How do you manage uncertainty and risk on your project? What are your client’s expectations and how much risk are they willing to accept while pursuing project objectives? Is maintaining your schedule more important than cost control and how will you plan for project delays that haven’t happened yet? Understanding risk and the importance of good project risk management is an essential component of project management. Risk management is a continuous, integrated process at the project level, and instills a risk-thinking culture as part of the project team’s everyday activities. The risk management process allows your team to focus on proactive efforts to identify, assess, mitigate, and control risks for the primary purpose of reducing threats and leveraging opportunities across all phases of your project to keep your cost and schedule in check. Ranking and prioritizing risks that have the most significant impact to scope, schedule, cost, and quality informs decision making and keeps your team’s attention moving in the right direction. Utilizing risk-based cost estimating directly addresses uncertainty and risk in your project estimates and can be used to proactively set the project budget. Differentiating between buckets of contingencies provides your team with a real-time estimate as you manage risk throughout the project lifecycle. Examples from transportation risk workshops across multiple states will be discussed.
Glenn Goldstein PE, PMP, PMI-RMP