Project Risk Management: A Competitive Necessity

Kicking off project management in the New Year, here’s Megan Cacioppo from Deltek with a post-Christmas present, Project Risk Management for Dummies, available for you to download.

Here is a scene that plays out all too often… Prior to starting a project, the team gathers to lay out the project and generates a list of risks. Risk elements are defined based on the intuition and experience of the people in the room and transferred to a spreadsheet – inaccessible to all but a select few – where the head of projects tracks progress, giving heightened attention to areas of risk as they emerge.

But every project leader lives in fear of the moment when the chorus begins to sing, “I didn’t know that part was going to be late!” or, “Why didn’t someone let me know we only had a single supplier contracted for our most important component?” Invariably, the last-minute scramble to address the issues that these risks cause diverts attention from other areas of the project.

Project leaders caught blind wind up spending much of their time “putting out fires” to keep projects from teetering. At worst, unexpected problems can be fatal to project success. Accumulate enough of them and the entire solvency of a company can be threatened.

The new reality is that effective project risk management is no longer a competitive advantage—it is a competitive necessity. At Deltek, our vision is to help project teams shift towards proactively reducing risk rather than just reporting risk exposure. This shift requires a robust risk analysis tool that integrates cost and schedule risk analysis, logically linking all project activities.

Today’s best tools provide an aggregated view of risk that is transparent up, down and across an organisation. They centralise in a standard format and a common language the risks and opportunities identified throughout an organisation, supply chain and partner network. With data current and available 24/7, all levels of employees can identify risk issues, while management can risk-adjust their business planning so that strategies and forecasts are more realistic.

And unlike spreadsheet-based risk management, an integrated system creates an automatic audit trail, providing the transparency and certainty increasingly required by customers, auditors and others. The next generation of project leaders is likely to look back to this time and point to risk management as a critical turning point in their ability to delivery on-time, on-budget projects.

Tomorrow’s leaders are making the time and resource investments today to develop project risk management as a core competency. Are you on the forefront of effective risk management?

For more information about managing project risk, check out the eBook, Project Risk Management for Dummies™.

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