What are the most common risks on a project?

In project management, zero risk does not exist. Every year, all businesses see part of their projects fail for various reasons. For example, the Covid-19 pandemic has been responsible for the cancellation, delay or delay of many projects.

Thus, to guarantee the success of your projects, it is essential to implement effective risk management. The objective is to identify in advance all the obstacles, unforeseen events and hazards that you may encounter during the implementation of your project, in order to limit them, to anticipate them and to find a strategy to remedy the problem should it occur.

Because it is not easy to determine in advance all the risks that your project could encounter, here is a non-exhaustive list of the most common risks in project management classified into different categories.

Internal risks

These are the risks that can take place within your business. Some examples: lack of resources or qualified resources, lack of support from your hierarchy or company management regarding the project, sudden and last-minute changes, expectations and goals that are not clearly defined, etc.

If management loses interest in your project even though they had fully validated it, this could delay the making of certain decisions, and cause an overall delay in project deadlines. In any case, do not hesitate to report your concern to the people concerned.

External risks

External risks are also common on a project. They depend on a multitude of factors that you often have no control over. It may be a natural disaster (earthquake, storm, flood, fire), an act of terrorism, vandalism or a cyber attack, a difficult economic, political, environmental, health or social situation (such as the coronavirus pandemic), a problem with a supplier, a problem with a supplier, the creation or modification of a law or regulation impacting your project, etc.

To prepare for these types of risks, you can set up surveillance measures and train your project teams to react to these types of unpredictable external events (such as Raise awareness among your employees about cyber risks).

Budget risks

This type of risk concerns the finances of the project, and can be caused by poor budget management, a poor estimate of planned expenses, a change in project objectives, a reduction in the budget, or the addition of new requirements by the client. Exceeding the originally planned budget is generally not highly appreciated by stakeholders.

To avoid budgetary risks, it is essential to carefully manage your project budget and to inform the client when you believe that their requests are likely to significantly increase the budget agreed at the beginning.

Planning risks

A successful project is a project that ends on time. However, it is sometimes difficult to stick to the schedule scrupulously because of external events, but also because of a poor assessment of the time needed to complete each task. As a result, some tasks will take longer than expected, and this will cause more and more delays.

This type of risk is closely linked to budgetary risks because the longer the project is spread over time, the more it falls behind schedule and the more the costs will increase (because, among other things, it is necessary to pay the resources necessary to carry it out). In addition, by missing the set deadline, you risk losing your competitive advantage (for example, your competitors will have released their product before you on the market) and therefore lose money.

So, when planning your various tasks, set realistic deadlines and be sure to allow for extra leeway in case of unforeseen events or problems.

Performance risks

When the project is unlikely to achieve the expected results, there is a risk of performance. For example, if your project is to equip all employees of a company with a tool that allows them to be more productive, but none of the employees know how to use it, this will have an impact on the productivity of employees (they will not be more productive, or even they will be less productive since they are wasting time trying to understand how to use the new tool) and therefore on the overall performance of the company.

Not only does your project not bring the expected results, but in addition, you will have to train employees, which generates additional costs. Not to mention that the customer can impose a penalty on you for poor quality or performance.

To ensure the performance of your project, regularly test with users, validate each milestone and deliverable with the client, and follow up after the delivery of the project to be sure that the customer is satisfied.

Operational risks

A project can fail when there is a problem in carrying out operations or in carrying out fundamental processes such as production, procurement, distribution, etc. It can be a problem related to the workforce, a supplier, a maintenance concern, etc.

This type of risk is also a performance risk because the expected results cannot be achieved.

To anticipate these risks, surround yourself with competent people who can offer you solutions to avoid problems and ensure that your project is a success.

Strategic risks

This could be a mistake in the strategy, for example choosing a tool that is not suitable (the team spends more time trying to understand the tool than working on the project) or establishing a poor communication strategy during the project (you are not using the right channels to communicate with stakeholders).

Or else, the project is no longer a priority in the company's strategy, or it is no longer in line with the organization's overall strategy.

Be attentive and attentive, and don't hesitate to change your strategy during the project to correct the situation and avoid failure.

Now you know some of the most common risks in project management. This will help you implement effective risk management.

As a bonus, discover What are the main causes of project failure.