Risk Management Issues In Project Planning

Project Context

Discuss about the Risk Management Issues In Project Planning.

In recent times with rapidly changing business environment, project management has gained importance in every organization whether small, medium or large (Atkinson et al., 2006). This is mainly because of the benefits reaped from successful project management. Project Management proves to be beneficial for the business organizations to achieve maximum return by using minimum resources i.e. it helps in achieving cost efficiency and enhances the productivity of the employees by driving them towards working in a team (Larson & Gray, 2011). In the present competitive business environment, an organization can succeed only if it adopts creativity and innovation and both these aspects are ensured by project management (Shenhar & Dvir, 2007). Project management helps in completing the work systematically since in project management, everything is done in a proper sequence starting from setting of the goals and objectives to implementation of strategies for successful achievement of the project goals (Meredith & Mantel, 2011). Thus Project Management has emerged as an attractive profession.

Moreover, project Management has emerged as one of the prestigious professions in competitive market and this is because project management is more challenging and it enhances the learning of the individuals exponentially and acquiring experience by solving critical issues pertaining to the various requirements of different projects (Crawford et al., 2006). An individual who recognizes himself as a good problem solver and is ready to take the challenges upfront then, the profession of Project Management is best suitable for him or her (Meredith et al., 2013). Moreover, the Project Management as a profession demands good attitude towards work, good level acceptability and huge patience (Madter et al., 2012). In addition, it is also the fact that overall money matters and Project Management as a profession fetches an individual with starting remuneration between S20,000 to $35,000 on the basis of the industry norms. So, with respect to earnings an individual as a Project Manager can find himself on good edge that can solve all his financial requirements and it also provides individual with the opportunity of leading a lavish life and various other benefits (Holzle, 2010).

In order to become a professional Project Manager, it becomes important on the part of the individual to exhibit a broad a range of talents to bring teams together and assist the organization in reaching its goals. Thus there are various skills and knowledge required to become a professional Project Manager:

Vision Save Time On Research and Writing Hire a Pro to Write You a 100% Plagiarism-Free Paper. Get My Paper	A professional project manager should possess a clear vision of where to go and the ability to articulate the same.
Communication	Professional Project Manager should possess effective communication skills to communicate the goals, performance, responsibility, feedback and expectations. He should also possess the desired negotiation and persuasive skills to ensure the success of the team (Brill et al., 2006).
Integrity	A professional Project Manager is responsible for setting ethical standards for the team and thus he should be characterized with honesty, loyalty and integrity.
Enthusiasm and Passion	The Project Manager should possess a can do attitude. He should be enthusiastic to remain committed to the goals and express the commitment through optimism (Thomas & Mengel, 2008).
Empathy and Compassion	Project Manager should understand that team members have life outside the workplace and the individuals are not machines without emotions. So, considering these aspects, he would be able to develop personal relationship with the team members necessary for achieving better results (McManus, 2006).
Competence	The Project Manager should be competent in context to both the soft skills and technical skills. He should possess the ability to challenge, lead inspire, enable, model and encourage the team members. Moreover, he should also be aware of the technical know of the details of the project he or she is handling.
Delegation	The Project Manager should possess the ability to delegate and so he should be able recognize the expertise and skills of the team members and assign the tasks accordingly.
Composure	It is important for the Project Manager to remain composed and maintain his cool irrespective of the level of pressure.
Team Building	The Project Manager should be a good team builder and he should be able to maintain a sense of team spirit despite of the problems in project execution.
Problem Solving	The Project Manager should possess the ability of solving problems, may it be with the team or with the project itself. This would help in developing a sense of trust among the team members that the Project Manager can solve their problems (Middlewood and Abbott, 2012). However, Project Manager should involve the team in problem solving.
Risk Management	The skills required by the Professional Project Manager have undergone significant changes over the years. The technological advancements have led to increased uncertainty and thus risks associated with the project cannot be controlled by developing detailed project plans (Ferraro, 2008). Thus a successful Project manager emphasizes upon learning to adapt to the changes rather than making attempts to eliminate the risks.

