18 August, 2022

How to Do Risk Management in Agile Projects | Video

Some people might expect that agile projects have – or even need – no risk management. That is completely wrong. So, let’s look at how to do risk management in agile projects.

It is also easy to think that Risk Management may be completely different in Agile projects. That would be wrong too. And it would be equally wrong to think it will be just the same.

The truth is that risk management is similar and different between predictive and adaptive project management. And, there is much that traditional project managers can learn and adapt from the way risk management works in agile projects.

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Adapting Your Agile Risk Management

Clearly, we need to adapt our risk management approach to the nature of our project. especially to:

  • The level of risk
  • The risk attitude of your customer, client, users, or sponsor
  • The culture of the sponsoring organization

After all, all project management is hybrid project management!

The Process of Risk Management in Agile Projects

As you’d expect, risk management is more adaptive and emergent in agile projects, compared to traditional, plan-driven projects.

Whilst the basic process is the same, in agile projects, we typically apply that process at 2 levels:

  1. Level 1: The Project level
    …an over-arching Risk Management framework
  2. Level 2: The Iteration, or sprint, level
    … a process that happens at each iteration

The Steps in the Agile Risk Management Process

That process can be described in many ways. But the essence of it is:

  • Identify 
  • Analyze (and prioritize)
  • Plan risk responses
  • Take action
  • Monitor & Control RM progress

How Agile Risk Management Differs from Traditional Project Risk Management

But, in addition, there are elements of risk management that differ:

  1. First, the adaptability of agile projects is a response to risk – the uncertainty of the end product. Each iteration bites off a small chunk and thus limits risk. And, as risks increase, we typically reduce iteration cycle time.
  2. Second, we follow the whole risk lifecycle at each sprint or iteration. This increases the focus on risk. This can be further enhanced by discussing risks at daily stand-up meetings.
  3. The use of a backlog is also a risk management approach:
    • Defers high-risk tasks (especially high uncertainty) means more knowledge and greater process experience when we tackle it
    • We can use ‘Spike Stories’ to answer a specific question that can reduce uncertainty and therefore risk. A Spike story is also known as a ‘timeboxed investigation’.
  4. The Sprint Reviews and Sprint Retrospectives of Scrum allow:
    • Sprint reviews can consider the impact of risks in this sprint on backlog items and their estimates
    • Sprint retrospectives can sharpen the team’s risk management practices and overall process – thus reducing risk through the project life cycle

Problems and Benefits of Agile Risk Management

There are also some real benefits (and problems) that agile working confers on Risk Management.

Problems with Agile Risk Management:

  • No clearly defined risk owner/risk manager. The entire team is responsible, which could be a benefit, but can also lead to complacency among individuals
  • This lack of ownership and the wider risk management benefits of the agile approach can lead to a cavalier attitude towards risk – which is, itself, a risk

Benefits of Agile Risk Management

Agile working encourages:

  • Transparency – better risk identification
  • Collaboration – better planning and problem solving
  • Customer involvement – greater accountability, business participation, expectation management
  • Stable teams – learn better time and cost estimating

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What Kit does a Project Manager Need?

I asked Project Managers in a couple of forums what material things you need to have, to do your job as a Project Manager. They responded magnificently. I compiled their answers into a Kit list. I added my own. 

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Mike Clayton

About the Author...

Dr Mike Clayton is one of the most successful and in-demand project management trainers in the UK. He is author of 14 best-selling books, including four about project management. He is also a prolific blogger and contributor to ProjectManager.com and Project, the journal of the Association for Project Management. Between 1990 and 2002, Mike was a successful project manager, leading large project teams and delivering complex projects. In 2016, Mike launched OnlinePMCourses.
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