Risk mitigation strategies

Now that you know which risks require your attention, how do you determine what to do about them? This is where risk mitigation planning comes in.

Risk mitigation planning is about finding ways to eliminate or reduce the impact of potential risks on your project. There are four common ways to mitigate risk. You can avoid it, accept it, reduce or control it, or transfer it. Let's discuss each option using the Office Green example. Sometimes you can avoid the risk altogether.

For example, if you learn that a certain contractor you've considered working with on your Office Green project has a poor reputation for meeting deadlines, then you might choose to avoid that risk by hiring a different contractor. You can also accept the risk, especially ones that you deem low in probability and impact. In this case, you're accepting the possibility that this risk can happen. You've agreed to monitor it throughout the project, and you'll ultimately be okay with the risk if it does happen. For instance, maybe your plant supplier tells you that one of the planter styles you've requested is back-ordered. The supplier is confident that they'll have time to restock the planters without delaying your project schedule, but if there is an issue with every stock shipment, this could delay deliveries to your clients by up to two days. Rather than starting over with a new supplier, you decide that it makes more sense to accept the risk. It wouldn't be ideal for this delay to occur, but you're flexible and you know that accepting this risk will save you and your team the headache of onboarding a new supplier, which could take two weeks. Another way to mitigate risk is to reduce or control it. Personally, I like to use a decision tree when building mitigation plans. A decision tree is a flowchart that helps visualize the wider impact of a decision on the rest of your project. For example, you decide to hire a contractor with a reputation for missing deadlines because you know they do great work. In this case, you might create a quick flowchart that visualizes the risks and potential options for addressing them, like checking in with the contractor daily, either by email or through meetings. Ultimately, you might then choose to have daily check-in meetings with the team to ensure that they're staying on top of their tasks. Finally, you can choose to transfer the risk. For example, you've determined that it's too risky to attempt to grow plants on site at Office Green due to the possibility that bad weather or pests could negatively impact your product. Instead, you've made a decision to transfer the risk to another party or parties. By outsourcing plant production to local suppliers, you have the power to change suppliers if there's an issue with quality. When you transfer the risk, you don't risk losing out on time, resources, and money. To recap, four common ways to mitigate risk are: to avoid it, accept it, reduce or control it, or transfer it. Using one of these four strategies can help you effectively take control of the risks to your project.