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Differentiation Between Risk and Issue

StarAgilecalenderNovember 11, 2020book minseyes2068

Difference Between Risk and Issue

Project management is a difficult subject and to manage, control, monitor, and track the progress of projects is called project management. If you are planning to buy some groceries or go shopping or do some work in the office whether it is personal or professional require project management skills. 

To do this one must know various project management tools, concepts, frameworks, principles, and methodologies. There are various project management methodologies such as PMP, Prince2, XPM, Six Sigma, Lean, Agile, and Scrum, etc. It is the responsibility of the project manager to deliver the products or services within the cost, within time with a defined scope and highest quality to the expectations of the customer. To do this project manager must know one or more areas of project management methodologies discussed above. 

The organization prefers a certified project manager in one or more of these areas. PMP methodology originated in the USA and is the most popular project management certification in the market. Those who are aspiring for a Project manager certificate online can take up the PMP training with StarAgile. There is a high demand for PMP certified project managers in the industry. It provides benefits such as high pay salary, high growth, recognition, and high demand within the organization and outside of it. 

Types of Risk in Project Management 

Risk is uncertainty in the project due to internal and external circumstances. 

There are various types of risks in project management.

  • Cost risk - This is the risk due to the escalation of the cost that is not planned for. That is unable to meet the expenses as planned in the budget.
  • Schedule risk - This is the risk that has unforeseen escalation in the time to complete the projects.
  • Performance risk - This is the risk due to unforeseen failure to produce the products or services as per the specifications.
  • Quality risk - Uncertainty over meeting the parameters required in the deliverables as agreed to the customer
  • Governance risk - Uncertainty over the organization's board over not performing about the ethics, company reputation, and community stewardship.
  • Security risk - This may be the uncertainty over the cybersecurity or information security practices to safeguard the data or information of the organization.
  • Strategic risk - Unable or uncertainty to choose the technology that can be used for work purposes.
  • Operational risk - This includes risk from poor implementation, production, distribution, and procurement
  • Market risk - This risk is uncertainty over market currency fluctuations, interest rates, currency liquidity, credit risks, and commodity risks.
  • Credit risk – This is the type of risk that has uncertainty to pay the loans given in credit to the organization.
  • Legal risks - This includes litigation brought against the organization, legal and regulatory obligations, and including the contractual risks.
  • Risks due to the external environment - This includes risks due to floods, storms, earthquakes, sabotage, vandalism, labor strikes, civil unrest, and terrorism

To know more about the project management subject explore the PMP course online at StarAgile institute.

PMP Certification

What is the issue in Project Management? 

An issue is an event that is encountered in the project management is the difficulty in bringing the projects to successful completion.

There 2 types of project issues they are as follows,

a. Difficulty in finishing the tasks/items as per the project plan

b. The next is the items/tasks not identified or scheduled as per the project plan.

Issue Management - This is nothing but the identification of an issue and response to it to minimize or eliminate the issues in the project management.

There 2 ways to address the issues as per the issue management. 

a. Identifying the needed work items - Here the project manager identifies the issue as a new task or milestone and includes in the plan. This is generally discovered during the standing project meeting example in the weekly project meeting. These issues are captured in the issues tracking register and addressed during the periodic issues tracking review meeting.

b. Resolving the issue - These issues happens when the items/tasks are included in the execution plan and need to be fixed at the earliest possible time to ensure the project moves smoothly.

The issues solving must be effective otherwise may create the following discrepancies in the projects,

  • Wastage of efforts, time, and energy in the issue resolution
  • Delay in resolving the issues
  • Hiding information that is used in planning future projects.

So the purposes of the issue management process are as follows,

  • Provide well-timed, precise, and thorough communication in the project issues
  • Helping the project team to recognize, confirm, investigate, preparation, and determine issues that are impacting the project deliverables.

Register for the PMP course at StarAgile to know more about these topics.

Tabulate Risk Vs Issue

Serial #
Categories
Risks 
Issues
1Definition
Anything that could go wrong or any uncertainty in the project
Anything that has gone wrong or the events that have impacted the project completion either planned items or unplanned items
2Types

There are 12 types of risks in project management they are as follows,

Cost risk, Schedule risk, Performance risk, Quality risk, Governance risk, Security risk, Strategic risk, Operational risk, Market risk, Credit risk, Legal risk, Risks due to the external environment.

There generally 2 types of issues 1) Items or events that have occurred after planning 2) The events that have occurred that are yet to be planned
3Example
Unable to manage the project cost
The project scope changes suddenly which was not planned earlier
4Classifications
Theoretical, and are positive and negative risks
They are actual and are only negative issues
5Meaning
There are potential to happen
Has happened already
6Documentation
Risk Register
Issue Register
7Solution
Risk Management Approach
Issue Management Approach

StarAgile offers online PMP training which covers the various project management topics.

Conclusion

We have discussed the differences, definitions, and how to solve the risks and issues in this article. The risks and issues are part of project management that must be addressed before something goes wrong. Both are extremely difficult to solve. The project manager must have the necessary skills to address both of them. Both of them as seen in this article are quite different and addressing them at the earliest is the solution to successful project completion. These topics are discussed in the PMP training online at StarAgile institute. StarAgile is the official training partner of the Project Management Institute (PMI) for providing PMP training.

Register for the PMP training online with StarAgile and become certified in PMP. StarAgile delivers the PMP training with the help of excellent consultants who are themselves certified and have vast industrial experience. The PMP training by StarAgile is interactive with real-world examples and case studies.

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