Image by vector4 on Freepik
When you first make a plan, you 'plan for success' — that is, you assume that everything will go right and the outcomes will be just as expected. Of course, the real world has a habit of challenging the best-laid plans, and whatever could go wrong often does — at the worst possible time. It is for this reason that contingency planning should be an element of every plan.
A contingency is an event which may or may not occur. Contingency plans are alternative courses of action to take if the planned actions are disrupted or become inappropriate.
Perhaps the hardest part of contingency planning is identifying what could go wrong. Failure to identify potential problems is often a failure of imagination.
Experience will tell you what could go wrong, and disasters sometimes give you warnings in the form of ‘close shaves’.
When you have identified as many potential problems as you can through experience and intuition, look at each planned activity in turn and determine what would be the effect if the activity:
It is unlikely that you will identify all possible failures, but the exercise is still worth doing because if you have plans in place to deal with the problems you can imagine, you will have more time to deal with those you didn’t.
In fact, it’s a good idea to put a little extra time and resources into the project to deal with these unexpected contingencies.
Analysing the contingencies is also called risk assessment. The action you would take for a particular contingency will depend on two factors:
For example, if there is a negligible chance of the problem occurring (low probability) and the consequence would have a very low impact, then it would be safe to ignore this particular problem and take no action.
“Probability is about expectation; impact is about regret.”
For all potential failures, you should establish the probability of occurrence. In other words, what is the chance of the unwanted event happening? When throwing dice, there is a one-in-six chance of throwing a six.
Probabilities are frequently expressed as decimals. So, a one-in-six chance is a 0.167 probability. If an event is certain to occur, its probability is 1. If the event is impossible, its probability is 0.
When carrying out simple risk assessments, rather than using precise figures, it is usually sufficient to rate the probability of the event happening as 'H' high, 'M' medium or 'L' low.
Impact considers the seriousness of what would happen should the failure occur. For example, if a nuclear power plant were to leak radioactive material, the impact would be extremely high.
If numbers are used instead of decimals, the lowest is 0, and the highest is 10.
As with the probability assessment, it is usual to use ‘H’, ‘M’ or ‘L’ with impact:
There are two main categories of action you can take when planning for contingency:
This will reduce the probability of the event occurring and consists of actions inserted into the original plan before the activity where the unwanted event might occur. For example, if you might run out of fuel, you could plan to carry a spare can.
Contingency actions are those you plan to take if unwanted events do occur. They are used when it is not possible to prevent the occurrence. They are actions that are designed to either correct the problem or reduce the damage.
In addition to taking a predefined action (sometimes known as 'Plan B'), you can also allocate additional time or resources.
Trigger events and contingency actions should be included in the original plan.
Now you are in a position to identify the critical events in the plan - usually events which have a high probability or impact.
For each critical event, list the potential problems and rate them for probability and impact.
A spreadsheet is recommended for entering this data.
You can download a free copy of this spreadsheet from Learning Pages Digital Products.
Whether you take any action, and the type of action you take, will depend on your assessment of these ratings. There is no substitute for good judgment of a particular situation, but the following guidelines may help:
The following table provides a guide for assessing the risks based on probability and impact. It also suggests possible actions based on the risk assessment.
You can download a free Contingency Planning Python script from Learning Pages Digital Products.
Python scripts are in the Programs section.
This script takes L, M and H probability and impact inputs and outputs possible contingency plans.
A more accurate report can be generated by using 0.0-1.0 for probability and 1-10 for impact.
Risk = Probability x Impact
In some cases, this risk score will be the same for 2 different combinations (e.g. H-L and L-H). In these situations, it might be worthwhile to focus more on events where the impact falls into the H range.
