Risk can either be an opportunity or a stumbling block; nothing is guaranteed but either way it is going to have an effect on your project’s goals and is an essential part of business. Without risks businesses wouldn’t grow or venture into new markets, which in an ever-changing environment could wind up costing them the business itself.
Taking risks is scary, but when guided by a professional who has undergone PRINCE2 Training and knows how to use risk management techniques, looking for potential benefits at every possible opportunity. To be able to do this an individual must be able to use a set of processes and principles to be able to identify, record, analyse and control risks, knowing what best courses of action to take in different situations.
There are a number of things to take into account when coming up with a risk assessment strategy to ensure that your business’s future isn’t completely left to chance, but an extremely calculated risk. Or as calculated as it can be. This is why we are going to look at some of these principles to help you manage risk and help you make your own risk management strategy:
Learn more about PRINCE2 with our previous post on the Seven PRINCE2 Principles.
Work with Your Goals
One of the main aims of risk management is to ensure that a risk doesn’t affect the business or project’s main direction and goals. Avoiding impact on the core values, including aspects such as turnover, reputation or assets, of the business/ project is vital. Identifying these vulnerable areas is key, but if the risk against them is too high then those in charge may decide not to go ahead with the plan.
Context and Tolerance
Knowing the project or business and how it fits in with its surroundings is vital. What is risk free for one project maybe extremely high risk for another, which could be down to something as fundamental as the economic climate or level of peace in the area the project is taking place. The more information you have about it the more accurately you can factor in risk tolerances, stating how much risk a project is willing to put up with.
So by finding out about how it is affected internally and externally by issues such as technological boundaries, political policy and economic standing you can better understand the risk at hand.
Input
Getting input from the people involved in the project/ business is vital to properly identify the risk and to receive an extra perspective on it. This also allows joint decisions to be made and gives an opportunity to work on what resources you have to best manage the risk.
All risk information should be logged in a risk register so you have a fully documented record of what you are facing.
Detection
The best way to prepare and deal with a risk is to pick it up early, but the only way you’re going to be able to do that is by looking for it. So aside from carrying out a full risk assessment at the beginning of a project, regular monitoring and reviews on potential risks should be carried out to ensure that they haven’t developed. You can achieve this by assigning a risk to an owner, making it his or hers goal to monitor any risk at the end of any stage to see if it has become more or less urgent or could effect or be effected by future progress.
Warnings
The development of risk can also be evident if you begin to face issues such as being over budget, over time, facing errors in your quality reviews or all of a sudden finding that the number of issues to deal with have skyrocketed. If any of these begin to occur then you must ask yourself what is not going to plan and how can I fix it?
Support and Responsibilities
Setting up a supportive environment is healthy for a risk taking role. This includes being prepared by having a full strategy in place and knowing what areas are more susceptible to risk. Project workers must be able to take ownership and responsibility of their roles and duties to prevent potential flaws from developing.
Similar posts you may like:
- Getting the Most from Managing Your Team
- PRINCE2 Project Initiation Document Template
- The Themes of a PRINCE2® Training Course
- 3 types of PRINCE2 training that you could benefit from.
- Project Management Means People Management
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benefits to prince2, prince2 implementation, PRINCE2 project management, prince2 risk management, prince2 tolerance, risk, risk management, risk management Strategy, risk tolerance