Risk mitigation in project management
When I start managing a new project, one of the first things I ask myself and the project team to consider is:
“What could go wrong, and if it does how serious is it going to be ?”
This may seem to some a very pessimistic approach, but I believe an important part of strong project management is thinking about the possible risks that may occur and putting a mitigation strategy in place to manage these risks so that they do not become issues.
There are various methodologies for managing risks, though the following 5 steps are what I have personally followed over many years when successfully delivering large, complicated transformation projects.
1 – Identify the risk.
You can’t resolve a risk until you know about it! So, get your project team thinking about potential pitfalls, think about what went wrong on previous projects, have a look at your lessons learned log from previous projects, etc. Get these risks identified and recorded on your risk log.
2 – Analyse the risk.
Now it’s logged, gather the information you require about the risk to help you understand both the likelihood of the risk occurring and what are the impacts it could have on the project.
3 – Prioritise the risk.
Based on the likelihood and severity you are going to have different levels of risk, so get them prioritised. On complicated projects, I usually rank risks on a 1 – 5 scale, though on some smaller simpler projects a Red, Amber & Green rating will suffice.
- Level 1,2 or red risks are going to require immediate attention, and these are the risks that can really derail your project.
- Levels 2,3 or amber risks are important, but perhaps do not threaten the success of your project – so act accordingly.
- Then the level 5 or green risks have little impact on the overall project, so not always worth spending too much time on these.
4 – Assign an action and owner.
Decide and document the mitigation action for the risk – what are you actually going to do about it? Equally important is to assign an owner to the risk, who is going to drive the action forward and report back on progress.
5 – Monitor the risk.
Monitor the progress of the risk until reaching resolution. Regularly check that the prioritisation of the risk is still correct and that the actions are still valid. Far too often green low-priority risks can turn into red critical risks as a project progresses and more information is uncovered.
If you would like any more information on risk management or how we successfully manage important projects for our clients, please contact me at Sean.firstname.lastname@example.org
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