Wellington researchers have recently mentioned that risk management is among the most important factors of project success. However, this fundamental aspect of project management is seen as optional by the majority of project leaders. According to another PM study by the Australian Institute of Project Management, only 36% of organizations report that they consistently apply risk management methods. Furthermore, only 30% of organizations successfully deliver projects within the set time and budget. Implementing project risk analysis and employing tools for risk assessment is a great strategy for improving project success. Let’s take a closer look at the most common risk management practices and find out what new tools we can apply.
Common Risk Management Practices
There are a variety of techniques for risk analysis and management, such as brainstorming, root cause, and checklist analysis, SWOT analysis, risk surveys, and assumption analysis. We recently talked to PM leaders to figure out what risk mitigation methods they commonly use. Here’s what they said:
Hani Almeghari, a Business Development Specialist at Finn Church Aid:
“In impact investing, the risk management system is based on the risk matrix, which allows the institutional investor to not just identify the financial, legal, and reputational risks but to quantify the risk as well.”
Juan Gutierrez, a Project Management Engineer at Edison Chouest Offshore:
“We use our database for quantitative analysis, PERT, and Monte Carlo simulation. At the beginning of the project I use qualitative analysis, and during the project I re-evaluate the risks.”
Steve Canfield, an Executive in Project Management:
“I am evaluating risks every week. It’s not unusual for new risks to appear, and for previously identified risks to change status, so I think it’s important to make sure evaluation is part of the PM’s regular activities”
Michelle Capuano, an IT Business Analyst at WWE:
“The postmortem of previous projects is also another opportunity to identify additional risks for a new project. Once a compilation of risks is identified, certainly a risk matrix, with defined prior risks, should be managed and reevaluated by the project team and steering committee.”
Kiran Kachela, Director and Business Improvement Consultant at Continuous Improvement Projects Ltd.:
“[The] risk assessment process should be a team activity, not just something managed and controlled by a project manager. The scoring of a risk can be subjective and vary based on individual people’s perceptions and context; therefore, it’s important to involve the team in identifying, evaluating, and managing risks.”
Proper risk management process is a must for all PMs who expect their projects to end in success. Efficient practice not only brings security to the future of one’s project but also protects resources, saves time and money, and provides new development opportunities.
Risk Management Challenges
All of the risk assessment practices mentioned above are helpful, but it’s difficult to implement them, especially in a multi-project environment. Project statuses change too fast for brainstorming and risk surveys to be sufficient for risk management.
What makes the process especially challenging is the fact that it often involves complex calculations based on data that might already be outdated. Real-time monitoring of project performance gives an early indication of deviations from the plan, yet 55% of organizations still don’t have access to real-time project data. This is because there’s never a point when you’ve gathered enough information, as project statuses change fast. It’s better to use the benefits that technology offers.
Read more: Emerging Trends in Project Management 2019
If your risk assessment is a backward-looking process, we suggest you consider a software solution that can help you approach monitoring as a predictive process: risk management is always ongoing. After all, at its very core, a risk management plan helps you avoid witnessing project failure by identifying and eliminating risks, when you first identify them.
Effective Risk Management Process with Epicflow
There’s a direct connection between project success and real-time monitoring, since real-time monitoring guarantees efficient and timely project risk management. You need a risk assessment tool that can regularly log and track risks by taking into consideration threats and opportunities as well as changing project statuses. The question stands: How can a group of PMs make their projects cooperate and complement each other rather than create unneeded bottlenecks, especially in multi-project environments? With the help of Epicflow, it is possible.
Epicflow creates a risk assessment process based on quantitative analysis and the probability of occurrence and potential impact of a risk. Then Epicflow prioritizes risks based on their impact on overall project objectives. Focusing on constraints is in Epicflow’s DNA. It helps you identify existing and new risks proactively and fix the weakest parts in your chain. What’s more, Epicflow manages risks at five levels:
- Risk identification can be done with the help of the Pipeline and the Bubble graph, which track project progress. Risk is based on time and capacity constraints, which are highlighted both on a tactical and operational level. You can also use the What-If tool to predict possible negative outcomes and avoid them.
- Risk analysis is conducted by the Future Load graph, which shows future capacity constraints and resource group overload.
- Risk prioritization is done automatically by Epicflow based on risk identification and risk analysis results. Epicflow brings high-priority tasks to the top and makes sure each of your employees knows what to do next. Moreover, all projects are sorted by priority in the Pipeline.
- Risk response is conducted with the help of Simulation functionality, which helps you find the best decision and apply it in a few clicks.
- Monitoring is also done with the help of the Bubble graph and Pipeline, which allow you to visualize real-time project development.
Epicflow is designed to be the world’s best multi-project resource management system. This online application for predicting and eliminating risks may be one of the most essential parts of your project management success. Many C-level executives and PMs have already recognized the change this software brings to their environment:
“Epicflow meets my project management needs from a timing and resource perspective. The software is easy to use and points me directly to the biggest constraint. For the resource part, I can easily track workload across multiple projects,” says Sander Janssen, a Project Manager at Lightyear, a solar car producer.
Please, provide your contact information in the form below to request an Epicflow demonstration. Our PM consultants will contact you to arrange a meeting and show you how to mitigate project risks with Epicflow. After all, you can easily use the functionality of Epicflow to make your project planning process standardized, scalable, efficient, and predictable at both the group and individual level.