Geostrategy Imperative: How it Elevates Risk Management

As geopolitical volatility reigns, organizations must increasingly anticipate, assess and manage the risks that come in such a complex project environment. How is this turbulence affecting project leaders? How are they incorporating geostrategy into their risk management processes? We discuss this with: 

Heather Buchanan, PMI-RMP, PMP, supply chain project manager, Canada Goose, Toronto: She discusses how geopolitical volatility’s impact extends beyond the triple constraint. She explains how project teams are handling change with strategic shifts and proactive planning, and how she ensures her teams keep geopolitical considerations at the forefront. Plus, Buchanan talks about how subject matter experts, tech tools and even PMI helps her stay up-to-date on geostrategy. 

Rosa Gilsanz, PMI-RMP, PMP, project leader, Bayernoil, Munich: Gilsanz shares why geopolitical issues can wreak havoc with energy projects, the importance of a diverse team in risk identification, prioritization and mitigation planning, and how she uses clear communication and knowledge sharing to bolster her team’s resilience and adaptability amid uncertainty. 

Key themes

[01:09] Geostrategy’s impact on project teams’ risk management 

[03:25] Managing risk and change with flexibility and contingency planning  

[05:49] Discussing geopolitical considerations—from tariffs to labor laws—with teams

[08:10] Identifying and prioritizing risks with AI, subject matter experts and online alerts

[12:19] How the energy sector is affected by geopolitical volatility

[15:14] Why you need a diverse team for risk management practices 

[17:03] Improving risk resilience on teams through communication and knowledge sharing

Transcript

Transcript

HEATHER BUCHANAN 

One of the biggest misconceptions that I’ve seen for geostrategy is that it’s not going to happen, and it’s not going to have an impact. In recent years, we’ve seen that things that were once maybe rumors or it may happen, it can come to fruition—and it can happen fast.

STEVE HENDERSHOT

If the last few years have taught us anything, it’s that risks can materialize with little to no warning. Project leaders today are facing more surprises more often from more places—with more potential downsides. And as a consequence, geostrategy is playing a more prominent role in risk management. How are project managers responding? Let’s find out.

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This is Projectified. I’m Steve Hendershot. 

When will the wars end in eastern Europe and the Middle East, and what will be their resolutions? How will U.S. tariffs and trade wrangling affect prices and supply chains? South Korea became the latest to experience record wildfires. How might climate change affect other regions? 

Geostrategic concerns abound these days—not only in the headlines but also in the risk meetings of project teams around the world. According to EY Parthenon, 94% of companies increased the time and resources they spent on geostrategy in the last two years. That’s after corporate and investor attention on geopolitical issues surged sixfold in 2022—and that focus persists. 

Geostrategy plays a crucial and elevated role in the project playbook. So today we’re going to look at how teams across industries are factoring in geostrategic risks. We’ll start with Heather Buchanan, supply chain project manager at retail giant Canada Goose in Toronto. She has both the Project Management Professional (PMP)® and the PMI Risk Management Professional (PMI-RMP®) certifications.

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STEVE HENDERSHOT

Heather, thanks for talking with us. Let’s start with a geostrategy overview. Why is it essential to your work, and what does it look like in practice in your project management? 

HEATHER BUCHANAN 

Geostrategy is looking at all of the regions and countries that you’re operating your project in, that your stakeholders are in, [and] looking at the various ways that it can impact your project.

When we think of geopolitical volatility, before, we were only potentially looking at the impact to the triple constraint. But I think it really is, as a project manager, looking at all aspects of the project. So it’s the procurement, the stakeholders, the quality and the resources. It’s not just physical resources that can be impacted. There’s the human aspect, members on your project team. I think that project team morale and focus can be impacted during volatility. It is difficult to lead during these times, but I believe that it’s important to lead with compassion and empathy and increased communication and really understanding how the volatility can impact the people on your project team and your stakeholders.

