Portfolio Risk (and Vulnerability) Management

Introduction

As a project manager you are (or you had better be) very aware of project risk.  And you are aware (or you had better be aware) that risk comes to us as positive risk (opportunity) or negative risk (threat).

This posting is about something ever-so-slightly different.

First of all, it’s not really threat we’ll discuss here, but vulnerability.   Next, it’s not really at the project level that this post will cover risk management, nor even at the program level, but at the portfolio level.

The Rejection of Sustainability as ‘yet another ridiculous bothersome constraint’ by Project Managers

In fact, as we research the intersection of sustainability and project management, we find that it may be necessary to ‘escalate’ the level at which we approach this from the project level to the PMO or portfolio level.  Why?  To put it bluntly and rather directly, we’re finding – disappointingly – that many project managers still, just don’t “get it” when it comes to sustainability.  They cling to the idea that “I manage my project, and that’s it.  Any other stuff you throw at me, like this “sustainability junk” (as some have actually put it to us) is extra work.  Not only that, but your sustainability stuff brings with it the luggage of an ‘extremist’ view which is not my view or my company’s view”.  These aren’t actual quotes but it’s a composite of a palpable chunk of feedback we’ve seen as we ‘make the rounds’ on Linked In, PMI Chapters, Twitter, and in our seminars.

The Program and Portfolio Level

At the program – and in some organizations, at the portfolio level, the suite of projects being performed is much more connected to the the execution of the enterprise’s strategy, and thus, closer to the enterprise’s mission and value statements.  And these mission and value statements are much more likely to be connected, in turn, to the portfolio/program level than they are to a remote project manager and his or her specific (and likely much smaller) project.  And it’s at this level, perhaps at the PMO level, where cross-project common threats and opportunities are identified.  It’s also at this level where the management reserves are set aside to cover these common threats across projects (for example a labor strike).

Threats and Vulnerabilities

We could get into a whole philosophical argument over the definitions of vulnerabilities, threats, and risks, and in fact, if you want to go down that road, click here.   For our sake and so that we can get to our main point, let’s say that vulnerability will, to us, represent exposure to a threat.

Climate change vulnerabilities

So…to our point – and one that is right at the intersection of sustainability and project (or rather PORTFOLIO) management: Climate Change, whether you believe in it or not, is being assessed by those with some reasonable science behind them, to cause some vulnerabilities.  Those vulnerabilities include Health Risks, Weather Disasters, Habitat Loss, and Economic Stress.  We think you’d agree that if you are running a project – or a portfolio of projects (say, constructing some bridges) in a region which will be hit with any of these, it would expose your portfolio to threats.  To that end, a very good graphic has been created by DARA , a Madrid-based humanitarian advocacy organization.  This is the image we’ve used in our post and by clicking on it you will get the full-sized PDF of this infographic.  Or just click HERE.

Below is the text that describes what is shown on the chart:

The punch climate change packs varies from one country,
region or continent to another. DARA, a Madrid-based
humanitarian advocacy organization, recently partnered with
the Climate Vulnerable Forum, comprising countries particularly
vulnerable to climate change, to create Climate Vulnerability
Monitor 2010, an atlas of vulnerability. This infographic
presents a small portion of the picture the Climate Vulnerability
Monitor paints.  Vulnerability is grouped into four
categories: health impacts, weather disasters, habitat loss
and economic stress. Circles on the left side of each set
indicate relative magnitude of vulnerability in 2010. Circles
on the right indicate the same for 2030.

Our message to you is two-fold.

1. If you are a project manager, look up.  Look up to  your program and portfolio levels.  Look up further, to your organization’s strategies.  Look even further up – to the organization’s mission and vision statements. And..look even further up – is that a hurricane cloud?

2. If you are a project, program, or portfolio  manager, or a PMO staffer, or a business manager who happened to read this post by accident, have a look at the infographic.  H ave you considered these vulnerabilities?  They’re possible.  They should at least be considered.  And even if you are the world’s biggest cynic on climate change, it’s still important for you to know that this science is in the minds of others, others that you deal with.

Thanks for your attention.

More like this in our book – Green Project Management, and in our upcoming seminars and webinars.  Stay tuned for announcements about those…