What is the difference between project and technical risk?

I've been told that I need to evaluate both project and technical risk in the project plan and while running the project. What is the difference between project and technical risk?
Many project mangers focus so intensely on the effort and events around creation of the deliverables that they forget to think about the other elements associated with making the project successful. We need to think about both project and technical factors when we conduct the risk assessment. When planning for risk, mentally dividing risk into these two categories may help you identify ways to mitigate or eliminate it.

Project risk is the cumulative effect of events that may prevent you from achieving project and product goals. Think about what is needed to successfully run a project—the infrastructure needed to support the technical team and communicate progress, issues, and needs to sponsors and stakeholders. These risks tend not to get much attention, but can have an equally negative effect on the project outcome if not addressed. Technical risk is that related to the discovery of new information, technology limits, and/or constraints that render previous solution assumptions invalid. This is where the majority of the risk assessment is focused. Some examples of each risk category:

Project risk:
  • Inability to find a suitable project manager
  • Inability to staff key team positions
  • Design reviews don't identify deviations from requirements
  • Inadequate communication among remote team members
  • Unavailable test facilities or resources
  • Budget and/or schedule constraints
Technical risk:
  • Cannot achieve noise targets in an analog circuit design
  • Cannot achieve dimension requirements in a packaging design
  • Cannot implement a software algorithm on the target machine
  • Cannot meet response requirements in a real-time system
  • Cannot fit software program in available memory

Working through the potential project and technical risks can be rewarding process; the end result will open the project teams' eyes and prepare everyone for the potential pitfalls ahead. For more on this topic we recommend you review the Product and Project Risk Assessment and Mitigation Tables, to be used during the early project selection process and during detailed investigation and planning work. The goal is to ensure that technical and non-technical risks are factored into launch decisions and full project planning to make sure the risks will be handled. "What Could Possibly Go Wrong?" provides insight into the many areas where risk lies in a project.

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