Risk Management Methods
discover 7 practical & proven project Risk Management Methods
Risk management is the process of identifying, quantifying, and managing risks. The following practical and proven risk management methods will help you spot trouble in advance, in order to keep projects on-track:
- Make Risk Management a Mindsetâ€”Not Just an Activity: Run a series of meetings to identify and analyze project risks, and add risk-related discussion to the agenda for all recurring status meetings. Make risk management a part of the mindset and culture, and not just an activity that only happens when when things go wrong.
- Make Risk Identification a Team Activity: Engage as many stakeholders as possible in the risk identification process. Some risks are obvious and self-evident, while others are apparent (in whole or part) to individuals. It’s vital to get input from the full group to get a clearest, most comprehensive risk picture possible.
- Quantify Risks: Risk mitigation tactics require resources, incur costs and take time. As such, it’s necessary to quantify risks before you make plans to address them (as discussed in the next best practice). Most project managers focus on high-probability, high-impact risks first, so that the project team is prepared for the most serious threats.
- Develop Plans for Avoiding and Addressing Risks: Once risks are quantified, develop two sets of plans: one that strives to prevent adverse events, and another one that seeks to mitigate the damage if those events do indeed occur.
- Track Risks Throughout the Project: Keep an organized record of project risk management activities. If team members are allowed to lose sight of identified threats, then adverse events are not just likely: they are virtually guaranteed.
- Get Full Visibility: It’s important to get full visibility into the project and portfolio, so that ongoing health can be assessed in real time. This allows the team to spot trends and address issues before a project shifts to “at-risk” status.
- Use the Right PPM Solution: Clarizen’s award-winning portfolio and project management solution features a suite of powerful, yet easy-to-use tools that support quantitative risk analysis, risk modeling, variance and trend analysis, risk categorization, system and process flow chart development, and risk reports for all stakeholder groups including executives and customers.