Delivering client value through uncertainty management
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Delivering Client Value through Uncertainty Management. Tim Wells Halcrow Group Ltd. Introduction. PM for Halcrow Group Ltd. Our Markets. Seoul International Airport. Clyde Arc Bridge. Egyptian National Railways. Chendu Ecological Park China. Thames Barrier. Rhudbar Dam Iran.

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Presentation Transcript

Introduction
Introduction

  • PM for Halcrow Group Ltd



Selection of projects

Seoul International Airport

Clyde Arc Bridge

Egyptian National Railways

Chendu Ecological Park China

Thames Barrier

Rhudbar Dam Iran

Selection of Projects


Scope
Scope

Adding Client Value through management of uncertainty

  • What is Client Value

  • Robust Decision Making

  • Tour through hierarchy of case studies (coastal planning)

  • Take Home Messages & Barriers


What adds value to clients
What adds value to clients

  • Innovation

  • Predicting their needs

  • Compliance

  • Technically rigorous solutions

  • Sustainable solutions

  • Social / Ethical / Environmental Responsibility (SEE)

  • Manage project risks (cost and programme)

  • Robust decisions


Robust decision making
Robust Decision Making

Robust Decisions:

  • Decisions that are not sensitive to uncertainty

  • Stand the test of time / ‘Future Proofed’ / ‘No Regrets’

  • Survival Strategies

    • Organisational level

    • Capital investment decisions

    • Business Strategies / Mergers & Acquisitions

    • Product development

    • Flood Risk Management Options Appraisal


Robust Solutions – Top Down

Implement solutions that cope well with uncertainty

Resistant, Resilient, Reliable, Adaptability, Flexibility


Robust Solutions – Bottom Up

Understand and Formalise Uncertainty

Identify Uncertainties / Assumptions, Model Building, Defining Parameters, Uncertainty / Probabilistic Analysis, Sensitivity Testing, Supporting Decision Making


Hierarchy of Case Studies

  • Technical - Flood defences ; Rock Sizing

  • Project - Project Risk Management

  • Strategic – Long Term Investment


Flood defence freeboard

Traditional Design

Design for Standard of Protection - 1:200 (0.5%AP)

Safety margin added on to represent uncertainty

99%

95%

50%

Flood Defence Freeboard


Added value

Better understanding of existing performance

Understand dominant parameters

Provides scientific rigor - robust

Better evidence for decision making

Transparent (share)

Potential cost savings

Traditional Design

Design for Standard of Protection - 1:200 (0.5%APF)

Safety margin added on to represent uncertainty

Added Value


Rock sizing

Armouring for coastal structures

Design based on empirical formulation

(Van der Meer/Hudson)

Many uncertain parameters / lots of correlations / expert choice

Rock Sizing


Rock sizing1

Armouring for coastal structures

Design based on empirical formulation

(Van der Meer/Hudson)

Many uncertain parameters / lots of correlations / expert choice

Rock Sizing

Wn50 5.5T


Added value1

Deterministic

Added Value

  • Understanding of performance envelope

  • Making informed choices

  • Trade-off [cost/safety & confidence in performance]

  • Support traditional methods

Rock size needed to

Prevent failure for

Given range in

Forcing events


Project risk management

The Environment Agency is the leading public body for protecting and improving the environment in England and Wales

NCPMS – National Capital Programme Management Services = Delivery of the nations flood defence projects

Project Risk Management


Drivers
Drivers protecting and improving the environment in England and Wales

“The Environment Agency has accepted the culture of risk management. It is considered to be best practice and is mandatory.”

£200M annual capital investment needs effective management (>500 live projects)


Dedicated extranet website
Dedicated Extranet Website protecting and improving the environment in England and Wales


Rm process
RM Process protecting and improving the environment in England and Wales

Facilitated workshops

Key team members

Focus on programme / activities

ID Causes /Consequences

Ownership

Consensus

Risk Register

Understand Objectives

Review cycle

Manage actions

Update risk register

Share knowledge

Continuous

Integrated into PM

Capture Lessons

Prioritise (qualitative)

ID Mitigation

Residual probability

Quantitative (3 point)

Assumptions

@Risk simulations

Consensus

Actions become programmed tasks

Named ownership


Sources of uncertainty

Poor Decision Making protecting and improving the environment in England and Wales

Unrealistic Expectations

Consultation process

Insufficient Planning

Access Problems

Changes to Team

Delays to Approvals

Project Objectives

Weakly defined outputs

Supplier / client Performance

Equipment Failure

Unfamiliarity

Unexpected Findings

Time and Resource Constraints

Errors

Poor Weather

Complexity

Sources of Uncertainty


Risk Model – Risk Register protecting and improving the environment in England and Wales


Risk Model – Risk Register protecting and improving the environment in England and Wales


protecting and improving the environment in England and Wales

Multiple risks

Risk Model

Single Risk

x

=


Risk Model – sensitivity analysis protecting and improving the environment in England and Wales

Provide a means of prioritising management effort


Added value project
Added Value (Project) protecting and improving the environment in England and Wales

  • Improves the Deliverables (Critical Review)

  • Develops team Understanding (Sharing Knowledge)

  • Feel more in Control (Understanding Risks)

  • Develop targeted Contingencies (Quantify Risks)

  • Better Prepared for risk (resilience) (Dry-runs of issues)

  • Improves personal / Firm Capability (Thinking Differently)

  • Demonstrates Forward Thinking to clients (Proactive not Reactive)

  • Saves Money (Less Issues occurring)


Added value programme
Added Value (Programme) protecting and improving the environment in England and Wales

  • Balanced view of risk exposure across programme (efficient decision making)

  • Understand likelihood of budget delivery

    • Early release of contingency - build more schemes!

  • Schedule certainty (phase procurement input)

    • Match supply with demand


Strategic level
Strategic Level - protecting and improving the environment in England and Wales


Take home messages
Take Home Messages protecting and improving the environment in England and Wales

How can exploring uncertainty add value

  • Scientific Rigour & Richer understanding of the problem and solutions

  • Performance certainty, transparency, robust - defendable evidence

  • Prioritisation of management effort

  • Effective expenditure – potential to save £


Barriers challenges
Barriers / Challenges protecting and improving the environment in England and Wales

Barriers

  • Represents Change (expert & client)

  • Still faced with tough decisions (confidence level)

  • In hands of the Analyst

    Challenges

  • Communication of benefits and value

  • Training of technical staff

  • Selling value to clients (who get value and ultimately pay)


Thank you questions
Thank you & Questions protecting and improving the environment in England and Wales


Decision making process
Decision Making Process protecting and improving the environment in England and Wales

UKCIP decision making framework – a framework for decision making given uncertainty in climate change.


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