What is a Contingency Plan?

A contingency plan in project management is a defined, actionable plan that is to be enacted if an identified risk becomes a reality. It is essentially a “Plan B”, to be put in place when things go differently than expected. The Project Management Institute defines contingency planning as involving defining action steps to be taken if an identified risk event should occur. Contingency plans in project management are a component of risk management and should be part of the risk management plan.

When is a Contingency Plan used?

Contingency plans can only be created for identified risks, not unidentified or unknown risks — if you don’t know what your risk is, it’s impossible to plan for it. It should be noted that contingency plans are not only put in place to anticipate when things go wrong — they can also be created to take advantage of strategic opportunities. For example, say you’ve identified that a new training software should be released soon. If it occurs during your project, you may have a contingency plan on how to incorporate it into the training phase of your project.

Difference between a Contingency Plan & a Mitigation Plan

A mitigation plan attempts to decrease the chances of a risk occurring or decrease the impact of the risk if it occurs. It is implemented in advance. A contingency plan explains the steps to take after the identified risk occurs, to reduce its impact. Think of a contingency plan as the last line of defense.

How to prepare your Contingency Plan

When preparing your contingency plan, consider these four guidelines:

  1. Identify what specific event or events need to happen to trigger the implementation of the plan.
  2. Cover the five bases in each step of your plan: who will be involved, what do they need to do, when does it need to happen, where will the plan take place, and how will it be executed.
  3. Have clear guidelines for reporting and communication during the implementation of the plan. How will internal and external stakeholders be notified? Who will draft and send the notice, and how soon after the incident will it be released? How often will updates be provided?
  4. Monitor the plan on a regular basis to ensure it is up to date.

In addition, you should be aware of these four common challenges that project managers face with contingency planning:

  • Contingency planning is viewed as a low priority

Since the plan may never be needed, there can be a tendency to put off the creation of it. However, not having a properly planned out contingency can lead to project failure.

  • Team members may be overconfident or overly invested in Plan A

Therefore, they may not be motivated to create a detailed, actionable Plan B.

  • Lack of enterprise-wide plan awareness and buy-in can hinder implementation.

Projects do not happen in isolation. If all stakeholders in the organization are not aware of and invested in the plan, there may be delays in enacting it.

  • Not spending enough time identifying all risks.

If a risk has not been properly identified, it’s impossible to prepare a viable contingency plan.


In project management, contingency planning is often part of risk management. Any project manager knows that a plan is only an outline. Sometimes the project will extend beyond those lines. The more a manager can prepare for the change in their plan, the more effective it will be.

But risk management isn’t the same as contingency planning. Risk management is about identifying, assessing, avoiding, mitigating, transferring, sharing, and accepting risk; while a contingency plan is about developing steps to take when an actual issue occurs. However, they do share the aspect of what to do when the risk happens.

So, a contingency plan is what to do if an unplanned event occurs. It can be as simple as asking, “What if…?” and then outlining the steps to your plan as you answer that question.




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