AbstractsEconomics

Project Risk Management (PRM) plays an important part in determining project success and it is considered an essential activity for companies. The literature provides a vast amount of tools and techniques created to help project managers to deal with project risks. However, in practice, project managers use few tools and techniques. The aim of this research is to understand the reasons for the non-use of PRM tools and techniques by project managers when dealing with risks in the Swedish manufacturing sector. In order to provide evidence on why project managers do not use PRM tools and techniques, this study identifies a list of tools and techniques to investigate, and a list of possible reasons. Both these lists derive from the existing literature and past research. This qualitative study is based on multiple case studies of seven companies with nine respondents. The companies are based in the Umeå region and operate in the manufacturing sector. This study has revealed that project managers, within the sample, prefer to use qualitative tools and techniques such as meetings and expert judgements when dealing with risks. On the contrary, most of the tools and techniques for quantitative risk analysis are not used. There is a lack of awareness regarding the existing tools and techniques, and in general regarding the basic concepts of Risk Management (RM). Project managers tend to heavily rely on intuition and past experience when dealing with project risks. Other reasons that account for the non-use of tools and techniques are lack of resources and an unwarranted use in relation to the project type. In some cases project managers might avoid or delay the management of negative risks and therefore to do not use tools and techniques. Furthermore, two more reasons emerge from the analysis of data, which contribute to a better understanding of the reasons behind the non-use of PRM tools and techniques. These reasons are small increment in quality of RM by using PRM tools and techniques and complacency by project managers when using PRM tools and techniques. This research extends prior literature by providing evidence on the use and non-use of PRM tools and techniques and the reasons for their non-use in a sector where there is a lack of research. Finally, two more reasons are discovered and can contribute to a better understanding of the existing gap between theory and practice of RM.