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The Value of Risk Management

• Risk management is an essential feature

of successful project management• If you don't manage risk your project will

ultimately fail• There are many benefits to performing risk

management

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The Value of Risk Management

#1 - Increases Awareness

• Provides an opportunity to proactively avert risks• If you identify risks and how they may impact the project

ahead of time, you will be prepared to implement a response plan to thwart the risk with minimal disruption to the project

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The Value of Risk Management

#2 – Improves Communication

• You can't act on what you don't know!• Promotes the frequent communication of project risks

(both opportunities and threats)• Encourages stakeholders and management to get

involved in decision making • Promotes awareness about how risks are being

managed

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The Value of Risk Management

#3 – Identifies Opportunities

• Risk management not only identifies negative risks but also positive ones

• It gives the project manager and team the opportunity to enhance positive risks and reap the associated benefits

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The Value of Risk Management

#4 – Reduces Costs, Resources, & Time

• Implementing a risk response plan will save your organization time and money

• Unnecessary costs will be avoided, valuable resources won't be wasted and precious time won't be lost

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The Value of Risk Management

#5 - Protects Reputation & Legal Liability

• Having a risk response plan will minimize the damage that may be caused by a risk

• If a risk spins out of control, an organization's reputation may go with it

• Embarrassment and legal ramifications will be avoided

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The Value of Risk Management

#6 - Improves Roles & Responsibility Assignments

• Identifying and understanding risk provides an opportunity to assign the best person to address the risk before it arises

• Having the risk monitored by the most suitable person will ensure that it's responded to as soon as a trigger occurs

• Assigns accountability for the risk and risk response

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The Value of Risk Management

#7 – Improves Reliability & Predictability

• Provides the project manager and team with the opportunity to avoid or mitigate risk

• Helps to keep your project on track so you can deliver what is required and by the due date

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The Value of Risk Management

#8 - Improves Quality & Continuous Improvement

• Identifies the strengths and weaknesses of an organization's processes

• Provides an opportunity to enhance strengths and make improvements to existing processes, policies and procedures as well as create new ones

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The Value of Risk Management

#9 - Improves Auditability & Compliance

• Ensures standards are adhered to and a methodology is followed

• Greatly increases a project’s chances of meeting the defined success criteria

• Provides auditors with a paper trail to demonstrate that the appropriate actions were taken

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The Value of Risk Management

#10 - Improves Project Control & Transparency

• Provides greater control over a project • Ensures risks are identified and response plans are in

place ahead of time so the project team is proactive and equipped to deal with problems if/when they occur

• Reduces the likelihood of issues arising • Allows for greater transparency and understanding of

roles and responsibilities • Creates a more cohesive, collaborative and productive

project team