How to assess and manage risk in a project

Successful handling of risk is essential for project managers.

by MT Staff
Last Updated: 06 Mar 2018

Risk is an ever-present companion in business. We don’t live in a closed system, where we can predict and measure all outcomes. Sometimes, things don’t go according to plan.

Successfully responding to emerging scenarios is particularly important for project managers. The Project Management Institute defines project risk as ‘an uncertain event or condition that, if it occurs, has a positive or negative effect on a project's objectives.’ The Institute of Risk Management (IRM), meanwhile, defines risk as ‘the combination of the probability of an event and its consequences.’

So how does a project manager identify, track and effectively treat risks that inevitably arise during a project’s lifecycle?

Risk register

The risk register is the main tool for assessing and remedying many of the issues that could potentially knock a project off course. It can also identify issues that may have an impact on wider business operations.

In a nutshell, the risk register codifies and tracks issues both internal and external, and provides the framework for managers to make effective qualitative and quantitative analyses of the problem.

Main components of the risk register include a description of the risk by category and an estimation of how it affects the health of a project. In order to track issues, it is important to include a risk ID and clearly assign ownership to the appropriate team members.

Professional training

Professional training such as the PRINCE2 Course Edinburgh offers project managers the skills they need to create a risk register appropriate to the project and sets out the right approach for ensuring the register is updated and reflective of current issues.

PRINCE2 is the UK's leading project management qualification - the Foundation course is an excellent grounding introducing candidates to the basic framework, whereas the Practitioner course is useful for current project managers seeking to expand their skills base.

For professionals in Wales, the PRINCE2 Course Cardiff is available from March through to July with more dates to follow over the course of the year. One of the major lessons within such courses is how important communication is to ensure that risk and mitigation are clearly articulated. For example, regular risk workshops offer the opportunity to discuss issues and ensure key action points are being implemented.

And in Ireland, the PRINCE2 Course Dublin has been established to supply a thorough understanding of core methodologies and techniques necessary to bring a project successfully to completion.

For established project managers, there is considerable support, guidance and toolkits available through chartered bodies such as the Association for Project Management. The IRM’s ‘Risk Management Standard’ also contains a plethora of research intelligence and practical advice for project managers.

Finally, at project completion it is important for organisations to review the risk management process in order to learn lessons and inform future project delivery.

In conclusion, by combining training alongside professional guidance, project managers and organisations can deploy resources effectively, transform a risk event into a positive opportunity, and deliver the stability and continuity every project requires. 

Image credit: Linda Bestwick

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