Posted by Kate Phizackerley on 21:54

That should be a familar diagram to any project sponsor or project manager.  The idea is that there is a threeway tradeoff between risk, cost and time: time can only be reduced by increasing risk and/or cost; cost can only be reduced by increasing time and/or risk; and time can only be reduced by increasing cost and/or risk.

Many project managers will introduce this concept when planning a project, but few seem to really understand the implications and will still use the same approach for managing a project if the sponsor wishes to run it with minimal risk as if they wish to minimise timeframe. 

Within the field of corporate governance there is a concept of risk budgetting.  It's also an appropriate tool for running projects when the focus is on risk and there are alternative ways to achieve the overall objectives.  Weak project managers seem to believe that everything can be achieved with a Gantt Chart.  When managing for risk, a Gantt Chart offers little insight.  A better approach is to compile a network chart based on risk.  (Routes which are unacceptable in terms of cost or timeframe can be removed from consideration.) 

The difficulty is that visualising network charts can be difficult, especially if the analysis skills of the project manager are weak and she cannot present them as drill down.  However, realistically for large projects something like an interactive whiteboard can be really valuable in talking the project sponsors through the alternatives.


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