Any issues that could affect a projects performance, budget, and timeline are considered as a risk. Risks are possibilities in a project management context which can escalate to being problematic issues if they become realities. Therefore, risk management refers to the process of identifying, analyzing, prioritizing and strategizing to mitigate risks before they become real issues (Cervone, 2006). In projects, risk management strategies include detailed strategies for individual risks to ensure strategies in place in the event issues arise. Usually, risks can be negative or positive though most individuals assume risks are entirely negative. This discussion explores common risks in projects along with their impacts as well as the risk register and probability chart as some risk management tools.
Some common risks associated with projects include staff issues, lack of continuity, lack of resources, dis-engagement of leaders from project, and change of strategy (Cervone, 2006). When leaders become disengaged from the project, the project is bound to lag behind in regards to schedule, budget, and achievements. During initiation, executives imply they will support and direct efforts towards team objectives. However, after approvals, leaders usually lose interest in the critical duties that accompany their roles. This loss of interest comes as a result of unpreparedness and misconception about their executive positions. Consequently, employees at bottom levels lack the proper leadership to oversee crucial issues such as decision making, delegation, and coordination. Staff-related problems such as high turnover present risks for projects. Loss of staff in projects equals reduced expertise and skills. Additionally, negative employees or high turnover can create morale issues for the project. Lack of continuity is another significant risk for projects. The uncertainty that things might change is a risk. Lack of continuity affects the team cohesiveness and strategy towards stipulated goals. Resources are a limited aspect of any project. The inadequacy of resources can occur in any project without warning. This inadequacy consequently leads to inadequate tools and skills to achieve project goals. Change of business risk is a significant risk with potential impacts on any projects. The shift in strategy can affect a plan regarding the inadequacy of resources and time, poor management. However, through risk management tools, these risks can be addressed before they become real issues affecting the project.
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There are various risk management tools such as the risk register and the probability chart. A risk register refers to a document created during the initial stages of a project, used as a tool for risk management. The fundamental purpose of the risk register is to help identify issues and address challenges as they arise. The risk register is often shared among project stakeholders to ensure executives are vigilant of issues and to provide a method of tracking the response to such matters. The probability and impact matrix is a risk management tool that provides a viable framework that helps management prioritize risks that demand attention. The Probability chart is founded on the principle that risk has two primary dimensions; impact and probability. The chart allows the risk manager to scale potential threats based on these two dimensions.
Conclusively, risk management is a critical function in organizations in the modern world. Companies take extensively complex and ambitious projects. Often, managers are responsible for the successful execution of projects in risky and uncertain atmospheres. Responsible managers ought to be aware of the potential risks to prevent any risks from becoming adverse realities. The preparedness of risks can be achieved through the employment of various risk management tools such as the probability chart and the risk register. Managers need to analyze and prioritize the relevant risk ineffectively. This allows projects amass effort and time toward the most important risks. Therefore, project managers should mitigate risks by staying vigilant and strategizing before potentialities blossom into the problematic realities hindering the project from achieving their established goals.
Reference
Cervone, H. F. (2006). Project risk management. OCLC Systems & Services: International digital library perspectives, 22 (4), 256-262.
