Regardless of your industry, risks are a part of business. Risks can stem from issues related to compliance, finances, operation, reputation, business strategy, changes in customer attitudes, and much more.
Because risk is inevitable, you must be able to mitigate potential risks that could derail your project. A risk register can help you identify risks so you are better prepared to address them before they become big problems.
What is a risk register and why do you need one?
A risk register (or a risk log) is a project management tool that documents potential risks that can impede a project’s development. A risk can be anything that might threaten your expected project outcome.
Collecting a comprehensive list of potential risks can help you determine how to manage or eliminate them early in the planning stages. For example, your plan for dealing with supply chain issues might include building up your inventory, diversifying your supply base, and identifying backup suppliers. An emergency plan could be the difference between surviving and thriving amidst unforeseeable issues.
Creating a risk register
Create a risk register before your projects begin. You should refer to it frequently and keep it updated with current information.
There are many ways to create a risk management register, so there aren’t any established steps or processes. The register is a log of potential risks. This log can be a spreadsheet, a form, a table, a dashboard, or any type of document that makes sense to you.
Lucidspark is a virtual whiteboarding application with dozens of features and tools, making it a perfect place to create a risk register. Try out one of our risk register templates, like the ROAM board template that guides teams through identifying risks and making a plan for tackling them, the 4T risk management template that helps you determine the frequency and impact of potential risks or the risk matrix template that allows you to compare the impact with the probability of foreseeable risks.
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Here are some tips for creating a risk register that works for you:
What’s included in a risk register?
A comprehensive and well-maintained risk register should be part of your ongoing risk management effort. You should implement one with every project—regardless of how expansive or simple the project may be.
Smaller projects might have a risk register that includes only essential information like a list of risks, the likelihood of each risk, and planned responses and related assignments.
When working on larger projects, your risk register might need more details, such as risk categories, descriptions, severity ratings, qualitative and quantitative risk analyses, current statuses, etc.
Your risk register might include some of the following elements:
- Risk identification
- Risk category: Risks can come from internal or external sources. Internal risks include finance, compliance, insufficient human and material resources, etc. External risks include supply chain, natural disasters, changes in customer interest, etc.
- Risk ID: Assign every risk a unique ID number so you can track them easily.
- Risk description: Include a brief description of what the risk is, what it comprises, its effect on the project, and so on.
- Risk analysis
- Risk impact: What is the potential impact this risk could have on the project’s development or ultimate success?
- Risk probability: Indicate how probable the risk is.
- Risk ranking: Evaluate the risk impact against the risk probability. The higher the risk impact and likelihood, the higher this risk will be ranked in the register.
- Risk consequence: Identify what could happen if this risk occurs.
- Risk evaluation
- Risk trigger: Identify what would trigger a risk to occur. This is important so you can prevent them from happening.
- Risk priority: Use the risk ranking system to determine the importance of each risk in your register.
- Risk response plan: Outline actions to reduce, prevent, or eliminate a risk, as well as steps to take if the risk is triggered.
- Responsibility: Determine who on the team is responsible for overseeing and monitoring the risk.
Who creates a risk register?
Writing, maintaining, and updating the risk register is usually one of the project manager’s many responsibilities. In larger companies or on larger teams, you may have a dedicated risk manager responsible for the risk register.
Regardless of who creates and maintains your team’s risk register, all team members should have access to the document. This empowers everyone to identify and assess potential risks and share their ideas and thoughts.
Using a risk register
Here are some steps to consider as you maintain your project management risk register.
Step 1: Identify risks
Don’t assume you’ll organically think of all the risks associated with a project—you’re likely to miss some. Bring the team together and gather their input about potential risks. Lucidspark is perfect because you can collaborate in real time, organically creating living documentation. Later, you can take what is recorded in the session and organize the data in a more formal risk register document.
In the risk identification step, you should also meet with management and other stakeholders to record any potential risks they are particularly concerned about.
Step 2: Describe risk impacts
Enter the data you gathered from the risk-identifying step into your document. Clearly describe the potential impacts that each risk might have on your project. Include plenty of details so that it’s easy for team members to understand the possible outcomes. At the same time, indicate the probability that the risk could happen.
For example, if you have only one employee who can do a particular job, a risk might be that employee getting sick. What impact will that have on the project? Will it delay the project? Is there somebody who can step in while the employee is out? However, the probability is relatively low if the employee has a history of rarely missing work.
Step 3: Create an action plan
If something happens to the project, foreseeing it won’t be enough—you must have a plan to correct it. This could also decrease the probability of a risk being triggered in the first place. Describe the adjustments you might need to make to stay on track, including changes in the project’s timeline.
Step 4: Make assignments
Identify the members of your team who are the most qualified to monitor and lead out on the action plan for each risk. You are responsible for the document and all the risks logged in the register, but trying to monitor each risk on your own is not practical. By delegating the work, your team can help reduce the number of possible risks. They’re likely to recognize potential triggers and should be able to use your action plan to address them before they become real problems.
Step 5: Share the document
After you record the risk data and make assignments, share the documentation with your team. Make it accessible so individuals can refer to it often and keep it updated. This will prepare everyone to act if a risk is triggered so its impact is minimal.
Make a risk register in Lucidspark
Lucidspark has the features to create a risk register perfect for your use case. With features that optimize collaboration, real-time editing capabilities, dynamic risk register templates, and tools that simplify brainstorming, you can confidently approach any project, knowing that your risk management measures are ready to deploy at any time if needed.
Learn more about the benefits of using a risk assessment matrix.Read now
Lucidspark, a cloud-based virtual whiteboard, is a core component of Lucid Software's Visual Collaboration Suite. This cutting-edge digital canvas brings teams together to brainstorm, collaborate, and consolidate collective thinking into actionable next steps—all in real time. Lucid is proud to serve top businesses around the world, including customers such as Google, GE, and NBC Universal, and 99% of the Fortune 500. Lucid partners with industry leaders, including Google, Atlassian, and Microsoft. Since its founding, Lucid has received numerous awards for its products, business, and workplace culture. For more information, visit lucidspark.com.