Project Risk and Risk Management in Contemporary Society

This essay delves into the critical aspects of project risk and risk management within the context of contemporary society. It begins by highlighting the significance of project management in today's complex business environment, characterized by rapid technological advancements and interconnected global networks. The essay emphasizes the need for structured approaches to achieve project goals, considering attributes like project importance, uniqueness, and the inevitability of conflicts. It then explores the benefits of effective project management, including improved planning, resource allocation, and change management. The core focus is on risk management, discussing the types of project risks (estimated and unforeseen) and the importance of predetermining risks. It covers risk assessment, mitigation strategies, and the impact of these on project success. The essay provides a comprehensive analysis of internal and external project relationships, and the application of project management in different scenarios. It concludes by underlining the value of knowledge retention, learning from failures, and continuous improvement in project management practices.

Contemporary Project Management Issue – Project Risk and Risk Management

Project management refers to the initiation, planning, execution, control and closure of the work
for the achievement of particular goals (Kerzner & Kerzner, 2017). These goals are considered
achieved if it meets the predefined success criteria at the initiation stage of the project. In this
paper, the reasons for project management in the contemporary society has been discussed and
an issue facing the dynamic project teams has been considered. The issue that has been
considered for the discussion is risk management. The essay further sheds light on the
application of the project management on different situations and the potential impact of the
project issues. Furthermore, a comprehensive analysis of the implications of both the internal and
external relationships that the project might develop has been discussed.
Reasons for Project Management in Contemporary Society
With the change in the business scenario in the past few decades, the contemporary situation has
become quite complex to manage. Contemporary society is referred to those society in which
there exists innovative technologies, and the people are strongly interconnected at local and
global scale with the help of technology. Though the technology has also developed along with
the increasing complexity which is considered as a tool that facilitates in handling the activities
efficiently, there exists strong need for a proper management of the projects that are
implemented by the businesses. The companies, nowadays, have rapidly changing goals and
objectives that are far more competitive in nature. In such situation, it is important that the
businesses consider right approach for the achievement of these goals. A structured approach
allows the businesses to plan and execute their objectives successfully (Larson & Gray, 2015).
There are certain attributes of the projects in the contemporary society which should be
understood in order to ensure that the successful completion of the project is achieved. The
project should be important for the management as it needs their support in effective

management. Moreover, if the organization does not consider a project to be important, then it is
more likely to fail. Another attribute of a project is that it is conduct one time with a particular
set of goals in the mind. The project can be divided into several subtasks for easier achievement
of the project goals. Moreover, the projects’ life cycle are finite and contains several
interdependencies (Fleming & Koppelman, 2016). Only few of the many projects function in
isolation (Turner, 2014). In the larger organizations, companies handle multiple projects at the
same time and most of the time these projects are interconnected with each other. Therefore, the
success of all the undergoing projects define whether the organization will be able to achieve it
organizational goals and objectives. Another attribute of a project can be its uniqueness. It may
be possible that the similar project may have been achieved somewhere else, but that project may
be unique to that particular organization. The important aspect of a project is that the need of
customization and the associated risks can lead to the changes in the same types of projects.
Therefore, the similar projects rarely stays similar even if it is being executed for the second time
as the circumstances change (Harrison & Lock, 2017). Moving further, conflicts within a project
is another important attribute of it. The occurrence of conflict within project is inevitable and
sometimes it is for the good of the project and sometimes it is bad. The conflict can arise within
the team or it can arise with the various stakeholders of the project.
After gaining understanding of the several attributes of the project, the next aspect is to
understand the benefits that are brought in by the project management (PM) to the projects in the
contemporary society (Marchewka, 2014). There are several benefits of project management for
the projects in the contemporary society. Firstly, PM allows the organization to accurately plan
and handle the chaotic nature of the project. Inherently, the projects are of chaotic in nature and
therefore, to ensure that a clear path is visible to achieve the project goals and objectives,

