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Positive Risk Management
A positive approach to
Project Risk Management
Creative outcomes
New opportunities
Fresh ideas
To...
Relax...it's not all Bad News
We often think of Project Risk Management as being
about "avoiding bad news".
It doesn't nee...
Getting on the front foot
Risk Management is so often reactive and defensive.
"What will we do if something bad
happens?"
...
Opportunities for positive change
When we change our perspective...we get a different answer.
"If we don't have the right ...
We still PLAN the same way
The fundamentals of Risk Management planning don't
change.
Impacts. Likelihood. Consequence.

W...
We just turn it round a little
Think differently. Imagine the possibilities. Ask questions.

"What does the end state look...
When we look forward...
Ideas flow. Thoughts take shape.
Schedule
"Which milestones will mark
our successful delivery?
"Wha...
It's not about cutting corners
Keep the same practices.

Engage the same people.

Apply the same discipline.

It's about d...
Contact Me
I'm passionate about connecting with people sharing ideas and stories. So please drop me
a line.
tonyadamspm.co...
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Positive Risk Management

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Let's try a different way of thinking about Project Risk Management - instead of being defensive and reactive, let's turn things around and look for positive opportunities to add more value and drive benefits.

Published in: Business, Economy & Finance
  • In my experience, a positive risk is about identifying the opportunity cost of not pursuing a forward looking opportunity.

    Imagine if we identified an opportunity to deliver the project solution 3 months early and provide an extra $2M NPAT over the next financial year. That's a terrific opportunity and one that we would probably want to explore.

    A risk review may express this as 'If we do not position ourselves with the right resources, then we risk losing this additional value opportunity'. There is an opportunity cost to the Business where we do not seek this positive outcome.

    Once we have identified the opportunity, we treat it like any other risk - come up with strategies, assess the likelihood and consequence, and make a decision about how we will respond.

    As I said in the presentation, we use the same tools and techniques, but by changing our focus and looking forward, we are able to see positive value opportunities and put an opportunity cost on not achieving them.

    How much additional benefit have we identified in this opportunity?
    What is the value to the Business of achieving it?
    What do we need to do to prevent this opportunity being lost?
    What is the impact to the Business where we do not realise the opportunity?

    The difference is that by looking forward for value opportunities, we have the chance to put in place strategies and plans that will add additional value rather than look backwards and try to save money and reduce impacts.

    Example 1.
    There may be a value opportunity if we can finish a project early and allow the Business to reinvest the remaining funding back into their product range. A positive risk says 'If we are not able to meet this emerging opportunity, the Business may lose $ABC capital investment returns over the next financial year.'

    Example 2.
    The client may decide that they want to open a new market, with a targeted product launch. If we modify our project scope to include this new product, we may be able to deliver it within the product launch window. This would give the client an opportunity to capitalise on the product launch and drive new revenue and other benefits. A positive risk says 'If we are cannot supply this additional product by the launch date, the client may not be able to realise the $A market opportunity.'
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  • Thanks so much Martin.
    We spend so much of our Risk management time focussing on the negatives, rather than the positives.
    With even PMBOK calling out 'positive risk opportunities', I'd love to see more conversation around how we can do this.
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  • Excellent presentation Tony. Project opportunity ... the other side of the risk coin. Perhaps summed up by Churchill:

    'A pessimist sees the difficulty in every opportunity; an optimist sees the opportunity in every difficulty.'
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Positive Risk Management

  1. 1. Positive Risk Management A positive approach to Project Risk Management Creative outcomes New opportunities Fresh ideas Tony Adams Leadership. Communication. Engagement. (c) Tony Adams 2013-14 All rights reserved
  2. 2. Relax...it's not all Bad News We often think of Project Risk Management as being about "avoiding bad news". It doesn't need to be that way. Risk Management can help us drive positive outcomes and real benefits. Tony Adams Leadership. Communication. Engagement. (c) Tony Adams 2013-14 All rights reserved
  3. 3. Getting on the front foot Risk Management is so often reactive and defensive. "What will we do if something bad happens?" "How much will it cost if something goes wrong?" The picture changes when we get on the front foot. We see opportunities to act early and create positive change. Tony Adams Leadership. Communication. Engagement. (c) Tony Adams 2013-14 All rights reserved
  4. 4. Opportunities for positive change When we change our perspective...we get a different answer. "If we don't have the right people, our delivery will be late. We will fail." "If we have the right people, we can deliver early outcomes and build a richer solution. We will succeed." "If the Requirements aren't clear, we will deliver poor quality." "If the Requirements are clear, we can build even more Tony Adams Leadership. Communication. Engagement. value into our product." (c) Tony Adams 2013-14 All rights reserved
  5. 5. We still PLAN the same way The fundamentals of Risk Management planning don't change. Impacts. Likelihood. Consequence. We just ask ourselves different questions. Tony Adams Leadership. Communication. Engagement. (c) Tony Adams 2013-14 All rights reserved
  6. 6. We just turn it round a little Think differently. Imagine the possibilities. Ask questions. "What does the end state look like?" "How could this situation provide us with an opportunity? "Imagine how much better things would be.." "How much extra value will we add by solving this problem?" Tony Adams Leadership. Communication. Engagement. (c) Tony Adams 2013-14 All rights reserved
  7. 7. When we look forward... Ideas flow. Thoughts take shape. Schedule "Which milestones will mark our successful delivery? "What new activities will help us create this opportunity?" Client "How will we improve the way our client runs their business?" Function "What additional functions will we provide?" Benefits "What additional benefit will we provide?" "How will the new opportunity benefit the client?" Tony Adams Leadership. Communication. Engagement. "How will the new funding improve our overall cash flow?" Budget "What investment will this new opportunity require?" (c) Tony Adams 2013-14 All rights reserved
  8. 8. It's not about cutting corners Keep the same practices. Engage the same people. Apply the same discipline. It's about doing them in a new way. Creatively. Differently. Positively. Tony Adams Leadership. Communication. Engagement. (c) Tony Adams 2013-14 All rights reserved
  9. 9. Contact Me I'm passionate about connecting with people sharing ideas and stories. So please drop me a line. tonyadamspm.com Linkedin.com/in/tonyadams1 Twitter.com/tonyadams2002 Google.com/+TonyAdamsPM1 Facebook.com/TonyAdamsPM Pinterest.com/TonyAdamsPM Tony Adams Leadership. Communication. Engagement. (c) Tony Adams 2013-14 All rights reserved

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