Each risk registered should have an owner and description, an Impact, collateral, likelihood, action and progress value.
The register should be started at the outset, IE from concept stage and reviewed on a monthly basis or determined basis depending on size and programme. Risks should be opened at every meeting and should not be looked at as a monthly task but an ongoing task. Example if you are in a design meeting and find that the access for steels may impact on safety or finish build. It should be acted on regarding how it's going to managed who's going to manage and update the risk register so it's not forgotten about.
The risk register will have many risks, but it is generally best to keep the risks and their values in proportion to the size of the project value and program. Example if you are dealing with a multi-million pound Project it is not worth putting a risk that may or not impact and will cost peanuts.
So what risks are worth noting and registering? All risks are different and depending as I said on the size of the project and its programme. The risks will change but generally there will be a list of risks that will be familiar and not forgetting risks from lessons learnt brought forward.
A small example of general familiar risks are weather, labour, access, planning, made to order, and other things out of your control usually brought in by stakeholders like TFL and other authorities.
So now that you have a register and you have filled out all the values how do you summarize the overall risk. PRINCE2 suggests that we look at risk generally and as unlikely that all the risk will not come to fruition.
So let's say that we have a list of 10 risks. The 10 risks if they come to Materialize have a value of £100,000 each given a grand total of £1 million. PRINCE2 asks us to consider that not all the risks will actually occur so your likelihood impacts on your £1 million.
It is hard to describe and also provide likelihoods and impacts. As a general I suggest that you look at some YouTube videos and use some past experience as an example or training tool.
It is at this time that I remind you that the project brief should identify the risk value or percentage and the target value percentage. As I said earlier we aim for 10% to 12% at the start with a final figure around 5%. If you cannot get it down to between 5% and 8% we suggest that the project needs to be reconsidered or you need to rework you're migration strategy. On smaller projects anything bigger than 12% could be acceptable depending on your return on investment and your appetite for risk and opportunity. Some people say that you need to take risks for the biggest gains. I believe that you should take the minimal Risk managed to produce a better return on investment. This gives all you're investor’s confidence and the ability to plan and budget before funding release.
It is worth noting that any opportunities should be registered on the risk and opportunity register. Opportunities may present themselves within meetings and at the beginning of the project. There are many different ways to manage opportunities but generally opportunities should disappear off the register as they have been taken up and now become part of the project and do not in any way of set opportunity against risk. An example of an opportunity is to improve on the programme time due to buying differently or designing differently. It is very hard to put a value on these, but it should be noted and also reviewed as part of the lessons learnt what went well and how to make sure that we take it going forward.