Risk profiling
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The document discusses risk profiling and its importance in categorization rather than prioritization of risks within a backlog. It provides insights into various risk dimensions and classification methods, highlighting the need for effective demand management. Additionally, the facilitator and coach views emphasize the interplay between risk assessment and decision-making processes in project management.
![Ordinal
Ordinal sets have an implied order, sequence, priority, e.g.
- Spring-Summer-Fall-Winter
- High-Medium-Low [technical|delivery|business] risk
Ordinal sets provide us with more actionable risk information such as a
sequencing or scheduling preference, often with conflicting guidance
While capacity allocation is still useful for hedging, we now have sequencing
and scheduling information. We may also have urgency or class of service
information. An ordinal risk classification may have a relationship to a
deadline, delay cost function, or pattern of value decay.](https://image.slidesharecdn.com/riskprofiling-180329075453/85/Risk-profiling-41-320.jpg)
Risk profiling
- 2. Thank you.
- 3. Two views.
- 6. Coach view.
- 8. Two envelopes are lying in front of you, one has 10 €, the other one is empty. What would you do? Option 1- Pick one of the envelopes Option 2- Leave the envelopes and receive 3 €
- 9. Two envelopes are lying in front of you, one has 10M €, the other one is empty. What would you do? Option 1- Pick one of the envelopes Option 2- Leave the envelopes and receive 3M €
- 10. Risk is not Uncertainty
- 11. Risk is the economical impact of Uncertainty
- 12. What’s the highest risk item in your backlog? Why? What kind of risks are involved?
- 13. What’s the 2nd highest risk item in your backlog? Why? What kind of risks are involved?
- 14. What’s the 3rd highest risk item in your backlog? Why? What kind of risks are involved?
- 15. What’s the …?
- 16. Etc.
- 17. Risk Profiling is not about priorization.
- 18. Risk Profiling is about categorization.
- 19. Work Which risk do you manage related to your work?
- 21. Risk is not Uncertaintly.
- 22. Risk is not Uncertaintly. Priorization vs Categorization. At the same time, we collected 3 items they identify as ‘high risk’. Keep them, we will use later.
- 23. Risk is not Uncertaintly. Priorization vs Categorization. At the same time, we collected 3 items they identify as ‘high risk’. Keep them, we will use later. Identify risks Create ownership.
- 25. Visualizing Risks Qualitative Taxonomies 4 to 6 categories Fact-based Cheap Fast Accurate Consensus Forming Managed Risk Heterogeneous Expensive Time Consuming Fake Precision? May still be High Risk Homogenous Cheap Fast High Risk too simple too complex
- 26. Visualizing Risks Qualitative Taxonomies 4 to 6 categories Fact-based Cheap Fast Accurate Consensus Forming Managed Risk Heterogeneous Expensive Time Consuming Fake Precision? May still be High Risk Homogenous Cheap Fast High Risk too simple too complex
- 27. Risk 1 Risk 2 Risk 3Risk 4 Risk 5 Visualizing Risks
- 28. Risk 1 Risk 2 Risk 3Risk 4 Risk 5 Visualizing Risks
- 29. Work Can you group the risks you identified into 4 to 6 categories?
- 31. A tool for Consensus Forming.
- 32. A tool for Consensus Forming. Nothing keep out your categories. Avoid fustration. Reduce complexity. Reinforce ownership.
- 33. Dimensions Risk 2 Risk 3Risk 4 Risk 5 Risk 1
- 35. Dimensions Lifecycle UrgencyDelay impact Tech risk Table stakes Cost reducer Spoiler Differentiator Enthusiast Majority Laggard Intangible Standard Fixed date ExpediteExtinction level event Major capital Discretionary spending Unknown solution Known but not us Done it before Commodity Market role
- 36. Work Can you create the dimensión for each category?
- 37. Work Can you create the dimensión for each category? Work Can you create the dimensión for each category? Please excuse it. Just do one of them because of the time for the meetup.
- 39. Four types of dimensions: - Nominal - Ordinal - Interval - Ratio
- 40. Nominal Nominal sets generally have classification but without any specific preference, priority or ordinality. In other words, an item of one class isn’t more or less risky than an item of a different class, e.g. - Men-Women-Kids - Red-Blue-Green - … In precense of nominal sets, hedge risk and shape demand to an acceptable ratio using capacity allocation.
