Proposal Risk Management

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Identifying, quantifying and managing project risks is an essential component of a good proposal. The risk planning activity provides you with an "eyes-wide-open" approach to making the business decision to bid or no-bid the project. Risk also is a major component in identifying project contingencies (reserves) and establishing an appropriate pricing/profit strategy.

While many "Risk Management" experts do a simple qualitative analysis and present management with a multi-colored risk "heat map" as their work product - the Contract Coach recommends a more intensive and nuanced approach.

While we too will identify risks, record them in a risk register, and document various risk characteristics e.g., polarity (risk or opportunity), likelihood, and impacts - we also use that data for analytical purposes.

By using various tools such as Intaver's Risky Project and the resource loaded project schedule we can assign risks to various activities or phases of the project and then calculate the odds of achieving on-time on-budget performance. The figure shown here is typical of the analytical products the software can produce and includes risk adjusted estimates of project cost, duration, and completion date.