In the previous article, we discussed the first 4 rules in risk management. Now, we will address the remaining rules to mitigate risks in your project.
- Rule 5: Clarify ownership issues
After creating a list of risks, it’s high time you assigned who is in charge of each risk. It is vital to make clear who is taking responsibility for what risk. As a project manager, you should assign a risk owner for every risk. Someone has to take ownership of the effects if the risk occurs. People may feel uncomfortable at first, but this step is crucial to decrease threats and enhance opportunities.
- Rule 6: Prioritize risks
It might be a mistake to treat all risks equally because it doesn’t covey the best results. Some risks have a higher influence than others. Therefore, you must weigh the pros and cons of each risk before reacting and enacting. The criteria that are mostly used by project teams are the effects of risks and the likelihood that it will occur. The key is to focus on big risks.
- Rule 7: Analyze risks
Risk analysis can start with identifying the causes and effects of risks. The questions are: Why it happens? And What are the effects? In terms of the effects, you must distinguish what effects take place after a risk happens, and what effects might be the results of primary effects. Risk analysis needs a project manager to investigate the level of the entire project. If risks are considered, project managers can carry out an estimate of the budget needed or the date the project will finish. Risk analysis can provide ultimate insights into the project and valuable input to find effective solutions.
- Rule 8: Plan and implement risk responses
Implementing risk responses helps you prevent a threat and minimize its negative effects. When dealing with threats, you can choose to minimize, avoid or accept. Risk avoidance is to organize the project without noticing the risk anymore by changing supplier, adopting a different methodology or even terminating a project. Risk minimization is trying to prevent risks by having an impact on the cause or decreasing the negative effects. This requires a deep risk analysis as mentioned in rule 7. Lastly, risk acceptance is a wise choice if the effects on the project are minimal, and influence over it is time-consuming or difficult.
- Rule 9: Register project risks
This is about keeping a risk log, which aims to help you view progress and not miss out on any risks. A good risk log has risk descriptions, clarifies ownership (rule 5), and enables you to carry out some basic analyses on causes and effects (rule 7). It may be underestimated by project managers as it is simple. However, it is such a high payoff when you keep a record that someone will take the blame if things go wrong.
- Rule 10: Track risks and associated tasks
The aforementioned risk register (rule 9) will help you track risks and associated tasks. Integrating risk tasks into the daily routine is the solution to tracking risks every day, a job carried out by any project managers. Risk tasks are clarified to identify or analyze risks or to generate, select and implement responses. Risk tracking is different from task tracking as it emphasizes the current situation of risks.
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