planning and organizing is required. It helps the project manager in scheduling the execution
duration of each of the activities within the project to its minutest of the level. A project schedule
helps the organization in effectively tracking the progress of the project against the intended
completion time of the whole project. Furthermore, project management also helps the project
managers in effectively managing the human resources that are employed in the team for the
completion of the activities. PM also helps in fostering effective communication channel that
encourages the growth of teamwork within the team which eventually leads to reduced project
conflict and successful project achievement (Walker, 2015; Snyder, 2016).
Along with the aforementioned benefits of the project, it also helps in effectively maximizing the
resources such as the financial or human (Svejvig & Andersen, 2015). The tools and techniques
provided by the project such as project tracking and risk management helps in effective
management of these aspects. As stated previously, the project rarely occurs in isolation,
therefore it implies that after the completion of the project it has to be integrated to a bigger goal
or unit of the organization. This is where the project management plays a significant role. The
project management also allows the project managers and the organizational heads to identify the
aspects that can help in successful integration to the current processes in the organization (Mir &
Pinnington, 2014). As for example, a project that build sales system for an organization cannot
perform in isolation. It has to be integrated with the existing sales process within the
organization. If it fails to aid in functioning of the sales process and fails to integrate
successfully, then it will rarely be used by the individuals who are working in the sales
department in that organization. It can eventually lead to the failure of the project.
Moving further, the project management helps the project managers in controlling the progress
and the cost of the project. There are projects that require substantial investment of funds from

its stakeholders (Meredith et al, 2016; Titarenko et al, 2018). In such project, it becomes very
important that the cost of the projects are handled prudently as minor expenses may eventually
convert to huge cost to the company. Through the use of project management, the cost of the
project can be estimated successfully using top to bottom or bottom to top budgeting approach
(Serra & Kunc, 2015). The budgeting of the project should be done till the minutest of the details
so that the project team does not get caught by the surprise when new expense comes up. Cost
management also helps in assessing the project activities in accordance to the cost being incurred
and any derailment from the cost is identified and reported to the management for easier action.
There are several techniques provided by PMBOK to manage the cost such as cost variance plan,
cost control and reporting, cost estimation and baseline, and change control process based on the
changes identified to improve the project on costing aspect (Project Management Institute,
2018).
With the changes in the project dynamics in the contemporary scenario, there is a strong need for
the consideration of processes that can ensure that any change within the organization is
effectively implemented and manage. This is where the change management aspect of the project
comes to rescue. Now without a doubt it can be stated that most of the project does not take place
in the isolated environment (Joslin & Müller, 2015). Therefore, after the successful development
of the intended output of the project, it becomes important that the project is also implemented
within the organization for which it was developed. The studies have found that bring any
change within the organization is a challenging process due to the resistance of the people to
change. The project management gives ways to handle those resistance and implement even the
most daunting projects that seems impossible at first. The tools such as Kotter’s 8-step change

model, Lewin’s change management model and others have been brought in picture to ensure
that the changes within the organizations are achieved successfully (Hornstein, 2015).
Another challenge that is faced by the projects in the contemporary society is the quality of the
project results. A mere completion of project does not mean anything until the stakeholders of
the project are satisfied with the output of the project. Therefore, it is important that the project
manager implements quality measurement methods that can ensure that the quality of the project
is maintained successfully (Gido et al, 2014; Hillson, 2017). In the project management, there are
several suggested tools and techniques that help in ensuring that the quality of the project
activities and deliverables are assessed periodically and appropriate control measures are put in
place. There are several quality management techniques that can be utilized by the project
manager such as cause and effect diagrams, flowcharts, check sheets, Pareto chart, histogram,
control charts, scatter diagrams, benchmarking, quality meetings, and others. These quality
assessment methods ensures that the issues in the project progress and activity achievements are
identified earlier and proper actions are taken when needed (Kendrick, 2015).
The key aspect in any project being handled in the contemporary society is the retention and use
of the knowledge that are acquired through the project process. When any project progresses, it
results into the generation of knowledge through regular learning process either through the
experience and training (Sears et al, 2015). These knowledge are more likely to be lost if the
proper care is not taken in the retention of these knowledge and the project team and
organization is likely to fail to use the learned knowledge in the future similar research projects.
This may lead to the repetition of same process of knowledge acquisition in the new project
which leads to the unnecessary loss of time and resources. Therefore, the management of the
knowledge in the project is an important element. The project management allows the project

