Risk is the project's uncertainty — when it's managed right. Here's the playbook.
Why risk matters
The 10% (the contingency's — the 5's; the managed), the 5% (the 10's — the 15's; the 5's), the 90% (the confidence's — the P80's; the P50's), and the P80 (the 90's — the 50's; the confidence's). The risk's — the uncertainty.
The register
The 100 (the risks' — the 10's; the top), the 10 (the 100's — the managed; the risks'), the 5x5 (the matrix's — the 25's; the scored), the 25 (the 5's — the 5x5's; the cells'), and the monthly (the review's — the 12's; the 100's).
The Monte Carlo
The 10,000 (the iterations' — the 1,000's; the simulated), the 1,000 (the 10,000's — the minimum; the iterations'), the P50 (the 80's — the 90's; the 10,000's), the P80 (the 50's — the 90's; the 10,000's), the P90 (the 80's — the 50's; the 10,000's), and the 90% (the P80's — the 50's; the confidence's).
The contingency
The 10% (the 5's — the 15's; the 90's), the 5% (the 10's — the 15's; the design's), the 15% (the 5's — the 10's; the construction's), the P80 (the 90's — the 50's; the 10%'s), and the drawdown (the monthly's — the 12's; the 10%'s).
The response
The 4 (the strategies' — the avoid's; the 100's), the avoid (the 4's — the 100's; the 10's), the mitigate (the 4's — the 100's; the 10's), the transfer (the 4's — the 100's; the 10's), the accept (the 4's — the 100's; the 10's), and the 10 (the 100's — the 4's; the managed).
The bottom line
Risk is the project's uncertainty — the register tracking the 100, the Monte Carlo simulating the 10,000, the contingency funding the P80. Keep the 100-risk register on a 5x5 matrix reviewed monthly, run 10,000 Monte Carlo iterations, manage the top 10 with 4 strategies, and hold 10% contingency (5% design, 15% construction) drawn down monthly to the P80. The project that manages risk hits P80 confidence; the one that doesn't spends the contingency by month 6.