The Project Group, LLC
The Project Group, LLC Newsletter
  Advancing Project Management August 2003  

in this issue

The Project Group, LLC

Risk Planning

What are the things that could happen?

Risk Identification Template

Next Month's Newsletter

The Project Group, LLC

We specialize in assisting corporate and government clients in learning to improve their productivity while planning and executing projects.

Our three-phase approach yields faster, more efficient project initiation, planning and execution results.


Each month our newsletter delves into a specific step in the phases of Initiation, Planning and Execution of projects. Our methodology is applicable to any project in any industry. Our systematic approach to Project Management is designed to help your company's projects gain traction quickly, communicate clearly to all parties and keep them on track to reach a successful conclusion.

We facilitate workshops that jump-start your teams, making sure they know what they are going to do and validating they have the time and resources with which to do it.

This newsletter focuses on Process 10:

The process of identifying risks.

  • Risk Planning

    Have a plan
    Now that a project plan has been developed, it is time to create a Risk Management Plan before executing the Project Plan. In our July 2003 newsletter we discussed Risk, Impact and Probability. In this article we discuss the importance of taking time to create a Risk Management Plan.

    The benefits of creating a Risk Management Plan are:
  • Establishes a pre-agreed response should a known risk occur
  • Calms those queasy feelings you may have about the outcome of the project by turning those negative premonitions into positive actions.

    The PMBOK suggests (as it does with every content area) putting together a plan. Project Managers know, if you have a plan, you can conquer the world. The Risk Management Plan describes how you are going to manage risks and who is going to be responsible for them. Don't get hung up here on the process and overload yourselves. The important thing is to do something about risk rather than imagining that risk management takes too much time and is too difficult. A plan can be put together quickly. However, it needs to be periodically reviewed and updated as the Project gets into full swing.

    If nothing else, identify the top 5 risks and what you are going to do about them. Risks that have a higher degree of probability and a higher degree of impact make them the top ones.

    A small number of identified risks (like three or five) allows stakeholders to focus. As part of the risk management process you will later prioritize risks and probably have many more. Getting overwhelmed by identifying too many risks and a complicated risk plan at the onset submarines the whole process before you start.

  • What are the things that could happen?
  •    In creating your Risk Management Plan, the first thing the PMBOK says to do is to identify the risks. Where do you begin? Rather than be overwhelmed, brainstorm by risk categories. Categories may be something like:
  • Technical
  • Business
  • People
  • Project Management

    Technical folks can probably inundate you with all the risks that could befall your project. Bear in mind a risk is an event that may happen. If you live in an urban area and you consider that traffic is a risk to your getting home quickly think again. Traffic happens everyday. You can count on it with almost 100% certainty at rush hour. Therefore, you can't consider "traffic" as a risk.

    When you brainstorm risks, don't be afraid to go wild. Later on you can evaluate risks in terms of their probability and impact. Then you'll consider which of them you will spend more time with in prevention or mitigation plans. Remember that many shy technical people may not perform well in public brainstorming suggestions. Allow those quiet types to contribute by e- mail. You may be pleasantly surprised at the volume of their response. (Yes, even shy people have a lot of opinions! They just don't express them.)

    When thinking about business risks, remember that the stock market dropping or your company getting bought out could be placed in the category of general catastrophes which would have far greater consequences than just your project. The better you understand, clarify and communicate the specific business case for your project, the fewer risks you potentially have in this area. The axiom of business, however, is change. You should know how would a change in the larger business strategy effect your project?

  • Risk Identification Template
  •    We find often that stakeholders are not specific enough in their risk identification. We suggest the following template for describing a risk.

    [Event/occurrence] leads to [Risk Event] causing [Impact].

    Here are some examples

  • Insufficient steel in the concrete leads to a sagging of the floor causing four weeks rework
  • Lack of a spending plan leads to cash-flow problems in month three causing a delay in the project
  • Too much over-time in the development phase leads to staff exhaustion causing a slowdown in the latter phases of the project.

    By deifining the cause and impact into a one sentence description of the risk you are shortcutting the thinking processes you will later need to identify prevention and contingency plans.

  • Next Month's Newsletter
  •    In the upcoming September 2003 newsletter we will continue our articles about risk.

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