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Projects have risks. Are you denying that fact? Are you failing to plan for and manage those risks? If not, you are setting your organization and your project up for failure. Risks on small projects can have serious consequences.

For the smaller organization, one disaster could put the firm out of business, or turn a fundraiser into a loss.

The simple, but time consuming process of a team sitting around to identify risks can alert folks to an improved way of doing things. Here are four examples of risks on small projects that you may not have planned for on your project.

Key stakeholder leaves mid-stream.

Some years ago, I worked on a very successful project for a nonprofit fundraiser. About eight weeks before the event, the team member who had volunteered to coordinate ticket sales began experiencing significant morning sickness, and we quickly realized that we could forget about any oversight of ticket sales.

TIP #1: Have a backup leader – In this case, the group was still able to sell out the event.

Project team fractures.

I once worked on a project to renovate a space in an old building, with a large group of tenants and interested parties. Identifying the needs and wishes of every stakeholder became time consuming and energy depleting – and before long, the team became convinced that no amount of creative architectural design would please everyone. Instead of pulling together and re-assessing the objectives for the project, the team began to fracture. Quickly, folks began to take sides. In the end, no one was happy.

TIP #2: Reconnect with your why statement. What were your key objectives? Is everyone still in agreement that they are still good objectives?

Inability to acquire project resources at an affordable price.

When planning a project, it is easy to assume that the project team will be able to acquire resources at affordable rates. What happens when that bartering deal falls through, or a grant fails to materialize, or a last minute discovery throws off the budget? It doesn’t matter whether we are talking nonprofits or small businesses, projects are iterative, and as increasingly more information is known, there is the risk that resources will cost more than planned, or that revenues will be less than predicted.

TIP #3: As you schedule activities, focus first on the activities with the biggest financial risk. It can pay to keep a close eye on where your big costs are occurring.

Delays, delays, delays: finishing the project becomes seemingly impossible.

I watched a small company trying to launch the opening of a second location while construction delays postponed that opening by about nine months. The loss of revenue during those months of mounting expenses just about killed the company.

TIP #4: Manage your project. You’re paying a contractor and the firm has given you a move in date. That’s great, but construction delays happen on many projects, for a variety of reasons. The contractor’s project manager may be managing the construction piece, but he/she is not the only one who has some managerial responsibilities. Your organization needs representatives at the table, with the contracting team weekly, if not daily. If you wait until problems arise, you won’t have built a relationship of accountability and full disclosure.

Manage your scope carefully – changes may seem inconsequential until you start adding up the extra days and money. Consider processing scope changes in related batches to better understand the full impact on your project.

Each area of your project should have a staff person assigned as manager. This person can become the point person – someone who understands the background behind change requests and communications to interested stakeholders.

Communications are easy when all is going well and progress is obvious. They become much harder and thus, more important, when the work that is being done is infrastructure improvements and hard to see. And when delays occur and progress comes to a screeching halt, communications become even harder.

This is when some flexibility in your scheduling can help. If the activities that are scheduled for next week can’t happen, what can be accomplished? Think out of the box and don’t be limited by the Gantt chart that your contractor has produced.

Ask a lot of questions and be smart. Contractors are used to thinking linearly, but sometimes there are opportunities to move into a different area and accomplish something that wasn’t supposed to happen until later.

Unidentified and unmanaged project risks can doom a smaller organization.

Unidentified and unmanaged project risks can doom a smaller organization. Click To Tweet

Call us to learn more about how Smart Projex can help your teams identify, analyze and manage your risks. If much is at stake, consult a professional. And, if buying insurance to mitigate a risk seems justified, factor that cost into your budget.

If you are interested in more tips on project management, check out our free ebook, Project Management Tips That Will Make Your Client Happy. Even if you don’t do work for external clients, you have someone in your organization that is looking to you. Make them happier.

Photo Credit: Mission:Explore; CC by 2.0 License;