IDENTIFYING AND MANAGING PROJECT RISK BY TOM KENDRICK

IDENTIFYING AND MANAGING PROJECT RISK BY TOM KENDRICK Book Club Discussion Sandra Gwynn| PMI Southern Maryland Chapter JANUARY 23, 2020

Chapter 1: Why Project Risk Management? Technical projects have a high level of risk because of (pg. 1): • High Variation • Staffed “Lean” • Inadequate Funding and Equipment • Fast Execution Identifying and Managing Project Risk Book Club Discussion Topic: This book has a copyright of 2003. Do you think risk has changed for technical projects since that time? 27 FEBRUARY 2021 2

First Panama Canal Project Discussion Topic: The First Panama Canal Project failed. Can you identify any of the causes of that failure? Presentation Title 27 FEBRUARY 2021 3

First Panama Canal Project Causes of Failure: • Poor Planning • Inadequate Change Management • Not listening to the engineers (Sea-level canal project choice instead of dams with locks) • Not enough funding • Environment • Disease • Poor Communication – Lies • Lack of Risk Management Identifying and Managing Project Risk Book Club Discussion 27 FEBRUARY 2021 4

Chapter 2: Planning for Risk Management use in Project Selection (pg. 19): 1. Project is authorized 2. Project has changes to scope, schedule or resources 3. Project is rejected Key Ideas for Project Risk Planning (pg. 35): • Project selection affects risk management and depends upon it. • Project risk management builds on the foundation provided by your project definition and planning. • A project risk plan summarizes your risk management approach Identifying and Managing Project Risk Book Club Discussion Topic: Can you give an example of a project you are familiar with that was authorized, changed, or terminated because of risk management? 27 FEBRUARY 2021 5

Chapter 3: Identifying Scope Risk Scope risk identifies projects beyond your capabilities. Sources of scope risk pg. 38: Changes, Defects Discussion Topic: 3 techniques for managing scope risk: Key Ideas for Identifying Scope Risk (pg. 65): • Clearly define all project deliverables and note challenges. • Set limits on the project based on the value of the deliverables. • Decompose all project work into small pieces, and identify work not well understood. • Assign ownership for all project work and probe for reasons behind any reluctance. • Note risk arising from expected project duration or complexity. Identifying and Managing Project Risk Book Club Discussion • Using a documented definition process • Developing a straw-man definition document • Adopting a rigorous evolutionary methodology Have you ever been involved in a project that used a straw-man definition approach? If so, how did that work for your project? 27 FEBRUARY 2021 6

Chapter 4: Identifying Project Schedule Risk Key Ideas for Identifying Schedule Risks (pg. 102): • Determine the root causes of all uncertain estimates. • Identify all estimates not based on historical data. • Note dependencies that pose delay risks, including all interfaces. • Find any differences between project effort requirements and life-cycle norms. • Identify risky activities and schedule them early in the project. • Ascertain risks associated with multiple critical (or nearcritical) paths. • Note risks associated with lengthy projects. Identifying and Managing Project Risk Book Club Discussion Topic: Have you ever been involved in a project with unrealistic estimates? Were you able to complete that project? 27 FEBRUARY 2021 7

Chapter 5: Identifying Project Resource Risk Key Ideas for Identifying Resource Risks (pg. 130): • Identify all required skills you need for which you lack named, committed staffing. • Determine all situations in the project plan where people or other resources are overcommitted. • Find all activities with insufficient resources. • Identify uncertain activity effort estimates. • Note outsourcing risks. • Gain funding approval early for needed training, equipment purchases, and travel. • Ascertain all expected project costs. Identifying and Managing Project Risk Book Club Discussion Topic: The author says teams that are not co-located increase risk (pg. 119). Do you agree? 27 FEBRUARY 2021 8

Chapter 6: Managing Project Constraints and Documenting Risks Key Ideas for Constraint Management and Risk Discovery (pg. 156): • Minimize differences between project plans and objectives. • Understand clearly document project priorities. • Use priorities to identify project alternatives. • Explore project opportunities. • Identify and explicitly remove unnecessary project scope. • Determine risks and costs of proposed project changes. • Minimize unknown risk through brainstorming, analysis, and research. Identifying and Managing Project Risk Book Club Discussion Topic: This chapter lists several techniques for risk discovery. What techniques have you used to identify project risks? 27 FEBRUARY 2021 9

Chapter 7: Quantifying and Analyzing Activity Risks Quantitative provides estimates and measures for each risk. Qualitative places risks into ranges and categories. Discussion Topic: Key Ideas for Activity Risk Analysis (pg. 179): • Assess probability and impact for each project risk. • Use qualitative risk analysis to prioritize risks. • Apply quantitative risk analysis techniques to significant risks. • If you use PERT, keep it simple. On a project you have been involved with, are some risks measured with quantitative risk assessment? If so, what percentage? Identifying and Managing Project Risk Book Club Discussion 27 FEBRUARY 2021 10

Chapter 8: Managing Activity Risks Key Ideas for Managing Activity Risks (pg. 217): • Determine root causes. • Avoid, mitigate, or transfer risks when feasible. • Develop contingency plans for remaining significant risks. • Document risk plans and keep risk data visible. • Thirty grams of prevention is worth half a kilogram of cure (approximately). Identifying and Managing Project Risk Book Club Discussion Topic: How do you minimize the damage of unknown risk on your projects? 27 FEBRUARY 2021 11

Chapter 9: Quantifying and Analyzing Project Risk Key Ideas for Project Risk Analysis (pg. 262): • Survey contributors and stakeholders for risk assessments. • Use worst-case estimates, contingency plan data, or PERT analysis to determine project uncertainty. • Estimate project scale in effort-months. Identifying and Managing Project Risk Book Club Discussion Topic: Have you used Program Evaluation and Review Technique (PERT) on any projects? 27 FEBRUARY 2021 12

Chapter 10: Managing Project Risk Key Ideas for Managing Project Risk (pg. 288): • Hold a project start-up workshop. • Select and use several project metrics. • Determine required project reserve. • Negotiate and validate possible project objectives. • Freeze scope and manage specification changes. Identifying and Managing Project Risk Book Club Discussion Topic: Do you use Management Reserve on your projects? If so, how do you communicate that to your customers and your team? 27 FEBRUARY 2021 13

Chapter 11: Monitoring and Controlling Risky Projects Key Ideas for Risk Monitoring and Control (pg. 317): • Collect status dogmatically. • Monitor variances and trends frequently throughout our project. • Respond to issues and problems promptly. • Communicate clearly and often. Identifying and Managing Project Risk Book Club Discussion Topic: What communication challenges have you had on your projects? How have you addressed them? 27 FEBRUARY 2021 14

Chapter 12: Closing Projects Key Ideas for Project Closure (pg. 329): • Thoroughly and accurately document the project results. • Recognize accomplishments and thank contributors. • Conduct a project retrospective and use the recommendations. Identifying and Managing Project Risk Book Club Discussion Topic: In your experience, how good have the project closeout processes been for the projects you have worked on? Do you perform a lessonslearned/project retrospective analysis? 27 FEBRUARY 2021 15

Chapter 13: Conclusion Do enough planning and risk management to convince yourself that the project is, in fact, possible (pg. 331). Information on the PERIL database is available at http: //www. failureproofprojects. com/ Identifying and Managing Project Risk Book Club Discussion Topic: Are their risk planning techniques or risk management techniques discussed in this book that you plan to use? 27 FEBRUARY 2021 16