STEVE HENDERSHOT 

That’s a really good point, because part of dealing with risk and change is leading with the ethos of flexibility. What does that look like, both in terms of strategically meeting the moment and also helping your teams operate in a way where they can handle change?  

HEATHER BUCHANAN 

I think it’s about trying to be as proactive as possible about potential shifts. As much as we can be proactive and plan, there are going to be times where you’re going to have to adjust strategies, which, as a project manager, is complex. So in those situations, it’s about making sure that any adjustments that we’re making, we’re still hitting our project deliverables. I also think that when we do make adjustments, it’s not just a knee-jerk reaction. We really need to take time and bring key project team members and stakeholders together to have a conversation about how we’re going to adjust the strategy while still achieving the project deliverables.

STEVE HENDERSHOT

What does that adaptation process look like? When are you creating those contingency plans in relation to when you hit a roadblock or circumstances change? 

HEATHER BUCHANAN 

Early on when the risks are being flagged, that’s when to have the conversations of, if we need to, the probability of it happening and if we need to have the contingencies. But based on the nature of the projects that I lead—that they are worldwide—we’re doing the contingencies very early on in the project and always having those conversations and revisiting, “Is the risk going to actualize? What’s the probability? What’s the impact?” So it’s really ongoing, and we’re being agile as things change. 

As a project manager, you have plan A, B and C. But sometimes, you have to realize that plan A, B and C may not work. So then it’s about bringing your project team members together [and] any organizational experts if they’re not already directly involved in the project. I facilitate and lead the conversation of how we’re going to get to our deliverables by adjusting the plan. I try to use really focused questions to keep the project team on track, to really think through and be strategic about how we’re adjusting the strategy while remaining flexible. So using questions such as, what deliverables of the project are impacted? What’s the severity? How can we adjust our approach? What are potential mitigation strategies? But also, who needs to be informed? Who needs to make decisions, and what’s our new timelines?

STEVE HENDERSHOT

You do risk reviews regularly with your teams. When do these discussions happen? Are you finding geostrategy or geopolitical considerations are coming up more often? 

HEATHER BUCHANAN 

I dedicate time in my project status meetings to have updates with the project team about risks that they’re seeing based on their area of expertise, risks I’m seeing, really having those discussions in those status meetings and, if needed, taking it to separate conversations to dig in a bit more about the risks. But it really can’t be separate. It needs to be rolled into one. So as a project manager, you’re really taking that overview to understand, what are all the risks for the project? I think depending on what’s happening in the environment, geostrategy volatility and risks does take up more of the time in the project status. It’s usually our first point when we’re talking about risk. Depending on what’s happening, we may have to take another meeting with key stakeholders to discuss further and in depth, but it is something that the project team definitely has to spend more time and energy on.

STEVE HENDERSHOT 

What geostrategy considerations are most prevalent for your work? And what are some areas where you see the biggest impact in the retail sector? 

HEATHER BUCHANAN 

Mostly what I’m seeing is an impact from a compliance standpoint and a trade standpoint, especially what’s happening in the world. I think a lot of retailers are seeing that. For the geopolitical risks, it’s really about tariffs, any changes in legal laws that impact, from a retail perspective, labor or manufacturing.  

STEVE HENDERSHOT

Tariffs are definitely a geostrategy consideration for a lot of project teams right now. What makes them a unique challenge? 

HEATHER BUCHANAN 

With tariffs and the impact of cost and uncertainty around that, it obviously impacts the budget. So in those instances where we know that there’s a high probability of tariffs, costs changing, I think it’s about having open and honest conversations with your sponsors about their project budget and understanding if you need to put in a buffer or a contingency for the project budget. It’s not ideal—nobody wants to put in a higher contingency for the budget. But sometimes it is necessary when you don’t know what’s going to happen and nobody can predict it. 

STEVE HENDERSHOT

You’re contending with a range of geostrategy considerations. How do you identify, prioritize and even triage all these different threats and their potential impacts?  

