Manage chaos by mapping risks
Working with risks in project is one of the more difficult part of being a project manager. Risks are perceived to be hypothetical and team members prefer working on something that is tangible and makes a difference here and now.
Some times risks are merely a problem that needs to be solved, sometimes risks are even a hidden opportunity to do something more efficiently.
How do you work with rísk in a way that the responds are understood by all team members and increase engagement and commitment to take actions to respond to risks?
Visualization works. Here are 5 steps to start working with visual risks:
- Make a 2 by 2 matrix on the office white board
- Add probability on one axis and consequence on the other
- Ask your team to write down risks on post-it notes
- Discuss each risk according to the two dimensions probability and consequence and see if you can make a collective decision where the risk should be placed on the matrix
- Revisit each risk and identify an appropriate response
If you are working in a virtual team and want to share the white board experience you can set it up like this using vimpl®. Key in your response actions on the back of the risk note.
Responding to risks
Building on the Prince 2 definition of risk, there are 9 ways to respond to risks I have listed them here for easy reference. Note that some risks are actually opportunities and that there is specific responses to threats and opportunities.
Avoid the risk by Changing the project and bypass the risk.
Transfer all or part of the risk to a third party for (insurance company).
Reduce the probability of the risk occurring or the consequence it will have on your project.
Accept the risk and plan for back-up or contingency.
Contingency plan for what you want to do if the risk realizes. All risks should preferably have a contingency plan to ensure continuity.
Share an opportunity with a partner, competitor or supplier to maximize the benefits through use of shared resource/technology
Exploit new technology and adjust your project to take advantage of a change in technology or a new market.
Enhance the probability of the opportunity occurring or the positive consequence it could have.
Reject the chance to gain from the opportunity