In response to my post, ‘leading teams in uncertain environment part two,’ a contributor sent me a comment via email, and linked stakeholder management and risk management together, which I found fascinating. The contributor went further to state, having a positive risk management strategy in place will also aid a project executive in dealing with uncertainties, and I affirm. The two propositions are detailed under the project strategy concept presented by (Karlos, 2007; Andrew and Jim, 2004; Aaron, 2001). One of the risks, all project face is the tendency for stakeholders to make different assumptions about the expectation of a project. The lack of alignment between stakeholders causes a significant risk to a project. And as discussed in the previous post, this needs to be managed effectively. i.e. to minimize project risk, a project manager needs to be competent in determining the expectations of internal and external stakeholders (David and Mike, nd; Adriene, nd). And by understanding stakeholder expectation, one is effectively able to reduce or eliminate one if the biggest risk that threatens a project. Mehwish (2012) stated risk management is implemented by an individual that is aware of the risk associated with the project and employ different strategies to mitigate them. Although the tools highlight by Mignan (2005) will offer an advantage to control risk, in the age of multitasking, it is expected of project managers to be competent of managing risk from different angles.
In Patchin (2013) response to questions raised by WSJ, she mentioned the importance of prioritization i.e. taking another look at multidimensional look at risk, which involves putting a risk to the top of the priority list. Whereas, the elements with the highest likelihood or impact, will get the most attention from professionals. However, this calls for an extensive look at the probability of occurrence, and when there is a change, it shows a high likelihood to occur. The mentioned will instantly call for speed, i.e. “velocity” to be built directly into the technics of dynamically managing and accessing risk processes. Patchin (2013) went further to state, “risks may appear to have a minimum impact on their own merits. But threats don’t usually unfold in isolation. One risk event can trigger other related risks, contributing to a snowball effect in which different risks become connected and gain momentum, possibly leading to catastrophic events that can persist for long stretches of time.” Thus, as Tara (nd) stated, this calls for an effective risk management, which involves but not limited to planning, preparation, result, and evaluation of risk strategies, which is an element of project strategies put together at Eroe consulting. Indeed, from a wider look at risk, one can conclude that those responsible for risk management, should not be limited to, project managers, however, managing risk effectively, will require top management support and the project owners.
Further Reading
Adriene W., (nd) Stakeholder Management [Online] Available from: https://opentextbc.ca/projectmanagement/chapter/chapter5project stakeholdersprojectmanagement/ [Accessed: February 21, 2016]
Aaron J. Shenhar, Dov Dvir, Ofer Levy and Alan C. M., (2001) Project Success: A Multidimensional Strategic Concept strategy [Online] Available
from: https://irecanati.tau.ac.il/sites/nihul.tau.ac.il/files/media_server/Recanati/management/h [Accessed: February 21, 2016]
Andrew L., and Jim M., (2004) Project management: key tool for implementing strategy [Online] Available from: http://www.kepnertregoe.com/PDFs/Articles/JofBusinessStrategyPM.pdf [Accessed:February 21, 2016]
David M., and Mike O., (nd) ; Engaging stakeholder for project success [Online] Available from: https://www.pmi.org/~/media/PDF/learning/engagingstakeholdersprojectsuccess.ashx [Accessed: February 21, 2016]
Mehwish M., (2012) Risk Management: an Important Part of Project Management [Online] Available from: http://projectmanagement.com/riskmanagementanimportantpartofprojectmanagement/ [Accessed: February 21, 2016]
Mignan, A, Landtwing, D, Kaestli, P, Mena, B, & Wiemer, S (2015), Induced seismicity risk analysis of the 2006 Basel, Switzerland, Enhanced Geothermal System Project; influence of uncertainties on risk mitigation, Geothermics, 53, pp. 133146, GeoRef, [Online] Available from: www.ebscohost.com [Accessed: February 19, 2016]
Karlos A., Jaakko K., Perttu D., Miia M., (2007) What is project strategy? [Online] Available from: http://web.nchu.edu.tw/pweb/users/arborfish/lesson/10320.pdf [Accessed: February 21, 2016]
Patchin C., (2013) Risk Assessment: Answers to Five Frequently Asked Questions [Online] Available from: http://deloitte.wsj.com/riskandcompliance/2013/11/01/fivequestionsoncurrenttrendsincomplianceriskmanagement2/ [Accessed: February 21, 2016]
Tara D., (nd) Why Is Risk Management Important to Project Success? Online] Available from: http://smallbusiness.chron.com/riskmanagementimportantprojectsuccess56920.html [Accessed: February 21, 2016]