ISSUES WITHOUT A RISK PLAN
While project managers cannot prevent every potential risk that comes in their path, careful risk planning greatly mitigates the impact it can have. All projects carry some risk. The purpose of having a risk management plan is to reduce the overall project risk to a level that is acceptable to the project sponsor and stakeholders. Planning risk management is the process of defining how to conduct risk management activities for a project (Kloppenborg, 2012). Risk is an event or condition that (if occurs) could have a positive or negative effect on a project’s objectives. The issues that can develop without a risk management plan can be detrimental to a project and be the reason for its failure or success. These issues can range from minor to severe in nature. One issue that can come up is a threat, which is a condition that will have a negative impact on the project.
Another issue that could arise would be an opportunity. An opportunity would pose a favorable impact on a project if it occurred. Specific issues to the Satellite Development Project may have been not spending enough time planning, not having enough supplies or even the risk of not running a thorough enough risk management program (Kloppenborg, 2012). It is wise to develop a risk management plan before these types of issues occur so a proactive approach can be taken to reduce the threats or to capitalize on the opportunities. This case is one where an integrated system was put in place for risk management and a proactive approach was taken.
RISK PLAN VALUE
Careful consideration must be given to the identification of the risk plan identification. The process of developing the risk plan involves the project team and the appropriate stakeholders and considers such elements as time, effort, cost and many other resources such as project scope, schedule, deliverables, constraints, culture and even environmental factors. Several methods may be used to assist in the identification of the risks these may be brainstorming, interviewing, Delphi Technique and SWOT (Strengths, Weaknesses, Opportunities and Threats). Risks are then identified by their level of importance with a risk analysis. The value of the risk plan for the Satellite Development Project was such a high priority the team exclusively worked on the development during a day-long clinic (Kloppenborg, 2012).
Time, effort, costs and resources are an integral part of the risk management plan. High risk projects demand more time, effort and initially more costs, but in the end creating an effective and well-managed risk management plan can ultimately save time, extended effort, excessive costs and wasted resources. Hayes agrees that people think about risk management as stopping things that might go wrong, but he stated in his article ‘good risk management programs are about making sure the right people have the right information at the right time to make good decisions’ (Power, 2012).
LEVEL OF RISK PLAN MANAGEMENT
Determining the level of risk management also means considering the potential for change that may occur during the project. Developing criteria for evaluating these probabilities of occurrence and their impact must be identified on an associated plan of action and milestones and then tracked. The method by which this is done should be integrated in to the risk management plan while also utilizing risk management reviews. Creating a risk management report allows the team to know if the risk should be elevated and how to move forward with the project. The risk management report shows the team and the project sponsors where the risks are actively identified, analyzed and managed throughout the life of the project (Daisy, 2010).
The risk management review allows the team to work together to resolve high-priority risks, be proactive and examine strategies for the level or risk. In order to review the risk management plan, a regular review should be scheduled. ‘Risk isn’t static’ (Power, 2012). New risks can develop as the project progresses and the potential risk factors may change. This can be every other month as in Case Study 3 but should be on a set schedule so that the decisions and actions regarding any new risks or changes that have occurred since the last review can be discussed and all team members are up to date.
VIRTUAL TEAM – RISK PLAN MANAGEMENT
‘With rising globalization there is an emergence of virtual structures in many organizations’ (Ahuja, 2010). Although the Satellite Development Project was not a virtual structure, there is the potential in today’s culture for it to become a reality with regard to looking at the risk management plan in general. ‘Changing workforce, changing family norms, rapid advancement in technology and the upcoming of the knowledge worker have led to many changes in the work structure which specifically has let to replacement of the face-to-face contacts’(Ahuja, 2010). These changes have led to the virtual team environments. The virtual environments have allowed dispersed talent and knowledge to be brought together without the use of physical space while still attaining a common goal with planning and execution. The impact however can be challenging while facing such situations as communication challenges, team participation, coordination and overall trust. Because there are no geographical barriers, there can be complex global issues due to diversity and cultural backgrounds.
When looking at the specifics of the Satellite Development Project the expected impact would have been most prevalent during the planning stage, specifically during the development of the risk management plan. A virtual team would not have had the luxury of taking a full day to attend a ‘day long clinic’ to exclusively work on developing the plan. The virtual team would however be able to do the same research according to industry standards of those at SEI, develop criteria for evaluating the probabilities of the risk occurrence and impact as well as prioritizing. The virtual team would have had to potentially schedule a Skype meeting at some point during that integral phase of planning. Studies show virtual teams do not have a smooth flow of information sharing compared to face-to face teams and that face-to-face meetings should be encouraged (Warkentin et al. , 1997).
Goals should be referred to frequently by team leaders to encourage virtual teams to stay on course. This leads to the planning and execution stages of the risk management plan. A virtual team could implement the current risk management plan for the Satellite Management Project due to the solid approach that was put in place. The Risk management worksheet allowed for integration face-to-face or virtually. The Satellite Development Project adopted a risk management database tool as its cornerstone. The tool allows anyone in the project team to view the risks, enter new risks, and provide input for potential risk responses (Kloppenborg, 2012). This was done via a database entry record system. The execution was to hold a risk management review every/other month to discuss any decisions and actions with regard to new developments. This could easily be done via virtual methods Skype, FaceTime, web media presentations or other forms of virtual technology.
The process for deferring, transferring, mitigating or accepting the risk would be discussed and the potential need for risk elevation would also be assessed. Two ways the team could maintain its current goal in planning and execution could be through the risk management review tool and review meetings created through accessibility by all in the group, both virtual and in the Satellite Development Project. This allowed remaining on track with the current goal of completing the high risk project involving research technologies, system integrations and manufacture component variables possible whether physically on site or a virtual member of the team. ‘Whenever possible, measure the effects of your risk management efforts and continuously implement improvements to make it even better’ (Daisy, 2010).
Virtual teams are on the rise and the potential to remain true to original goals and objectives can be met, even in proactive risk management plans. In order for a virtual team to stay on track and achieve the original goals such as those of the Satellite Development Project the team must have clear communication, solid trust among team members, strong participation and a collective performance where roles and responsibilities are clearly defined.
Ahuja, J. (2010). A STudy of Virtuality Impact on Team Performance. IUP Journal of Management Research, 9(5), 27-56.!
Daisy, B.A. Daisy1, Ms. P. V. Sornalatha 2, Dr.R.Karthi 3, IOSR, (2005-2010). Assessing the Project Risk Management Processes by using Rules and Project Management Templates, Journal of Business managementhttp://www.iosrjournals.org/iosr-jbm/papers/NCCM PCW/P010.pdf.
Kloppenborg, T., Nkomo, S. (2012). Human Resource Project Management, (2nd ed.). Mason, OH: South-Western Cengage Learning
Power, B., (2012) How to make a sound risk management plan. Charter, 83(10), 42-43.