HEATHER BUCHANAN 

In order to prioritize, I try to use tools such as the risk register to, one, keep track of everything. And it’s really leveraging my subject matter experts on the team. They understand how the risks can impact the project. I may not know the impact of the risk, but it’s [about] asking the questions and leading the team in these meetings to understand what’s the biggest risk and what’s the biggest impact on the project, and the probability that it’s going to happen. What’s going to impact our deliverables? What’s going to impact our budget, and what’s going to impact our schedule? It’s my job to sort it and triage it and continuously work with the teams for updates, because something that may not have been a risk previously may be a higher risk. So it’s always having those conversations, but also triaging as we go.

STEVE HENDERSHOT

Are those subject matter experts region-specific? Domain-specific?  

HEATHER BUCHANAN 

They can be regional experts. We can also have domain-specific experts. There may be a risk, and we may not have that expert on the project team. So then at that point, it’s me reaching out to them for consultation, [to] talk to them about the risk and what’s happening, to get their viewpoint on it.

And sometimes, it’s actually bringing them onto the project team as that expert, to consult and lead with us.  

STEVE HENDERSHOT

Project managers are dealing with a lot of rapid change. What advice do you have for how they can stay up to date on geopolitics and have the geostrategy knowledge they need to run successful projects? 

HEATHER BUCHANAN 

So that’s definitely a challenge because there’s so much information out there to look at, but it’s also [about] what is credible information. We can really get bombarded, so I try to take a more tailored approach. I do rely on my SMEs, experts in the organization. But externally, I set up Google alerts for any of the regions that my project’s in or anything I’m kind of hearing. So that helps filter out some of the information. 

Recently I began to explore how to use AI to stay up to date. I think that it’s going to be a vital tool for project managers going forward, staying up to date in geostrategy. I really try to have that focused approach about finding credible sources, filtering the relevant information at the right time. 

LinkedIn is another really great resource to use—following leaders in the retail space or whatever space your project is in, as well as, actually, PMI. PMI has a lot of good resources that can be leveraged. There’s a lot of webinars, journals and even events that I find help because it offers a viewpoint from a project management lens—and it’s current.

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STEVE HENDERSHOT

The energy industry can be particularly sensitive to geostrategy concerns, because it’s so dependent on having access to specific physical locations, keeping those locations safe and secure, and maintaining a reliable supply chain to and from those sites. Not to mention the sector is contending with new technologies and growing climate change impacts. 

Rosa Gilsanz is a project leader at oil and gas company Bayernoil. Based in Munich, she has both the PMP® and PMI-RMP® certifications. Rosa spoke with Projectified’s Hannah LaBelle about how she approaches geostrategy in her projects.

MUSICAL TRANSITION

HANNAH LABELLE 

Rosa, is geostrategy becoming a more critical factor in how you manage projects? And what are the forces that you’re seeing drive this shift?

ROSA GILSANZ

The world is changing very fast, and we have had recent events like wars or the COVID pandemic, and we have seen the big influence that it had in our lives, [in our] industry, in the markets. 

The energy sector is especially exposed to these geopolitical issues, because we are dependent on physical resources and infrastructure. And we are also very dependent on the tendencies in the international markets. We are dependent on oil and gas, on critical minerals, and these are sometimes concentrated in politically unstable regions, like [the] Middle East, Russia and so on. Then the third one, the sensitivity to the markets. The material price, the oil price, is going up and down. It can have a pretty big impact, because it can also be that you’re not making such a big profit, that the economics of the project, they are not so attractive if the market is changing. If our organization wants to be successful, [it] has to be able also to adapt to such changes.

HANNAH LABELLE 

Can you just kind of expand on how you’re seeing this sector and your projects being impacted by this geopolitical volatility? 

