Tools and techniques to identify risks process in project risk management can be needed for every project manager to achieve acceptable project outcomes. So, in this article, we’ll discuss 11 tools and techniques for identifying risks in project risk management.
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What Is Project Risk Management?
Project risk management plays a vital role throughout the project life cycle because it helps project managers maximize the probability and impact of positive risks and minimize the probability and impact of negative risks to optimize the chances of project success. Furthermore, project risk management aims to identify and manage risks ( Individual risks and overall project risks) that are not addressed by the other project management processes. If not managed appropriately project risks, you cannot prevent the project from deviating from the plan and failing to achieve acceptable project outcomes. So, project risk management is directly related to the project’s success.
According to the PMBOK (Project Management Body of Knowledge) 6th edition, project risk management includes seven processes. These are as follows.
- Plan risk
- Identify risks
- Qualitative risk analysis
- Quantitative risk analysis
- Plan risk responses
- Implement risk responses
- Monitor risks
These processes play a vital role throughout the project life cycle to meet the project objectives effectively and efficiently. So, each process is crucial, but let’s explore the identify risk process and 11 tools and techniques needed to identify different types of risks in the project.
Identify Risk Process in Project Risk Management
During this process, project managers should focus on identifying individual and overall project risks and documenting their characteristics. Documenting relevant information will help their team members respond appropriately to identify risks. Individual project risk is uncertain events or conditions. So, that has a positive or negative effect on the project objectives. Project risk management aims to enhance positive risks (opportunities) while avoiding or mitigating negative risks (threats). Unmanaged threats may result in issues or problems as follows.
- Schedule delays
- Cost overruns
- Performance shortfall
However, opportunities can help acquire benefits as follows.
- Reduces time
- Reduces project costs
- Improved performance
Overall project cost can be positive or negative. Typically, this helps minimize negative variation while maximizing the probability of achieving overall project objectives.
As well as this process plays a vital role throughout the project life cycle. So, the following people are participating in the risk identification activities.
- Project manager
- Project team members
- Project risk specialist (if assigned)
- Subject matter experts
- Customers
- Operation managers
- Risk management experts within the organization
- Stakeholders
So, let’s explore the tools and techniques needed to identify risks.
Tools and Techniques to Identify Risks Process
As discussed above, the identity risk process helps project managers to identify individual and overall project risks. So, here are 11 tools and techniques that can be used when identifying project risks.
Expert Judgment
The experts play a vital role when identifying project risks and may involve individuals or groups with specialized knowledge of similar projects. Furthermore, experts should be identified by the project manager and invited to consider all aspects of individual and overall project risks. As well as that is based on their previous experience and knowledge.
Brainstorming
Brainstorming is a data-gathering technique that can be used when identifying project risks. Brainstorming aims to obtain a comprehensive list of project risks ( individual project risks and overall project risks). Typically, in this process, the project team performs brainstorming, often with experts, but they are not part of the team. However, ideas are generated under the guidance of a facilitator. Furthermore, you can categorize risk, such as risk breakdown structure (RBS), which can be used as a framework. Moreover, special attention should be paid to ensuring that risks identified through brainstorming are clearly described.
Checklists
The checklist is another vital data-gathering technique that will help project managers use this as a reminder. So, a checklist can be considered as a list of items, points, or actions. When creating a checklist, you can use historical information and knowledge. So, project managers can collect this information and knowledge from similar completed projects, listing particular individual project risks that have occurred previously. Furthermore, the organization may maintain a risk checklist based on completed projects. However, the risk checklist should be reviewed to update new information. As well as remove or archive information.
Interviews
The interview is a vital data-gathering technique among project managers. So, this technique will help project managers identify project risks, including individual and overall project risks. Therefore, the project interviews should be conducted in a friendly environment to encourage unbiased contributions and honesty. Typically, the interviews involved experienced project participants such as subject matter experts and stakeholders.
SWOT Analysis
SWOT analysis is a data analysis technique among project managers. So this will help them to examine the project from each of the strengths, weaknesses, opportunities, and threats. Accordingly, this analysis helps identify any opportunities for the project that may arise from strengths and any threats resulting from weaknesses. As well as SWOT analysis inspects the degree to which organizational strengths may offset threats and determines if weaknesses might hinder opportunities.
Root case Analysis
Root case analysis is another vital technique among project managers because it helps them discover the underlying causes that lead to the problem. Furthermore, this technique will help identify threats and opportunities in the project. For example,
The root cause analysis technique helps project managers identify threats by starting with a problem statement, for example, over budget or schedule delays. On the other hand, this technique helps explore opportunities by starting with a benefit statement, for example, under budget or early delivery.
Document Analysis
Document analysis is another vital technique among project managers because it helps them identify project risks from a structured review of project documents. Here are some documents that help you discover project risks.
- Project plans
- Assumptions
- Constraints
- Previous project files
- Project agreements
- Project contracts
- Technical documentation
Assumptions and Constraints Analysis
Assumptions and constraints analysis is a technique that helps project managers find the validity of assumptions and constraints to determine which poses a risk to the project. Project threats may be identified by using the following assumptions.
- Inaccuracy
- Instability
- Inconsistency or incompleteness
On the other hand, constraints may give rise to opportunities by removing or relaxing a limiting aspect that affects the execution of a project or phase.
Interpersonal and Team Skills
Interpersonal and team skills play crucial roles throughout the project because they will help facilitate and improve the effectiveness of many techniques used to identify individual and overall project risks. Accordingly, a skilled facilitator can help participants as follows.
- To focus on the risk identification tasks
- To follow the method associated with the technique accurately
- To ensure a clear risk description
- To resolve any disagreements that may arise
- To identify and overcome sources of bias
Related Post: Top 10 interpersonal skills for project managers
Prompt Lists
The prompt lists are crucial for identifying project risks because they can be used as a framework to aid the project team in idea creation when using risk identification techniques. Accordingly, some common strategic frameworks are more suitable for identifying project risks. For instance
- PESTLE framework
- TECOP framework
Meetings
As a project manager, you can conduct special meetings for identifying project risks, often called a risk workshop. Having a facilitator’s interpersonal and team skills will enhance the effectiveness of the meeting. However, these skills are essential to ensure the right people participate in the meeting. Typically, risk workshops involve the following people.
- Project sponsor
- Subject matter expert
- Project stakeholders
- Other relevant parties to the risk workshop
Read More: 8 reasons why team meetings are important for project collaboration
Conclusion
When identifying risk in project risk management, project managers can use these tools and techniques to identify them effectively and efficiently. So, those tools and techniques are expert judgment, brainstorming, checklists, interviews, SWOT analysis, root case analysis, document analysis, assumptions and constraints, interpersonal and team skills, prompt lists, and meetings.
