Program Management 2.0: Risk Management
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The document outlines a program management presentation focused on risk management techniques, including estimating progress and monitoring project performance. Key learning points include creating metrics for task progress, managing risk through various response strategies, and the importance of effective communication in project teams. Participants will learn to implement risk management matrices, monitor predictive metrics, and ensure timely communication to enhance project execution.
Program Management 2.0: Risk Management
- 1. 1 1 PROGRAM MANAGEMENT 2.0 RISK MANAGEMENT Jeanne Bradford, John Carter, Scott Elliott April, 2018
- 2. 2 22 AGENDA 1 Schedule Prediction Accuracy Exercise in creating diagram 2 Metrics for estimating progress at the engineering task levels Exercise in creating a Task Burn- Down Chart 3 Monitoring Progress: Earned Value – Scope, Cost and Time Exercise in managing Partner’s delay 4 Risk & Circle Dot Charts: What happens if there is a breakdown? Exercise 5 Management Systems Covered in this presentation
- 3. 3 33 KEY LEARNING POINTS Monitoring Project Performance for Internal and External Partners (TCGen’s Innovate Products Faster, Greene’s Head First PMP) 1 Metrics for estimating progress (at the engineering task levels) 2 Monitoring Progress (Earned Value – Scope, Cost and Time) 3 Risk Monitoring 4 Circle Dot Charts 5 Management Systems Participants will understand how to create and update Schedule Prediction Accuracy charts and how to demonstrate program status by showing scope, cost and time in one chart. They will also gain skill in creating and using:
- 5. 5 55 ESSENTIAL PROCESSES FOR MANAGING RISKS • Assess – Learn from the past, create checklist, review prior audits, go outside, generate list of potential risks • Plan – Perform impact and probability analysis, prioritize, and make plans • Monitor – Keep an active watch for trouble by monitoring predictive metrics • React – Re-mediate if and when there is trouble Assess Plan Monitor & React
- 6. 6 66 RISK RESPONSE OPTIONS Risk Response Description Examples/Notes Avoidance Avoiding the risk. Changing the project plan to eliminate the risk. Changing the project plan to protect a project objective from the impact. Reducing the scope remove high-risk tasks. Adding resources or time. Adopting a proven approach rather than new one. Removing a “problem” resource. Acceptance Accepting the consequences of the risk. The project plan is not changed to deal with the risk. A better response strategy cannot be identified. Active acceptance. Passive acceptance. No action. Contingency allowance (reserves). Communication plan around possible major cost increases if this risk occurs. Monitor and prepare Accepting the risk for now. Closely monitor the risk and develop alternate action plans proactively if the event occurs. Contingency plan. Fallback plan. Establish criteria that will trigger the implementation of the response plans. Source: Project Management, Absolute Beginner’s Guide, Gregory Horine Que Publishing, Indianapolis 2013
- 7. 7 77 Risk Response Description Examples/Notes Mitigation Taking action to reduce the likelihood that the risk will occur. Taking action to reduce the impact of the risk. Reducing the probability is always more effective than minimizing the consequences. Adopting less complex approaches. Planning on more testing. Adding resources or time to the schedule. Assigning a team member to visit the seller’s facilities frequently to learn about potential delivery problems as early as possible. Providing a less-experienced team member with additional training. Deciding to prototype a high-risk solution element. Transference Transferring ownership of the risk factor. Shifting the consequence of a risk and the ownership of the response to a third party. Outsourcing difficult work to a more experienced company. Fixed price contract. Contract, insurance, warranties, guarantees, and so on. Used most often for financial risk exposure. Does not eliminate the risk. RISK RESPONSE OPTIONS Source: Project Management, Absolute Beginner’s Guide, Gregory Horine Que Publishing, Indianapolis 2013
- 8. 8 88 ESSENTIAL PROCESSES FOR MANAGING RISKS Which Business Problems Does the Tool Solve? • Innovation brings with it additional risks which can still be managed by the team on its own • Helps improve project execution because it can help the team anticipate, prevent, and mitigate risks Benefits: • You can identify risks before they occur • There is a reduction of risk impact due to early detection • Quantitative metrics that help clarify when to act on a risk item • Action accelerates because of the clear thresholds and the agreement to follow a process
- 9. 9 99 RISK MANAGEMENT MATRIX Status Risk Impact Likelihood Metric Threshold Current Value Date Action Plan Global team does not communicate frequently enough. Want to keep weekly communication high. 4 7 Meetings per week 2 2.5 Current Invoke team’s elevation plan, purchase videoconferencing systems, change incentives. Data captured on long forms from online interaction sessions must not be lost if user gets error message or returns to screen. 6 6 % Data Lost 10% 25% Q3 FY 13 Design review current forms layout, bring in Expert Co. consulting firm, change staff balance. Server must respond to users rapidly under fairly high loads – expect page to be updated way under a second. 7 7 Ms at 1000 Users 259 1000 Q2 FY 13 Add architect and create tiger team with system optimization experience. Financial partner cooperation is critical to this household finance program, and we need to have a sufficient number at launch 4 6 Institutions 1000 247 Q3 FY 13 Increases business development staff, change incentive compensation, add external business development firm. Mobile operating system support must be in place at the same time as launching the desktop version. 5 6 On Time Q4 FY 14 Q4 FY 14 Current Track schedule prediction accuracy. If slip then recruit internal team from Vietnam (permission already granted).
