Human Factors and Risk Management: What Considerations Must Be Made?

Human Factors and Risk Management: What Considerations Must Be Made?
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Including Human Factors

It has often been said in business that a company is only as good as its people. Therefore, the people essentially are responsible for the success of any project. Since a good risk management plan must include all potential contingencies, human factors should also be included in that list of contingencies. The International Organization For Standardization (ISO) identifies human factors as one of the eleven essential components of risk management, along with the fact that risk management should be an integral part of the decision-making process that addresses uncertainty.

Accounting for Human Factors

When designing a risk management plan, you should generally list potential events that can occur, the probability that said event will occur, the impact of what will happen if it does occur, ideas for mitigating the problem, and a contingency plan to reduce the impact of the event. Once you evaluate the probability of an event and the steps taken to mitigate the problem and create a contingency plan, you can then evaluate the actual risks that occur in the project. Thus, to include human factors you need to consider what the people working on the project might do, how they will impact the project, and what you can do to minimize the risk of problems occurring through human involvement.

Human Factors to Consider

The essential nature of people is that they are unpredictable. While this is not always the case, it is always true that no boss ever knows what is going to happen. Thus, in accounting for human factors, you need to consider any possible eventuality that could arise when working with people. These factors include:

  • Key project personnel leaving the project for whatever reason: Those who are in on the project from the ground up may tend to seem committed, but it is always possible that unforeseen medical, personal or career circumstances will necessitate that they leave the project. If the success of the project rests upon their head, the whole project could fall apart without a contingency plan.

  • Disagreement or disharmony among project participants. If people can’t work together, the whole project may fall apart no matter how well constructed it appears.

  • Failure of support staff to provide adequate support. Every project depends upon others who are not fully involved to assist in certain steps along the way. If the marketing department, for example, fails to advertise a product, it may not get off the ground no matter how ingenuous it may be.

Mitigating Risks

Once all potential pitfalls with people have been identified, accounting for a contingency plan is the next key step in risk mitigation. You should consider exactly what will be done in any given situation and have a back-up plan in place to minimize the damage to the product. Examples of contingency plans and mitigating circumstances include:

  • Ensuring that every person on the project has a back-up counterpart who is trained and knowledgeable about specifics of the project. That way, if someone has to leave, there is another person who is aware of what they were working on who can step in to fill the void or has the ability to train a replacement.

  • Plans to deal with disharmony. There should be a clear hierarchy of leadership and clear delineation of jobs to minimize the chances of disagreement to head this off before it begins.

  • Back-up plans in the event that those who are designed to offer support fail to do so.

Human factors and risk management should play an important role, especially when designing your risk management plan. Along with identifying other risks, identify the human factor element in the event you need to reconsider your project plan.