Module 10. Why risk and quality management are so important in project management

Up to now, we have discussed the critical factors, inputs, tools, and outcomes that make processes, risk and quality effective in project management. Let’s revise why these processes are important.

While the context may suggest that ‘quality’ refers to ‘perfection’ and ‘excellence’ in project management, it is more important to ensure quality exists across the project life cycle. Many individuals unfamiliar with project management find it peculiar that quality is considered a separate knowledge area. Certainly, quality must be present in every task of the project. However, as it needs to be developed, implemented and monitored, explicit planning is essential and close attention by the project manager and their team is a must. One key aspect to remember is that, as pointed out in Figure 32, quality needs to be customer driven rather than dictated by the project manager or their team.

_{Figure 32. Customer role in quality project management, by Carmen Reaiche, Samantha Papavasiliou and Frank Anglani, licensed under CC BY (Attribution) 4.0}

In quality planning, the project manager sets the criteria that the project must satisfy for success, as well as the methods for achieving and confirming those goals. But this is only done once the customer agrees on the project’s outcome and its specifications. Therefore, quality planning needs to be considered at the start of the project, within phase 1 and 2 of the project life cycle. Quality planning needs to be consolidated and agreed at minimum, within the project’s planning phase since it effects costs, schedule, and other key resources. Without solid quality planning, there is a greater chance that the customer will not be satisfied with the project’s results. So, you must have clear documentation of key stakeholders’ expectations to avoid unpleasant shocks later in the project. Without this, a project might be derailed if there are differing perceptions of how and what constitutes acceptable project quality.

Quality planning also establishes the scope of what will be monitored, which metrics will decide the project’s success, and how these requirements will be met from start to finish. As suggested by the ISO 9001 quality management’s 7 standards, the project manager’s scope will often rely on the specific outputs and procedures involved in the project. Therefore, within the scope of the project, we also need to define and execute quality assurance processes.  Unless the project is extremely short-term, quality planning should incorporate benchmarks. These points of reference compare the progress of the project to expectations derived from prior projects, industry standards, or other metrics, and monitor the project progress frequently, from its earliest phases through to the final result.

Like other processes, quality planning should include clear, quantifiable, agreed-upon, realistic, and time-constrained objectives. These S.M.A.R.T. objectives may keep the project on track and assist with uncovering any quality issues early on. As a project manager you should be familiar with the concept of S.M.A.R.T. objectives by now 😊 but just in case, Figure 33 will remind you of these.

_{Figure 33. S.M.A.R.T objectives, by Carmen Reaiche, Samantha Papavasiliou and Frank Anglani, licensed under CC BY (Attribution) 4.0}

There are many factors determining the benefits of project planning. However, keep in mind that cost implications are what make proper quality planning in project management so crucial. A cost-benefit analysis indicates how much each incremental improvement affects the bottom line, allowing for a well-informed decision when determining the project tasks that must-exist from nice-to-exist.

Challenges of implementing quality planning in project management

Quality planning is not always quite so easy as described in earlier modules – there are few challenges.

Difficulties in identifying requirements. Occasionally, project managers may encounter stakeholders’ or senior managements’ reluctance to identify the project requirements as they are not willing to admit that they are themselves unclear or confused about what they want. The project manager needs to be able to prompt stakeholders to express their needs with sufficient clarity. On some occasions, this challenge is the project manager’s liability. This is often the result of not engaging clear communication processes with all stakeholders or not asking all end user groups.

Misunderstanding requirements. In some situations, the requirements are misconstrued and the project outcomes are misconstrued. Consequently, the design, plan and implementation of the quality management process is invalid. Ongoing meetings, communication and stakeholder engagement are critical to mitigate this challenge.

Inability to meet requirements. For various reasons, external and internal uncertainties will make it difficult or impossible for project managers and teams to meet requirements and achieve project specifications. This may be the result of having unclear and unrealistic objectives at the start or simply due to uncontrollable variables such as market volatility, economic inflation, environment disruption, etc.

Quality requirements creep. Just like scope creep, quality requirements creep is a new term incorporating the unforeseen changes that a project faces and which affect the initial agreed specifications. As we have learnt with our traditional Iron Triangle, any change during the project will have an impact on the quality specifications. The earlier the project manager acknowledges these changes and transparently communicates with key stakeholders, the earlier the quality plan can be adjusted to prevent major costly deviations.

There are always going to be other challenges; however, a good project manager will acknowledge these as soon as they eventuate and respond with a plan that aims to minimise large-scale variations.

Now let’s reflect on the relationship that exists between quality and risk management processes, depicted in Figure 34.

