Project Opportunity, The Positive Side to Risk

by Martin Webster

Do you manage risk and project opportunity or do you leave things to chance?

Before I close my series of posts on project risk I thought I should address a related
topic: project opportunity. Risk management is concerned with potential unplanned
events that impact a project negatively. In contrast, opportunity can have a positive
affect on the project. Moreover, project opportunity should be managed in broadly
the same way as project risk.

Project Opportunity

Project opportunity is the possibility that the project may go

better than planned.

As with risk, you should address opportunities at the beginning of the

project since they may influence project outcomes and the project plan.
Therefore look for opportunities during the later part of a risk workshop
(see addressing risksunder Project Risk.

A pessimist sees the difficulty in every opportunity; an optimist

sees the opportunity in every difficulty. – Winston Churchill

Opportunity is the other side of the risk coin. When addressing risk you may find
that there’s an opportunity to start some work immediately―taking an upgrade off
the critical path, for instance.

Likewise, some aspects of a project can go really well but bring no real benefit
because other work is still to be done.

When considering about project opportunity think about what happens when things
do go well and consider starting other work earlier in the schedule if this will bring
forward a major milestone or implementation date.

There’s rarely enough time to discuss every risk or opportunity when managing a
project. Therefore―to help you make the right choices―always document risks
and project opportunity and categorise them according to likelihood and impact.
Record opportunities in a project opportunity log (or within the risk log.) And review
regularly!
As with risk consider amending your plans when major opportunities arise and
always prepare an outline contingency plan for all but minor opportunities.

Defining Threats And Taking Opportunities By Risk Management Strategy

Two Components Of Risk Management Strategy

Eric McConnell August 26, 2010

In the literature on PM (project management), the term “risk management strategy” refers to
the scope and direction of actions for project practitioners to embrace the likelihood of both
positive and negative consequences that can potentially happen. Such a strategydetermines
what configuration and implementation of available resources are best to use within a
challenging business environment in order to ensure successful accomplishment of project
goals and adherence to stakeholder expectations.

Risk management strategy for a typical project is a high-level plan that

combines tools and methods for identifying, analyzing and mitigating
negative consequences (the so-called threats) that can harm the project,
while exploring positive consequences (the so-called opportunities) that can
potentially improve the project.

In this context, in any project there are both threats and opportunities. A risk manager is a
person how should take care of mitigating the likelihood of risk, while reducing the impact of
threats and exploiting opportunities. That person needs to design a high-level plan of actions
on how risks and opportunities will be managed during the course of work. Such a plan will be
the foundation for immediately initiating the risk management process and utilizing necessary
resources throughout the implementation lifecycle.

A risk management strategy is about the following:

•Developing the risk and opportunity management plan

•Taking steps to identify project risks and reduce the probability of their occurrence

•Communicating with project staff and contractors to collecting and analyze project risk
management information

•Using project risk management software to process that information, create a risk
register and share the project risk management database

•Generating and presenting project risk reports on review meetings

•Measuring the outcome of PM activities and recording lessons learned.

 Two Components

Many articles and white papers published on the Web describe a risk strategy as a
combination of activities for managing opportunities and threats. In this connection, a strategy
for managing project risks can be considered a structured plan that consists of two
components such as Opportunities Management and Threats Management. Let’s review each
of the risk strategy components, as follows below:

1. Opportunities Management

If referring to previous project risk management strategy definitions, an opportunity is a

positive outcome that may bring additional value to a project by allowing achieving
improvement. Project opportunities management is a set of techniques and tools to help a risk
manager to identify and understand possible improvements to the project objectives.

Often managing project opportunities refers to stepping through a 4-stage process (Identify,
Analyze, Plan and Manage). The process is carried out following an opportunity management
plan. Such a plan involves project risk manager in implementing formal and informal project
risk management techniques (brainstorming, questionnaires, experience, and project history).
It aims to identify opportunities and create an opportunities list that is prioritized and
scheduled.

Once an opportunity is identified, it should be necessarily added to the risk register because
any opportunity may cause additional threat.

2. Threats Management

Actually this component of a strategy for project risk management refers to actions for
identifying, analyzing and mitigating negative consequences that are risks. Threats
management involves utilization of project risk management resources to describe risks,
analyze their attributes, evaluate the probability of occurrence, and add identified risks to the
risk register.

Like with managing opportunities, managing threats refers to a 4-stage process (Identify,
Analyze, Plan and Manage). A project risk manager is responsible for organizing a team
which will follow a risk treatment plan and report back on current progress of project risk
management strategy.