managers to ensure that the lessons learned from the success and failure of the projects are
retained for future utilization. It stores what worked and what not worked in the project and the
possible reason for such result. This furthers with another aspect of the project management is
learning from failure (Todorović et al, 2015). With the fast changing contemporary environment
and still competition, the organizations will have less opportunities to repeat the same mistake
again and again. Therefore, it is necessary that they spend some time in learning about the
reasons of failure for the project and then ensuring that the same mistakes are not repeated in
similar projects in the future.
Risk Management
After understanding the reasons for project management in the contemporary society, the next
aspect is to evaluate the project management from the perspective project issues that are faced by
the dynamic project teams. One of the issues that are very important to be considered here is the
risks that are associated with any project (Cooper et al, 2014). Risks are inevitable to any
organization and the projects are bound to encounter associated risks within the project. The
risks for a project can be either estimated or it can be unforeseen. The risks that can be estimated
prior to the initializations of the project are easier to manage – barring few circumstances where
the project team can only handle the project when it occurs even if they are aware that such risk
may occur – in comparison to the risks that are invisible and the management is unsure about
such risks (Pritchard & PMP, 2014). In such scenario, deciding the contingency plan for such
risks also becomes a tough nut to crack. With the advancement of the technology in the
contemporary society, the project team is now able to predetermine the risks that might take
place. However, still with the increased access to the information, the volatility and nature of the
risks have also changed. Despite all the forecasting methods available for estimation for the

risks, the project team faces challenge in completely realizing what may hit the project progress
and from which direction (Marcelino-Sádaba et al, 2014).
In the contemporary society, the need of the consumers are complex than before and so is the
increasing complexity of the project that leads to the increase in the associated risks. Poor
management of the risks is likely to severely impact the project from all sides. One of the issues
that can come up is the poor user adoption. The intended users of the project may end up not
using the project which may defy the purpose for which the project was being conducted in the
first place (Team, 2014). Another issue is the poor work ethic within the team members. This can
occur from the lack of robust work process and presence of more than required bureaucracy
where the employees end up cutting corners instead of achieving things with the needed
dedication. The complicacy of the process also leads to such situation where the project manager
fails to adequately control the project team (Khameneh et al, 2016).
The project is likely to miss out on the expected benefits that it fails to achieve. If the team
members are not working as per the expectations then it further adds the cost to the company and
increase in the delivery time. This has direct impact on the time that will be required for the
realization of the benefits of the project. The risks that are unforeseen and the project team is
unable to predict its happening, may slow down the progress of the project. The occurrence of
unforeseen risks requires that the project team dedicate specific time to understand the risk and
take necessary measures (Cagliano et al, 2015). This requires consumption of more resources in
terms of time, money, and capital. Another impact is the over expenditure of budget on the
project. One of the important aspect to note here is that generally project teams stay prepared for
the risks they foresaw in terms of cost and resources. However, the real challenge is received by
the project risks that are unforeseen and the team has no preparation at all for it. In such

scenarios, the project team ends up spending more than that what was estimated for the project.
The project teams get into a dire situation where either they have to resolve the risks or face
further consequences (Cleden, 2017).
Another impact of the risk is the unhappy clients. The study has found that the clients are less
willing to engage with the projects that are perceived to be having high risks. The clients would
prefer to know about the planning that are in place to ensure that the risks will be effectively
handled (Liu et al, 2015). If the fail to find any convincing procedures in place, then they are
more likely to dissociate themselves from the project which is more likely to stall the project
progress or even if it is completed, it will have no meaning. Furthermore, such situations can
have reputational damage on the company. The presence of risks and inability to get out of it
promptly may portray an image among the clients that the generally fails to effectively manage
the risks. This may lead to bad reviews for the company which may have chain effect on the
losing customers (Parihar et al, 2015).
Moving further, the worst case scenario for the poorly managed project on the risk aspect is
complete failure to achieve what it intended to achieve initially. It is more likely that the project
will get into some risky situation from which it never came out or even if it completes, it fails to
deliver anything that is of value to the target client. The project team will fail to achieve the
business objective and will witness loss of time and money (Muriana & Vizzini, 2017). The risks
present in the project also impacts the health and safety of the individuals who are engaged in the
project. If the project scenario involves usage of heavy machinery or hazardous situation, then a
poor risk management is likely to increase the chance of failure of the project results and at the
same time it will jeopardize the lives of people who were engaged in the achievement of the
project (Rai et al, 2017).

