Summary

A $10m project with three risks is ridiculous. Similarly, a $10m project with over 380 risks is just stupid.

Project risk management, although common to almost all projects, is still so poorly done that it is often a risk to the project itself.

Giving projects ‘laundry lists’ of potential risks does not help. This approach tends to increase the number of irrelevant risks identified to be managed.

Conversely, some organizations have ‘risk scoring’ approaches that generate a score but don’t actually help manage the risks (yet the project team believe they’ve ‘done’ those risks).

Understanding Project Risks defines the whole area of project risk clearly and comprehensively.

1. It describes the eight types of project risk that can exist (most projects barely consider three).
2. It explains how time spent on risk management is potentially wasteful and, therefore, needs to be justified and managed
3. It introduces the concept of ‘systemic’ risks that apply to all projects yet are so obvious that they are often forgotten
4. It discusses real-world situations, such as the “Swiss-Cheese Syndrome” that can destroy your project when you are watching!
5. It refocuses risk management onto value protection.

This Guide is an essential primer on project risks for all parties involved in projects.

Benefits

This Guide will

1. enable you to cull unnecessary effort and cost on risks
2. enable you to focus your energies where needed
3. ensure you don’t forget some of the less obvious risks
4. make you alive to the impact of the different risks and their dynamics
5. give you the basis for a common, business and value based approach to risk management
6. help you ensure your project does not fail due to unforeseen or unmanaged risks.

Who should read

1. Project practitioners - to help them understand quite simply what can become a complex topic
2. PMOs - to enable them to understand and manage the portfolio’s risk profiles
3. Governance teams (Sponsors/Steering Committees) - who also retain accountability for risk management across a number of dimensions
4. Boards and Executives - to be aware of the scale and nature of project-related risks
5. Auditors - to understand the nature and types of project risks involved
6. CFOs - understand the threats to each project’s value.

Contents

1. Understanding project risks
2. Understanding project risks and value delivery
3. Understanding project risk management
4. Understanding systemic project delivery risks
5. Understanding systemic business impact risks
6. Understanding project-specific risks
7. Understanding the nature of risks
8. Understanding different approaches to risk
9. Understanding critical success factors
10. Understanding design risks
11. Understanding corporate profile risks
12. Understanding the leading indicators of failure
13. Understanding the “Swiss cheese” syndrome risk

Bonus

Why companies are (inadvertently) destroying shareholder value
Shareholder value is being destroyed by ineffective and incomplete change management processes. The risks of these processes is described in this article so you can check your change program risks.