Rucker's Musings

Risk Management is not Project Management

A common situation I find myself in looks like this: I am working with a client to plan a project at a strategic level. These are large, cumbersome, multi-phase programs of work requiring multiple internal and external parties. I have several goals during this phase, and one of the outputs from this planning phase is a defined RACI. Primary accountability for all aspects of a program of work will typically fall to the client (i.e., the client is working to accomplish X; of course, they are accountable for it.); however, secondary accountability is commonly shared with 3rd parties as well. In this context, a 3rd party is any party that is not the company that owns the project.

Here's where things can go off the rails.

In this process, I will invariably ask the client, "For this section, you've removed yourself as accountable. Why is that?"

"Oh, we (the client) are not accountable for this. We want to shift this to the 3rd party and hold them accountable for delivering this."

"I understand they are responsible or even share accountability, but program success is ultimately yours. What happens if the 3rd party fails to deliver? Will your organization's leadership accept blaming project failure on a 3rd party?"

"We do not want the risk. The 3rd party must be accountable for this."

Repeat ad infinitum.

Rucker's Musings

There are several common motivations for this behavior. The most common reason is a high degree of risk of failure or high difficulty. Most people will fall into this trap in their professional careers. This is an anti-pattern that I like to call "risk management is not project management."

One can run, hide, look away, and be as willfully ignorant as possible, but it will not change reality - "the task" is challenging and must be done. One can shift most of the responsibility and accountability to a 3rd party, but not all of the accountability. In this context, the client, specifically the project owner, is always responsible for project completion and success. Leadership should never accept external accountability without internal accountability. This is not to say that one cannot share, or should not share, accountability; however, again, one cannot have only external accountability.

What if one convinces a 3rd party to accept all accountability for a project task? It is vanity! There is a high likelihood the 3rd party will experience partial or complete failure. A target for frustration exists, but pragmatically, has one's position improved? The 3rd party, now educated on their error, will likely work to salvage the delivery through additional billings or scope reduction; however, an anti-pattern has been introduced. The negatives will soon begin to outweigh the positives. Relationships start deteriorating with the 3rd party, and internal relationships will become strained as project owners slip on their commitments. This is a failure of project management. The project owner confused risk management with project management, and in its confusion, it actually increased risk!

Rucker's Musings

What are you saying, Matt? That 3rd parties should not be leveraged and held accountable for project delivery? Of course not. I'm saying that the project owner is always, in the end, responsible for the success of a project. No amount of shifting blame should change that in a healthy organization. Successful project management clearly communicates risk, especially high-risk scenarios, to senior leadership so that all parts of the organization share and accept the responsibility.

I'm glad a 3rd party could be convinced to accept that very risky task; let me know how that goes.