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Risk management is one of the most important areas in project management, especially in the IT projects, large scale infrastructure projects, new product development projects and in new venture projects. There are nine knowledge areas prescribed by the Project Management Institute of USA in their famous Project Management Body of Knowledge® (PMBOK). Risk Management is one of the nine knowledge areas dealt in detail in the PMBOK® Guide. Any aspiring Project Management Professional with global prospective will be expected of a good understanding of all these nine knowledge areas. If we closely examine the skill sets of the currently practicing Project Managers, it can be observed that they are not very clear about risks in a project and how to plan for risks, identify, develop suitable responses to the risks and then monitor those responses throughout the project.
The current practice seems to be an ad-hoc risk management or more subtly, a kind of crisis management, which implies that risks are not being managed proactively but reactively. Due to the inadequate knowledge and training in project risk management, many project managers allow the risks to happen/occur and then fire-fight with those occurred risks resulting in almost always an increase in cost and project completion time. It may also be emphasized here the fact that projects do not have only negative threats but also positive risks or opportunities. An effective project manager will not only identify the threats to projects but will also identify opportunities available to enhance the impact on the project objectives positively. However, if risks are identified early in a project, analyzed well for suitable responses, monitored and controlled then they can be proactively managed well without endangering the project budget and completion time. |
