Chapter 12
Managing Risk
Planning a project is a bold attempt to predict the future. Anyone who has indulged in a bit of gambling or invested in the stock market can tell you that attempts to tell the future are fraught with uncertainty. And that uncertainty equals risk.
A project risk is an uncertain event or condition in the future, which, if it occurs, will affect the project in some way. While that effect can be positive, in risk management, often the focus is on the negative effects — the threats — that can debilitate, derail, or even destroy the project.
Whether negative or positive, some risks are more likely than others, and some risks would have a greater impact than others. So as the project manager, it serves you well to pay attention. You want to identify which risks or threats exist in your project, assess their probability and impact, determine which ones are worth your attention, plan responses for those risks, and track and monitor them so you are not blindsided if any of them become reality.
Having such a risk management plan in place for your project helps keep your project on track. If you and your team are aware of and prepared for risks, you're less likely to panic and overspend time, money, or effort recovering if a risk comes to fruition. Knowing what you'll do if certain things go wrong actually reduces the anxiety and angst when a risk becomes reality.
This chapter covers the risk management life cycle and the development of the risk management plan in ...