Overall, considering the above discussed risks impact, it can be stated that the poor management
of risks leads to some severe circumstances for the project. Here, it is more likely that the
presence of the unattended risks in the project can eventually lead to the project failure. The
project risks not only have internal consequences as well, but it also has external consequences in
the relationship it holds with the various entities (Sadgrove, 2016). A project consists of several
stakeholders who are directly or indirectly concerned with the outcome of the project
achievement. In the contemporary society, the businesses and government are willing to orient
towards activities that are socially responsible because it is likely to impact the reputation and
long term sustainability (Klakegg, 2016). The government has also become a key concerned
stakeholder who willingly monitors the outcome of the project as in the long run it may impact
the society and the community where the project is being implemented. Common stakeholders of
a project can be categofrized into senior management, project team, users of the project, sponsors
of the project, government, and those stakeholders who do not have any say in the project but
may be impacted by the project results indirectly.
Here it becomes important that the relationship with all these internal and external stakeholders
are maintained positively in order to achieve the intended project goal (Tomanek & Juricek,
2015). However, with the poor risk management, the internal and external relationship might
break and instead of project goal achievement, the project will end up in chaos. As per PMBOK,
there are three actions that can be taken by the project team in order to ensure that the risks of the
project are handled effectively. It has been suggested that either project risks can be avoided,
mitigated, or accepted (Project Management Institute, 2018). Here, it should be understood that
not all the risks fall in all of the categories. It depends on the type of risks that have been faced
by the particular project and the capacity of the project team and project to fight the project risk.

It depends on the understanding of the project manager to assess the level and type of risks and
the available resources with the project to manage the risks. When the project manager takes the
decision of avoiding the risks, then in this case, the risks are eliminated by ensuring that the
cause of the risks are removed. In the case of mitigation of the risks, the project manager ensures
to reduce the monetary impact of the risk by ensuring the chance of occurrence of the risks are
reduced. In the case of acceptance of the risks, the project manager accepts the risks. In this case,
the project manager arranges contingencies to handle these risks (Hopkin, 2018). The project
risks can be handled successfully with the use of risk management methods. Risk management
helps the organization in identifying the potential risks, reducing or allocating the risks,
providing rational ground for making accurate decisions, and planning to manage these risks.
Conclusion
In the end, it can be stated that the project risk management is crucial for the success of the
project in any organization. In the contemporary society, the organizations have adopted
advanced technologies and the methods that have increased the complexity. Though the
technologies have helped in easing most of the aspects of the society, yet it has also given ways
for the generation to more complexity due to the changing needs of the society. There are
multitudes of projects that are handled on regular basis everywhere and every scale. The studies
have helped in understanding that if these projects are not handled effectively, then it may lead to
the creation of chaotic situation. The chaos can be considered as an outcome to the
mismanagement of the various aspects of the project. The project management can be considered
as a strong tool of contemporary society that helps in managing the high to low complex projects
with ease. It helps in successful initiation, planning, execution, monitoring and control of the
projects which leads to the project success.

The focus of this essay was on one of the key issues faced by the projects in the contemporary
society, that is, the risks. The presence of risks in any type of project is inevitable. The risks have
the potential to severely impact the success of the project in terms of achievement of the project
within the given time and budget. The studies have helped in understanding that there are several
types of impacts that can severely block or slow down the project success. The project risks
impact the internal and external relationship. The project risks can be handled with the effective
implementation of project risk management. The project risk management suggest three key
actions that can be taken to resolve particular risk, namely, avoidance, mitigation, and
acceptance. However, it depends on the experience and understanding of the project manager,
capacity of the project to handle the risks, and the availability of the resources that which one of
the three can be selected to ensure that the risks are handled effectively.

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