Beyond Execution

ok, I am trying this again, since I accidentally clicked on the wrong button and didn't save my entire blog entry....  (aaarrggghhhh!!!!)

This idea isn't new, but it hasn't really been adopted on a widespread basis.  The idea works like this - an organization or department hires a project manager with the specific responsibility of managing project risk across multiple projects.  Perhaps the ratio is something like 7-10 projects per risk PM, so the additional cost might be .1 to .14 FTE for a project.  The Risk PM would be responsible for:

             - Recording and tracking project risks

             - Facilitating risk brainstorming sessions for identification

             - Reporting risks at an enterprise or departmental level

             - Conducting risk audits

             - Reporting risks to upper management

             - Coming up with risk response strategies and contingency plans

             - Performing risk lessons learned and communicating them to the organization

             - Maintaining the risk management process and templates

             - Maintaining a risk database

Basically everything a project manager should do, but can't because of time constraints.  The ugly truth is that project managers are busy fighting fires, dealing with unproductive staff, responding to sponsor inquiries, dealing with customer issues and producing 10 different reports for 10 different parts of management.  And risk management is unfortunately a more documentation-heavy aspect of project management.  So it's easy to see how project risk management gets relegated to being done inside a PM's brain, instead of written down like it should be.

There are a lot of benefits to this idea, number one of course is that risks are being managed when they might not otherwise.  A concern might be the additional cost this role incurrs, but it should (in-theory) be self funding.  I say self funding because although there are definite cost benefits from managing risk, there aren't really any definitive numbers that show ROI of managing risk.  So in theory, the costs saved, especially across a number of projects should more than pay for the payroll of a risk PM.  Let's take an estimated savings of $50k per project times 7 projects = $350k saved.  That should easily support a PM`s loaded cost of $100k-$150k.  And I think the $50k number I use is quite conservative.

The downside of this is that it take the risk responsibility away from the PM, who ideally should be doing these activities anyways, but for the aforementioned reasons.  I firmly believe that a PM should have the skills and to perform all tasks necessary to manage projects.  Having a risk PM might absolve them of this responsibility and other consequences might ensue.  But I think the overall benefits outweigh the downsides, and that in the end, project risks will be managed, which can`t be consistently be said today.

So, this is an idea waiting to take off.  If it`s in play in companies today. I`d love to hear how it`s working out.