When you’re hiring a project manager, the concept of risk management may not be at the top of your mind. This can be especially true if you’re still gathering proposals.
However, when your project manager skillfully employs risk management techniques throughout a project—such as an FF&E installation or an office and industrial move—your venture is much more likely to come in on time and on budget.
As a result, understanding your project manager’s approach to risk management can be an important differentiator in the vetting process.
In this article, we’ll share four questions you can use in interviews with project managers that will shed light on their approaches to risk management. These questions will help you understand who’s best equipped for the job, and who’s got the highest likelihood of delivering your project without significant cost and time overruns.
But, first, let’s take a look at the potential impact of risk management on your next job.
What Is Risk Management—and How Can It Keep My Projects on Track?
The Risk Management Institute defines risk management as “understanding, analyzing and addressing risk to make sure organizations achieve their objectives.”
Risk, the institute notes, is a part of all of our lives.
In other words, unexpected problems inevitably crop up. Shipments get delayed. Inclement weather delays a job. Containers arrive in the wrong order. Elevators break down.
Risk management involves anticipating these possible events. By assessing their probability and planning for potential risks, you’ll be more likely to meet your objectives.
To understand the real-world application of these principles, take a look at two examples:
Scenario #1: A project manager calculates his team could complete an installation in two days if everything goes perfectly. However, that estimate leaves no room for error. If his team encounters any issues—such a surprise power outage that shuts down an elevator—the entire project timeline will be impacted. As such, the project manager might budget an extra day of wiggle room to plan for the unexpected.
Scenario #2: A hotel is shipping in 10 containers of FF&E for installation. In the project manager’s past experience, suppliers don’t pack the containers in a way that facilitates easy installation. Instead, they’ll often get a container full of couches when they need full room sets: a couch, a bed, a desk, and a chair. Rather than take this risk, which would throw off the project’s timeline, the project manager contracts with a freight forwarder on the mainland to repack the containers and send them in the order that will support the project’s timeline, avoiding potential delays caused by receiving the FF&E in the wrong order.
From these examples, you can see how a few simple risk management techniques have the potential to keep your project on track. You might also recognize that this is a skill you’d like in your future project managers.
Next, we’ll share four interview questions that will help you understand your project manager’s approach to this topic.
Questions #1 & 2: “Where do you think the biggest risks in this project lie? And how will you and your team address them?”
As your project management candidates answer this question, you’ll get a glimpse into the way they’ll approach your project.
- Some candidates might identify a few potential problem areas, right off the bat. If they’ve completed a similar project, you may hear about some of the bumps in the road they’ve experienced in the past, ideally with the solutions they created.
- Others may talk about their risk management procedures. For example, they may discuss how they kick off a project by evaluating the risks inherent in the job, then creating a plan to address them before work even begins.
What to look for: This question will help reveal how important your candidates believe risk management will be to the success of your project. The strongest candidates will have existing processes and systems they’ve deployed in the past to evaluate and mitigate unexpected events to keep your project on track.
Question #3: “What systems do you have in place to monitor risk throughout the project?”
Unexpected events, by their nature, can happen at any time.
However, if your project manager is only doing a risk assessment at the start of the project, he or she will miss the opportunity to make mid-project adjustments that can eliminate future problems.
Let’s return to the earlier example of adding a day of wiggle room to a two-day installation. After all, is said and done, it may turn out that an extra day wasn’t enough, and this piece of the project actually took four days.
If your project manager has systems in place to continually monitor risks throughout the project, this experience might trigger a re-evaluation of other estimates. As a result, he or she might make other adjustments, such as:
- Shifting other project timelines so this one piece doesn’t cause a cascading effect.
- Examining other milestones to see if they will also require extra time, or if more efficient procedures can be put in place.
- Looking for ways to make up time, possibly by reassigning crew members to assist with different tasks.
What to look for: When you ask this question, look for project managers who have processes in place to re-evaluate the project at significant milestones. This enables mid-course corrections that might 1) offset any unexpected issues or 2) make use of any lessons learned during the project. Project managers who have this kind of system in place should move to the top of the heap.
Question #4: “Despite the best planning, issues do crop up. What kind of plan do you have in place to resolve issues?”
Identifying issues, then managing and solving them is a key component to managing the risk of any project.
For example, that set of stairs that were thought to be easily negotiable might be narrower than estimated, causing significant delays in emptying out your old office space.
However, if your project manager has a reporting and managing system in place, these delays will be noticed quickly. With a resolution system in place, ideally, these issues will get researched—and, most importantly, prioritized. Not all issues deserve the same level of attention. The best project managers should be able to recognize mission-critical issues and resolve them quickly.
What to look for: When you ask this question, look for project managers who have an established system in place for issue reporting, prioritization, management—and solution.
Managing Your Projects—and Your Risks—for Success
Risk management can be a critical factor in the success of your next project. With the right strategies in place to assess and mitigate risk, your project will be much more likely to meet its objectives, including an on-time and on-budget delivery.
The best project managers incorporate risk management processes throughout the execution of their contracts. The four interview questions we discussed in this article will help you assess your candidates’ risk management proficiency so you can select the PM with the skills you need to deliver a successful project.
Looking for a project manager who understands the importance of risk management? Talk to one of our experts. Using our extensive experience in project management for FF&E installations, office and industrial moves, supply chain projects and more, we’ll work with you to evaluate and mitigate your project’s risks to deliver an on-time and on-budget solution.