What is Advanced Project Risk Management?

Rubin Jen, P. Eng, PMP Beyond Execution March 3, 2011

About The Speaker
• Rubin is a speaker, writer, teacher and consultant of project management
– PM for 15 yrs across several industries – Presented at PMI Global Congress, ProjectWorld Toronto, PMI Ottawa Symposium – Served on board of directors for the PMI Southern Ontario Chapter from 2005-2007 – Project Management training on Risk, Scope and PMP
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Agenda
1. What is Advanced Project Risk Management? 2. How can it help? 3. What should I know? 4. How can I use and implement it?

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What’s Your Opinion? • What do you think Advanced Project Risk Management (APRM) is? 4 .

Different Ideas around APRM Risk Database Monte Carlo Qualitative Analysis Opportunity Management Risk Awareness Insurance Bubble Graphs Risk Communication Quantitative Analysis Urgency Predictive Metrics Risk Tolerance Calibration Issues Analysis Lessons Learned Monitoring & Control Probabilistic analysis Visualization Attack Risk Delphi Risk Breakdown Structure Risk Reporting Confidence Levels Range Estimates Audits Enterprise Risk Management Risk Project Manager 5 .

Response and Monitoring & Control? 6 . cost analysis – Expected Monetary Value.Common Perception • Most Project Managers would likely consider APRM as deeper in Risk Analysis – Software analysis (Monte Carlo. decision trees • What about Risk Planning. probabilistic analysis) – Quantification. Identification.

we need to understand what is “regular” project risk management.So. as well as what we mean by “Advanced” 7 . What Is It? • To understand this better.

monitor. and prioritization of risks followed by coordinated and economical application of resources to minimize. and control the probability and/or impact of unfortunate events 8 . assessment.Risk Management • Risk: – The effect of uncertainty on objectives • Risk Management: – The identification.

Project Risk Management • Project Risk Management: – The processes of conducting risk management planning. identification. response planning and monitoring & control on a project 9 . analysis.

practices. skill. taken as being more enlightened or liberal than the standardized. pertaining to or embodying ideas. etc 3.What is “Advanced”? • dictionary.. etc. placed ahead or forward 2. knowledge. or traditional 10 . complexity. established. attitudes.com: 1. ahead or far or further along in progress.

to enable better decisions and more effective project management – – – – Different Different Different Different tools techniques processes level of thinking 11 .Advanced Project Management • The use of tools. techniques and practices that are above the standard.

More effective response plans 3. Further reduction of uncertainty 2.Proposed APRM Principles 1. Higher level competency and skills 12 .

Reduction of Uncertainty • Greater clarity and understanding of risks • More detailed analysis • Uncover hidden information and trends Better Assessment 13 .

More Effective Response Plans • Improved prioritization • Greater option development • More effective project management Better Decisions 14 .

Competency and Skills • • • • Risk ownership Training Risk awareness Increased teamwork. buy-in & performance Better Performance 15 .

What should I know? .

Define Your Objectives • Better decisions – Tools & techniques. processes. buy-in – Team awareness • Better assessment – Monte Carlo – Timeframe/urgency 17 . decision tree • Better performance – Visualization.

APRM Outcomes • Better Decisions – – – – – – – Increased identification Delphi technique Risk audits Risk breakdown structures Attacking risk Mitigation and contingency plans Decision trees 18 .

APRM Outcomes • Better Performance – – – – – Risk management training Team involvement Risk awareness Team meetings Visualization • Visual Ishikawa Risk Technique (VIRT) • Heat map/bubble chart 19 .

APRM Outcomes • Better Assessment – – – – – – – Monte Carlo simulation Increased subjective range assessment Confidence level estimation Range estimates Probabilistic/statistical analysis Weighted scoring Urgency 20 .

Implementation Costs • Risk management has been a difficult realm to show ROI • Some risk tools & techniques can cost a lot but provide very little improvement in return • It’s not just about software 21 .

How Can I Use It? .

Techniques that are simpler and practical 2. Knowledge that can be easily shared and explained to others 3. Visualization 5.Choosing APRM • Which parameters provide the maximum effectiveness for the minimum amount of time? (biggest bang for the buck?) 1. Techniques that can involve others 4. Better risk prioritization 23 .

Better Decision Techniques Collaborative Techniques Prioritization Knowledge Transfer Simple Technique Graphical Increased identification Delphi technique Risk audits Risk breakdown structures Attacking risk Mitigation/contingency plans Decision trees 24 .

Better Performance Techniques Collaborative Techniques Prioritization Knowledge Transfer Simple Technique Graphical Training Team involvement Risk awareness Team meetings VIRT Heat map/bubble chart 25 .

Better Assessment Techniques Collaborative Techniques Prioritization Knowledge Transfer Simple Technique Graphical Monte Carlo Increased range Confidence level Range estimates Probabilistic analysis Weighted scoring Urgency 26 .

Implementing APRM • Understand and assess risk stakeholders – Champions – By-standers – End users • • • • Continual education and communication See results <-> creates buy-in Create mini case studies of successes Know each techniques’ implementation costs 27 .

Are We Done Yet? .

Summary • There are a number of ways to be "advanced" but don't confine yourself to simply analysis tools • Utilizing APRM is like a project management process: – Understand what your needs are. then choose an appropriate technique(s) 29 .

P.Contact Information • Name: • Email: • Phone: Rubin Jen. Eng.com (416) 618-1734 30 . PMP rubin.jen@beyondexecution.

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