisfaction and many others.
Secondly risk identification and management is iterative process, one can try to identify as many risks as possible but some of them may not identified at initial stage or knowledge about them is refined as project progress
Normally project manager manage them with use of contingency(know - unkonwn) reserve and management reserves.
Project manager remain on watch out for risk in re assessments, and analysis of reserve analysis to determine that initial contingency and management reserve is still hold good to manage risk for rest of project life cycle
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1 reply by Carlos Eduardo Escobar Muentes
Nov 22, 2017 6:54 PM
Carlos Eduardo Escobar Muentes
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Excellent
The point that I highlight and that sometimes is difficult to understand in organizations that do not have an adequate project controls, is that the identification and evaluation of risks is iterative.
Senior Projects Manager | Field & Marten AssociatesNew Westminster, British Columbia, Canada
You need to identify all risks, put a plan for each, revisit them, identify new risks and manage them properly. If this is not done, your project will remain fully exposed.
Risk management has to go through the full set of processes as defined in the PMBOK to effectively reduce the threat and increase the opportunity outcomes. Otherwise, we are just reporting on an impending disaster (or windfall) vs. preventing/enhancing it.
It also needs to be a full lifecycle discipline to account for changes in project context and increased knowledge on the part of the team.
A disciplined project team will ensure they are allocating sufficient time over the lifecycle for ongoing monitoring & control of risks which will include revisiting identification, analysis and response activities.
Kiron
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1 reply by Carlos Eduardo Escobar Muentes
Nov 22, 2017 7:00 PM
Carlos Eduardo Escobar Muentes
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thanks Kiron
It is good to know that all the answers are directed to the correct way of doing risk management.
The problem arises when the organization is not project oriented or is matrix but weak.
regards
There is no reason for keeping a registry, if it is just for the sake of it. Risks if not recognized in time or left to sit in a register column can and will jeopardize a project, sometimes even before the project begins. Many organizations ignore risks and do not plan or keep funds for their mitigation/ management (though all risk responses do not require funds sometimes it may be compliance to certain regulation) and end up in failed projects. Risk identification and planing their responses should be a proactive and continuous activity till the end of project.
Thank you very much for the contribution
I believe that in many cases the response plan to the initially identified risks is advanced, but there is no evaluation and identification of new risks that may appear during the development of the project.
Any action I plan on taking before the risk happens, such as mitigtion, will go into my project schedule and budget.
Actions that will happen after the risk happens, such as contingency or fall back, will go into my contingency reserve. (Please note that the contingency reserve is part of the project budget.)
Risks that were not identified will be covered by the management reserve, which is not part of the project budget.
You are Right
The explanation is very clear.
We must continue to push for better attention to risk management in organizations Saving Changes...
It is not only important but very vital for project to do risk management for project. it is one important role of PM to do risk management as it effects many part of project including cost, schedule, user satisfaction and many others.
Secondly risk identification and management is iterative process, one can try to identify as many risks as possible but some of them may not identified at initial stage or knowledge about them is refined as project progress
Normally project manager manage them with use of contingency(know - unkonwn) reserve and management reserves.
Project manager remain on watch out for risk in re assessments, and analysis of reserve analysis to determine that initial contingency and management reserve is still hold good to manage risk for rest of project life cycle
Excellent
The point that I highlight and that sometimes is difficult to understand in organizations that do not have an adequate project controls, is that the identification and evaluation of risks is iterative.
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