Four Tips to Help You Manage and Reduce Project Risk
While eliminating risk out of the project equation is impossible, managing and reducing risk is entirely possible! Here are four tips to help you do so.
1. Create and update a risk register. A risk register is a log containing all potential risks that are likely to occur during a project. As you brainstorm to come up with potential risks, keep a written record of anything you and your team can identify.
As projects evolve, grow, and become more complicated, it’s common to lose track of risks. A risk register can help by serving as a stored, centrally located (head offices, cloud storage, etc.) document you can easily access to see which areas are most prone to uncertainties. Upon completion of projects, the log should be updated and returned to the secure location. When the next project comes, you won’t have to start the risk management process from scratch.
2. Take advantage of positive risks with automated tools. Identifying positive risks can be as difficult, if not more so, than identifying negative risks. For that, it’s highly advisable that you make use of software to help manage the most time-consuming parts of a project.
The most common mistake people make is handling risks with a reactive approach. While that’s a skill in and of itself, a proactive approach is much more sensible. It affords you more time to think of alternative solutions to a singular problem before you come across it. By investing time before a project begins or at the early stages, you’re better able to develop a more comprehensive risk log. Doing so can also help you reduce the risk of unfavorable events affecting your project and, ultimately, your bottom line.
3. Stay up to date with industry trends. Monitoring the risks associated with common industry trends not only enables you to better prepare but also better manage risk. Due to the dynamism of all industries, it’s crucial that you brush up on industry knowledge and trends. Understanding how the market works will give you the upper hand when it comes time to identify and assess potential risks.
You can stay on top of the industry by attending seminars, participating in workshops, or speaking with colleagues in similar businesses. While experience is the best teacher, it’s ideal to avoid making mistakes altogether.
4. Involve the whole team. Harnessing the insight and brainpower of multiple people from multiple angles is better than relying on an individual’s perspective, knowledge, and experience. Seeking as much input and feedback as possible from every part of the organization can help better prepare your team for any unfavorable events that might occur.
One of the more effective methods to get everyone involved is to assess risks from the bottom-up and top-down. Involving every part of the organization empowers members to voice their opinions.