When does a hazard become a risk?

Hazard and risk are two sides of the same coin. But what’s the difference?

Vehicles on a busy road represent a clear hazard. But traffic only becomes a risk when you want to cross the street. Until then, the cars whooshing past are still a hazard but pose no actual risk to you.

Why does this rather obvious distinction matter?

On major complex projects, hazards are ever present and often obvious but only become risks based on your choices.

Mistaking hazards—which do not affect your project’s outcome—for risks, which may impact you, can be time-consuming and costly.

Missing risks because the hazard hasn’t been properly identified and understood can be catastrophic. At the very least, nasty surprises down the line erode your project’s value.

And, yes, to return to our metaphor, a truck may veer off the road and put pedestrians in danger. Which is why it also pays to be vigilant for early warning signs of unlikely events, and then react quickly if a threat materializes.

Getting a clear and early understanding of the hazards faced—and when they actually become risks—creates major leverage.

We call this foresight process Peak PRM (project risk management).

Mistaking hazards—which do not affect your project’s outcome—for risks, which may impact you, can be time-consuming and costly.

Get in touch and we can help you identify yours.