4 Common Risks In Software Development Projects

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Sometimes, even the most elaborately planned projects can still run into trouble. No matter how much thought you’ve put into a project, there is still some amount of risk associated with it. And, it’s no different with software development projects. Team members may quit, resources may become unavailable, and sometimes, there’s just nothing you can do about it.

But, does that mean that you are completely helpless?

No, you’re not. By using risk planning and identifying what can go wrong, you can take preventive actions to ensure that the technical risks in software development are altogether avoided or at least minimized. In this blog post, we’ll explore the 4 common risks in software development projects and how you can eliminate them by implementing the right project management strategies.

Why is risk management becoming increasingly important for IT projects?

There are several reasons why identifying the risks in software development projects has become the need of the hour. Some of them include:
  1. To evaluate the entire project
  2. To plan for success
What are some common risks in software development projects?
  1. Tight Schedules
  2. Budget Changes
  3. Technical Difficulties
  4. Poor Management
The right project manager will be able to efficiently plan devise strategies that ensure that the risks associated with the project are minimized.

Read more to know about risks in offshore software development in detail with examples.
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Thanks for sharing.

It is true that risks in software projects must be detected early and deal with it.

The uniqueness of IT project is that it is usually short in lifecycle as it can't wait for the market to get over it even faster. So PMs have to really move fast.
Sandesh Tallera
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There are a huge number of risks in a project because the requirements for a software development project are typically much more difficult to define. For that reason, probably the biggest risk of all is that the project produces something that does not provide the business value it is intended to produce and the whole project is scrapped.

There are Four main categories of risks that can affect a software project:

1. Project risks
Project risks concern various forms of budgetary, schedule, personnel, resource, and customer-related problems. An important project risk is schedule slippage. Since the software is intangible, it is very difficult to monitor and control a software project. It is very difficult to control something which cannot be seen. For any manufacturing project, such as the manufacturing of cars, the project manager can see the product taking shape. He can, for instance, see that the engine is fitted, after that the doors are fitted, the car is getting painted, etc. Thus he can easily assess the progress of the work and control it. The invisibility of the product being developed is an important reason why many software projects suffer from the risk of schedule slippage.

2. Technical risks
Technical risks concern the potential design, implementation, interfacing, testing, and maintenance problems. Technical risks also include ambiguous specification, incomplete specification, changing specification, technical uncertainty, and technical obsolescence. Most technical risks occur due to the development team’s insufficient knowledge about the project.

3. Poor planning
Poor planning, in terms of budget or budget allocation. Some projects are in my opinion under cost which adds the risk of serious budget blowouts or failing to meet financial targets.

4. Poor implementation
Poor implementation, even the best design needs to be well implemented, things like user feedback and acceptance, milestone reporting to identify problems at each milestone, and constant engagement between IT and the companies management.
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  • Schedule Risk. The wrong schedule affects development almost immediately. If project tasks and schedules are not addressed properly, the likelihood of project failure is high.
  • Budget Risk. The finance distribution when done properly leads to reasonable use of finances and creates the grounds for project success. If the financial aspect of software development is mismanaged, there will be budget concerns.
  • Operational or Project Management Risks mostly occur when team structure is not clear, and the work environment prones to be toxic. Under these conditions, a team member will not be able to pursue the project or achieve software development goals. Aside from that, the surfacing of external factors such as the improper process of implementation of failed system can also affect the project.
  • Technical Risks arise when only a part of developers’ team is familiar with the software.
  • External Risks are dangerous due to their unpredictability. Therefore, it is crucial that developers had the best business analyst in the area of their market to back-up ideas and eliminate the risks created by such external factors as:
    • Limited funds for continuous development of the project
    • Market’s rapid development
    • Inevitable changes in customer product strategy and priority
    • Government rule changes