One of the challenges in project management is dealing with the risk involved in every major decision. There is always a certainty of risk that a project manager has to deal with. One way to determine the nature of the risk is by taking a calculated risk. However, there are also some rules that can help in project risk management.
Rules in Managing Project Risk
The risks in project management can be reduced or prevented if the project manager remembers the eight essential rules of projects risk management.
- Understand that risk management is part of it. Risk management should be a part of the daily operations. Seasoned and successful project managers understand that they need to incorporate risk management into their staff training and regular meetings.
- Early identification of risk. Analyze the risks that are discovered and anticipate any future consequences that may happen. Discuss it with the project team during meetings and when there is no meeting. Experts in the project team can identify these probable risks and may have different ways of identifying both risks and opportunities. Check documents that may give hints or clues of possible risks.
- Keep effective communication. Faulty and insufficient communication contributes much to a project’s failure. Always maintain regular communication and be accessible all the time. Keep sponsors informed of big risks so they don’t get surprised. Managing project risk is keeping everyone in the loop.
- Assign accountability. One of the ways to properly deal with risks is to assign people to own and be accountable for them. For financial accountabilities, they need to be addressed before risks happen so that everyone knows who shoulders the bill in case of a negative risk adversely affecting the project.
- Prioritize risks. Managing project risk is about prioritizing risks. High risks need to be attended more by giving them more time and resources. Although there is a general rule that all risks must be attended equally, high risks can mean big losses if not dealt with promptly and properly.
- Plan and implement appropriate responses to risks. Address risks properly by choosing among a few responses: risk avoidance, risk minimization, or risk acceptance. An effective project manager understands the need to use the appropriate risk response on every risk identified.
- Register risks. Another thing to remember in managing project risks is to record project risks in a risk log that contains the name of the risk and its descriptions. An effective risk log stipulates ownership and contains information that can be used for high level analysis on causes and effects.
- Daily tracking. Every day, incorporate tracking risks and tasks as part of your daily schedule. This is essential in the early identification of risk so that the project manager can easily choose and execute the proper response.
Knowledge in project manager risk management allows project managers to become more knowledgeable in managing project risks. One way to reduce problems is to use a project management program such as Nutcache’s. Nutcache offers a free trial to those who wish to become familiar with the system so that they can eventually decide to become a paid member and avail of more comprehensive features. To get your free trial, click HERE.