The paradox of risk management; a project management practice perspective

Purpose - The purpose of this paper is to investigate the interplay between risk management and uncertainty and the contextual variability of risk management practice. More precisely, the research empirically measures the relation between the extent of use of risk management and the level of project uncertainty. Design/methodology/approach - The research defines risk management from an empirical perspective., i.e. from an empirically-identified set of tools that is actually used to perform risk management. This toolset is derived from the results of an ongoing major worldwide survey on what experienced practitioners actually do to manage their projects. This paper directly relates uncertainty to the degree of project definition. It uses a sample of 1,296 responses for which the interplay between risk management and uncertainty could be measured. Findings - The results are very coherent. They verify and empirically validate many of the propositions drawn from a review of the literature. But results challenge some of the propositions found in the conventional project management literature and some commonly held views. The research shows that the use of risk management practices and tools is negatively related to the degree of project uncertainty. This somewhat counter-intuitive result is consistent with a general tendency for all project management tools and techniques to be used more intensively in better defined contexts. Practical implications - The empirical investigation of actual risk practices and their contextual variability can help better understand risk management practice and manage risks better. The research also clarifies the concepts of uncertainty, risk and risk management. Originality/value - The results confirm some well-known assumptions about practices, but at the same time produced unexpected results that can stimulate the development of new practices adapted to highly uncertain contexts. The project management field needs to develop new responses for specific contexts for which it was not primarily developed. The results of this research point in the direction of such a need for ill-defined projects and highly uncertain contexts.