4.7. Assumptions underpinning the approaches to risk management
Empirical findings indicate that the assumptions underpinning risk management are in certain cases not correct. These findings contradict the potential effects of risk management on project success. Kutsch and Hall (2005) show that project managers in IT projects show a tendency to deny the possibility or actual presence of risk and uncertainty; they avoid them, ignore them, or delay their actions until the circumstances have improved. These are the characteristics of behaviour that is not in line with the view presented by the risk management approach that actors behave rationally. Flyvbjerg et al. (2003) have shown that at the start of a project, people deliberately both overestimate the benefits of the project and underestimate its risks and uncertainties. As a result, the stakeholders become biased; right from the start of the project, their expectations are too high. Project success will, therefore, become much harder to achieve in terms of time and budget requirements.