| There is no better way to convince a potential | | | | manage the program well, or, in other words, those |
| customer that yours is the right company for the job | | | | that are inherent to the nature of the job. |
| than to demonstrate a true understanding of the | | | | To drive this concept home, let's use an analogy of a |
| risks the program will be up against and to come up | | | | woman going through pregnancy and childbirth. Let's |
| with plans to mitigate those risks upfront. But in | | | | say that there are things that educated pregnant |
| many proposals, the risk management section ends | | | | women know to do to maximize their chances of |
| up as a missed opportunity to shine at best and a | | | | success, such as going to the doctor for exams, not |
| setback at worst. Rather than showcasing a real | | | | smoking, and getting good nutrition. Then, there are |
| knowledge and understanding of the program and | | | | also risks that could possibly occur due to the nature |
| proposed solutions, the risk section falls flat or | | | | of the process, such as any number of medical |
| actually does harm. | | | | complications that are common to pregnancy and |
| It happens for two reasons. One reason is that many | | | | childbirth that could affect the cost (medical bills), |
| proposal teams fail to put enough time and | | | | schedule (carrying the baby to term), or performance |
| consideration into developing a solid risk section. They | | | | goals (giving birth to a healthy child). If a woman |
| assign one author to write it and then shift their | | | | were to put together a risk matrix for a proposal to |
| focus to other work. What they do not realize is that | | | | become pregnant, documenting the risks of what |
| great risk sections are usually born from hours of | | | | would happen if she did not have timely medical |
| intensive brainstorming and input from every key | | | | exams or smoked would usually imply her |
| player who truly understands the program. Instead, | | | | irresponsibility. Documenting possible medical |
| the process by which most risk management | | | | complications inherent to the nature of pregnancy, |
| sections are written leaves little room for success. It | | | | such as gestational diabetes, would demonstrate a |
| is impossible for a single author to draw out and | | | | thorough and thoughtful understanding of the risks. |
| evaluate all of the program's risks. | | | | There are only three categories of risks that should |
| The second reason is that the wording of many risk | | | | be presented in proposals: |
| statements fails to represent the company as an | | | | 1. Risks caused by lack of information or knowledge |
| expert, and instead hurts the company's chance of | | | | about the project that could only be gained in the |
| winning. Often risk statements tend to follow this | | | | process of project execution; |
| train of broken logic: "If we fail to provide such and | | | | 2. Risks caused by lack of control or resources to |
| such (with "such and such" standing for something | | | | deal with external events or authorities; and |
| that is expected from any good company doing well | | | | 3. Risks caused by lack of time to complete tasks |
| in this line of business), this horrible thing will happen." | | | | sequentially and methodically. |
| For example, "If no Customer Satisfaction Survey is | | | | If a company is bidding to perform a project at a |
| established, there will be no feedback on Service | | | | facility where no site survey has been completed, an |
| Desk performance, which may lead to undetected | | | | example of a good risk statement would be that the |
| systemic problems resulting in lower customer | | | | "Existing facility is not large enough to support the |
| satisfaction." Then, the risk mitigation strategy is to | | | | required number of personnel for the Service Desk |
| "Establish a Customer Satisfaction Survey." This type | | | | function, which could lead to inability to provide the |
| of risk and mitigation statement reads like an | | | | required services." The mitigation would then be |
| exercise in shooting oneself in the foot. Essentially, it | | | | identifying an alternative to the existing facility in case |
| says to the customer, "If we do not know what we | | | | the survey findings confirm this risk instance. "Not |
| are doing and we fail to do what any decent | | | | getting environmental licenses and regulatory |
| company should do if it wins the bid, then we will fail." | | | | approvals in time because of the issuing agency's |
| Do not offer a risk like this and then couple it with a | | | | notorious scrutiny" is another example of a |
| mitigation such as, "But we do know what we are | | | | well-identified risk. A good mitigation could talk about |
| doing." | | | | expert bodies, relationships with the regulators and |
| Consider another example where the risk is of | | | | local authorities, and the ability to design and build in |
| "Equipment not identified early enough or critical | | | | accordance with every possible standard. |
| equipment items not identified," and the mitigation is | | | | It is critical to remember that the only way to come |
| something as rudimentary as "Ensure early | | | | up with solid risk and mitigation content is to |
| identification of long-lead items." Think about this | | | | collaborate as an entire team, rather than tasking a |
| from the standpoint of the customer. If the | | | | single author. Even if there is no requirement for a |
| customer is choosing an expert logistics company, | | | | separate risk section, risk analysis is still all-important. |
| and one of your company's key programmatic risks is | | | | Discussion of applicable risks and mitigation strategies |
| that someone will fail to identify equipment in | | | | also should be included in each section, to showcase |
| advance, what kind of image are you projecting? | | | | your understanding of the job at hand. In your |
| The examples of "risks" cited above do belong in the | | | | brainstorming session, it is a good idea to have a |
| proposal, but only as elements of the technical or | | | | mediator who can point out the holes and flaws in |
| management approach, and not as components of | | | | your risk ideas. A mediator will also ensure that you |
| the risk section. | | | | avoid the pitfall of inadvertently stating as a risk that |
| A good "do" for risks is to avoid representing as a | | | | your company is unfit for the job, and then stating |
| risk anything that is within your company's control as | | | | for the mitigation that your company is - go figure - |
| well as anything that any reasonably good company | | | | fit for the job. Make your risk statements work for |
| would do in this line of business. The kinds of risks | | | | you, since they can be pivotal in convincing the |
| you need to show in your proposal must be those | | | | customer that yours is the right company for the |
| external to the company's own abilities to plan and | | | | job. |