Risk Happens!

Highly Practical

Risk Happens! is the practical introduction to Project Risk Management that is missing from the bookstores: easy to read, with a broad scope and sufficient depth to help you get things done. Risk Happens! includes:

60 tables and checklists and
57 figures and diagrams.

These are listed below.

List of Tables, Checklists and Figures
Acknowledgements
Prologue

Introduction

Planning out Risk
The Risk Management Process

Identify Risks
Analyse Risks
Plan for Risks
Take Action on Risks
Risk Monitoring and Control

Risk Resilience
Involving Stakeholders in Risk Management
Appetite for Risk
The Psychology of Risk*
Risk Culture

Conclusion
Appendix A: List of Common Project Risks
Appendix B: Glossary
Appendix C: Learn More

From Elizabeth Harrin
Director, The Otobos Group

“This book is a solid introduction to risk management and would be good for beginners. There is a good glossary and an appendix of common project risks – great if you want a starting point for brainstorming risk on your own project.

The book is not method specific, so it doesn’t matter if you use PRINCE2, the PMI equivalent or any other national or international standard. There are useful tables and processes, which will save you having to work out a risk management process for yourself – handy if you are setting up a PMO and want to save some time. You could easily take what is in this book, tweak it a little to suit your project or company and implement a risk management approach straight away.”

Elizabeth is a project communications expert, founder of The Otobos Group and author of the award-winning blog, A Girl’s Guide to Project Management.

From Glen Alleman
Principle Member of Niwot Ridge LLC

“An accessible book on the topic of risk management is Mike Clayton’s Risk Happens! It’s easy to read has all the facts right and can be put to work.”

“Risk Happens! is a must read for anyone wanting to understand how to be a risk manager. Mike has a nice newsletter, speaks to the topic of risk from hands on experience, and is well grounded in the practical aspects of improving performance of both the people and processes.”

Glen is a senior Program and Project Control expert working on large scale complex systems projects in the US Aerospace industry. He specialises in Programmatic Risk Management. Glen’s blog, Herding Cats, is one of the most influential PM blogs.

From Ron Rosenhead
CEO of Project Agency

“In this book author Mike Clayton brings together I believe many of the ideas and practices that will help you and your company identify and manage risks in projects. What makes it so different from other books on this topic is that Mike uses very practical rather than academic approaches to project risks.

Practical approaches – there are well over 100 tools and techniques to use all based on a simple model of identifying your risks, analysing the risks, planning what to do to manage risks and actioning your plan. Included in the process is the need to monitor and control your plans and actions.

But, and here’s the key to the books success; it calls on some really practical approaches to identify and manage risks in projects.

The chapters that follow mirrors the above process and also includes looking at your risk resilience – a chapter that looks at issues such as scenario planning, contingency planning and business continuity. There is also another challenging chapter which I hope many of our clients will read: Appetite for Risk as well as The Psychology of Risk – I wonder how this will go down with you (and others in your company).

This is a good book that should find its way into many companies. It is applied common sense and should be mandatory reading for all involved in projects.”

From Leam Hall
Amazon.com Review

“In ‘Risk Happens:Managing Risk and Avoiding Failure in Business Projects‘ author Mike Clayton clearly spells out several ways to look at and deal with risk. His writing is easy to read and to the point and there are a good number of graphics to ensure the statements made are well communicated. As a new project manager I found Mike’s points easy to understand yet I realize that my risk management skills will only grow with practice. He’s given me several things to apply to my current projects and I look forward to more success!”

From “Busybee”
Amazon.co.uk Review

“This book covers (pretty much exhaustively) the types of risk you may encounter in any new project, in a concise and readable manner. I got this book by chance, but now intend to get more by the same author, as I like his style and the way in which he presents information. Rather than just being theoretical, this is a book which translates properly into real life and which I imagine will continue to be of use in the future. Highly recommended.”

From Vic
Project Manager

“I am just halfway through reading “Risk Happens!” and I would like to say what a great book it is! Compelling reading and I can’t put it down.

I am am a PM of 10+ years standing and I have never found such a concise read on risk management that provided so much valuable information.”

Risk Happens! is filled with techniques, tips and tools.

This page gives you access to downloadable versions. It also contains links to articles about risk and risk management on my main blog: Shift Happens! – which covers the topics of change, projects and risk.

Risk Management Templates

Risk Potential Review
Based on Table 4.2, this template offers a quick and effective assessment of the overall risk level of your project.

