Although many people use the terms “contingency plan” interchangeably with “workaround”, they are not the same. The difference between the two terms is related to whether the problems being handled were identified ahead of time or not. Contingency plans are made based on potential risks that are identified that could derail a project. Workarounds are responses to problems that develop while the project is being worked that were never identified.
When a project plan is first put together, potential risks are identified that could pose a significant threat to the project if they occur. Contingency plans are developed around those possible issues and they are completed before the threat takes place. These contingency plans should address the objective of the plan, the criteria for activating the contingency plan, the people and responsibilities involved, and the additional details required for implementation.
Here is an example of a contingency plan. A company that produces skis has a project to stock its retail stores with the latest models for the winter season. While the project was being planned, a risk was identified regarding a potential strike. The project continued, but a contingency plan was developed in case the strike lasted longer than anticipated. In the case that the strike was not over by a pre-identified date, the company decided to reassign the work that was to be done by the factory on strike to alternative factories. Potential costs were reviewed and it was determined that this contingency plan would be beneficial.
A workaround is not a planned response because the problems being addressed were not anticipated ahead of time. Per the name, a “workaround” let’s you “work around” the problem. As soon as it is determined that there is an unanticipated problem, it needs to be addressed, researched and incorporated into the documentation of the project plan.
A corrective action must be taken occasionally to make sure the project stays in line with the projected results. Examples of corrective action include the implementation of both contingency plans as well as workarounds. Most projects will require the implementation of a contingency plan or will require a workaround to be created. Since larger projects tend to be more complex, these are common fixtures as the size of the project increases.
The PMBOK Guide discusses both Workaround and Contingency Plans in sections 11.5.3 – 11.6.3 in it’s fourth edition.
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