Projects happen in every business across all sectors of industry and all over the world. Anyone who is looking to deliver a successful project no matter what the size, cost or type of industry needs the right foundation to help them achieve their desired results successfully. Effective risk management has an essential role to play and is essential for the successful outcome of any project and for future-proofing your business. But is especially important for every small business project where the stakes are higher because a project failure can have a much larger impact than in a large company.
Over the course of the last decade, the term project management is one that you will hear more and more frequently. It is estimated that the need for qualified people in this particular field will continue to rise in the coming years as more and more companies opt to employ a qualified project manager to help with the smooth running of their projects. Of course, for the small business, this extra expenditure may not always be possible, so it is important to look at the ways in which you can tackle a small business project for your greatest chances of success.
Here are some of the things that you should be considering when it comes to managing risk on your project, particularly in the early stages of the project.
One of the first things you need to consider, no matter how large, or small, your company is and no matter how complex your project is, ‘What are the risk management expectations?’ You will need to think about the expectations of both the client and any stakeholders, and this should be done as early on in the lifecycle of the project as possible.
Risk management expectations will naturally depend on how complex the project is as well as the requirements for risk management that are attached to the project. You should consider if this will affect the management plans and governance of the project as well as considering how often any risks should be reviewed, at what level they need to be reviewed and perhaps most importantly, how you will report any risks.
You will also need to establish a risk culture within your team, and again this is the same no matter how large or small your team is. This should be established from the top down, and you will need to make sure that your team understand a risk management approach. Not everyone on your team will be happy with risk management, so look for those who are.
As your project progresses, both your skill set and resources will evolve, and your risk management will mature. This is something you will need to prepare for. A good project training programme will help you to identify a risk champion amongst the team who will assist you during the project delivery.
There are three main risk types associated with any project. These are schedule (timescale), cost and performance. The objective of your project will be linked to these. When you look at tolerance and risk appetite, it is very important to be clear about the amount of risk that you are willing to accept on the project to achieve the desired objectives. This is your risk appetite, whilst your risk tolerance is the amount of deviation that you are willing to accept in respect of the project’s risk appetite.
Any project professional will consider how they will manage their risk at the beginning of a project, and this is the same if you are supervising the project yourself. It is also important to ensure that you understand both the risk management principles and the processes that will be involved as well so that you can fully support the project to a successful end.
A project plan is a great place to start and gives you the opportunity to discuss the project with everyone who will be involved. This will ensure that the timescales that you allot to the various tasks involved in the project are more likely to be realistic, and this will help you to stick to any timescales that you allot to the full completion of the project itself. It will also allow you to consider any points in the project where you may hit issues and what you will do if this occurs. This is essential if you want to keep as close to your project budget as well as your timescales. Once you have your plan in place, you have a better chance of succeeding at your project.