Skills and Knowledge Required for Project Manager

Working Title: Risk Management Issues in Project Planning

The studies conducted by (De Bakker et al., 2010) has revealed that a project generals fails when the plan is not met i.e. the project exceeds the timeline, overspends the budget or underperforms expectations. So, it can be said that the project tends to fail when the plan is too optimistic i.e. when costs and actions are forced for achieving the predetermined targets and when the external events influences the project plan i.e. lack of sufficient resources, unanticipated work and extraordinary events (Olsson, 2008). So, this leads to the necessity of risk assessment techniques for obtaining more realistic estimates that can lead to more attainable plan. This helps the project to be more likely towards meeting its forecasts and avoid disappointments. Risk Management emphasizes upon disclosing the sensitivity of the project to the participants and thus ensures the fact that all the threats are fully understood (Bannerman, 2008). This in turn leads to setting the targets and contingencies at correct levels, negotiating the contracts with accurate understanding of the potential challenges and provide opportunities for developing the risk mitigation strategies in advance (Kendrick, 2015).  So, on the basis of the above aspects, it can be said that risk and uncertainty if not managed efficiently can lead to damaging consequences and this is the reason why risk analysis and management is an important aspect in project manager for achieving success. This, in turn makes it necessary on the part of the project managers to possess the right knowledge and experience in context to risk analysis and management.   

Thus, taking into consideration the above aspects, the researcher in the present study would emphasize upon analyzing the importance of risk management and identifying the risk management issues in project planning.

Analysis has revealed that the success rate of the projects is very low globally and this evident from the fact that globally only 64% of the projects meet their goals. Moreover, around 70% of the companies report that at least one of their projects have failed in the year 2013 and this has resulted in a loss of around $109 million for every $1 billion they have invested in their projects (projectmanagementworks, 2014). Other statistics reveal that where high performing organizations are characterized with a success rate of 89%, the low performers are characterized with a success rate of mere 36%. The analysis of the major realisms behind the failure of the projects revealed that undefined risks are responsible for 30% of the project failures (projectmanagementworks, 2014). So, these figures clearly highlight the importance of risk management in project management.

Background and Definition of the Issue

 So, the above aspects motivated the researcher to undertake the study to analyze the importance of risk management and identify the risk management issues in project planning.

The researcher in the present study would strive towards analyzing the importance of risk management issues in project planning together with analyzing the importance of risk management in project management and thus the entire study would be observed to revolving around the following research objectives:

• To analyze the risks that project managers attend to while managing the project.
• To analyze the risk management practices that project managers employ while managing the project.
• To investigate the risk management strategies employed by the project manager while managing the project.

The studies conducted by Hillson, (2006) has revealed that there are various concepts like explicit opportunity management, the uncertainty management paradigm, a constructively simple approach to evaluation and interpretation of estimates, risk attitude and complexity theory concepts that are important for improving the management of risk and uncertainty in a complex project environment. Moreover, the studies conducted by Olsson, (2007)put forward the fact that the probability based risk management theory does not provide explanation to the important aspects of the observed project management practice and the assumptions of the probability based approach exhibits limited applicability. Analysis of the available literature revealed that there exist very limited evidence where the literature is mainly focused upon the importance of risk management in project management and risk management issues in project management (Hillson & Murray-Webster, 2008). So, this can be looked upon to be a research gap especially in context to the uncertainty and risk management practices on the part of the project manager in relation to the complexity of the project. Moreover, studies conducted by Zhang, (2011) has emphasized upon facilitating the project managers with advices in context to the ways in which they can manage the risks involved in the project rather an assessing the relative effectiveness of the advices.

Thus, with increased number of project failure together with increasing complexities in the project and inadequate risk and uncertainty management practices creates the need to analyze the risk management strategies and practices that are efficient in managing the risks involved in the project.

The researcher in the present study would strive towards collecting the secondary data from both the online and offline sources. The online sources would include the peer reviewed articles, early researches and journals published online (Zikmund et al., 2013). Various articles relevant to the undertaken study would be searched with the help of Google Search Engine and would be reviewed manually by reviewing the abstract, title and list of references to decide upon where to include the article or journal into study or not. The inclusion criteria would include studies providing details of risk management in project management, studies published within a time a frame of 2006 to 2016 and the studies published in English language. The sleeted articles for the study would be analyzed and interpreted to analyze the alignment that exist between the available literature and the findings that would determine the success of the study (Blumberg et al., 2014).

