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Risk management plan
Risk management is an important part of project management. Although
often overlooked, it is important to identify as many risks to your project as
possible, and be prepared if something bad happens.
Here are some examples of common project risks:
– Time and cost estimates too optimistic.
– Customer review and feedback cycle too slow.
– Unexpected budget cuts.
– Unclear roles and responsibilities.
– Stakeholder input is not sought, or their needs are not properly under
-
stood.
– Stakeholders changing requirements after the project has started.
– Stakeholders adding new requirements after the project has started.
– Poor communication resulting in misunderstandings, quality problems
and rework.
– Lack of resource commitment.
Risks can be tracked using a simple risk log. Add each risk you have iden-
tied to your risk log; write down what you will do in the event it occurs,
and what you will do to prevent it from occurring. Review your risk log on
a regular basis, adding new risks as they occur during the life of the project.
Remember, when risks are ignored they don’t go away.
Congratulations. Having followed all the steps above, you should have a
good project plan. Remember to update your plan as the project progresses,
and measure progress against the plan.
∗ SMART Goals
Once you have planned your project, turn your attention to developing several goals that will
enable you to be successful. Goals should be SMART:
S - specic, signicant, stretching
M - measurable, meaningful, motivational
A - agreed upon, attainable, achievable, acceptable, action-oriented
R - realistic, relevant, reasonable, rewarding, results-oriented
T - time-based, timely, tangible, trackable
Task 1. Check your understanding of the text answering the following questions.
1. Howisthevalueoftheprojectplandened?
2. Who are the stakeholders?
3. What is important to bear in mind while interviewing the
stakeholders?
79
What is money and what is not money
If you are trying to determine if something is money, simply consider
whether it would be accepted in most stores as payment. You then realize that
stocks, bonds, gold or foreign currency are not money. These must rst be
exchanged for the national currency before you can use them for consump-
tion. Note that in some cases, foreign currency will be money. For example,
in some border towns, the currency of the bordering country may be accepted
virtually everywhere.
You also realize that some bank deposits are money. If you have money in
an account in a bank and a debit card, you can pay for goods and service us-
ing the card in most places. Funds are withdrawn directly from your account
when you make the purchase, which makes the deposits as good as cash in
your pocket. Counting deposits as money is also consistent with the idea that
money measures how much is available for immediate consumption.
Not all deposits can be counted as money. With most savings accounts,
you cannot connect the account to a debit card and these deposits should
not be counted as money. We also note that what is money has nothing to do
with the commodity or token itself: USD is money in the United States but
not in the U.K.; Gold is not money but gold was money in some countries
in the middle ages. Historically, such diverse commodities as cigarettes
and sharks’ teeth have been used as money in some places; A national cur-
rency may suddenly cease to be money in a country. This may happen if
ination is so high that people shift to another foreign currency.
Money, wealth and income
Money is not the same as wealth. An individual may be very wealthy
but have no money (for example by owning stocks and real estate). Another
individual may have a lot of money but no wealth. This would be the case
if an individual with no wealth borrows money from a bank. She will have
money (for example in the form of a deposit in the bank) but no wealth
since this deposit exactly matches the outstanding debt. Be careful with this
distinction: do not say: “Anna has a lot of money” if you mean that Anna
is wealthy.
Money is not the same as income and income is not the same as wealth.
Income is a ow (for example is currency units per month) while money or
wealth is a stock (measured at a particular point in time). Again, it is very
possible to have a high income but no money and no wealth, or to be very
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