Strategy Survival Guide

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Strategy Survival Guide Version 2.1 Prime Minister’s Strategy Unit home | strategy development | strategy skills | site index Strategy Skills > Managing the Project Managing risks > in practice The project plan should contain an analysis of risks to the project itself. There are a number of potential risks which can hamper a project including necessary changes to the project time scale, budget cuts, staff problems or shortages or, more fundamentally, that the sponsor changes his/her mind as to the objective or scope of the project. The aim of the risk assessment is to identify and assess these threats to successful project delivery. This will enable the team to identify actions to help avoid or reduce the potential damage. The risk assessment should identify and describe possible risks to each task identified in the project management plan. This can be done by brainstorming (perhaps at the initial project away-day) and by speaking with others who have worked on similar projects or issues. The analysis should identify the probability of the risk occurring (High/Low) and the potential impact of the risk on project objectives (High/Low), as shown on the diagram below. Limited Probability High Probability High Impact Less Impact A risk log can be maintained to capture and actively manage risks to the project, and could contain: • A unique reference for each risk identified • A description of the risk to the project • A description of the impact on the project should the risk materialise • The proximity of the risk, which is an estimation of time-scale for when the risk might materialise • The likelihood of the risk occurring. This could be a mathematical calculation, or a simpler High, Medium, Low classification Strategy Survival Guide – Strategy Skills Page 70
• The severity of the risk - categories for severity might be Critical (that is, adverse effect such that continuation of the project is unacceptable), Major, Significant, and Minor • The risk owner - each risk should be assigned to an individual who is best placed to monitor it and manage any necessary actions • The response to the risk which either reduces the probability of the risk happening or reduces the damaging effects of the risk should it happen • The current status of the risk itself and progress of any actions relating to the management of the risk. A risk log should be reviewed and updated regularly. References The Risk Support Team at HM Treasury are responsible for implementing the Strategy Unit report on handling risk in government and provides guidance on all aspects of risk management, including the Principles of Managing Risks to the Public. Managing risks In Practice: SU GM Crops Project The SU GM Crops project formed one strand of a highly-charged and controversial dialogue around the role of GM technology in the UK. This had the two-fold impact of (1) increasing the number of risks faced by the project, and (2) raising the stakes in the event of things going wrong. In this context, active management of risks was essential. The team worked together to identify risks and to assign to them both impacts and probabilities. The possible consequences of each risk were identified, and responsibility for preventative actions assigned to specific team members. Risks varied from the relatively prosaic – e.g. team members leaving partway through the project (which happened twice in this instance) – to the much more dramatic – e.g. the US bringing a case against the EU under the WTO, in respect of policy on GM (which happened towards the end of the project). Many of the risks identified in the risk register came to pass during the project. The fact that the team had already thought about these risks undoubtedly made them easier to deal with, although the use of a risk register in itself was not a panacea. For example: • In several cases the team’s assessment of impact or probability proved inaccurate. For example, the early departure of team members was classed as medium / high impact but only medium probability – in the event, two team members left early, but the impact if anything was positive, because it enabled different skills to be brought into the project at different stages. • Even where risks were identified, it was not always possible to mitigate against them or to deal effectively with the consequences. For example, the availability of good data from the parallel Science Review was identified early on as a key risk. But despite best efforts from the SU and the Science Review team, the timing of the two strands restricted the opportunities for datasharing. • Some risks were missed completely – partly because the team did not keep the risk register fully up to date. For example, the team failed to identify and prepare for the impact of a reshuffle of Ministers on the governance of the project. Overall, however, the use of active risk management techniques enabled the team to steer a successful course through a potential minefield, relatively unscathed. Strategy Survival Guide – Strategy Skills Page 71
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Strategy Strategy Survival Survival
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Strategy Survival Guide Version 2.1
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Building an Evidence Base 113 Data
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A Framework for Strategic Direction
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Multi-criteria analysis In Practice
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Strategy Survival Guide

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