Main Activities/ Stages	Week 1	Week 2	Week 3	Week 4	Week 5	Week 6
Topic selection and its scope	Ø
Identification of secondary data sources	Ø
Preparation of research proposal	Ø
Preparation of literature review		Ø
Description of research methodology			Ø
Preparing ethics form			Ø
Analysing data				Ø
Comparing findings				Ø
Conclusion and recommendations					Ø	Ø
Finalising and submission					Ø	Ø

Research Rationale

Conclusion

The study would prove to be beneficial on the part of the researcher to gain the required knowledge to become a professional in Project Manager that would assist him in handling projects at work in future.

References

Atkinson, R., Crawford, L., & Ward, S. (2006). Fundamental uncertainties in projects and the scope of project management. International journal of project management, 24(8), 687-698.

Bannerman, P. L. (2008). Risk and risk management in software projects: A reassessment. Journal of Systems and Software, 81(12), 2118-2133.

Blumberg, B. F., Cooper, D. R., & Schindler, P. S. (2014). Business research methods. McGraw-hill education.

Brill, J. M., Bishop, M. J., & Walker, A. E. (2006). The competencies and characteristics required of an effective project manager: A web-based Delphi study. Educational technology research and development, 54(2), 115-140.

Crawford, L., Pollack, J., & England, D. (2006). Uncovering the trends in project management: Journal emphases over the last 10 years. International journal of project management, 24(2), 175-184.

De Bakker, K., Boonstra, A., & Wortmann, H. (2010). Does risk management contribute to IT project success? A meta-analysis of empirical evidence.International Journal of Project Management, 28(5), 493-503.

Ferraro, J. (2008). The strategic project leader. Boca Raton, FL: Auerbach Publications.

Hillson, D. (2006). Extending the risk process to manage opportunities. International Journal of Project Management, 20, 235-240.

Hillson, D., & Murray-Webster, R. (2008). Managing group risk attitude (pp. 190). Burlington, USA: Ashgate Publishing.

Hölzle, K. (2010). Designing and implementing a career path for project managers. International Journal of Project Management, 28(8), 779-786.

Kendrick, T. (2015). Identifying and managing project risk: essential tools for failure-proofing your project. AMACOM Div American Mgmt Assn.

Larson, E. W., & Gray, C. F. (2011). Project management: The managerial process.

Madter, N., Bower, D. A., & Aritua, B. (2012). Projects and personalities: A framework for individualising project management career development in the construction industry. International Journal of Project Management, 30(3), 273-281.

McManus, J. (2006). Leadership. Amsterdam: Butterworth-Heinemann.

Meredith, J. R., & Mantel Jr, S. J. (2011). Project management: a managerial approach. John Wiley & Sons.

Meredith, J. R., Mantel Jr, S. J., & Shafer, S. M. (2013). Project management in practice. Wiley Global Education.

Middlewood, D. and Abbott, I. (2012). Achieving success with your leadership project. Los Angeles: Sage.

Olsson, R. (2007). In search of opportunity : Is the risk management process enough? International Journal of Project Management, 25(8), 745-752.

Olsson, R. (2008). Risk management in a multi-project environment: An approach to manage portfolio risks. International journal of quality & reliability management, 25(1), 60-71.

projectmanagementworks. (2014). Project Failure Statistics: The Shocking Truth. [online] Retrieved from: https://projectmanagementworks.com/project-failure-statistics/.

Shenhar, A. J., & Dvir, D. (2007). Reinventing project management: the diamond approach to successful growth and innovation. Harvard Business Review Press.

Thomas, J., & Mengel, T. (2008). Preparing project managers to deal with complexity–Advanced project management education. International Journal of Project Management, 26(3), 304-315.

Zhang, H. (2011). Two schools of risk analysis : A review of past research on project risk. Project Management Journal, 42(4), 5-18.

Zikmund, W. G., Babin, B. J., Carr, J. C., & Griffin, M. (2013). Business research methods. Cengage Learning.