So, what are project risk owners and how should project managers identify and assign them? Let's talk.

Imagine that you are the project manager of a two-year, multi-million dollar project. During the execution of your project, you take a beach vacation.

One of your team members calls upset that a major risk has occurred. You cooly reply, "No problem." You text the risk owner and discover that the risk response plan is being executed and everything is fine.

Is this scenario possible? One thing is for sure. If we don't identify and recruit risk owners, this will never happen. Your project will be at greater risk.

What is a Project Risk Owner?

The PMBOK 6th Edition says a risk owner is "the person responsible for monitoring the risks and for selecting and implementing an appropriate risk response strategy." Furthermore, these individuals may aid in evaluating their risks in performing qualitative risk analysis and the quantitative risk analysis. 

What would you do if all hell breaks loose in a critical company project that you are managing? You lose two of your best team members. Your budget is shot. A key stakeholder is breathing down your neck. Behind schedule by four weeks. You haven't slept well in two weeks. And you feel like throwing in the towel.   

Taking on Risky Projects

Some projects are more risky than others. A project sponsor sees an opportunity. It's a stretch and he knows it, but he wants to try anyway. So, the project charter is completed and the top risks are recognized.

The Project Board approves the project. Why? Because there will be tremendous gains if the project is implemented successfully.

And guess what? You've been asked to manage this project. Lucky you.

As you are engaged in the project, you begin to understand just how challenging the project is going to be. How will you approach the uncertainty that lies before you? What can you do to recognize and plan for the events and conditions that may have negative effects on your project objectives?

When is risk exposure greatest in a project? In the beginning, in the middle, or at the end of the project? It's actually highest in the beginning. Let's look at how to reduce risk exposure early in your projects.

Why Risk Exposure Is Greatest in the Beginning

So, why is your risk exposure greatest in the beginning? Project managers have the least amount of information. Uncertainty is the greatest. We know very little about the:

• Goals of the project
• Deliverables
• Requirements
• Budget
• Constraints
• Success criteria
• Availability of resources

Here are five activities that you can undertake to reduce the risk exposure early.

Operational risk includes people risk, technology risk, external event risk, and process risk. In this article, let's talk about process risk and how to reduce these risks through process mapping.

When employees leave organizations, these entities may loose daily operational knowledge. You know. The people that know how to get things done are now gone. And these organizations often lack process documentation. Furthermore, they fail to cross train other employees adequately.

So, who is impacted? Employees for sure. But most importantly, the customer is adversely impacted. 

IF. Have you thought about the use of this two-letter conjunction in risk management lately? Let's look at how to use the power of If-Then risk statements.

IF is a simple word that can open up new doors to writing clear risk statements. And it can be used to write opportunities as well as threats.

If-Then Risk Statements

Write Opportunity Statements

Opportunities are events and conditions, that if they occur, have a positive impact on your project objectives (e.g., schedule, scope, budget, quality). Here are examples of how you might start these risk statements:

• If you purchase ten or more computers from the XYZ vendor, 
• If you add an additional developer to task ABC,
• If you use quick-drying cement,

If you are looking for a great way to engage your key stakeholders and identify project risks, perform a SWOT Analysis. Project managers or other facilitators can use this powerful tool to identify strengths and weaknesses. Furthermore, strengths may give rise to opportunities and weaknesses may lead to threats. Let's look at how to perform a SWOT Analysis.

"Why am I still having problems with small projects?

This plaintive question is one I'm asked from time to time. I'd like to give a few brief reasons why project managers struggle with small projects.

Pitfalls of Small Projects

1. You think these projects are simple. In general, smaller projects have less risk. However, small projects may have a complex set of variables.

Be sure to analyze the complexity of the project. For example, you may engage your team to draw a context diagram and/or data flow diagrams early in the project. This exercise allows the team to understand the context of the project.

2. You don't have a project charter. Project managers are assigned projects at the last minute with a tight deadline. Rather than discussing the project with stakeholders and documenting the business case, problems, goals, and deliverables, the project manager hits the ground running. Later, stakeholders demand costly changes.

Make it a priority to engage your key stakeholders and develop a project charter. This exercise will provide a good foundation and reduce the changes later in the project. For smaller projects, the project manager should be able to create a charter in short order.

3. You are applying the wrong level of rigor. I see two extremes: First, project managers do not follow any methodology. 

Second, project managers undertake numerous tasks usually performed for large, complex projects.

Keep it simple. Determine the steps you plan to take and develop the planning documents that will provide real value. Execute and stay with the plan.

5. Your team has been poorly staffed. These projects often get the leftover resources. Any warm body will do or will it?

For all projects, define the required knowledge and skills. Seek to staff the project team accordingly.

6. You are not performing project risk management. Yes, smaller projects typically have less risk. This does not mean there are zero risks.

Risk management should not take much time, but be sure to integrate risk management in your project activities. Simple qualitative analysis should be sufficient for evaluating the risks.

7. You are not performing change management. A stakeholder asks for a change in the scope. It's not a big change. You say okay.

Users request additional changes over time. The cumulative effect becomes significant.

Decide up front how you will manage, track, and report changes. When is a change order required? Who has to approve it? 

After publishing my article entitled Evaluating Risks Using Qualitative Risk Analysis, I received questions on how to determine project budget reserves. Here are my answers.

Project Budget Reserves: Questions and Answers

The success of a project manager largely lies in the individual’s ability to communicate. Some project managers have great oratory skills but don’t ask the right questions at the right time.

Here are some key questions for each of the project management process groups. This is not meant to be a comprehensive list; just some questions to get you thinking. Neither will you need to ask all of these questions for every project.

Keep in mind, the project process groups are seldom sequential, one-time events; they are overlapping activities that occur throughout the project.

Initiating Process Group

1. Why are we doing this project?
2. Is your project sponsor fully engaged and on board?
3. What is the authority level of the project manager?
4. What do we wish to accomplish?
5. What are the products and services we wish to deliver?
6. What are the budget constraints?
7. What are the schedule constraints?
8. What assumptions are being made?
9. Who will be impacted? Which stakeholders have the greatest interest and power?
10. Who will comprise the project team?
11. What are the most significant risks?
12. How will we know if the project was successful?

According to PMI, "47% of unsuccessful projects fail to meet goals due to poor requirements management." Wow! Requirements are a pretty big deal. Let's look at five things to start and five things to stop in requirements management.

5 Things to Start

1. Identify and engage appropriate stakeholders. Project managers who work in a matrix environment should seek resource approval from stakeholder's managers early in the project.
2. Ensure the requested software features will be used. Inquire (politely) why the features are needed. How does the requirement align with the goals of the project? The results of one Standish Group indicated that 45% of product features were never used.
3. If questionable, ask if a requirement is in the scope of the project. The project manager may wish to capture out-of-scope requirements in a parking lot for future consideration. Check with the Project Management Office (PMO) or other authority on how to handle these requirements.
4. Analyze requirements using context diagrams, use cases, stories, and other tools and techniques. Project managers or business analysts who use different tools help the stakeholders see things from various perspectives.
5. When requirements change, be sure to update the requirements under version control. Ideally, the project manager should be able to see the versions of the requirement from the initial version to the current version. Many of the requirement tools today provide this capability.