Why is a Risk Register Essential?

Some reasons:

1. Systematically Identifies Risks: Ensures all potential project risks are captured and documented.
2. Assesses Risks: Evaluates the likelihood and impact of each project risk, helping prioritize them.
3. Manages Risks Effectively: Documents and tracks mitigation strategies and actions.
4. Ensures Accountability: Assigns responsibility for managing each project risk.
5. Promotes Transparency: Provides a clear, centralized view of risks and their management.
6. Facilitates Monitoring: Tracks the project risk status and progress over time.
7. Supports Decision-Making: Offers critical information for informed decisions.
8. Documents and Complies: Records project risk management activities for compliance and future reference.
9. Raises Risk Awareness: Keeps stakeholders informed about potential threats.
10. Optimizes Resource Allocation: Focuses resources where they are most needed.

A project management risk register is a handy tool for identifying, managing, and keeping track of all project risks and it’s the go-to document for the team and stakeholders when it comes to anything related to risk. It helps you see what might go wrong and plan how to deal with those situations if they come up.

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Small Project? Here are some DIY Low-cost Options for a Risk Register

For smaller projects, using a low-cost or DIY project risk register can be an effective way to manage project risks without the need for expensive software. Here are three options:

(Click here for a list of more sophisticated project risk management/register software systems – used for medium to large projects)

1. Trello:
   Description: Trello is a versatile, Kanban-style project management tool that can be adapted for project risk management.
   How to Use: Create a board for risk management, with lists for different stages like “Identified Risks,” “Assessment,” “Mitigation,” and “Monitoring.”
   Price: Free for basic use, with optional paid plans for additional features.
2. Microsoft Excel or Google Sheets:
   Description: Excel is a widely-used spreadsheet program that can be customized for risk management.
   How to Use: Create a template with columns for risk details, including ID, description, category, probability, impact, mitigation strategies, and monitoring.
   Price: Requires a Microsoft Office subscription, however many people already have access through work or educational institutions.
3. Asana:
   Description: Asana is a project management tool that offers features for task and risk management.
   How to Use: Use Asana’s task management features to create a risk register, with tasks representing individual risks.
   Price: Free for basic use, with optional paid plans for additional features.

DIY Steps for Creating a Risk Register

1. Define Your Columns:
   Risk ID: A unique identifier for each risk.
   Risk Description: A detailed description of the risk.
   Category: The type or category of risk – without controls in place (e.g., technical, financial, operational).
   Likelihood: The probability of the risk occurring – without controls in place (e.g., High, Medium, Low).
   Impact: The potential impact if the risk occurs (e.g., High, Medium, Low).
   Mitigation Actions: Steps to reduce the likelihood or impact of the risk.
   Risk Owner: The person responsible for managing the risk.
   Status: The current status of the risk (e.g., Identified, In Progress, Mitigated).
   Target likelihood: The probability of the risk occurring – with the above controls in place (e.g., High, Medium, Low)
   Target Impact: The potential impact if the risk occurs – with the above controls in place (e.g., High, Medium, Low)
   (You may identify additional columns that are project, organisation or industry specific)
2. Create the Spreadsheet:
   Open your chosen spreadsheet tool (Google Sheets, Excel, etc.).
   Set up columns based on the definitions above.
   Create a new row for each identified risk and fill in the relevant details.
3. Populate the Risk Register:
   Conduct a brainstorming session with your team to identify potential risks.
   Add each risk to the register with all relevant details.
   Regularly update the register as new risks are identified or existing risks change.
4. Monitor and Review:
   Schedule regular meetings to review the risk register.
   Update the status and mitigation actions as necessary.
   Ensure that risk owners are actively managing their assigned risks.

Example of a Simple Risk Register in Google Sheets or MS Excel

Risk ID	Risk Description	Category	Likelihood/ Probability	Impact	Mitigation Actions	Risk Owner	Status
001	Supplier delay	Operational	Medium	High	ID backup Suppliers	John D	In progress
002	Budget overrun	Financial	High	Medium	Implement cost control measures	Jane S	Identified

This simple format allows for easy tracking and updating of project risks, making it a practical tool for small projects. Regularly reviewing and updating the risk register ensures that risks are managed proactively.

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List of Advanced Software Tools

Here is a list of more sophisticated risk management/register software systems commonly used in various industries for comprehensive risk management:

1. LogicManager
   Features: Enterprise risk management, incident management, policy management, compliance management.
   Benefits: Intuitive dashboards, risk heat maps, comprehensive reporting tools.
   User Case: Ideal for large organizations needing integrated risk management solutions.
2. SAP GRC (Governance, Risk, and Compliance)
   Features: Risk management, audit management, compliance management, access control.
   Benefits: Integration with SAP ERP, advanced analytics, real-time risk reporting.
   Use Case: Large enterprises with existing SAP infrastructure, particularly those in finance and manufacturing.
3. Archer (RSA Archer Suite)
   Features: Operational risk management, IT risk management, third-party risk management.
   Benefits: Customizable frameworks, robust reporting, workflow automation.
   Use Case: Organizations requiring comprehensive risk management solutions across multiple domains.
4. MetricStream
   Features: Risk management, compliance management, audit management, policy management.
   Benefits: AI-driven insights, real-time dashboards, integrated risk management.
   Use Case: Ideal for regulated industries like banking, healthcare, and pharmaceuticals.
5. Resolver
   Features: Risk assessment, incident management, internal audit.
   Benefits: User-friendly interface, integrated workflows, comprehensive analytics.
   Use Case: Organizations of all sizes looking for an intuitive and scalable risk management solution.
6. CURA Software
   Features: Risk management, compliance management, audit management.
   Benefits: Highly customizable, real-time risk reporting, integration capabilities.
   Use Case: Enterprises needing a tailored risk management approach.
7. RiskWatch
   Features: Security risk assessments, compliance management, incident tracking.
   Benefits: Customizable assessment templates, real-time analytics, robust reporting.
   Use Case: Particularly suited for managing security and compliance risks across various sectors.
8. SpiraPlan by Inflectra
   Features: Risk management, project management, quality assurance.
   Benefits: Integrated risk and project management, real-time dashboards, customizable reports.
   Use Case: Suitable for IT and software development projects requiring comprehensive risk and project management.
9. Xactium
   Features: Risk management, incident management, audit management.
   Benefits: Cloud-based solution, integration with Salesforce, advanced analytics.
   Use Case: Organizations using Salesforce for CRM and looking for integrated risk management solutions.
10. Active Risk Manager (ARM)
    Features: Risk management, incident management, audit management, compliance management.
    Benefits: Advanced risk analytics, customizable risk frameworks, comprehensive reporting.
    Use Case: Ideal for large enterprises in industries like aerospace, defense, and engineering.

These sophisticated tools provide advanced features for managing risks comprehensively across various industries, offering robust analytics, customizable frameworks, and real-time reporting capabilities. They cater to the needs of both large enterprises and smaller organizations that require integrated risk management solutions.

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In the next month, we will post an article with a more in-depth discussion about some of the pros and cons of the more advanced project management and risk systems.

Let us know in the comments below if you found this article of interest and how we could improve on it.

At MadiTech Consulting we cater to a diverse range of projects and can provide numerous services. If you wish to contact us go here www.maditech.com.au