Risk Management in Action - Part 1

Identifying Potential High Risk Projects

As stated before project management is characterised by uncertainty and risk. Though there are no prescribed criteria to identify a prospective high risk project, we do outline some thumb rules that one can keep an eye on.

Thumb Rules for identifying Projects that may become High Risk Projects

• Projects / Proposal with one liner requirements: These are usually projects from a known client. The client expects you to understand statements like “Replace the existing system using DB2-Delphi with a .NET system” or “Use the latest technology to rework the current report generation”.

• First time customer: This might be a customer who is off-shoring for the first time. Other case might be that the customer has been bitten hard by a former offshore IT vendor. Hence, one may encounter problems like low confidence levels, micro management by customer, escalation at trivial issues, etc.

• First time technology or complex technology: This needs rigorous technology management and client cooperation to deal with unknowns in emerging and difficult technologies.

• First time project manager: Have you heard the proverb “There are no good project managers - only lucky ones”? Project Management is one of the keys to project success. Thus, good project management is a must for good risk management.

• Bad history of project execution for an account: If there have been cases of failure for projects in an account, one should ensure good risk management practices in other projects in the same account.

• Crunched projects (> 40% COCOMO crunch): Project with crunched timelines is critical since there is little time to set right things that go wrong.

• More than 50% of people have technology mismatch.

• Multi location projects: Managing virtual teams is a reality today. But it needs maturity with the project manager and the team.