Project Risk Management in Health Care

In health care, risk management programs are often used to reduce the risk of medical errors and other organizational loss in operations.  Risk management activities can be classified as proactive (before an occurrence) or reactive (after an occurrence).  According to Sharon Hall, Vice President of Parker, Smith & Feek, “Proactive risk management may avoid some losses and expenses that could otherwise impact your bottom line.”  On the other hand, an overcautious approach may result in the loss of potential business benefits. (Sheppy, Zuliani and McIntosh, 2012)


Although risk management is commonly used to mitigate, avoid or transfer risks in health care operations, it is not commonly used in project management efforts within health care organizations.  Health care project managers continue to struggle with demonstrating the value of proactive risk management in project work. (Hall, 2014)


In traditional project management methodology, the project environment within which risk is taken is considered (Barkley and Saylor, 2001).  It is important to distinguish between the inherent risks in the project itself and the risks associated with the project management process.  Health care project managers now face ‘complex environmental conditions’ that increase risks. (Sheppy, Zuliani and McIntosh, 2012).


According to the British Journal of Healthcare Management article, “there needs to be a greater emphasis on placing risk relative to both operational and cultural factors.”  Health care project managers must possess both hard and soft skills in order to perceive the ‘synergistic risk impacts that arise’. (Sheppy, Zuliani and McIntosh, 2012).


In our MGT 598 Project Management class, we learned how to put together a risk management plan.  Step one is to identify and assess all potential risks.  (Sheppy, Zuliani and McIntosh, 2012).  Step two is to assess risk.  Risk factors can be assessed based on the severity of impact, likelihood of occurring and controllability. (Larson and Gray, 2014).  Step three is to develop a strategy to reduce possible damage and contingency plans. (Larson and Gray, 2014).   Step four is to implement risk strategy, monitor and adjust the plan for new risks and change management. (Larson and Gray, 2014).  According to Sheppy, Zuliani and McIntosh, “risk management should be a continuous, iterative process that requires revisiting assessed risks” (2012).


Discussion Questions:

  • Does your company use risk management to mitigate, avoid or transfer risk in project management?
  • Is risk management proactive or reactive in your firm?
  • Does your organization see the value in proactive risk management?





Erik W. Larson & Clifford F. Gray, Project Management: The Managerial Process, 6th Edition, McGraw-Hill Irwin, New York, 2014.

Project Management In Health Care

In my previous role, I worked as a Project Management Consultant in the Project Management Office (PMO) for a health system in the greater Chicago-land area.  Project Management Consultants are responsible for “driving high-profile, complex projects, helping customers and stakeholders to meet their needs, and acting as a change agent to foster continuous process improvement” (source: job description).  In this organization, there were eight Project Management Consultants who reported to the Director, Project Management Office.  The Director reported to the Vice President, Strategic Planning.


We used a custom, Project Management application called Performance Logic to manage operational and strategic projects and to track performance against our targets.  Performance Logic is similar to Microsoft Project but is web-based and user-friendly so it can be used by the ‘first time’ Project Manager.  We also incorporated many of the tools we discussed in our MGT 598 class – project charter, detailed project plan, status reports, etc. — as part of our Project Management process.


The process begins when an operational leader (i.e., Director of Emergency Department) fills out a new project request form, which can be accessed from the hospital’s intranet site.  The operational leader provides the project information, service level required, business need, statement of work, project boundaries, critical success factors, project assumptions, project constraints and estimated costs.


There were five service levels offered:

  1. Project set up and/or training in Performance Logic
  2. Project planning
  3. Project consultation
  4. Full project management
  5. Problem solving facilitation


The Director of Project Management Office and the Vice President of Strategic Planning reviews all projects requiring full project management or problem solving facilitation weekly.  If the project aligns with the health system’s strategic priorities (e.g, quality/patient satisfaction, strategic initatives, growth, financial stability), a resource is assigned.  A Project Management Consultant can be assigned up to eight projects at any given time based on their professional interests and capacity.


In this health system, a matrix structure was used to organized projects (Larson and Gray, 2014).           The Project Management Consultant works closely with the operational leader of the area to complete the project charter and meet the project goals and objectives.  The project team consisted of front line staff who can participate on multiple projects while performing their duties as a physician, nurse, pharmacist, etc.  At the project kick-off, a stakeholder analysis and communication strategy can be completed to ensure all stakeholders are informed throughout the project.


This is one example of how Project Management can be applied in health care.  How is Project Management applied in your industry?



Larson, E. W., & Gray, C. F. (2014). Project Management: The Managerial Process (6th ed.). New York, NY: McGraw-Hill Education.