Tools for Risk Management

Forming a risk management plan is a crucial aspect of any business plan, as there are elements of risk in almost every element of running a successful business. While certain potential risks, such as environmental, political, and social are often unpredictable, other potential elements are more easily controlled like cyberattacks, viruses, and malware.

Small- to medium-sized businesses are especially encouraged to have a risk management plan in place for all stages of a project's lifecycle. Damages that can arise from unforeseen risks may have devastating effects on not only a specific project, but also on a company as a whole.

1. Project Management Lifecycle

First, it is important to be familiar with the 4 stages of a project management lifecycle. There are risks specific to each stage.

A. Initiation 

In this phase, the needs, problems, and opportunities of a project are identified and analyzed to determine its potential rewards, its feasibility and the general objective.

B. Planning

Once a project has the green light, it is on to the planning phase. In this stage, the project is broken down into smaller parts, and teams are assembled to address each component part. A schedule is set for each task with every team having its own set goals.

C. Execution

Now the project is on the go, and the action begins. This is the phase in which the work is getting done, the results are being assessed, and the goals are being met or revised. At this stage the teams are productive and dedicated to the end result.

D. Closure 

With all the work done, the project enters the final phase. In this phase, the success of the project is to be determined. The functionality of the process and the final results are evaluated by the project manager to establish its success, as well as the areas that require future changes.

Damages that can arise from unforeseen risks may have devastating effects on not only a specific project, but also on a company as a whole.

2. Effective Tools for Risk Management

In coordination with the first step of a project management cycle—the Initiation stage—a risk management strategy should also be implemented. For each phase, and for the project’s entire lifecycle, there are tools and specialized software options that are recommended to minimize risk and mitigate setbacks.

A. Critical Path

During the Initiation phase you should look for software tools that visually summarize the tasks at hand and the time it will take to complete the task. Gantt charts—a bar chart that outlines the schedule of a project—are very useful at this stage.

B. Breakdown of Work

Utilizing software with strong communication capabilities is a huge time/headache saver. Look for software like Trello or Toggl that help create documented deadlines, schedules, assist in assigning work to teams, and keep the project moving along smoothly.

C. Budgeting and Scheduling Resources

Find software with high resource management functionality and calendaring capabilities. For keeping a project's finances in order, look for software with budget and expense management abilities. Celoxis and TargetProcess, for instance, have capabilities in both areas.

D. Execution of Work/Meeting Milestones

Once the actual work is underway you will need to keep track of its progress, make sure the goals are being met, and ensure that the budget is intact. These are all crucial elements to ensuring the project's success. Look for software with task tracking capabilities to monitor tasks and the team’s performance. Airtable is a software that specializes in keeping track of deliverables, and it also sends out updates and alerts when a task is completed or when a deadline is coming up.

E. Monitoring and Reporting on Risk

Keeping track of risks previously identified in the project's first stages and making sure they haven’t become bigger issues is important not only to those working on the project, but also to the shareholders. Look for software tools that specialize in reporting, and can monitor tasks and risks singularly, as well as provide an analysis of the project's performance as a whole.

F. Closing of Project

Putting together a fully formed closeout document of every completed project is one of the most important aspects of risk management—and often the most overlooked. In this stage, the overall project is analyzed to determine its successes and its failures. This document is then shared within the team and with shareholders and serves as a guide for future projects. Software that boasts document management and collaboration abilities can aid in formulating a detailed summary of the project in each stage of its lifecycle.

By utilizing software tools to keep track of all aspects of a project from start to finish, and by having good communication between teams and with shareholders, the threat of risks is greatly diminished. Proper risk management increases the likelihood of a project’s success, as it facilitates the early identification of problems and enhances inter-team communication.

A central element to any risk management plan is IT and cybersecurity. CITI can put together risk management plan for your IT, as well as provide ongoing monitoring of risk. Get in touch to start your IT risk management plan.