Project Management Institute

What Could Go Wrong?

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By Alexander Strazmesterov, PMP

In an era of disruption, organizations have to reduce surprises at every turn. Yet only 60 percent of organizations always or often apply risk management practices, according to PMI's 2017 Pulse of the Profession® report.

Distinguish mandatory processes from optional ones so that the new approach does not become burdensome.

Optimizing an organization's risk management approach can often be a lengthy and complex project. The following seven steps will help you develop your own blueprint and ensure a successful implementation.

In addition to project managers with deep experience in the organization's risk management practices, the team should include stakeholders from all major project disciplines. The team should then develop a charter and agree on roles and responsibilities, including how to involve decision makers.

2. ESTABLISH A PHASED APPROACH

Depending on the size and complexity of the organization and team members’ other tasks, it could take up to two years for your new risk management processes to be ready for final implementation. If you anticipate a long project, break it into phases. This allows upper management to approve the work—or make adjustments—at specific times midstream rather than at the end of the project. These phases might comprise the following: an analysis of the situation, conceptual and detailed development of the new approach, piloting, finalizing procedural work and tools, and qualifying and mobilizing resources for the rollout.

3. ANALYZE THE CURRENT SITUATION

Your team's analysis of the “as is” situation must be thorough and honest. Comb through your organization's processes, applied methodologies and tools to identify anywhere it falls short of best practices. But don't forget to note which aspects of your current risk management approach are successful. In addition to examining the technical aspects of risk management, look at your organization's risk attitude and behaviors. If the new approaches you choose don't fit your organization's culture, the project will never succeed.

4. TAILOR YOUR APPROACH

Based on this gap analysis, define what risk management should look like for your organization's largest and most complex projects. From there, scale the requirements down to smaller projects. Distinguish mandatory processes from optional ones so that the new approach does not become burdensome. For instance, sophisticated quantitative methodologies can be limited to critical projects.

5. TAKE A TEST DRIVE

Select suitable pilot projects on which elements of the new approach can be tested. It is best to test an early, incomplete risk management approach so there's time for problems to be corrected. Initial pilots are also an opportunity to include leading external experts or consultants, such as for quantitative risk analysis. Their feedback can help you fine-tune your risk management approach. Finally, pilot projects can help spread the word around the organization about your revised approach.

6. DEVELOP A TRAINING PROGRAM

Your work likely will reveal gaps in general risk management knowledge at your organization. Employees also will have to be trained on the new processes. Look into what specific training certain stakeholder groups need and develop a practical training agenda. I've found it helpful to divide the material into small chunks that can be immediately applied in a simulation game. I use a sample project from a different industry to help get employees out of their old risk management patterns of perception or behavior. Participants are organized into small working groups. As the training into the new risk processes proceeds, the working groups should record the results of their risk identification, quantitative risk assessment and risk response planning so they can refer to it later. Finally, enrich your seminars with different instructional formats, such as quizzes or videos.

7. ENSURE A FACILITATED IMPLEMENTATION

Publish the new or updated procedure for implementation only after the approach has been sufficiently verified through pilot applications. The first projects under the new risk approach should include risk workshops, perhaps led by members of your risk assessment project team. Encourage the project teams not to perceive this as a cumbersome obstacle to project completion, but rather a chance to learn what the facilitators hope to reveal concerning the project's risks. As the implementation proceeds, feedback and reactions will provide valuable insight to improve both training content and procedures.

In the day-to-day rush of ensuring individual projects get completed, it's easy to overlook organization-wide risk management processes. But a thorough update of these processes can benefit every project your organization touches—right now, and years into the future. PM

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img Alexander Strazmesterov, PMP, is a senior engineering consultant at BASF, Ludwigshafen, Germany.
This material has been reproduced with the permission of the copyright owner. Unauthorized reproduction of this material is strictly prohibited. For permission to reproduce this material, please contact PMI.

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