Risk management
Not a list of worries in a spreadsheet, but a calculation: what could happen, what it would cost in days and money, and how much contingency the project needs to absorb it.
Contingency was set as a percentage of the budget, and there is nothing to justify it with to an investor or a bank.
Risks were discussed at the start, a register was drawn up, and nobody has been back to it since.
The programme shows one date while everyone involved expects a later one. By how much, nobody has calculated.
The lender or head office asks for a quantitative assessment, and all that exists is a colour-coded table.
Risk register
Not a list of anxieties but statements with a cause, an event and an effect, each tied to specific activities and packages.
Qualitative assessment
Probability and impact on an agreed scale, ranking, and the filtering out of what does not warrant attention.
Quantitative analysis
Simulation across schedule and cost. The output is not a single date but a distribution — for instance, the date that holds with 80% confidence.
Justified contingency
A contingency figure derived from the risks rather than assigned as a percentage. That number can be defended to a bank.
Response plan
For each significant risk: what is done in advance, what is done if it occurs, who owns it and what it costs.
CSRA workshops
Facilitated sessions with the project participants: contractors, designers and the client's team assess the schedule and its risks together.
Regular review
The register is updated on the same rhythm as schedule and budget. A register nobody revisits is, by mid-project, describing a different project.
- 1
Identification
Interviews with participants and a working session. Different roles see different risks, and half of them never appear in the correspondence.
- 2
Qualitative assessment
Probability and impact assessed, risks ranked, the immaterial ones set aside.
- 3
Quantitative analysis
Modelling the effect of risk on programme and budget, producing probabilistic dates and costs.
- 4
Response and contingency
Measures for the significant risks, ownership allocated, and the contingency requirement calculated.
- 5
Review cycle
Regular updates: what materialised, what closed, what is new.
Risk kept where time and money already are
The register and its effect on the forecast sit next to the programme and the budget rather than in one person's file. "What happens to the date if this risk lands" therefore does not require a separate study.
See what it looks like- What does quantitative analysis add to an ordinary register?
- A register says a risk exists and is "high". Quantitative analysis answers the question the investor actually asks: with what confidence will we hit the date and the budget. Instead of one date you get a distribution, and you can decide deliberately which confidence level to commit to.
- What is CSRA?
- A joint schedule risk assessment session: the project participants work through the critical path together, assess uncertainty in durations and add risk events. Its value is that the estimates come from the people who will do the work, rather than from an analyst guessing on their behalf.
- How much can such calculations be trusted?
- Exactly as much as the honesty of the inputs. The model creates no knowledge; it collects what the participants know and shows the consequences. That is why we spend more effort on the elicitation sessions than on the simulation, and always show which assumptions produced the result.
- We are mid-project. Is it too late?
- No, but the question changes. Early on, risk management helps choose a strategy and justify the contingency. Mid-project it answers something narrower: how this ends at the current state, and what can still be changed. Both are useful; the second is simply cheaper than finding out by arriving there.
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