Risk Happens! Risk Register Template
This template collates all of the risk register elements illustrated in Tables 4.7, 5.17, 6.7, and 7.1. The columns of this risk register are fully described in the book. (Excel format)

Risk Management Plan
Over-arching plan for risk management across your project

Risk Response Plan
For detailed response to an individual risk

Templates for related project controls

Change Control: Change Request form, and Change Log (Excel format)
Quality Processes: Pro-forma Quality Plan
Resource Management: RACI Chart

There are a whole load of extra downloadable project management resources on my Brilliant Project Leader page, including:

Risk and Risk Management articles

Click on these links for selected articles on the Shift Happens! blog.

Online Resources

Risk Toolkit: How to take care of risk in volunteering: a guide for organisations
The Institute for Volunteering Research and Volunteering England
If you work in the voluntary sector, this is a very helpful pamphlet to get you started.
You can download a pdf from the Volunteering England website.

Shift Happens! Mike Clayton’s blog on change, projects and risk.

For my money, the best Project Management Bloggers on the subject of project risk management are:

Glen Alleman: Herding Cats
Kailash Awati: Eight to Late
John Goodpasture: Musings on Project Management

Group Think and Risky Shift extract, at A Girl’s Guide to Project Management.

Elizabeth Harrin (of “a Girl’s Guide to Project Management”) talks about using
Cost Breakdown Structures to create budget contingency, in a
video and transcript on her Gantthead blog, “The Money Files“.

Risk Happens! is full of useful tables and checklists

One of the things that makes Risk Happens! such a valuable resource for project managers and project leaders at all levels are the 60 tables and check-lists that it contains. You will want to bookmark these and refer to them frequently.

Here is a full list of the tables:

Table 1.1: Why Crises Happen
Table 2.1: Estimating Techniques
Table 2.2: Common Estimating Errors and Omissions
Table 3.1: Variables of scale and complexity for your risk management process
Table 3.2: Drivers of scale and complexity for your risk management process
Table 3.3: Sample Roles and Responsibilities for Project Risk Management
Table 3.4: Reasons for documenting aspects of your risk management process
Table 3.5: Typical Contents of a Risk Management Plan
Table 4.1: Core Project Documents
Table 4.2: Typical considerations for a Project Risk Potential Review
Table 4.3: Indicative Risk Kick-off Workshop Agenda
Table 4.4: Risk Identification using Personal Experience
Table 4.5: SPECTRES
Table 4.6: Risk Categories
Table 4.7: Risk Register Part 1
Table 4.8: Formal Description of a Risk
Table 5.1: Typical Descriptors for Likelihood
Table 5.2: Typical Probability Ranges for Likelihood
Table 5.3: Suggested Probability Ranges for Likelihood
Table 5.4: Suggested General Scales for Impact
Table 5.5: Suggested Scales for Schedule Impact
Table 5.6: Suggested Scales for Financial Impact
Table 5.7: Suggested Scales for Quality Impact
Table 5.8: Suggested Scales for Scope Impact
Table 5.9: Suggested Scales for Reputational Impact
Table 5.10: Suggested Scales for Health, Safety or Security Impact
Table 5.11: Suggested Scales for Environmental Impact
Table 5.12: Frequently Used Numerical Scale for Likelihoods and Impacts
Table 5.13: Example of an Exponential Numerical Scale for Likelihoods and Impacts
Table 5.14: Failings of Risk Scoring Systems
Table 5.15: Traffic Light Status Definitions
Table 5.16a: RMS Method
Table 5.16b: RMS Method
Table 5.16c: RMS Method
Table 5.16d: RMS Method
Table 5.17: Risk Register Part 2
Table 6.1: Tactics to Remove Project Risk
Table 6.2: Tactics to Reduce the Likelihood of Project Risk
Table 6.3: Tactics to Reduce the Impact of Project Risk
Table 6.4: Contingency Planning Process
Table 6.5: Elements of a Contingency Plan for Project Risk
Table 6.6: Risk Response Plan
Table 6.7: Risk Register Part 3
Table 7.1: Risk Register Part 4
Table 8.1: Leading Indicators of Project Risk
Table 8.2: Crashing the Timeline
Table 9.1: Scenario Planning Process
Table 9.2: Business Continuity Management Process
Table 10.1: The Stages of Resistance to Change
Table 10.2: Examples of Project Stakeholders
Table 10.3: Factors Affecting Stakeholders’ Attitudes to Risk
Table 10.4: Project Communication Strategy
Table 10.5: Stakeholder Communication Plan
Table 11.1: Typical Factors leading to a High Risk Project
Table 13.1: Typical Benefits of a Strong Risk Management Culture
Table 13.2: Elements of a Strong Organisational Risk Culture
Table 13.3: Steps in Creating a Strong Organisational Risk Culture
Table 13.4: Risk Management Maturity Levels
Table 13.5: Lessons Learned Register
Table 13.6: Post Project Risk Review

Risk Happens! is full of useful Diagrams and Figures

One of the things that makes Risk Happens! such a valuable resource for project managers and project leaders at all levels are the 57 Diagrams and Figures that it contains. You may want to bookmark some of these and refer to them frequently.

