Decrease risk exposure by as much as 80 to 90%. New insights into risk management process help you manage expectations and outcomes.
Some experts have said that a strong risk management process can decrease problems on a project by as much as 80 or 90 percent. In combination with solid project management practices, having a well-defined scope, incorporating input from the appropriate stakeholders, following a good change management process, and keeping open the lines of communication, a good risk management process is critical in cutting down on surprises, or unexpected project risks. Such a process can also help with problem resolution when changes occur, because now those changes are anticipated and actions have already been reviewed and approved, avoiding knee jerk reactions.
Before one can embark on a risk management process, one must have a solid understanding of some key definitions. Project risks as defined from a PMI perspective are, at their core, unknown events. These events can be positive or negative, so that the word "risk" is inherently neutral. That said, most of the time and focus is spent handling negative project risks, or "threats," rather than positive project risks, or "opportunities."
Often, companies that do perform a risk management process on a fairly typical multi-month project (no longer than 12 months) will identify and manage possibly five to ten easily recognised project risks. However, that number should in fact be much higher with a high number of project risks identified early on, a team's awareness of what to look for is increased, so that potential problems are recognised earlier and opportunities are seen more readily.
By Vicki Wrona, PMP