- 10. 10 1010 Status Risk Impact Likelihood Metric Threshold Current Value Date Action Plan Global team does not communicate frequently enough. Want to keep weekly communication high. 4 7 Meetings per week 2 2.5 Current Invoke team’s elevation plan, purchase videoconferencing systems, change incentives. Data captured on long forms from online interaction sessions must not be lost if user gets error message or returns to screen. 6 6 % Data Lost 10% 25% Q3 FY 13 Design review current forms layout, bring in Expert Co. consulting firm, change staff balance. Server must respond to users rapidly under fairly high loads – expect page to be updated way under a second. 7 7 Ms at 1000 Users 259 1000 Q2 FY 13 Add architect and create tiger team with system optimization experience. Financial partner cooperation is critical to this household finance program, and we need to have a sufficient number at launch 4 6 Institutions 1000 247 Q3 FY 13 Increases business development staff, change incentive compensation, add external business development firm. Mobile operating system support must be in place at the same time as launching the desktop version. 5 6 On Time Q4 FY 14 Q4 FY 14 Current Track schedule prediction accuracy. If slip then recruit internal team from Vietnam (permission already granted). RISK MANAGEMENT MATRIX Impact of Risk 1 = Low,10 = High Likelihood 1 = Low,10 = High Metric Value triggering action What to do if Threshold reached
- 11. 11 1111 CONTROLLING RISKS • Tackle high risk tasks first • Maximize resources on high-risk tasks • Postpone low-risk tasks • Use iterative, phased approaches • Frequent, smaller deliverables reduce overall risk • Change the way you design • Create a better balance between theory and experimentation; lean more on experimentation to get fast answers • Get to “no” more quickly on parallel paths • QA the planning process • Leverage independent QA audits
- 12. 12 1212 MITIGATING RISKS: ALTERNATIVES 1 Soft Skills 2 Meetings 3 Dot Voting 4 Out of Bounds 5 Communication Paths 6 Fast Tracking and Crashing Assess Plan Monitor & React These Tools are for the “Monitor and React” phase
- 13. 13 1313 SOFT SKILLS: EXECUTING A successful Program Manager has these critical soft skills Is the leader of communications: sets the tone and protocols for them When there are breakdowns, emphasizes the outcome the team is trying to produce not who is to blame
- 14. 14 1414 MANAGING YOUR TEAM & MEETINGS • “Smooth” program management starts by running effective meetings • Communicating effectively outside of team meetings is where the real work gets done however • Focusing on the outcome rather than on blaming people • Establishing clear priorities and sticking with them • Tracking the status of each activity (sub-project) within the project • Using metrics to see the big picture and to drive improvement Necessary Conditions for “Execution: Managing Teams & Meetings” Communication Skills Communication Tools Tracking Capability Metrics • DOCUMENTS: Communication protocols, Metrics dashboard, Priority lists (These are suggested, not in place yet at D+M)
- 15. 15 1515 FAST TRACKING & CRASHING TASKS Source: Dynamics of Project Performance: System Dynamics and Project Management , Lyneis, MIT, 2003, p 16 Worry about taking shortcuts that only cause delay because of more rework Traditional project Overlap phases Compress each phase Reduce Rework Planned Duration Actual Phase 1 Rework Phase 2
- 16. 16 1616 EXERCISE: MONITORING RISK Possibilities: Build a Risk Management Matrix from a project Have a role-playing scenario where a risk has crossed the threshold and Partner is not responding well
- 17. 17 17 TCGen Inc. Menlo Park CA, 94025 jcarter@tcgen.com (650) 733-5310