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Stories > Managing risks in EU funded projects
Identifying and planning how to manage risks is a standard feature of EU-funded projects, yet it is rarely a focus of project development, either because it just seems to be another purely administrative requirement, or just because we tend to have rosy expectations of our capacity to control everything.
One of the things COVID-19 has taught us, is that we do not control everything, and that managing risks and planning remediation measures are more than an intellectual exercise. While extreme situations such as the one we are still experiencing might (luckily) not occur often, it is a reminder that within a project, one cannot control external factors, may it be changes within partner organisations, changes in regulation, or even bad weather.
It is not a surprise that projects that already had difficulties are the ones being the most disrupted when a new problem emerges. Even if mitigation measures were taken to remediate earlier issues, major disruptions such as COVID-19 tend to make them simply obsolete. In some cases, procurement that was delayed, has simply stopped, postponing any linked activities for weeks or months. Citizens’ activation is always a complicated feat in projects, but it became completely impossible.
For projects nearing the end of their implementation, the situation is similarly dire, budget is almost fully gone, and time is short to take action.
Below are some good examples of effective risk management in projects affected by COVID-19.
In one of the EU projects that we are assisting, a partner made arrangements with a company to do installation works at several homes. Due to COVID-19, the company has halted all external projects which interact with the general public. This is to safeguard their employees and is in keeping with the central Government guidelines. The installations will start again once the restrictions are lifted or reduced to a workable level. To ensure project deadlines are met with, the company will add more teams to the installation phase as soon as the situation admits this.
In another project, a partner wanted to organise a stakeholder consultation. In order to comply with COVID-19 restrictions, physical meetings are postponed until late summer. If at that time physical meetings are still not achievable, digital consultations will be set up. This also gave time make an inventory of experiences and start experimenting with this option.
So, what can you do?
As a response to COVID-19 most (if not all) programmes have come up with their own mitigation measure by allowing or implementing a 6 months shift of project end dates. This provides respite for more projects, some pressed with delays in the delivery of infrastructural work. Yet, a 6-month shift is not necessarily the best solution, and a shorter period can be more efficient in delivering an impact without increasing the costs, considering that budgets did not get raised.
The first thing to do is to consider how many of the activities are delayed and plan accordingly, using a retro planning to see for each activity what has to be postponed, what can be done despite the situation, and what cannot be delivered, even with an extension. An extension is not a panacea, it is therefore better to accept that activities might not be done at all if the cost/efficiency is not there. Remember that you should demonstrate that you have done your best to reach your expected results, even if some results cannot be attained.
First things first, you need to list and identify all risks including mitigation measures and implicit deadlines, a lot of different methods are available to assess the risks and you can find them online, but you can always start by listing any project activity that is coupled to external factors (stakeholders’ participation, environmental reports, building permits…). Based on this thorough assessment make sure to discuss regularly with the partners and programme, to see if and when possible, changes arise.
When not in a crisis situation, it is necessary to look at your risk assessment and planned mitigation measures at least each reporting period, and update if necessary.
Make sure to review your financial progress regularly with current spending and forecasts. This might require you to plan the work of the partnership differently, reducing or increasing the involvement of staff.
Despite planning, remediating, mitigating there will be a time when as a project leader, you will have to make choices:
1: Extend the project: Make sure it does solve the problem and ask the partners who want to make use of the extra time to make plan before requesting the extension. And preferably, make sure the extension is limited to the time that is actually needed.
2. Accept that you need to change your project: It might be difficult to accept that the project you have carefully prepared and worked on cannot be realised as expected. You have to accept and embrace changes. Discuss with your partners, and agree on what can be done differently, what cannot be done, and if there is anything new that could be rolled out.
3: Re-allocate budget: You might need to move budget from one partner to another. This is not a fun process, be clear about what you are doing and when you will take these kinds of steps. Let it not be a surprise to anyone.
4: Prepare your project closure: Things might not have gone as planned, so make sure you document every step taken, every mitigation measures, review you indicators (you should do this at least every 6 months), and build together with your partner proper justifications for your current status at the closure. Make sure that all partners know that they should be making their last payment six to three months before your report is due. The earlier the better.
From the start, you need to make sure to inform and stay in contact with the programme officers. Be open and fully transparent. This will ensure that you will not face unpleasant surprises from their side at the end of the project, or when you submit your change requests. Do not forget: they are also here to make your project a success.
Do you have a question about risk management in EU-financed projects? Feel free to ask us.