Welcome back. In an earlier video, we learned about how to identify risks when planning projects. In this module, we'll learn why risks and changes might occur during a project and how that can impact your project's scope. You may remember that a risk is a potential event that might occur and could impact your project. When you think about risks in the context of project management, you'll think about them as hypothetical. In other words, these might not be events that will definitely happen, but because there's a possibility that they could happen, it's your responsibility as a project manager to identify and plan for those risks. Let's revisit some examples of risks. A project risk might be a contractor missing a deadline, or introducing a tool that may lead to communication breakdown within your team, or unexpected, additional work because of an unforeseen policy being put in place. When any risk occurs, the consequence is a change to the project plan. A change is anything that alters or impacts the tasks, structures, or processes within a project. Changes are typically unexpected. More often than not, they have a negative impact on the project, and you'll have to learn to navigate that. But sometimes, and I'm placing a heavy emphasis on sometimes, changes can have a positive impact. Changes can encompass any variance from the original project plan in regards to the triple constraint. This may entail changing priorities and scope, budget and resources, or changes to the project timeline. We'll discuss how the internal and external dependencies of a project impact each other and bring about change. Let's go through a few types of changes that can affect your project. Some examples of changes may include new or changing dependencies. Dependencies are tasks, activities, or milestones that are reliant on one another. So if one task isn't completed on time, it may put your other tasks behind. You might be in charge of renovations on a home where there are dependencies. In a bathroom remodel, for instance, a new sink cannot be installed until the vanity and plumbing are in place. Next, is changing priorities. The scope of the remodel changes if your client's in-laws suddenly have to move in, and you have to move up planned work on the spare bedroom before completing the bathroom remodel. Next up, the capacity and people available could change. Maybe you have to replace the plumber because you had issues on the job site. Another type of change could include a new limitation on your budget or resources. For example, you need to reduce design costs in the new bathroom by 10 percent because your quotes for electrical work come in higher than expected. Another change could be scope creep. Scope creep is when changes, growth, and other factors affect the project scope. For instance, your clients are so happy with the tile in the new bathroom that they'd like to replace the tile in all of their bathrooms. Finally, force majeure. This is another change that could occur due to a national or international crisis. If you aren't familiar with this term, it means an unforeseen circumstance that prevents someone from fulfilling the contract due to a major crisis. Force majeure is pretty uncommon. But for instance, if a union goes on strike, certain vendors won't be able to fulfill their contracts. If there's a pandemic, all production on your new product might be halted. Changes should be measured against the baseline estimates of scope, budget, and time allotted for your project, given the original requirements. Be mindful that when you change any one of those things, there may be knock-on effects which could be positive or negative. For instance, your clients may believe they have beautiful hardwood floors hiding underneath old living room carpet and want to pull up the old carpet and use the original hardwood floors underneath. You, the project manager on this particular construction job—you've budgeted to have the carpet removed and the old floors sanded and stained. Bad news. You pull up the carpet and find the floors are in bad shape and rotting. They'll need to be replaced or repaired, which could be costly, so your timeline and budget are likely to take a hit. When it comes to who takes on the responsibility of managing the changing scope, it'll be you—the project manager. But depending on the project, you probably won't do it alone. In order to properly manage changes, you'll want to refer to documents like your Statement of Work and the RACI chart. But you might also have to create some new documentation. You'll want to create or familiarize yourself with the processes for requesting changes for your team or organization. These processes might include a change request form. Let's discuss change request forms. You and your stakeholders will use these forms in order to stay on top of, and adequately manage, any changes. Since a lot of people with different roles on the project can fill out these forms, it's important for the forms to be self-explanatory and very thorough. In the provided template, which uses a 2-by-10 table, you'll need to include information in the cells, such as: the project name, the discussion owner, who's taking the lead on this discussion from the team, discussion type. You'll want to let your audience know if you'll be discussing a risk, opportunity, or anything else. You'll want to identify the teams involved and the expected outcome of the discussion, which might be a change in priorities, schedule change, or an official call on how to proceed with an issue. Add the target date for discussion, and identify which milestones or goals might be impacted. Provide a short description of the current situation, the change, and any difference you expect to make to the plan of record, like a snapshot of the before and after. Then go into in-depth proposal for the necessary changes and address any trade-offs. Finally, provide any background information so that everyone shares the same context. You can also refer to your statement of work, or SOW, for more information about who needs to be involved in that conversation. If you find that one or more of your milestones are at risk of not being completed, then you'll need to get a customer sign-off before the scope, deadline, or budget are changed, and all parties involved need to be informed. Great work. We've reviewed how to define risk and know more about how to identify the reasons why risks and changes might occur during a project. And now we can explain the impact of increasing a project scope. In the next video, we're going to discuss the role dependencies play and how to properly manage them. We'll meet you there.