The Program Manager’s Risk Environment
The program manager’s risk environment is complex, because risks at the business level, program level, or project level can impact the program. That’s why categorization of risks facilitates better risk identification activities.
Additionally, the program manager must scrutinize which business- and program-level risks project manager’s should address. It would be too burdensome and unnecessary for project managers to try to address all the risks that exist at each of these levels. Just as the program manager filters and decides what project managers need to address, the project manager also has to filter and decide what project-level risks are shown or escalated to the business level. Realize that the business level would be overwhelmed if its managers saw or even knew about every project-level risk.
So what are the various risks in each category? While not all-inclusive, the following are some common risks in each segment, obviously they can and do overlap.
• Business-level risks are numerous and include increased government regulation, globalization and outsourcing , technology changes, changes in competition, changes in demand for the products and services provided, ownership changes occurring through merger or buyout, and rapid expansion or contraction of products and services provided.
• Program-level risks include budget cuts, reorganization, turnover of program personnel, stakeholder changes, cost overruns, and failed projects.
• Project-level risks include resources availability, implementation risks, technology risks, and changing stakeholders. The risk environment is complex and categorization often simplifies, facilitates discussion and provides for clear accountability (#1 on my Top Ten Project Management Success Factors) as to who is responsible for managing what risk.
This post supports Chapter 9 of The Handbook of Program Management
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