In Part I of this two-part series, we examined the organizational and political risks of risk management plans and processes. Now we turn to the risks that arise from change and from the interactions between risks.
- Risk dynamics risk
- Risk is a dynamic attribute of projects. Even if a project were frozen in place, its risk probabilities and risk impacts could change, because its environment changes. It's necessary to review risk plans with a frequency compatible with the volatility of the risk environment, which is itself difficult to estimate.
- Indicators of risk dynamics risk include risk plans that remain unchanged for long periods of time; budgets and schedules that omit risk reviews or perhaps schedule them infrequently; and retrospectives that don't address risk review. If these indicators are present, risk dynamics risk is also likely present.
- Intra-project risk interactions
- Risk interactions within a given project are especially problematic. Two risks might seem independent, but the probability of one occurring might change if the other materializes; or the response to one risk might alter the consequences of or the probabilities of materialization of others; or the response to one risk might limit the project's ability to respond to another.
- For instance, if Arthur is backup for both Tory and Chris, all's well, as long as either Tory or Chris is available. If both become unavailable, we have trouble.
- The method known as morphological analysis developed by Fritz Zwicky, is useful for uncovering intra-project risk interactions. In this method, you examine all pairs of risks and ask, "If both risks materialize, will our planned responses still be effective?" If you find that the answer is "no," you can revise your plan. You can generalize this procedure to triples of risks, quadruples, and so on. For more on morphological analysis, see the article by Tom Ritchie at the Web site of the Swedish Morphological Society. Or take your pick from hundreds of sources.
- Inter-project risk interactions
- An inter-project risk interaction occurs when conditions in a given project change risk probabilities in another project, or cause risks to materialize in another project.
- For example, If Arthur is backup for both
Tory and Chris, all's well,
as long as either Tory or
Chris is availablesuppose two projects are scheduled to use the same resource serially. If the first project is delayed, the availability to the second project of that same resource changes. At the time of development of the risk plan of the second project, knowledge about the strategies and risks of the first would have been useful, but such information, sadly, is rarely shared.
- To limit inter-project risk interaction risk, coordinate risk reviews with projects likely to transmit risk back and forth. If the risk profile of one of the projects changes, there is enhanced probability of impact on the other.
Most risk conditions are connected to at least a few other risk conditions, either internal or external to the project. Maps of these connections can be very helpful. First in this series Top Next Issue
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More articles on Project Management:
- Declaring Condition Red
- High-performance teams have customary ways of working together that suit them, their organizations,
and their work. But when emergencies happen, operating in business-as-usual mode damages teams —
and the relationships between their people — permanently. To avoid this, train for emergencies.
- Nine Project Management Fallacies: II
- Some of what we "know" about managing projects just isn't so. Identifying the fallacies of
project management reduces risk and enhances your ability to complete projects successfully.
- Unnecessary Boring Work: I
- Work can be boring. Some of us must endure the occasional boring task, but for many, everything about
work is boring. It doesn't have to be this way.
- False Summits: II
- When climbers encounter "false summits," hope of an early end to the climb comes to an end.
The psychological effects can threaten the morale and even the safety of the climbing party. So it is
in project work.
- Symbolic Self-Completion and Projects
- The theory of symbolic self-completion holds that to define themselves, humans sometimes assert indicators
of achievement that either they do not have, or that do not mean what they seem to mean. This behavior
has consequences for managing project-oriented organizations.
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- Ten Project Management Fallacies: The Power of Avoiding Hazards
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- Many people who possess real organizational power have a characteristic demeanor. It's the way they project their presence. I call this the power affect. Some people — call them power pretenders — adopt the power affect well before they attain significant organizational power. Unfortunately for their colleagues, and for their organizations, power pretenders can attain organizational power out of proportion to their merit or abilities. Understanding the power affect is therefore important for anyone who aims to attain power, or anyone who works with power pretenders. Read more about this program.