The management of risk is one of the most important parts of the job done by the Project Board and the Project Manager.
The Project Manager is responsible for ensuring that risks are identified, recorded and regularly reviewed. The Project Board has four responsibilities:
- Notifying the Project Manager of any external risk exposure to the project
- Making decisions on the Project Manager’s recommended reactions to risk
- Striking a balance between the level of risk and the potential benefits that the project may achieve
- Notifying corporate or programme management of any risks that affect the project’s ability to meet corporate or programme objectives.
The Project Manager modifies plans to include agreed actions to avoid or reduce the impact of risks.
Risk analysis requires input from the management of the organisation. The organisation’s management, in turn, is kept informed by the Project Board of the risk analysis results. Communication is particularly important between the project and programme levels within the organisation.
Where the project is part of a programme, the management of risk procedures used by the project must be consistent and compatible with those of the programme unless there are valid reasons not to do so.
Where a risk is uncovered in the programme, any affected projects should be involved in the analysis of that risk. Similarly, project risk evaluation should include staff from the programme.
Project risks that threaten programme milestones or objectives must be escalated to programme management.