Here is a full list of the figures:

Figure 1.1: Risk Mirror
Figure 1.2: Project Risk Management
Figure 2.1: Project Cost-Risk Profile
Figure 2.2: The Time-Cost-Quality Triangle
Figure 2.3: The Time-Cost-Quality and Scope
Figure 2.4: Project Scope
Figure 2.5: Risk Breakdown Structure
Figure 2.6: Project Scope
Figure 2.7: Product Breakdown Structure
Figure 2.8: Work Breakdown Structure
Figure 2.9: RACI Chart
Figure 2.10: P.E.R.T
Figure 2.11: Slippage in Highly Dependent Tasks
Figure 2.12: Islands of Stability in a Project Schedule
Figure 2.13: Cost and Organisation Breakdown Structure
Figure 3.1: The Risk Management Process
Figure 3.2: Core Risk Management Documents
Figure 4.1: Periodic Review to Identify Risks
Figure 4.2: Starting Places for Identifying Project Risk
Figure 4.3: SWOT Analysis
Figure 4.4: Fishbone Diagram
Figure 4.5: Fishbone Diagram, Stage 2
Figure 4.6: Process Decision Programme Chart
Figure 4.7: Formal Description of a Risk
Figure 5.1: Likelihood versus Impact Chart
Figure 5.2: Likelihood versus Impact Chart, with scoring
Figure 5.3: Risk Dependency Map
Figure 5.4: Likelihood versus Impact Chart, with colour zones
Figure 5.5: Time to impact versus Likelihood, with bubble size representing Impact
Figure 5.6: Time to impact versus complexity, with bubble size representing Impact
Figure 5.7: Likelihoods of two independent events, with bubble size representing impact of combined outcome
Figure 5.8: Budget impact versus Schedule impact, with bubble size representing Probability
Figure 5.9: Decision Tree Example
Figure 5.10: The Beta Function
Figure 5.11: Examples of Statistical Distributions
Figure 5.12: The “Sleep at Night Test” Results
Figure 6.1: When to do Risk Planning
Figure 6.2: Contingency Plan Process
Figure 6.3: More Research in your Risk Management Process
Figure 7.1: Take Action on Risks
Figure 7.2: Consequential Risks arise from Treating and Existing Risk
Figure 8.1: Risk Monitoring and Control
Figure 8.2: Earned Value Analysis
Figure 8.3: Risk Reporting – Scatter Plot
Figure 8.4: Risk Reporting – Trend Analysis
Figure 8.5: Risk Reporting – Category Analysis
Figure 8.6: The Time-Cost-Quality and Scope
Figure 9.1: Scenario Analysis
Figure 9.2: Scenario Planning
Figure 9.3: Business Continuity Management Planning
Figure 10.1: Predicted Efficiency Gains following Project Handover
Figure 10.2: Observed Efficiency Gains and Losses following Project Handover
Figure 10.3: Stakeholder Management Process
Figure 11.1: Risk Appetite
Figure 11.2: Personality driven by Attitudes to Uncertainty and Consequences
Figure 11.3: Risk Managers in Context
Figure 11.4: Threat and Benefit Analysis for Potential Projects

Dedication

For my father, Gerald Clayton,
whose attitude to risk still affects my every decision.

Read the blogs I wrote about what I learned from my father here.
Of particular relevance is “A Careful Way“.

Acknowledgements

I could not have written this book without the opportunities afforded me to manage projects and learn about risk by colleagues at Deloitte Consulting, from the early 1990s until 2002. In particular, Gilbert Toppin, Brian Green, John Everett, George Owen, Tricia Bey, Chris Loughran and Richard Porter. I also gained valuable insights about risk from many other colleagues – particularly Mark Warren, Charles Vivian and John Perry (whose article I rediscovered in preparing this book).

There are also a number of project management bloggers whom I must thank for their insights. Often, their thinking is at a level well above that of this book, so my apologies to them, if a whole blog, or even series of blogs, has simply informed just one sentence, or simply the way I express an idea. The details are important to me, so thank you in particular to Glen Alleman, Kailash Awati, and John Goodpasture,

I must also thank my wife, Felicity, who gave me the time to write this and read the manuscript carefully, with the eye of a risk management novice – for whom the book is intended. She made me work just a little harder to explain what sometimes seems obvious.