Whether you realize it or not, we make risk vs. issue calculations all day long.
Let’s consider one issue: You’re running late for work. Why not drive through that red light? Well, because of the risk: Getting pulled over by police, or worse, putting peoples’ lives in danger. So, you wait out the red light.
That’s an easy one. Managing risk vs. issue in project management isn’t always so cut-and-dry. But understanding the difference between risk and issue does boost the chances that your project will be a success. Here’s what you’ll need to know to navigate the world of risks and issues in complex projects.
Risk vs. issue: What’s the difference?
It might sound as if issues are always greater challenges than risks. But the two can vary wildly in terms of degrees. For example, a broken pinky toe is a manageable medical issue. But ignoring a medical risk like a clogged artery can be far more serious.
As a project manager, your job is to evaluate both, so you never lose the patient (or the project).
Why is it important to note the difference between a risk and an issue?
Effective risk analysis hinges on estimating the potential pitfalls in running your project. Ideally, the planning phase will tackle them in reverse: You’ll try to lower the risks at the outset to avoid them becoming full-blown issues. But you’ll need plans for both.
To make your own complicated project run smoothly, you need to start backward. Think about the biggest risks with your team and develop plans for them. Run a risk assessment before the initial phases. Remember the old adage that “an ounce of prevention is worth more than a pound of cure.” This is all the more important when launching a complex project.
Risk vs. issue examples in project management
Still feeling a little confused? Let’s take a look at a couple of examples of risk vs. issue in project management.
Boeing’s 787 Dreamliner: Risk complexity leading to inevitable issues
Consider the problems with the unveiling of Boeing’s 787 Dreamliner. It was “a more complicated airplane, with newer ideas, new features, new systems, new technologies,” according to a Boeing engineer.
From the outset, this complexity made it difficult to foresee specific issues. But given the novelty of the project, some risks were already present. After several delays — and an additional $10 billion in budgeting — Boeing eventually “outran our ability to manage it effectively,” according to a release from the company.
It’s tempting to look at this risk vs. issue example from the outside and imagine that it was an unlucky project with too many issues. But Boeing’s ambitions meant higher levels of risks. Without enough risk management, project issues become inevitable.
Bank of America: When risks prove more intense issues than you imagined
In 2011, Bank of America rolled out a new pricing initiative: $5 per month for customers to get access to debit funds. Bank of America anticipated some customer blowback — after all, that’s common whenever prices go up.
But customer reaction was far more intense than Bank of America imagined. One customer started “Bank Transfer Day” on Facebook to protest the fees. Customers moved their money out of their Bank of America accounts in droves. Efforts like these had enough impact that the brand was eventually forced to back down on its new fees.
In this case, it wasn’t that Bank of America hadn’t adequately foreseen the risk. They simply hadn’t imagined the risk would manifest as such an intense issue during the rollout phase. Had they spotted this issue earlier, the launch may have played out differently.
Issue log vs. risk register: what is the difference?
In project management, leaders typically turn to two tools to manage these variables. For risk, they turn to risk registers. This register lists the various risks along with their probabilities and potential timing hazards. (Note: A risk matrix is another effective tool for weighing and predicting risks.)
For issues currently affecting the project, an issue log is simply a list of the current problems a team member needs to solve. In one research paper, project manager N.K. Shrivastava says that when a risk manifests as an issue, he makes two key changes:
- Adding the issue to the issue log to assign it to the relevant team member
- Flagging the risk in the risk register for better project planning in the future, especially noting which risks were most likely to manifest as issues
By flagging the risks that become issues, Shrivastava also grows as a project manager. He learns which issues to spot in potential future projects, making him better at risk assessment for future work.
One key difference here: A risk register can be a list of potential obstacles that you create at the outset, while an issue log is only a list of real obstacles. One is essentially in the future tense, while the other is in the present or past tense.
How to use Wrike for managing risks and issues
In project management, risks are everywhere. There are so many, in fact, that there are even positive risks: unforeseen events that help your project along.
Wrike can help you get started with risk assessment by providing the information and templates you need to begin your evaluation. The key is in using previous risks to inform your future work. If you’re starting your first project, use Wrike’s risk assessment templates to better predict, record, and measure the risks associated with your first project.
With any luck, your analysis at the outset will help you minimize issues along the way, so you can get to the project wrap-up celebration on time and on budget.
Ready to foresee risks, manage issues, and have a more successful project? Start your free trial of Wrike today.