What is a Residual Risk & What is Secondary Risk?

In this video, I answer the questions what is Residual Risk and what is a Secondary Risk? And along the way, we also need to understand the term Inherent Risk too.

Inherent Risk, or Underlying Risk
This is the risk level you start with, before you take any action to control it. If you do nothing, the risk is the inherent risk.

Residual Risk
If you do act, you may not remove all of the inherent risk. The risk that remains is the residual risk. So, the residual risk is the risk remaining after you have implemented your risk response.

Secondary risk
As well as resolving or mitigating a specific risk, a risk response can also have secondary, undesirable outcomes. These may be issues you need to deal with. Or it may generate risks: a Secondary Risks.
A Secondary risk is a risk that arises as a direct result of implementing a risk response.

Once you have applied a risk response, review the situation to identify any residual or secondary risks – and update your risk register accordingly.

Residual Risks need to remain in your risk register, with a fresh evaluation of their new impact, likelihood, and proximity. Thus you need to evaluate the next level of risk response (or decide to accept the residual risk or handle it with a contingency plan).

And, of course, you will add any secondary risks to your register, as you would for any new risk you identify.

Recommended Videos
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A while back, I asked Project Managers in a couple of forums what material things you need to have, to do your job as a Project Manager. They responded magnificently. I compiled their answers into a Kit list.
Note that the links are affiliated.

00:00 - What are residual risk and secondary risk?
00:15 - Three terms…
00:28 - Inherent Risk
00:47 - Residual Risk
01:21 - Secondary Risk
02:23 - Why does all of this matter?
03:28 - All Project Management is hybrid Project Management
03:55 - How much does this matter?
04:44 - What’s really important…

#ProjectManagement #ResidualRisk #SecondaryRisk

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Risk management is such an important part of project management. So, it pays to understand some of the less common terminology around the subject.