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How To Manage Project Risks, Part 2: Critical Success Factors

How To Manage Project Risks, Part 2: Critical Success Factors

There are 8 types of risk that need to be managed effectively for your project to be successful.

Critical Success Factors (CSFs) are defined as those factors that need to exist or go right for the project to succeed which are outside the control of the project manager.

CSFs include adequate project funding, appropriate resources being available when and for as long as required, as well as external events or situations like bank interest rates remaining under X% or no restrictions being introduced on xyz products.

The key is that these factors have an impact on the success of the project. Inadequate funding and we cannot deliver the project as planned. Increases in bank interest rates and the margins of the new product being launched are uneconomical. And so on.

Some CSFs will be identified when the project team does its risk analysis. Hopefully these will be captured for discussion with the governance team rather than rejected as "We can't do anything about that".

The main identification of CSFs should be with the Sponsor and Steering Committee. As, by definition, CSFs are outside the control of the project manager, they need to be managed by someone else - namely, the governance committee.

You may think they'll rebel at this idea, but this is not so. It gives them something understandable and meaningful that they can focus on. Remember, most Steering Committee members don't know why they are there!! CSFs gives them a role.

We find it is best if another project manager runs the workshop with you and your governance committee to identify your project's CSFs. This allows you to add your insights, but also ensures it does not look like you are trying to foist work onto the governance committee.

A complete and comprehensive guide to managing CSFs and running the CSF identification workshop is provided at www.yourcsf.com.

By now some of you will be saying, but you can't manage some of these CSFs - like any restrictions being introduced on xyz products. True. But, if having no restrictions introduced is critical to the success of your project (and, in this case, the xyz product), then this needs to be tracked.

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