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Challenges of Project Contingency Planning and Management

Mary Lewinson
November 17, 2010

In simple words, project contingency planning and management is a series of activities to create a feasible plan “B” and follow it in case of necessity. In the project management discipline, such a plan is called a project contingency plan. The planning and management of unexpected and uncertain events are always critical to the success of a project because risks cause the project failure and reduce the probability of project completion. Project contingency planning and risk management are the key activities that make your project initiative successful and achievable in terms of time, quality and money.

What is Contingency Planning in Project Management?

Project contingency planning is not just about major risks or uncertainties and threats. It is about creating an action plan to get prepared for any events (such as the loss of data, employee dismissal, lack of finance, various disasters, unsatisfied customers, dishonest suppliers, late procurement deliveries etc.) that can cause a situation when the project is no more manageable, out of control and does not meet requirements and expectations stated in the project management plan and subsidiary plans. It is very important to successful project management. That’s why the right understanding of project contingency planning definition significantly influences the likelihood of project delivery.

Here is the project contingency planning definition:

Contingency Planning in project management is an approach to forecasting future unexpected events (threats and uncertainties) that have a negative impact upon a project and develop an action plan to effectively respond to the identified threats and uncertainties. The purpose of project contingency planning is to develop an effective contingency plan document that could help minimize the likelihood of risk occurrence and mitigate the negative impact of identified risks.

The best way to fight disruptive unknowns and uncertainties is to manage risks and make project contingency planning activities a normal part of daily project operations. The project manager in cooperation with the risk management team needs to work on project continuity and contingency planning from the very beginning of the project once the project charter has been stated and approved. This person will assign a risk manager who will help with the development of a sample contingency plan and take care of implementing effective project contingency planning examples.

Project Contingency Planning Challenges

Why people involved in planning and managing projects don’t prepare for destructive unknowns and uncertainties? There are three common reasons that block effective business contingency planning and crisis management. You should know these reasons to avoid failure in preparing your own project continuity and contingency plan template.

The most frequent project contingency planning challenges are:

  1. Poor Motivation. This challenge relates to the confrontation between Plan “A” and Plan “B”. Often project management teams are poorly motivated to create a strong Plan “B” as they work hard on the development of Plan “a”. They invest too much time and effort in the primary plan and do not think of any contingency planning guide that could help in case Plan “A” is failed.
  2. Organizational Mistakes. Sometimes organization of a project can be built improperly, for example when prioritized tasks are not correlated with organizational policies. The conflict between organizational elements is often found too late because people involved in managing the project do not pay attention to project continuity and recovery efforts. This situation requires the implementation of risk assessment and prioritization process that eliminates any conflicts between organizational elements and paves the way for efficient project recovery and contingency planning.
  3. Inadequate Analysis. Most people do not have a sense of urgency because they inadequately analyze existing situation. Inadequate analysis increases the probability of crisis occurring. To handle this project contingency planning challenge, you need to use project risk management software that allows using tools for risk forecasting, assessment and analysis.

You can solve and handle all the project contingency planning challenges with help of project risk management software. Such software allows identifying, analyzing, and estimating risks surrounding your project and creating a sample project contingency management plan to mitigate the negative impact of the identified risks.

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