Project Planning

Even the most carefully planned project can run into trouble. No matter how well you plan, your project can always run into unexpected problems. Team members get sick or quit, resources that you were depending on turn out to be unavailable, even the weather can throw you for a loop. For example, Hurricane Ike. So does that mean that you're helpless against unknown problems? No! You can use risk planning to identify potential problems that could cause trouble for your project, analyze how likely they' Il be to occur, take action to prevent the risks you can avoid, and minimize the ones that you can't.

A risk is any uncertain event or condition that might affect your project. Not all risks are negative. Some events (like finding an easier way to do an activity) or conditions (like lower prices for certain materials) can help your project. When this happens, we call it an opportunity; but it's still handled just like a risk.

There are no guarantees on any project. Even the simplest activity can turn into unexpected problems. Any time there's anything that might occur on your project and change the outcome of a project activity, we call that a risk. A risk can be an event (like a hurricane) or it can be a condition (like an important part being unavailable). Either way, it's something that may or may not happen ...but if it does, then it will force you to change the way you and your team will work on the project.

If your project requires that you stand on the edge of a cliff, then there's a risk that you could fall (Figure 22). If it's very windy out or if the ground is slippery and uneven, then falling is more likely.

Figure 22: Potential ways to handle risk in a project.

When you're planning your project, risks are still uncertain: they haven't happened yet. But eventually, some of the risks that you plan do happen. And that's when you have to deal with them. There are four basic ways to handle a risk.

1. Avoid: The best thing that you can do with a risk is to avoid it. If you can prevent it from happening, it definitely won't hurt your project. The easiest way to avoid this risk is to walk away from the cliff (Figure 22), but that may not be an option on this project.
   
2. Mitigate: If you can't avoid the risk, you can mitigate it. This means taking some sort of action that will cause it to do as little damage to your project as possible (Figure 22).
   
3. Transfer: One effective way to deal with a risk is to pay someone else to accept it for you (Figure 22). The most common way to do this is to buy insurance.
   
4. Accept: When you can't avoid, mitigate, or transfer a risk, then you have to accept it (Figure 22). But even when you accept a risk, at least you've looked at the alternatives and you know what will happen of it occurs. If you can't avoid the risk, and there's nothing you can do to reduce its impact, then accepting it is your only choice.