Stakeholder’s risk appetite: #1 killer of projects in Somalia

Project management literature details well about stakeholder’s risk appetite or tolerance. For example PMI PMBOK6 defines stakeholder’s risk appetite as a measurable acceptable risk levels around each project objectives (scope, time, cost, quality, resource, etc. In that regard risk thresholds or stakeholder’s tolerances define parameters for risk assessment such as risk impact and risk probability

Somalia is a country in the horn of Africa where projects dominantly fall into humanitarian and private industries. I have worked in private sector project for some years. You could witness or participate a project intended for 3 months taking up to 1 year. This project or projects are declared successful by stakeholders because they risk appetite is high. They could tolerate 6 months schedule slip or $$$$ cost over-run

An other reasons why projects in Somalia have a high risk appetite is because projects are not projects but implemented as operations. PMO does not exist and success criteria for project is completing activities without considering early delivery of value

The project manager after conducting stakeholder analysis and interview will come up with stakeholder risk appetite thresholds tables like the one shown in figure 1 below. It shows that risk appetite for scope changes is very low

Once thresholds table are completed from stakeholders, the next typical thing to do could be defining probabilities and impact matrix. The result is then integrated with the overall project risk management plan

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Jama, A. .A. (2022). Practical project management: With Microsoft project illustration. Somalia: Pure Training Centre. https://www.amazon.com/dp/B09QGVRKY3