4 Negative Risk Strategies for Projects
Negative risk strategies for Projects specify how to deal with brisk scenarios that have a possible negative impact on the project. Here are the four main negative risk strategies for projects.
#1 Risk avoidance
Risk avoidance involves changing the project plan to prevent a potentially detrimental risk condition or event from happening.
One way to eliminate risk is to reduce or change the scope of the project in an attempt to avoid high-risk activities. The scope change could involve the project requirement or specifications, or it can mean changing the approach to meeting the requirements or specifications.
#2 Risk transference
This involves shifting the impact of a risk event and ownership of the risk response to a third party. This strategy is used in connection with financial risk exposure and most often involve payment of a risk premium to the party assuming the risk.
#3 Risk mitigation
Risk mitigation as part of negative risk strategies attempts to reduce the probability or impact of a potential risk event to an acceptable level.
Mitigation may involve implementing a new course of action in an effort to reduce the problem or changing the current conditions so that the probability of the risk occurring is reduced.
Sometimes, when reducing the probability is not possible, the focus must be on reducing the consequences of the risk event.
#4 Risk occurrence
This involves accepting that a risk exists. The acceptance may be passive or active. Active acceptance indicates that a plan is ready for execution of the risk occurs. Passive acceptance indicates that no action is planned if the risk occurs and whatever action is suitable will be executed on an extempore basis.
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