How Do I Write a Risk Management Plan?

Enough can't be said about the importance of performing risk assessments as a regular part of the project planning phase. A very important part of project management is dealing with risk in projects. This article offers a step-by-step formula for writing a risk management plan that will help your project to succeed.

The first step to writing a risk management plan is to figure out what the risks are and how likely they are to occur. Risks must be identified. To identify risks, it is helpful to peruse project documents, and have a meeting with project stakeholders. In this meeting, brainstorm risks that might occur during the course of the project. For more information on risk assessment, see my article "Determining the Level of Risk in a Project."

Once you have identified the risks in the project, you must then determine how likely the risks are to occur, and what sort of damage the risk will have if it actualizes. Rank the risks in order from most likely/most damage to least likely/least amount of damage. By doing this, you pre-organize the information you will require to write the plan. You can also focus your energies on coming up with potential solutions to the various risks should they occur.

Once risks have been identified and ranked, you and your team can begin to put together the actual documentation of the risk management plan. Preliminaries for the plan will include introductory material such as the risk management scope and risk management policy. For more information as to what should go in this section, see Natasha M. Baker's article "An Example of a Risk Management Plan" where she skillfully outlines the required features of such a plan. Once the introduction has been written, the risk identification list should follow. This is where you will list the results of your risk assessment and ranking processes.

Once you have documented the risk list and the risk assessment, it is time to come up with the risk management plan. This part will show exactly how your team will deal with risks that arise during the project. There are a few ways to deal with risks when they actualize: Avoid the risk, reduce the damage of the risk when it does occur, or transfering the risk elsewhere. For each risk identified, you will need to determine how to deal with it should it occur. Once this is determined, assign each potential risk to a resource, so there is no question about who will deal with the risks.

Bright Hub has a wealth of information on risk management. For more information, read the following articles:

Natasha M. Baker's "A Practical Approach to Writing a Risk Management Plan"

Joe Taylor Jr.'s "Risk Management" Series

and

Bob Legrand's "Risk Management & Tools"