Effective risk management must have the following features—‘proactive; management; accommodate; acceptably; professional; possibility,’ asserts author Paul Bower. Advanced risk reviews and risk management methods are ready to provide visibility and a buffer to identify these problems before they surface. In this article at Project Smart, Bower shares the options available for effective risk management.
Types of Risk Management
There is no single way of handling risks, but how do you use a new method until you know one? No matter what you try, it must help you address the existing problems and prepare you to achieve the long-term objectives. Without a decent risk management option, your company will suffer a loss of time, budget, and resources. Let’s find out what choices are available for you to strategically apply:
Avoid It Completely
Though not an ideal choice for all stages of project management, you can definitely avoid some risks. Ensure that they do not hamper any of your project phases before you plan to remove them from the risk register. Assign a risk owner to be on the safe side.
If you want to control them, create a risk reduction strategy that you continuously track until you are done. Have an experienced team to sort these risks out early in the project life cycle. You should have the team work in parallel to address these problems.
Organizations tend to think risk assumptions are a part of controlling the risks. The two risk management processes are different. Per this option, you just acknowledge that such a problem might exist and go ahead with your other tasks without creating a plan.
Transfer the Risks
Is your task list full and you cannot add another one? Transfer that task to someone else through contract or hedging. You are then no longer in charge of its management and can avoid accountability should it surface.
Acquire Knowledge and Research Further
Though this option might not directly be called a risk management type, it can improve the rest of the techniques. Learning how to mitigate risk is a long journey, and you must stay updated regarding new project risks.
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