ROSA GILSANZ

When Russia invaded Ukraine, the oil prices—the price of a barrel—it increased. Of course, it has also a big impact on the economics of the projects in the industry. When you have a war in the world, you have, of course, supply chain disruptions. You have all the materials, you have all the equipment and so on. And the market is getting crazy, because suddenly you have longer delivery times, the prices of materials are increasing. It’s very important for us project managers to keep an eye on that. You have to ensure that you have a risk management plan. That you identify the risks, that you identify the triggers and that you communicate this risk.

HANNAH LABELLE 

Are there any particular warning signs that you do watch for when you are running energy projects that maybe could trigger something like project reassessment or a major pivot? 

ROSA GILSANZ

Yeah, for some risks it’s more easy than for other ones because, as I say, you never know what’s happening tomorrow. Be aware of possible emerging risks. You can look for economic triggers. You can take a look, “Okay, what is the oil price doing? What is the energy price? Are they changing? Do we know that we have any supply chain constraints?” We as project managers, we have always to be updated on the current situation in politics and energy. Are there any new laws that we have to consider? Or maybe in the next year the government is planning to change—do we see that maybe some political instability is coming? And for me, the most important thing is when you are performing the risk identification, you have to do it with your team, with your stakeholders. 

HANNAH LABELLE 

How are you kind of prioritizing these threats as you create this risk list? Say you’ve got maybe an energy policy potentially shifting or supply chain issues due to a geopolitical situation. What are maybe some of the mitigation or management strategies you would consider in one of those scenarios?

ROSA GILSANZ

The first step always is to identify the risk. For the brainstorming, you have to ensure also to have a diverse team. You have to be sure to involve all stakeholders on that. Then you are doing the risk prioritization, qualitative analysis. And then you have to assess the impact and the probability of the risk. And that’s when you are coming also together with your risk team. You are building your risk metrics, and then you see, “Okay, which are my risks with high priority? Which are low priority risks,” and so on. Then you are developing, then, your strategies.

You have to work together with the team, with the stakeholders to develop the response, the mitigation measures. In [the] case of supply chain disruptions, for example, you can have a plan B, and you can work on the supplier diversification so that when you see, “Okay, this supplier is getting problems,” then you have to have a plan B and you have to have somebody else who can supply you the materials or what you need. And of course, you have maybe to plan more budget. You have also to plan a buffer in your timeline. And, of course, to communicate also with stakeholders. 

HANNAH LABELLE

Obviously there needs to be a lot of resilience and a lot of adaptability. So how do you as a project manager ensure that you and your team can adjust your strategies fast when things do change? How do you kind of work to build a culture of resilience and adaptability when uncertainty comes your way?

ROSA GILSANZ

Well, for me, the first measure is to have clear and transparent communication. You have to define clear rules. You have to define risk. You have to define and follow processes. You have always to have a plan, and everyone in the team has to know what to do when a trigger is identified.

And when I’m talking everyone in the team, I mean you have also to have this clear and transparent communication with your project sponsors, with the management in your company, with your colleagues.

You have to invest also in risk management training. Sometimes you see there are team members, for example, who maybe don’t have such experience with risk management methods or with the process and so on. You have to ensure that they understand what they are doing, how the risk management process works. And, of course, very important for me is also to work on the mindset. 

Some years ago, [at] a risk management workshop for risk identification, I was doing an introduction. What’s risk management? What are we doing, and how are we doing that? One of the members of the team was saying, “Well, yeah, I think I understood it. Our goal is not to have this high-priority risk.” I said, “No, that’s not the goal. We have to identify the risk. It’s okay if we have this high-priority risk having a big impact on the project. You have to know how to proceed when you identified your trigger.” 

You have to work with your team on the mindset, that they become more flexible. When you say the word risk, some people are getting afraid, and you don’t have to be afraid of that. It’s a normal process. You get risk in all your projects, and you have just to know how to manage them.

HANNAH LABELLE

Rosa, thank you so much for talking with me. I really enjoyed our conversation.

ROSA GILSANZ

Thank you, Hannah, also from my side for this wonderful conversation. 

STEVE HENDERSHOT 

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