_{Figure 34. Quality and risk interrelationship, by Carmen Reaiche, Samantha Papavasiliou and Frank Anglani, licensed under CC BY (Attribution) 4.0}

Project risk management plays a crucial role in attaining the project’s objectives by recognising, analysing, and responding to risks that have an effect on them during the course of the project’s duration. It contributes to a successful project outcome by playing a crucial part in selecting excellent projects, identifying project scope, and producing accurate estimates. Through identifying and analysing project risks, information on the project’s feasibility and planning is obtained. Project risk management therefore detects potential risk events. Project risk management increases the likelihood that project value realisation is optimal and that the project will be successful.

Unsatisfactory project risk management performance might have significant consequences. It is possible to establish an unrealistic notion that all risks have been accounted for and there are no more issues. It may also lead the project to be terminated unnecessarily, preventing any potential project benefits. To avoid failure, the organisation must be aware that risk management is not free; it frequently adds significant expenses and delays to the project’s completion. Therefore, the cost should be accounted for and planned accordingly.

The elements that play a part in risk management are determined by considering the nature of the project and the organisation’s strategy. It may affect project risk management tactics in several ways. To be effective, methods to adopt project risk management must be realistic. Obtaining sufficient information and knowledge at the start of the project as well as aligning this information with the organisational strategy are essential steps for successful risk assessment. Since there is an inverse connection between uncertainty and information, the greater the risk information, the less ambiguity exists. However, it should be recognised that situations of relative uncertainty (partial information) are the norm in project management.

Moreover, the circumstances of a project might influence the risk management approach, such as time constraints and the inability to consult all stakeholders. In addition, identifying an excessive number of risk tasks may limit adequate responses to the most significant ones. While organisations do not dispute the significance of risk management in today’s disruptive climate, the culture may not be conducive to conduct a risk assessment. As mentioned earlier, this is because risk assessment and management processes are seen as costly exercises and funding is always limited. Another aversion to these processes, aside from the cost, is the perception of needing extra resources and time.

Challenges of implementing risk management

Similar to any other project management activity, the process of risk management might present obstacles. Let’s examine a few of these.

Difficulties in risk identification. Occasionally, project managers may encounter stakeholders’ or senior managements’ reluctance to identify project risks because they are overly enthusiastic about the project implementation process and/or do not view it as something significant and worth their time. We advocate communicating with stakeholders and explaining the relevance and advantages of risk management, presenting several project result scenarios to highlight the need for a risk management strategy.

Difficulties in formalising risk management processes. Another type of problem emerges when a risk management strategy has been produced, but the risk management process itself has not been given adequate thought and, as a result, has not been executed. It is important that the project manager assigns team members with the responsibility of managing risks, including monitoring, reporting, and responding, but also provides the team with support and encouragement. Enabling the right culture for establishing a risk management system is critical.

Difficulties in identifying leaders in the risk management process. This difficulty is like the preceding one; however, it pertains to responding to risks. For example, a team member may report that an unpredicted risk activity has happened, but finds neither the right leadership nor decision-makers to mitigate or take any sort of action.

Difficulties in managing risk within a large project portfolio. Obviously, working on several projects is considerably more demanding than managing a single project; thus, the risk management process becomes much more complicated and involves prioritising projects and risks. Project managers need to exercise ‘risk prioritisation’ to respond proactively and at the most critical moment. It is also critical that tasks are automatically prioritised, so that the project manager always knows what to work on first.

Risk and quality management benefits in sum

Overall, project management is the most important aspect of corporate success. Appropriate project management enables an organisation to finish its projects on schedule, within budget, and with the quality desired. A successful project requires exhaustive study and appropriate implementation. A project manager cannot effectively assess the value of a project without identifying and mitigating its related risks or having the right quality processes in place.

Both risk assessment and quality project management are important for any project success. Let’s revise and dig into their integrated importance.

Supports the evaluation and assessment of a project. The first and most essential benefit is that both processes facilitate project evaluation and quality project outcomes. Each phase of the project is examined by risk managers, evaluating quality standards, who contribute to the full evaluation and identify problems and risks that are resolved prior to the project’s launch meeting the stakeholders’ project specifications and needs. After evaluating and mitigating risks, project managers and personnel work freely towards the conclusion of the project with the objective of ensuring its quality outcome and success.

Contributes to the successful completion of a project. With good risk and quality management, all risks associated with a project are reduced, ensuring its successful conclusion and quality outcome standards.

Contributes to budget control. A project’s success is not limited to its completion on schedule. One factor that impacts the success of a project is its ability to be completed within the allotted budget and meeting specifications. With good risk and quality management and monitoring processes, a project is finished within the allotted budget, since all risks have been mitigated and there is no longer any chance of a major change in the project’s outcome specification(s) that may affect the budget and planning.

Supports a proactive and not a reactive (response) strategy. Effective risk management helps eliminate hazards before they occur, and effective quality management helps eliminate errors and product/service variation, so reducing loss, chaos, and major project deviations. Implementing appropriate control mechanisms assists management to adopt a proactive stance and eliminate a reactive response.

Now let’s revise our knowledge: