97.5% of projects fail to meet the targets and deadlines

When you start the planning process for a project, one of the first things you need to think about is: what can go wrong? It sounds negative, but pragmatic project managers know this type of thinking is preventative. Issues will inevitably come up, and you need a mitigation strategy in place to know how to manage risks when project planning. Projects can be risky endeavors, and if not managed properly, they can quickly go off the rails. Without proper risk management, projects can have time or cost overruns, resulting in missed deadlines, unbudgeted expenses, and ultimately failure. Project risk is any potential issue that could negatively impact the successful completion of your projects. Risks could be due to internal or external factors. For instance, a key supplier going out of business and a key team member leaving your organization—both qualify as project risks.

Risk management is focused on anticipating what might not go to plan and putting in place actions to reduce uncertainty to a tolerable level. Working with the risk owner, the project professional ensures that risks are clearly identified before moving on to the risk analysis step of the risk management process. The project risk management process reflects the dynamic nature of project­work, capturing and managing emerging risks and reflecting new knowledge in existing risk analyses. Project risk management is the process of identifying, assessing, and responding to unexpected risks that might affect your project's goals and progress. Risk management does not have to mean the same thing to each project. Different projects can have different risks and must be managed differently. When it comes to big projects, for example, the risk management strategy could be much more extensive and require a lot more planning. If it is a small project, on the other hand, efficient risk management could mean prioritizing the risks. Risk management is a decision-making process considering multiple elements, such as social, economic, and political factors. In addition, it includes the engineering factors associated with relevant risk evaluation in the context of a potential threat so that various other regulatory options can be developed, analyzed, and compared to select the optimal regulatory response that will provide security or protection against any unanticipated event. In the risk management process, the threat and potential risks are evaluated by selecting either a regulatory or non-regulatory response to the risk. The entire selection procedure will necessitate the consideration of legal, behavioral, and economic factors.