2 minutes

Risk management is a project manager’s friend and ally. If he is able to plan and manage the risks associated with the project then it has a great chance for success. On the other hand, managing a project without giving allowances for possible risks that might happen may be heading failure. Risk management is a crucial factor in project management.

It is very essential that project managers always plan for the uncertainties involved in a project. In relation with this, he needs to write a risk plan, obtain consensus from the team members on how to handle these risks and other unexpected events that might happen that can hinder the project.

The Importance of Risk Management in Project Management

Risk management affects the essential factors to the success of your project such as your schedule, the scope, budget, communications, stakeholder engagement, agreed quality of the deliverables, and more. When an unforeseen event happens and there is no risk planning that has been done, it is difficult to manage the situation and might contribute to the failure of the project.

Although risks are generally known as negative, they can also be opportunities for the project team to grow by learning more from the experience.

There is no assurance that these possible events or risks will happen and if they will, they can happen any time. There is a need to identify these risks, discuss and monitor on them, as well as involve everyone.

It is important that all team members learn everything in managing risks and estimate when they could possibly happen. They must agree on the strategies to do for every risk and undertake actions to prevent negative events from happening.

Project risk management is not just developing the plan, recording these risk strategies on file and sharing it occasionally. Risk management is an undertaking wherein it is important that members know how to deal with them when they happen.

To manage these project risks, the procedure always starts with planning then identifying the possible risks that might happen. The next step is to perform qualitative and quantitative risk analysis. Plan how to respond when they happen and when they do, always monitor to control them.

Among the known risks that project teams must be ready of are the following:

Bad Weather. It can affect attendance of members in meetings and if done virtually, then bad weather might cause power or connection failure.

Emergencies. Project team members may not be feeling well or have a family member who just died – these unexpected events can hamper the operation of the team if they depend on the member with emergency issues.

Other project risks that need to be managed are the organizational risks that are related to the purpose of the project. Uncertainties happen and if the team is not prepared for them, they can adversely affect the success of the project. For a project to be successful, it is important that a well-done risk management plan becomes one of the priorities in the project.