The short answer is NO! Hear me out… Over the last FIVE years I have had the opportunity to immerse myself with Risk Management, from both a Project and Operational lens, across SIX different organisations. What I found really interesting was the maturity level of risk management within each organisation as well as the level of understanding people have of it. People mostly look at it from a project risks and project issues perspective, rather than a risks versus issues perspective, using those terms interchangeably.
The most common observations being:
- Risks were recorded according to the consequence of the risk event (without understanding what a risk event is or what the likely cause was, and
- Issues were recorded as risks, albeit the risk having already materialised and having negative impact on a project or business operations.
So, let’s have a look at Risks versus Issues separately:
So how should each be managed, and how do we manage them in a project environment?
Risks are quantified. That is, if the event occurs or the condition is met, what is the impact to the cost / schedule / scope of the project? Will it prevent success? What ‘controls’ can we put in place to ensure that the event or condition is avoided, or that impact to the project is minimal? A project’s schedule and scope is not altered by identifying a new risk, but considered should a risk materialise.
Issues have an immediate effect on a project’s cost / schedule / scope. Resolution must occur immediately to ensure impact to a project is minimised or avoided. Some issues can be ignored.
It is important to note that Risk Management is not as simple as it sounds, especially when mixing the project world with Operational Risk. We’ll leave that for next time…
To learn more about projects, check out our article detailing some signs that you may be lacking project management capability.
You can also listen to our podcast episode on what do to if you’re not a project manager but have to deal with them and how to overcome some challenges.