Riding in the Rain

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Four ideas for managing risks on a finance project

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Over the past few weeks, it’s been getting hotter in Sydney. Great for swimming, but if you’re thinking of riding a motorcycle – that’s another thing.

When I go riding, it’s all-the-gear-all-the-time (ATGATT if you like acronyms).

This means riding with boots, pants, jacket, gloves and helmet – all with good protection in case of an accident.

While it’s great for safety, my gear is heavy, and you melt when the temperature increases.

The other week, I launched out and bought a mesh motorcycle jacket. It has protection and mesh panels to allow air to flow through. A good solution for Summer, I thought.

However, unlike my old jacket, this one isn’t waterproof on its own.

So if I’m out riding, and it rains, I’ll get soaked. That won’t be pleasant if I’m an hour away from home.

So, that’s a new risk for me to manage.

What can I do to manage that risk?

  • Just accept that if it rains, I’ll get wet (it is Summer, after all)
  • Check the forecast, and don’t go riding if rain is likely
  • Take a waterproof layer to wear if needed

What about finance projects and the risk of “rain”?

From the Project Management Institute (2021, p. 117), the definition of risk is:

“An uncertain event or condition that, if it occurs, has a positive or negative effect on one or more project objectives”.

All projects have risks. For example, you’re implementing a new finance system and, late in the project, find holes in the design. This could impact the budget and the go-live date.

So, what can you do? Here are four things to think about on your next project.

1. Find

Start thinking about risks early – what might stop the project from delivering what was agreed?
A good place to start is learning from the past. What were the issues that hurt similar projects?

2. Assess

Identify the risks that need close attention. You can do this by considering the likelihood of the risk occurring and how significant the impact could be on the project.

3. Manage

Now, what will you do about the risk? If you’ve given it a low rating, maybe accept it.

But if it has a higher rating, you could think about what you can do now. For example, going back to our “holes in design”, we could:

  • Put more effort into ensuring the design was robust
  • Allow a contingency in the project budget for unplanned Change Requests
  • Build in a “buffer” of time in case something runs late

4. Review

There’s a temptation to put the effort in at the beginning and move on with other work. However, risks change, so you keep revisiting them throughout the project.

Bottom line

We want to improve how finance works, and doing that involves risk.

You’re better to start thinking about this early and avoid a long ride home on a dark and stormy afternoon, soaked.

References

Project Management Institute. (2021). A Guide to the Project Management Body of Knowledge (PMBOK® Guide) (7th ed.). Project Management Institute.

Disclaimer

The information provided in this document is of a general nature only and does not take into account your specific needs and circumstances. The information provided may not be relevant to you, and you should seek appropriate professional advice prior to making any decision based on this information.

Phil Howman

Phil Howman

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