Risk Management or Do I Feel Lucky?

1. Risk Management or Do I Feel Lucky? Jack J. Ference, PMP®, PMI-RMP® Jack.ference@dot.gov

2. Presentation Outline • Project Introduction and Background • Risk Management Process • Risk Management Planning • Risk Identification • Risk Analysis • Results from Process • Benefits and Lessons Learned • Questions PMI Baltimore Luncheon Meeting Columbia, MD

3. What this Project is About PMI Baltimore Luncheon Meeting Columbia, MD Photo clips from abcNews.com

4. Project Challenges • “Low to Moderate” risk project • Basic type of work had been done before, however, challenges included: • Completing project in four-year timeframe • Executing two concurrent field tests • Agreement upon system requirements/tests • Integration/testing of three standalone functions • Development of new capabilities • Collecting driving data in “down” economy • Varied project management culture within team PMI Baltimore Luncheon Meeting Columbia, MD

5. Phase II – 24 months Phase I – 30 months Pilot Vehicles Prototype Vehicles Engineering Development Vehicles Extended Pilot Test FOT Data Collection Nov 2005 Nov 2006 June 2008 Nov 2008 Feb 2009 May 2010 Project Timeline Project Information Five-year Cooperative Agreement (80%-20%) “Best-efforts” cost reimbursable agreement Federal Funds $25.6M – Private Funds $7.4M Other Federal Partners –$7.9M Support Staff –$1.9M Phase I –$28.3M Phase II – $14.5M PMI Baltimore Luncheon Meeting Columbia, MD

6. Risk Management Process Plan Risk Management Monitor and Control Risks Identify Risks Plan Risk Responses Perform Risk Analysis PMI Baltimore Luncheon Meeting Columbia, MD

7. Risk Management Planning • Deciding your approach – how formal? • Scaling effort to meet project needs/budget • Showing value of process and obtaining buy-in • Acknowledging training needs • Writing, communicating and following the plan • Developing probability and impact definitions • Writing actionable risk statements • Selecting tools and processes • All needed to ensure consistency • Following up, making adjustments, repeating processes PMI Baltimore Luncheon Meeting Columbia, MD

8. Probability and Impact Matrix PMI Baltimore Luncheon Meeting Columbia, MD

9. Risk Identification • Phase II statement of work, schedule and project budget • Phase I and past experience • Tools and Techniques • Adobe® Acrobat fill-able Form/Workshop • Risk Breakdown Structure • Project-specific checklist • Interviewing PMI Baltimore Luncheon Meeting Columbia, MD

10. Risk Identification Worksheet PMI Baltimore Luncheon Meeting Columbia, MD

11. Risk Register – Part I PMI Baltimore Luncheon Meeting Columbia, MD

12. Risk Rating Form PMI Baltimore Luncheon Meeting Columbia, MD

13. Consensus Risk Rating PMI Baltimore Luncheon Meeting Columbia, MD

14. Risk Register – Part II PMI Baltimore Luncheon Meeting Columbia, MD

15. Risk Response Worksheet PMI Baltimore Luncheon Meeting Columbia, MD

16. Risk Radar® PMI Baltimore Luncheon Meeting Columbia, MD

17. Individual Risk Summary PMI Baltimore Luncheon Meeting Columbia, MD

18. Risk Radar® Reports PMI Baltimore Luncheon Meeting Columbia, MD

19. Risk Radar® Reports cont’d PMI Baltimore Luncheon Meeting Columbia, MD

20. Results from Process • Risks avoided • Impact of model year change – Oct 2006 • Identified risks realized • High false alarm rate for heavy truck platform – Oct 2007 • Impact of economy on conducting field test – Nov 2008-present • Unidentified risks realized • Truck manufacturer leaves project – Aug 2007 • Test track closes abruptly – Nov 2007 • Phase II approval delayed – Dec 2007 (unknown-unknown) • Lead S/W engineer detained in China – Dec 2007 • Vehicle build cost over-run and schedule delay – Feb 2009 • Lead IT developer becomes ill while in India – Mar-Apr 2009 • Software development cost over-run – Apr 2009 • Supplier/Developer in Chapter 11 bankruptcy – May 2009 PMI Baltimore Luncheon Meeting Columbia, MD

21. Benefits of Formal Process • Improved project focus and team communications and coordination • Provided framework for discussing project issues with emphasis on problem solving • Brought the whole team together, creating a broader view of the project • Discussion of risk became a regular part of program reviews PMI Baltimore Luncheon Meeting Columbia, MD

22. Lessons Learned • To improve chance of success, risk management effort needs: • A “Process Owner”, team buy-in and cooperation • To be scaled to project needs, not be a burden • Consistent, open and honest process that is repeated • Tendency to use past experience to judge risk and overlook associated new risks: • Vehicle build (cost over-run, schedule delay) • Database development delays affected other efforts • Data synchronization issues impacted test schedule PMI Baltimore Luncheon Meeting Columbia, MD

23. Resources • MITRE Risk Management website: http://www.mitre.org/work/sepo/toolkits/risk/ • Mulcahy, R. P. Risk Management - Tricks of the Trade for Project Managers, Minneapolis, MN: RMC Publications, Inc., (2003). • Pritchard, Carl L. Risk Management Concepts and Guidance. 3rd Edition. Arlington, VA: ESI International, (2005). • Survey Monkey® website: http://www.surveymonkey.com • Risk Radar® website: http://www.AmericanSystems.com Email: RiskRadar@AmericanSystems.com Phone: (757) 424-3711, ext. 310; H. Duncan Wynne • Defense Acquisition University: https://acc.dau.mil/rm • Guide to the Project Management Body of Knowledge (PMBOK). Fourth Edition. Newton Square, PA: Project Management Institute, (2009) • Practice Standard for Project Risk Management. Newton Square, PA: Project Management Institute, (2009) • The Risk Doctor website: http://www.risk-doctor.com/ PMI Baltimore Luncheon Meeting Columbia, MD

24. Questions? Jack J. Ference, PMP®, PMI-RMP® U.S. DOT/National Highway Traffic Safety Administration Advanced Vehicle Safety Research Intelligent Technologies Research Division 1200 New Jersey Avenue, SE, W46-447 Washington, DC 20590 (202) 366-0168 Jack.ference@dot.gov PMI Baltimore Luncheon Meeting Columbia, MD