2.3.4.5: Risk Management Plan
- Page ID
- 48560
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Planning for Outsourcing Risks
Section Overview
Outsourcing introduces new opportunities, but it also introduces risk. These risks can affect cost, quality, delivery timelines, data security, stakeholder trust, and ultimately, project success. As a project team recommending outsourcing, it is your responsibility to identify the key risks early and prepare mitigation strategies.
This section helps you develop a risk register specific to the Reckon project and build a plan for how your team and the client organization should monitor and respond to those risks during the project lifecycle.
Learning Objectives
By completing this section, you will be able to:
- Identify the common categories of risk associated with outsourcing and offshoring
- Assess the likelihood and potential impact of each risk
- Assign ownership for risk mitigation
- Develop realistic strategies to reduce or respond to risk over time
Instructions
Follow the steps below to complete your risk plan.
Step 1: Brainstorm Risk Scenarios
As a team, brainstorm at least five realistic risks that may arise from outsourcing or offshoring the components of the Reckon project. Your list may include:
- Communication breakdowns due to time zones or language
- Vendor delays that impact project timelines
- Poor deliverable quality or misaligned expectations
- Data security or intellectual property violations
- Cultural misunderstandings or differing work norms
- Inadequate vendor staffing or resource availability
- Legal or compliance issues with foreign labor laws
Use your Make-or-Buy decisions, contract type analysis, and supplier selection criteria to help surface relevant risks.
Step 2: Create the Risk Register
Use the format below to log and assess each risk.
|
Risk Description |
Likelihood (High, Medium, Low) |
Impact (High, Medium, Low) |
Mitigation Strategy |
Owner |
|---|---|---|---|---|
|
Example: Vendor misses delivery deadlines |
Medium |
High |
Include penalties in contract and require biweekly check-ins |
PM |
Each row should describe one specific risk, an honest assessment of how likely it is to occur, how severe the consequences would be, and a practical mitigation strategy. Assign one team member or role (e.g., PM, tech lead, legal counsel) as the owner responsible for monitoring and responding to each risk.
Step 3: Write a Risk Summary
Write a short paragraph (five to seven sentences) summarizing your risk posture. Your summary should include:
- What categories of risk are most concerning and why
- How your team has structured your outsourcing recommendation to reduce risk
- How risks will be monitored during the project
- How you will escalate and respond if something goes wrong
This summary will demonstrate to stakeholders that your recommendation is realistic, responsible, and grounded in professional project planning.
Tips and Guidance
- Don’t try to eliminate all risks—focus on identifying, monitoring, and mitigating the right ones.
- Assigning an owner is critical; if no one is responsible for a risk, it will go unmanaged.
- Think beyond just delivery. Include risks to brand, IP, client relationships, or compliance.
- Reference outside resources such as the ACM Job Migration Task Force report for context on global outsourcing risks.
Deliverable
Each team must submit:
- A completed Risk Register with at least five entries
- A written Risk Summary paragraph
You will refer back to this document in your Statement of Work, supplier oversight plans, and final presentation.