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How Proper Project Risk Management Goes Against Common Management Thinking

Low probability, high consequence risks happen more often than we usually think and they are the ones that ultimately, shape a company or even an industry. Because they do not happen often, their prevention is easily overlooked and left to the next project. Yet, high risk industries like the nuclear or the aeronautics industry can teach us basic techniques and mindsets we can use to easily diminish the probability and the impact these risk. The project organizations that will implement these simple techniques will gain significantly in consistency of delivery and protect themselves against catastrophic events.

Our new White Paper 2013-04 \”Project Risk Management Reloaded: How Proper Risk Management in Project Organizations Goes Against Common Management Thinking\” tackles this important issue.

\"riskIt is a basic property of complex systems to make high consequence events happen much more often than we would normally expect. High risk industries implement comprehensive frameworks that develop prevention principles into strict guidelines. They are developed in the White Paper.

In project organizations, the worst that can happen is an organizational common cause of failure. The biggest challenge organizations face is how to effectively diversify their ways of doing things to avoid common causes of process failures. This goes against the tendency to seek maximum efficiency through standardization of tools and processes.

The point is that in today’s world in general, and even more in project organizations, efficiency of repeated production is not the key to success. Resilience to chaos or adaptation capability are the keys to success. If that goes with some loss of efficiency, so be it.
The biggest challenge organizations face is how to effectively diversify their ways of doing things to avoid common causes of process failures. This means, letting individual projects experiment with new ways of doing things, within certain limits; accept small failures to avoid a larger one that would wipe out the organization; and accept small failures to find better ways of doing things. Are you ready for that?

Read our White Paper 2013-04 \”Project Risk Management Reloaded: How Proper Risk Management in Project Organizations Goes Against Common Management Thinking\” why you need to change your approach to risk management today!

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