Have you ever had that feeling in your gut that something wasn’t quite right with your project? Or the nagging thought that you were overlooking something? While an impending project risk may not be as evident as being chased by a bear, that underlying feeling of unease may be your body’s “fight or flight” response telling you that your project has a hidden risk.
BusinessDictionary.com defines Risk as “a probability or threat of damage, injury, liability, loss, or any other negative occurrence that is caused by external or internal vulnerabilities, and that may be avoided through preemptive action.” A hidden risk may not be readily acknowledged or apparent to you or your project team. For example, you’ve scheduled your system go-live for March, and many of your team members fly in each week to work. Is a March snow storm a risk to your go-live? Another example is that a key team member will be eligible for retirement in the middle of the project. This team member is a fixture with the company, and you just haven’t gotten around to putting a succession plan in place. Is his potential departure a risk to keeping the project on track? While you might be counting on a mild winter or the loyalty of your co-worker to work past retirement, if either of these events occur, your project could be derailed.
About.com (http://psychology.about.com/od/findex/g/fight-or-flight-response.htm) says about our “fight or flight” response, “by priming your body for action, you are better prepared to perform under pressure. The stress created by the situation can actually be helpful, making it more likely that you will cope effectively with the threat.” Project teams also need to be primed to address risks so they don’t threaten the project. The best way to do this is to follow this simple five step risk rating process:
- Have your team members brainstorm all the things they can think of that might impact your project, including those things that are “gut feelings”.
- Review the list and using a scale from 1 to 10 assign a score to each item as to how likely it is to occur. For example, something that would rarely occur would be scored as 1, while something very likely to occur would be scored as 10.
- Review the list again and using a scale of 1 to 10 assign a score to each item as to what level of impact it would have on the project if it occurred. For example, something that would have negligible impact on the project would be scored as 1, while something that would cancel the project would be scored as 10.
- Multiply the likelihood score by the impact score to determine an overall risk score. For example, a low likelihood/low impact risk could have a score of 1, while a high likelihood/high impact risk could have a score of 100. The higher the score, the higher the priority to address the risk.
- Rank your risks based on the highest to lowest overall risk score. Then take the top 10 percent of the items, and devise ways to reduce each risk. For example, to avoid having your team members stuck in various parts of the country due to a snow storm, ask them to come into town a week earlier and plan to stay through the go-live. To avoid having a critical gap on your team, identify another team member to shadow the future retiree.
Throughout the project, be honest with yourself and your fellow team members. If your gut is telling you something, look for the risk, and apply the risk rating method. Acknowledging and dealing with your project “fight or flight” feelings is one of the best ways to cope with project threats and is key to project success. If you need assistance with risk identification and mitigation strategies, netlogx can help.