- 41. Ordinal Ordinal sets have an implied order, sequence, priority, e.g. - Spring-Summer-Fall-Winter - High-Medium-Low [technical|delivery|business] risk Ordinal sets provide us with more actionable risk information such as a sequencing or scheduling preference, often with conflicting guidance While capacity allocation is still useful for hedging, we now have sequencing and scheduling information. We may also have urgency or class of service information. An ordinal risk classification may have a relationship to a deadline, delay cost function, or pattern of value decay.
- 42. Interval A interval may be expressed as a numeric range on a linear, or logarithmic scale 0 10000 1 205 102 1 50025 1005 1 10000100 100010 1 2010 137
- 43. Interval Beware of the different scales 0 10000 1 205 102 1 50025 1005 1 10000100 100010 1 2010 137
- 44. Ratio A ratio may be expressed as a %, or a fraction Indicate the directionality of the risk. Is the lowest value least risky or most risky? 0% 100% 1/100 100/11
- 45. Shaping demand Lifecycle UrgencyDelay impact Tech risk Table stakes Cost reducer Spoiler Differentiator Enthusiast Majority Laggard Intangible Standard Fixed date ExpediteExtinction level event Major capital Discretionary spending Unknown solution Known but not us Done it before Commodity Market role
- 46. Shaping demand Lifecycle UrgencyDelay impact Tech risk Table stakes Cost reducer Spoiler Differentiator Enthusiast Majority Laggard Intangible Standard Fixed date ExpediteExtinction level event Major capital Discretionary spending Unknown solution Known but not us Done it before Commodity Market role
- 47. Shaping demand Lifecycle UrgencyDelay impact Tech risk Table stakes Cost reducer Spoiler Differentiator Enthusiast Majority Laggard Intangible Standard Fixed date ExpediteExtinction level event Major capital Discretionary spending Unknown solution Known but not us Done it before Commodity Market role
- 48. Shaping demand Lifecycle UrgencyDelay impact Tech risk Table stakes Cost reducer Spoiler Differentiator Enthusiast Majority Laggard Intangible Standard Fixed date ExpediteExtinction level event Major capital Discretionary spending Unknown solution Known but not us Done it before Commodity Market role
- 49. Shaping demand Lifecycle UrgencyDelay impact Tech risk Table stakes Cost reducer Spoiler Differentiator Enthusiast Majority Laggard Intangible Standard Fixed date ExpediteExtinction level event Major capital Discretionary spending Unknown solution Known but not us Done it before Commodity Market role Life is not so easy
- 50. Shaping demand Lifecycle UrgencyDelay impact Tech risk Table stakes Cost reducer Spoiler Differentiator Enthusiast Majority Laggard Intangible Standard Fixed date ExpediteExtinction level event Major capital Discretionary spending Unknown solution Known but not us Done it before Commodity Market role
- 51. Shaping demand using tresholds Lifecycle UrgencyDelay impact Tech risk Table stakes Cost reducer Spoiler Differentiator Enthusiast Majority Laggard Intangible Standard Fixed date ExpediteExtinction level event Major capital Discretionary spending Unknown solution Known but not us Done it before Commodity Market role
- 52. Shaping demand using tresholds Lifecycle UrgencyDelay impact Tech risk Table stakes Cost reducer Spoiler Differentiator Enthusiast Majority Laggard Intangible Standard Fixed date ExpediteExtinction level event Major capital Discretionary spending Unknown solution Known but not us Done it before Commodity Market role
- 53. Shaping demand using tresholds Lifecycle UrgencyDelay impact Tech risk Table stakes Cost reducer Spoiler Differentiator Enthusiast Majority Laggard Intangible Standard Fixed date ExpediteExtinction level event Major capital Discretionary spending Unknown solution Known but not us Done it before Commodity Market role
- 54. Shaping demand using tresholds Lifecycle UrgencyDelay impact Tech risk Table stakes Cost reducer Spoiler Differentiator Enthusiast Majority Laggard Intangible Standard Fixed date ExpediteExtinction level event Major capital Discretionary spending Unknown solution Known but not us Done it before Commodity Market role
- 55. Shaping demand using tresholds Lifecycle UrgencyDelay impact Tech risk Table stakes Cost reducer Spoiler Differentiator Enthusiast Majority Laggard Intangible Standard Fixed date ExpediteExtinction level event Major capital Discretionary spending Unknown solution Known but not us Done it before Commodity Market role
- 56. Work Can you create the profiles for the 3 highest risk items you identified at the beginning of the session?
