5 Risk Tolerance Considerations for Project Managers

How Much Risk You Are Willing to Tolerate?

Every project manager deals with risk assessment and risk management. If done right, the project manager will ensure the overall project plan includes a risk management plan early in the project. The risk management plan is typically guided by the risk attitude of the project stakeholders, which is determined by their risk appetite, risk tolerance, and risk threshold.

The PMBOK Guide offers detailed definitions and guidance for each of these factors. For this discussion, we will use simplified descriptions:

Risk appetite is the level of risk that an organization is willing to accept to reach its goals and objectives. Risk appetite is typically culturally determined within the organization.

Risk tolerance tells you how sensitive the organization or the project stakeholders are to risks, their willingness to accept or avoid risk. Risk tolerance is variable, if not fluid, from person to person.

Risk threshold is the level of impact, typically a clear figure, beyond which the organization will no longer tolerate the risk. Risk threshold is a negotiated or determined quantified limit.

Project stakeholders are hardly ever asked what their individual tolerance level is. They agree on the risk management plan, but transfer their trust and expectations to the project manager. Stakeholders may understand the risk, but they may not fully grasp what acceptance of the risk means in practice.

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Running an Effective Fit-Gap Analysis - Abraic

Running an Effective Fit/Gap Analysis

Commercial, off-the-shelf (COTS) software—not custom software—continues to be the preferred option for many firms, especially for ERP and CRM solutions.

The benefits of COTS solutions have been publicized widely and revolve around reduced time to deploy, cost avoidance, standards based, best practices included, solution maturity and platform flexibility, to name a few. However, many COTS deployments end up being disappointments, if not failures, once in production. Thus, many of the touted benefits are not being realized.

A critical success factor in a COTS solution deployment is the fit/gap analysis. COTS solutions are not ‘plug and play’, no matter what their marketing materials say. During the fit/gap analysis phase, decisions need to be made about customizations and functional configurations.

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The Fractional CIO Option - Abraic

Not Your Typical CIO: The Fractional CIO Option

Situations abound where a business could use supplemental C-level IT expertise to get through a transitory period of change. Maybe you’re between CIOs, or your senior IT leader needs some temporary executive-level help. Maybe the executive team needs some strategic IT advice, or the IT department needs a “shot in the arm” to get to the next level or deliver a new capability.

Flexible access to CIO-level expertise on part-time or temporary basis can serve to strengthen your IT function. Staffing services or consulting firms will provide a resource to cover strategic and/or tactical IT leadership needs. The resource can help with a short-term transition, organizational change, or other executive-level responsibility. Such a solution provides a viable and affordable option when an expert IT Leader is needed to augment the IT team or the business executive team.

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10 ingredients of a successful UAT

10 Ingredients of a Successful User Acceptance Test (UAT)

The User Acceptance Test (UAT) is a critical component of any IT implementation. The goal of a UAT is to validate if a system or solution will meet the needs of business users in their operational environment.

The outcome of this phase sends the project down one of two paths. If all goes well, the project moves on to the Go Live phase. If it’s a flop, the project faces many challenges ahead, the Go Live timeframe is at risk, and the credibility of the project with the business may be tarnished. Obviously, the stakeholders want the UAT to go well. So how do you secure a win?

Let’s explore the 10 key ingredients of a successful UAT. We’ve seen this recipe work across a wide variety of IT projects.

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IT Playbook for M&A Events

The IT Playbook for Seamless M&A Events

The role of IT in a merger or acquisition is crucial. When an M&A event is assessed properly for IT risks, benefits, and transition requirements, the implications of the deal become more transparent and disruption to the business is minimized. IT’s involvement in M&As can decrease costs, maximize deal value, and uncover synergies. And that’s all before the papers are signed!

Here is our IT playbook, including what to expect from IT during each of the 6 stages of the M&A lifecycle:

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IT project health report Abraic

7 Elements of an IT Project Health Report

A health check is a formal examination assessing if an IT project is on track and under control, and serving as a valuable continuous improvement tool. The outcome is a project health report that proactively and impartially informs project stakeholders of the well-being of the initiative.

Too often, a project health check is only initiated once a project already is in trouble. But best-in-class organizations require health checks at several points during a project’s life cycle.

Creating the health report can be time-consuming, and it is typically not the responsibility of the project manager (PM). Instead, such reports should be produced by an independent party for the benefit of the project sponsor. I’ve seen health checks carried out effectively by a central Project Management Office, an internal auditor, or an external 3rd party.

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