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Meaningful Risks
First and foremost, it is important to make sure that you only focus on risks that are pertinent and meaningful to the project. All too often, project managers log risks that are not specific to the project and are very generic. This offers little value and does not raise any cause for concern within your team. Instead, your team will respond to concerns that are viable and tangible. Be certain to avoid the likes of ‘once requirements are complete, they may be some changes in scope.’ Statements like this offer little value. You need to be more precise and demonstrate a genuine risk to ensure that your team are on board. For example, there could be an element of the project that could compromise supply chain integrity, and so it is important to outline what this and what could be done to prevent it. You can read this on blockchain companies ASX to see some inspiration regarding how they have protected their brand and supply chain integrity.
Identify risks early on
One of the biggest mistakes project managers make is leaving it too late to identify risks. You should be looking at risks even before the project begins, i.e. during the bid phase. Hold workshops where all those involved in the project will brainstorm a list of all opportunities and potential risks.
Identify risk owners
There are numerous people that have an important to play when it comes to the risk management of a project. You need to define the role of each individual, and you should outline who is responsible for the role in question in the risk log. The three key roles you need for the importance of risk management at a minimum are – the decision maker, the mitigation owner, and the risk monitor. The latter is the individual that needs to monitor the risk and report on the status of it. The mitigation owner needs to establish and execute a risk mitigation plan. It is their responsibility to make sure that this is a viable plan. Finally, the decision maker, as you have no doubt gathered, needs to make all of the critical decisions, which could lead to the project being cancelled if the risk is too large.
Analyse and prioritise risks
Once you have identified risks, you need to give them a level of importance. You cannot view all risks as the same; they must be prioritised. So, how do you do this? Well, you should always begin by looking at how the project goals will be impacted if the risk in question manifests. The risks that would result in the largest losses need to be given the highest level of priority. Then, to further prioritise these risks, you need to look at the probability of occurrence, and, therefore, if a risk is more likely to occur than another risk, it needs to take greater precedence. You should come back to this at a later date, as you may need to re-prioritise risks depending on how the project has developed.
Don’t use overcomplicated language
You are advised to use simple terms when explaining the risks to your team, as this will help them to understand the likelihood of a risk occurring and the impact of it. The easiest approach is to mark a risk as ‘low’, ‘medium’, or ‘high’ in regards to both the likelihood of the event and the level of impact it will have.