A Risk Management Research Report in Hong Kong (2)

Let’s continue with the results of the research paper. Interviews with the 25 experienced project managers revealed their FOUR risk response strategies – Control, Negotiation, Research, and Monitoring.

Control Strategies

Control Strategies	Descriptions
WBS	- Understanding requirements - Assessing staff skills required, technology & solution etc. - Detecting and negotiating over-ambitious target schedule
Progress Control	- Close monitoring and control of each task’s progress
Change Control	- Tightly controlling clients’ change requests, sometimes through contract T&Cs
Documentation	- Documenting all changes - Controlling all documents for advantageous position in disputes
Reactive Problem Solving Strategies	- Increasing available person-hours (OT) - Rescheduling and problem isolation

Negotiation Strategies

Negotiation Strategies	Descriptions
Change Control	- Assessing clients during pre-sales to determine the best approach - “Hard” vs. “Soft” approach
Trust & Relationship Building	- Mitigation for all relationship risks - Trying to put self into others’ shoes
Managing Client Expectations	- Recalibrating client expectations from the start - Being honest
Balancing Cost, Schedule, and Scope	- Reprioritization of time, budget, or quality, e.g., postponing less critical req. to 2nd phase - More resources or lower profits
Escalation	- Last resort
Team-building	- Building and maintaining commitment through lead-by-example & sharing decision making

Research Strategies

Research Strategies	Descriptions
Studying & Self Education	- Forming special team researching and studying new technology issues - Requirement study trying to identify potential pitfalls in solution or technology

Monitoring Strategies

Monitoring Strategies	Descriptions
Constant Surveillance	- Paying special attention to potential problem areas identified during implicit assessment and evaluation of the project surroundings and contexts - No preventive action - Helping to shape negotiation strategies

In summary, these project managers:

• Relied on contingencies built into the schedule (by pre-sales)
• Applied broad project management strategies, regardless of specific risks identified

There is little evidence that they:

• Revisited pre-sales risk checklist
• Made own independent risk assessment

This is in complete contrast to formal Risk Management methodologies that emphasize on risk-by-risk analysis and response. Neither do the findings match recommended practices of proactive planning – Negotiation strategies, based on good relationship, were usually adopted in a reactive manner. Some practices such as Overtime (OT) are not completely in line with best practices.

There is NO risk quantification at all, as recommended by formal methods.

In the beginning of the research, it’s already established that this group of project managers were competent and knowledgeable in formal PM methodologies. So why were they not using formal risk methods? Is using broad risk strategies more effective than risk-by-risk approach for small/medium size projects?

To be continued…

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