Project Management has many strings to its bow. Risk management is one of these and it is an essential part of project management. Each stage, or in a project has its own inherent risks. It is the job of a good project manager to know the risks evaluate the risk using a good risk analysis methodology, either As Low As Practicable (ALARP), or the Bowtie.

Once the level of the risk is determined, it will be necessary to draw out the next weapons in the armoury of the Project Manager and that is Mitigate, Manage, or Insure.

Where possible it is up to the project manager to manage the risk, or potential risk to ensure that the worse case scenarios never happen. This is where management comes into play, if the risk can be managed successfully there is no risk. If it cannot be managed, then it must be mitigated, in other words a way must be found to less the likely impact of the risk occurring. If the risk cannot be managed, or mitigated it must be insured against. This is where you attempt to share the potential impact with other areas of the project, or provide a contingency, in either money, or time.

Risks are a two faced coin, on the one side the benefits of a risk taken and well managed can deliver the benefits desired, if they are not managed correctly they can have a devastating effect.

It is worth remembering that risk management is a continual process throughout the lifecycle of the project. As each task is complete the next task becomes a risk challenge.

It should also be noted that on the flip side of risk is opportunity, with every risk if handled correctly delivering opportunities to advance the project further along to completion, or in some case providing a benefit that while identified was considered a doubtful gain.

Risk registers are mandatory in any project, a detailed list containing a breakdown of all risks and a rating of their chance of happening and the level of consequence if this risk eventuates. Once you have the risk register, it is very easy to see your problems and determine a Plan B, in the event that it all goes pear shaped.

Plan B's are also one of the most important things a PM can have, if it goes wrong what plan, process, or procedure do I have to pull the project out of the hole. Sometimes it can be a detailed plan to recover the project, or you can have a complex plan to blame the entire problems on a grassy knoll and a mysterious industrial/defence complex, or other times Plan B can be a ticket to Rio.

Learn more about this author, Robert Mcmartin.
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