When there is a discussion of Risk, there are four Risk Handling opportunities identified in nearly ever handbook or paper.
- Mitigate
- Transfer
- Accept
- Avoid
But there is rarely advice on when or how to apply which risk handling strategy to the risk. Here they are from a recent program:
- Mitigate - when we can reduce the likelihood and consequences of the risk. Allocate funding for the mitigation in the risk management system. A better approach to mitigation is to "retire" the risk before it becomes an issue. This "buydown" approach keeps you on budget and on schedule. If the risk comes true you'll need money and time to address it.
- Transfer - when there is another organization better suited to handle the risk. Find someone to look after this. They may need money to do this.
- Accept - the risk is acceptable or the risk will have minimal impact other than annoyance. Put the "Plan-B" path in the Master Schedule and the "Plan-B" funding so when it comes true, you can switch to "Plan-B"
- Avoid - there are alternatives and those should be chosen. Defines these in the planning phase of the project. Document these changes so everyone remembers why you did what you did to avoid this risk.
