Watch Your Risky Project Language

Watch Your Risky Project Language
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Risky Language

I was thinking about how important - and fundamental - the management of risk is to projects, and that was followed by a curiosity about how fundamental the use of language (particularly words related to uncertainty and risk) is to projects and project communications in general. Most of you are already familiar with “Risk Attitudes” - the idea of stakeholders in your project being “Risk Averse”, “Risk Neutral”, or “Risk Seeking”. If not, I suggest you check out this podcast:

In any case, back to this idea of risk and language. I did some poking around and found some interesting tidbits about the intersection of risk and language and thought I would share them with you.

There was this tidbit from Business Week magazine:

Wall Street has concocted all manner of indicators to divine which stocks will do well. But most rely on the numbers that companies report each quarter about their past performance. Professor Feng Li of the University of Michigan’s Ross School of Business wanted a measure that was more forward-looking. He found it in the section of annual reports where management discusses the challenges for the coming year. Li tried an experiment. Assisted by a computer, he counted up the number of times that words such as “risk,” “risky,” “uncertain,” and synonyms appeared in the annual reports of every non financial company from 1993 to 2004 – 34,180 reports in all. Then he compared each year’s total with that of the prior year.He discovered that a big jump in words related to risk is usually followed by poor share performance. A model portfolio that shorted equal amounts of stocks with the biggest jumps in the number of risk words and bought stocks with the smallest changes would have outperformed the Standard & Poor’s 500-stock index by 6% a year since 1995. Not a bad return for word counting.


The risk of communicating risk…

Others have noted the importance of clearly communicating risks. You can even find a Risk Management Professional Manifesto here: . This is an article posted by a leading expert on Project Risk Management, Dr. David Hillson. In the ten-point manifesto, my favorite is this one: Risk management advice is likely to be ineffective if expressed in a language or framework foreign to its recipients, such as offering engineering risk advice to business managers. Risk management professionals will frame advice in the language and framework understood by its recipients. One other point: risk varies by culture as well. I like to point out the differences in risk attitude as revealed in this study at Ohio State, which used - of all things - proverbs of different cultures to determine risk attitudes:

…what it means to the PM…

In projects, the words related to risks can affect our ability to communicate clearly. Words like: probably, maybe, conditionally, possibly, may, could, might, perhaps, perchance, potentially all leave some doubt as to the certainty of whatever the subject. In fact our language is peppered with risk words. Even that phrase - “peppered with”, smacks of uncertain language. It’s a reference to the fact that the words appear randomly and without any predictability, like pepper distributed on a meal. As a project manager, it’s important to catch oneself when using this language. It’s fine - and perfectly natural - to use these words, but as a PM, we should think about the impact of these ‘uncertain statements’ and focus on communicating clearly what in particular is uncertain.

Here is a simple example. In a project update, imagine that the following is reported to you:

“Delivery of the TBU-56 Medical Devices may be delayed”.

Don’t accept this statement as is. The key word, “may”, needs to be further defined. What is the chance that they’ll be delayed - is it 90% certain or 10% certain? “May” is too vague. Furthermore, push back in terms of why. What are the conditions that are causing the delay? In other words, WHY are the packs delayed? That information is important, too - it helps people understand the context. Is it just a matter of the devices being at a shipping transfer destination that is on holiday, or is there a design recall issue on a major component? This “stage setting” is important for communications. When you communicate as a PM, you also need to watch your risk language.

This also applies to the language in your Risk Register. You can read more about what a Risk Register is right here:

Important note: This is similar in nature to the technique I always promote to project managers regarding estimates. Never accept a single point estimate. I have a blog posting on this important and related topic here:

So, above and beyond communicating in certain language, one must also keep the context in mind.

Are you reporting out with uncertain language? Are you accepting reports and information with uncertain language?

You probably are.

(Yes, that was meant to be ironic).

Watch your language and bring more certainty to your project.