Supporting the Sponsor Who Takes Risks
Part of a project manager’s job is to manage risk on behalf of the sponsor. It is NOT to stop the sponsor from taking risks, because risk is often necessary to move a business forward. Here are ways to support a sponsor when they decide to take risks.
- Understand how taking the risk can advance the business. What are the desired outcomes that require taking this risk? If appropriate, take time to explore less risky ways to achieve those outcomes. Also, identify early success indicators that would show that the risk-taking will deliver the desired results.
- Make sure that project risks are fully understood. The project sponsor needs to know about all the risks the project presents. Share the risks, indicators of when risks might come to fruition, and any planned response actions. Also, communicate the costs and schedule impacts of those response actions.
- Know when the risk becomes unsustainable. A risk that turns into an issue can significantly affect the project and even the business. Early in the project lifecycle, determine the limits or thresholds of cost and schedule impacts that the sponsor is willing to accept to achieve their goals.
- Determine how to manage skeptical stakeholders. Pressure from key stakeholders about risks can be overwhelming. Work with your sponsor to understand what’s been communicated about the risks being taken, and how to communicate going forward to manage key stakeholders’ concerns. The key is to communicate consistently among all parties, especially the sponsor and project manager.
- If you fail, fail early. Typically, project risks relate to a few key processes or assumptions about deliverables. Work on those as a proof of concept, as early as possible. That way, the project premise is tested early. If you find that the project’s fundamental concepts aren’t feasible, the business will save precious time and money.
For more about sponsors, check out Antonio Nieto-Rodriguez’ course How to Be an Effective Project Sponsor.
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