Management Attitudes
Let's take a look at some of the management attitudes that run counter to effective risk management and indeed themselves introduce risk to a project.
| Attitude | Impact |
| Extreme Risk Aversion | Procrastination in decision-making. This often means that some possible options/opportunities are no longer feasible. Setting risk threshold of acceptable activities so low that the institution is incapable of change. |
| Pass the buck | Related to the above. Inability to reach closure on difficult decisions. Issues discussed regularly by a range of committees without progress. Decisions not documented and followed through. |
| No news is good news | The belief that a project manager causes a risk or an issue simply by reporting it. Encourages people to report only good news. Often risks/issues aren't noted until it is too late to deal with them effectively. |
| Knee-jerk reaction | Tendency to deal with symptoms rather than causes and to deal with the immediate and specific rather than the systemic.* |
| My mind is made up | Inability to review or reverse past decisions in the light of changing circumstances. |
| Shoot the messenger | The 'Don't bring me problems' approach. Inability to cope with the identification of risks that don't have an obvious solution. |
| Make it so | 'Don't be so negative'. The belief that a poorly conceived or inadequately resourced project can be made to succeed by sheer force of will. |
*There is a mathematical phenomenon known as 'regression to the mean' that is relevant to the management of change and hence the sort of situations we are looking at here. It states that in any change situation, such as a project, there will be ups and downs. This could be represented as a graph.
Where the project reaches its lowest ebb, as indicated on the diagram, management often takes a reactive 'knee-jerk' decision. This invariably addresses a symptom not the root causes of the problem. For a while it may look as if the 'decisive action' has worked as the graph starts to go up again. What is actually happening is simply regression to the mean. The situation had got as bad as it was going to get and would have begun to level out whatever happened.
We will look in more detail at how to build risk or 'real world' scenarios into plans and budgets in later sections suffice to say here that mature organisations must accept risk as an integral part of project activity. Risks must be identified and managed and we must accept that this takes time and costs money.
We can't simply blame 'bad luck' when things happen unexpectedly, at the worst possible moment and cost money we don't have. Risk management is about identifying what could occur and developing a planned response that is factored into the project plan and budget.
