Non-Technical Risk Explained

 
 

Project managers in industries such as urban development, power, energy, mining, waste and infrastructure are responsible for minimizing the risks to their projects and organizations.

Upon commercial approval, the number one risk for these projects is non-technical risk. Non-technical risks involve all risks that emerge from interactions with regulatory, public, socio-economic, governmental and environmental organizations to a project's success.

Sunexo conducted a survey of individuals in leadership positions, in energy and infrastructure companies, to assess where they saw risk to their organizations. The results were that nearly 75% reported that non-technical issues within projects created the greatest risk for their organization.

This fits with data that shows over 124 major North American Energy Projects were delayed between 2008-2014. Of those projects, 33% were delayed for purely non-technical reasons while a large majority included non-technical reasons.

The total estimated cost for these non-technical delays is estimated at $118 billion USD. This is because non-technical delays take the longest to address and are the most expensive to resolve.

Managing non-technical risk requires proper management of stakeholder information throughout the life cycle of a project.