Section Summary – Communicating Project Risks

In the previous few chapters in this section we learnt about project risk communication process. Let us now quickly summarize what we have learnt so far.

• After we identify risks, the next logical step is to communicate those identified risks to all stakeholders and this is the purpose of this communicate project risks process
• Though project communications management is not directly a part of project risk management knowledge area, communicating risks and regular updates to all key stakeholders is an integral part of risk management
• Psychological factors can influence peoples attitude towards risk which in turn can affect their risk tolerance
• Peoples risk attitudes can be broadly classified into 4: Risk Averse, Risk Tolerant, Risk Neutral and Risk Seeking
• People usually resist change (risks) when it threatens their level of comfort or control or if they are unfamiliar with the change
• Risk Tolerance is defined as the degree, amount or volume of risk an individual or organization will withstand
• The Stakeholder Register and Stakeholder Management Strategy can help us greatly in managing stakeholder expectations in terms of risk communications
• We cannot please or satisfy all stakeholders. So, a smart manager will classify stakeholders and identify the high influence/power category and keep them satisfied as much as possible
• Most stakeholders will require only high level information
• The information that we share with different categories of stakeholders will depend on their interest in the project, influence on the project and a variety of other factors. Simply put “Not everyone wants everything”
• Risk Management Plan usually contains templates and reporting formats that we must use for the different categories of stakeholders

Prev: Communicating Risks to Stakeholders

Next: Introduction to Risk Analysis

Communicating Risks to Stakeholders

So far, in the previous chapters, we learnt about risk attitudes and have analyzed the stakeholder risk tolerance. So, the next thing for us to do is “Start communicating” to keep our stakeholders informed of the project progress in terms of risk management.

The PMBOK guide defines a separate process that covers the topic of Managing Stakeholder Expectations. This topic was covered in our PMP prep series in a chapter with the same title Managing Stakeholder Expectations. If you check this process, you will see that the Communications Management Plan which is the output of the Planning Project Communication process is an input. This communications management plan is going to define how we are going to communicate with all our stakeholders.

If you are wondering how, then maybe you forgot about the contents of the communications management plan. I suggest you go back to the chapter on Planning Project Communication and revise the contents of the same. The communication management plan contains stakeholder communication requirements which we will be using along with the Stakeholder Management Strategy to effectively communicate about our project risks.

Most stakeholders will require only high level information regarding risks. They will be typically looking for information like:

a. How accurate the presented information is?
b. Whether there is a potential for gain or loss?
c. Can the risk be managed?
d. What are the recommended responses?
e. What is the impact?
f. Etc.

Along with the above mentioned information you must also be able to provide certain additional information like:

a. Who holds the responsibility for the risk and the related events if the risk were to occur?
b. How often will the risk event occur?
c. What alternates do we have?
d. Etc.

But, as with every communication, there is a problem here. Not everyone wants everything. This is where the Stakeholder Management Strategy and the Communications Management Plan come to our rescue. In these documents we contain details like “Who needs what information” and using that we can try to cater to the varying needs of the different stakeholders in our project.

One last thing about communicating project risks is that, the Risk Management Plan usually contains templates and reporting formats that we must use for the different categories of stakeholders. So, we need to take that into account and ensure that the right reports are sent to the right target audience.

Prev: Stakeholder Risk Tolerance

Next: Section Summary

Chapter 71: Distributing Information

One of the important responsibilities of a project manager is to share information with his team and other project stakeholders. You, as the project manager is the communication channel between your team, your management and the customer. Throughout the project lifecycle, you need to continually distribute relevant information to the right stakeholders at the right time by using appropriate methods. The information is distributed according to the communication management plan developed during the planning stage and by using the Distribute Information process.

The picture below explains this process:

Input to Information Distribution

The information distribution process is used to distribute information according to the communication management plan. Therefore, the information to be distributed and the communication management plan are the obvious input items to the information distribution process.

The distributed information includes performance reports, which contain items such as the following:

• Performance information, including cost and schedule
• Status information
• Results from risk analysis and risk monitoring
• Any other useful information
• Current forecasts

The performance reports are generated by using a monitoring and controlling process called Report Performance. In addition to the communication management plan and performance reports, the following organizational process assets can also affect the information distribution process:

• Information and lessons learned from past projects
• Organizational policies, procedures, and guidelines for distributing information
• Templates to facilitate information distribution

Tools and Techniques for Information Distribution

The tools & techniques that the project manager must use for this process are:
Communication skills - Communication is the exchange of information, so communication skills are a necessary requirement for information distribution. Communication skills, an essential part of general management skills, are used to ensure the following:

• The right stakeholders get the right information at the right time.
• The communication requirements and expectations of stakeholders are properly managed.

Any communication line has two ends. There is a sender on one end and a receiver on the other. Both the sender and the receiver need to have communication skills. The sender has the following responsibilities:

• Ensure that the information is clear and complete.
• Confirm that the information is received and properly understood.

The receiver has the following responsibilities:

• The information is received in its entirety.
• The information is correctly understood.

So, the success of information distribution depends on both the sender and the receiver.

Communication has two flavors in each of the following dimensions:

• Media - These flavors are writing and speaking on the sender’s end and reading and listening on the receiver’s end.
• Place - These flavors are internal to the project; that is, within the project; and external to the project; that is, communicated to entities external to the project, such as the customer, the media, and the public.
• Format - These flavors are formal, such as reports and briefings, and informal, such as memos and ad-hoc conversation.
• Hierarchy - A horizontal hierarchy means communication among peers, whereas vertical means communication between different levels of the organizational hierarchy; for example, a manager communicating to the team that reports to the manager.

The information that needs to be communicated also needs to be gathered, stored, and retrieved.
Information distribution methods - The information can be distributed in a number of ways that fall into the following two categories:
• Synchronous - Both the sender and the receiver have to be present at the same time, such as at face-to-face project meetings and telephone calls.
• Asynchronous - The sender and receiver don’t have to be present at the same time, such as with written paper or electronic documents, online bulletin boards, e-mail etc.

Information distribution tools - You can use one or more appropriate tools to distribute information. These sets of tools include the following:
• Document format - Hard copy or electronic.
• Messages - E-mail, fax, voicemail, Internet bulletin boards, blogs.
• Meetings - Face-to-face meetings, video conferences, and teleconferences.
• Management tools - Project scheduling tools.
You use these tools and techniques to generate the output of the information distribution process.

Output of Information Distribution

The output of the information distribution process is, well, the distribution of information to all stakeholders. This distribution of information falls into two categories:
• Formal distribution - This distribution refers to communicating the information as planned, such as regular status and progress information updates at scheduled times, such as once a week every Wednesday.
• Informal distribution - This refers to the communication of information on an as-and-when-you-need basis. For example, the project sponsor can ask you for information that is not part of the regular schedule of distributing information. You don't have a choice but to provide him with this report.

The process of distributing information will create some items that can be added as a record to the organizational process assets. Some of them are:

• Project reports and status reports
• Stakeholder notifications about resolved issues and approved changes
• Project presentations
• Project records, such as memos, meeting minutes, and project files, such as plans and schedules
• Feedback from stakeholders
• Lessons learned

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Next: Summary - Managing Stakeholders