Risk Management in Software Development

Every software project carries risks that can lead to delays, failure or financial loss. Risk management in software development reduces them: you predict as many risks as possible and plan how to handle each one. That is why a CEO should ask for a detailed risk analysis before investing in a software project.

At Go Wombat, we see the same risks come up whenever clients build web or mobile applications with a development partner. This article covers the main stages of risk management, the most common risks, and the mitigation strategies we use as a software development service provider.

What Is Risk Management In Software Development?

A risk is a potential problem that could jeopardise a project’s success. It can be financial, technical or business-related, and it means a loss of some kind.

Fixing problems after they happen is expensive, so the main way to prepare is to identify and list risks during planning.

Knowing that a risk exists is not enough. You need to identify it, assess it, prioritise it and manage it.

Main Aspects of Risk Management in Software Development

The risk management process has four stages.

Risk identification

First, identify and understand the risks connected with your project, starting from its goals. The earlier you recognise them, the fewer problems you will face during development.

Risk assessment

Next, assess how severe each risk is and whether it threatens the project from the start or only later. This assessment is the basis for prioritisation.

Risk Prioritisation

Rank the risks by importance and deal with them in that order.

Risk Management

Finally, plan and carry out a response to each risk, putting your resources where they prevent the most damage. This makes the development process more reliable for you and the development team.

To plan risk mitigation for your project, contact Go Wombat.

Why Risk Management Is Critical In Software Development

Every product has its own features, which makes it hard to identify all the related risks, and no project can remove every risk completely.

The goal of risk management in software development is to know what can go wrong, why, what the impact would be and how to respond. That prepares your business for the threats it is most likely to face.

Cost Reduction

Preventing problems is cheaper than fixing them, so managing risks saves time, effort and money. The process should cover the less obvious risks as well as the major ones, throughout the project.

More Productive Process

Development is faster when the team plans for known risks instead of spending time on unforeseen problems.

Smarter Funds Allocation

You avoid unexpected spending and can allocate the right budget to each development stage and team member.

Positive Effect on the Reputation

A project that runs smoothly improves your reputation with clients and with your own team.

Common Risks Any Project May Face

In the Standish Group’s CHAOS 2020 report, 31% of software projects succeeded, 50% were challenged and 19% failed. Underestimating financial or technical risks is one of the reasons projects fail.

Code Issues

If unqualified developers work on your project, code quality can be low and the software may malfunction.

Missed Deadlines

Unrealistic deadlines can make it impossible to deliver on schedule, and a failed stage causes problems further down the line.

Project Expectations weren’t Met

Inaccurate estimates and misunderstandings can leave a client with software that doesn’t do what they needed.

Budget Issues

When project details are not agreed properly, it is hard to estimate an accurate budget or find ways of reducing costs. Consider this risk before you hire a development team.

Incompetent Project Management

Some vendors assign a weak project manager or none at all, and poor management leads to poor results.

Project Scope Changes

Constant changes put the project at risk, and a sudden new idea can even damage the product. Discuss changes with the development team before making them.

Many Stakeholders

When a project has several owners, miscommunication between them can lead to false expectations and low engagement.

Team Members Leave the Project

Developers may leave in the middle of a project, which puts it at risk. Go Wombat has a large pool of experienced developers, so we can replace a developer who leaves.

External Risks

These range from political and economic issues to natural disasters and other force majeure events.

No vendor can remove every risk, but a written risk plan makes surprises smaller and cheaper.

Hire Go Wombat to build your project.

How We Deal With Risks At Go Wombat

As an experienced company, Go Wombat has faced all of the risks above. This is how we handle them.

Code Issues

Each project at Go Wombat has a tech lead who reviews the other developers’ code, and developers on the project also review each other’s code. This keeps code quality high and catches issues early. Regular communication between developers also helps us keep to the project schedule.

Missed Deadlines

We divide the project into small tasks, agree a deadline for each and monitor progress.

For example, if we complete only eight of the ten tasks planned for a week, we see early that the schedule is slipping. We then discuss it with the client and either extend the deadline or add developers to the team. Our aim is always to finish tasks within the deadline.

The Unexpected Risk

We reduce this risk with regular meetings between the team and the client. Our estimates include time for discussing tasks, and during the project we meet to go over the details, so the client always knows the progress, the current stage and the results of each stage.

Budget Issues

A project can be fast, cheap or high-quality, and you can choose any two. Fast and cheap means lower quality. Fast and high-quality costs more, because it needs more senior developers. Cheap and high-quality takes longer. Decide what you are ready to pay for and prioritise accordingly. Financial losses are usually the most damaging for clients, so risk management always pays close attention to the budget.

Sub-Par Software Project Management

Without a project manager, clients have to work directly with developers. At Go Wombat, the project manager manages the project’s financial and technical risks and motivates and supports the team.

Project Scope Changes

We split development into stages (sprints) and don’t recommend changing the current stage while we work on it. Instead, we complete the stage and move to the next one after approval. New ideas are welcome at any point, and we work through each change to see how it fits the product.

Stakeholder Issue

We keep in constant contact with all stakeholders and coordinate every change. On one hospitality software project, two stakeholders had different visions of the functionality and gave us conflicting instructions. We brought them together in a meeting and went through every detail until the plan met both their needs.

External Risks

No one can predict everything. When we were about to publish an iOS app we had built, we found that an App Store policy change prevented the upload. We solved the problem, but the case showed that platform policies need monitoring, so we now include time for this in the discovery phase of our estimates. We aim to make sure software complies with the relevant regulations and platform policies.

External risks cannot be eliminated, but a risk management plan with a mitigation strategy helps the client and the development partner spot them early and limit the damage. We also train our developers in good coding practices.