To me they both seem to be issues that negatively impact the project. So how to tell the difference? When identifying these 'issues', how do project managers determine whether or not it is a risk or an impediment? What are some real world examples of each and why they are categorized as risks or impediments?
An impediment or issue is something that is impacting the project now.
A risk is something that might occur in the future. Typically, we look at risks in terms of the likelihood they will occur and the impact on the project if they do occur.
If the impact/likelihood of a risk is high enough, we'd usually try to mitigate it in some way. This might involve a significant change in direction in the case of a high impact/high likelihood risk or just having a plan B for less critical risks.
Risks are always in the future and are not certain. Issues or impediments are either in the future, is occurring now, or has happened in the past with ongoing adverse sequelae. To distinguish a risk with a future issue, it comes down to degree of certainty. If it WILL happen, with 100% certainty, it is an issue. In addition to this, an organization may define an issue with something less than 100% certainty. For example, a risk averse organization may find it prudent to define the issue for those risks with greater than 75% likelihood. The reason for this would be the rule to allocate recovery resources. When it is a risk, you compare the expected impact value with the cost of mitigation and make a decision whether it is prudent to mitigate or simply accept. As an issue, the use of resources would be different, in that a PM would be able to gain access to funding in a faster, more easy way. Therefore, that is why you may define a risk as an issue with a high probability.
Risks you can mitigate. Impediments are impediments, so, your project can't go on.
In Software industry
- Risk example: You don't know if some technology fits your needs. You can mitigate doing a prof of concept.
- Impediment example: You need a impossible thing, like modifying/integrating with a closed software solution (non open source software) that has no integration API.