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