- 57. Work Can you create the profiles for the 3 highest risk items you identified at the beginning of the session? Please excuse it. We will avoid because of the time for the meetup.
- 58. Some examples Lifecycle UrgencyDelay impact Tech risk Table stakes Cost reducer Spoiler Differentiator Enthusiast Majority Laggard Intangible Standard Fixed date ExpediteExtinction level event Major capital Discretionary spending Unknown solution Known but not us Done it before Commodity Market role
- 59. Some examples
- 60. Some examples Making faster and better decissions
- 61. Some examples
- 63. Idea 1 Idea 2 Idea 3 Idea 4 Idea 5 Idea 6 Idea 7 Idea 8 Idea 9 Idea 10 Some examples
- 64. Idea 1 Idea 2 Idea 3 Idea 4 Idea 5 Idea 6 Idea 7 Idea 8 Idea 9 Idea 10 ▪ Are we managing housekeeping tasks as well as differentiators? ▪ Are we targeting low-effort incremental gains and higher impact projects too? ▪ Are the tactical projects balanced with feature developments that will help us catch up with competitors? etc Some examples
- 65. Idea 1 Idea 2 Idea 3 Idea 4 Idea 5 Idea 6 Idea 7 Idea 8 Idea 9 Idea 10 Some examples Balanced and diversified portfolio ▪ Are we managing housekeeping tasks as well as differentiators? ▪ Are we targeting low-effort incremental gains and higher impact projects too? ▪ Are the tactical projects balanced with feature developments that will help us catch up with competitors? etc
- 67. Structure
- 70. Structure What’s the highest risk …? 3 high risk items identified Introduction
- 71. Structure What’s the highest risk …? 3 high risk items identified List the risksIntroduction
- 72. Structure What’s the highest risk …? 3 high risk items identified List the risks Group the risks into categories Introduction
- 73. Structure What’s the highest risk …? 3 high risk items identified List the risks Group the risks into categories Create the dimensions for each category Introduction
- 74. Structure What’s the highest risk …? 3 high risk items identified List the risks Group the risks into categories Create the dimensions for each category Profile some work Introduction
- 75. Structure What’s the highest risk …? 3 high risk items identified List the risks Group the risks into categories Create the dimensions for each category Profile some work Samples/ Conclusions / Debriefing Introduction
- 76. Structure Introduction What’s the highest risk …? 3 high risk items identified List the risks Group the risks into categories Create the dimensions for each category Profile some work Close Samples/ Conclusions / Debriefing
- 77. Coach view.
- 79. Demand management is not always about priorization.
- 85. Today’s problems come from yesterday solutions.
- 86. Risks when everything is priorized Nothing is discarded At some moment, everything becomes high priority or Queues start to grow and become unmaneagable You may found yourself working in batches.
- 87. Irrefutable demand “We’ve already committed to it” “The boss (sometimes called “Business”) wants it” It’s a legal or regulatory requirement It’s part of an already committed Project. It’s mission critical
- 88. Irrefutable demand Pull requires that demand is refutable or at least delayable Demand must be balanced against capability to supply Demand can be shaped
- 89. It is irrefutable demand as irrefutable as it seems? Can we use policy to shape demand? For example, sacrifice fidelity or quality on items of a given risk category or risk profile to bifurcate demand to a shared sevice? Can we smooth demand through better understanding of when to schedule it or its cost of delay? Schedule highest cost of delay items at optimal start time, and offset others to less optimal start times Do demand shaping thresholds and other policies explicit
- 90. Not just Risk Profiling.
- 91. Our strategy for demand management improvement Use the feedback loops of service delivery review & operations review to adjust demand to capability Use a holistic approach to managing the network of interdependent services (blocker clustering, dynamic reservation systems, …) Ensure decision making is informed & effective, combining Risk profiling with making demand shaping thresholds and other policies explicit.
- 93. Thank you.