OnPoint, LLC

Real World Project Risks

If you are responsible for planning a project, you will need to perform a risk assessment. You will need to identify and make plans to mitigate those events that will impact your project’s schedule, cost and quality. Instead of starting with the blank sheet of paper, begin your risk assessment with some of these common events.

A New Sheriff Comes to Town

It may come from a merger. It may be the result of a management shakeup or even a promotion. Whatever the reason, there is a high probability that the sponsor of your project will move on within the next 12-24 months. Whoever replaces your sponsor will challenge every major decision made by your sponsor, including your project. If you are lucky, your project will be canceled. If not, you will be ordered to meet your project objectives with fewer resources. The mitigation for this risk is to break your project down into smaller phases. If you wait more than six to nine months for your first implementation, you are taking on considerable risk.

The vendor does not deliver

This risk is so common that it is almost a certainty. Having worked on both sides (vendor and buyer), it is easy to understand how this happens. The vendor is in the business of selling services, and sometimes they overachieve. The vendor may have the capacity to handle, for instance, two new customers. But they sell three – and you are number three. At the same time, the buyer finds it necessary to “get tough” with the vendor. During contract negotiations, your management will extract commitments for unrealistic deadlines and low prices. The vendor will agree to the terms then put their least experienced resources on the project (the best resources go to the customers who pay full price). The best mitigation is to encourage the buyer’s contract negotiator to leave his machismo out of the negotiations and focus on the success of the project. If that does not work, look for opportunities to build in a significant risk buffer in your project. You will need it.

The “solution” does not work

Perhaps your project will rely on a “state of the art” programming language, an advanced database management system, or a new project management methodology. If so, your project will become a “learning experience,” and it will be a very expensive education. This risk must be mitigated by starting out small and then expanding. Begin with a proof of concept, and then scale up from there.

The primary subject matter expert (fill in the name) does not start on time

Even in very large companies, there are relatively few true subject matter experts – people who know the both the business and the systems. These people are incredibly busy and they are already working on multiple projects. Your subject matter expert may be working on a project that will finish late and thus delay your project. To mitigate this risk, minimize your reliance on this person and try to schedule around her availability. Avoid relying solely on her manager to determine when she will be available. Have an off-the-record conversation to determine when she will really be available.

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