Saturday, March 25, 2017

About Risk

I accompanied some junior colleagues to a short course on risk management.

It was, unsurprisingly, the same old same old: it culminated in the presentation of a 5X5 matrix with some lovely colours and labels from low to high.

What was missed was the unavoidable error bands around any point on the map, which meant that it was impossible to differentiate between a medium and a high risk on the map. The error bands overlapped.

The result would potentially be misallocation of resources, and the inability to respond to actual risk in the real world appropriately. This is 'the risk in risk matrices'.

An excellent corrective to the reflexive reliance on the rough stepped matrix is Matthew Squair's blog Risk and the matrix. I commend it to you.

Risk is better mapped, in my view, as a series of 'isorisk' lines to guide the analyst in their determination of a risk response. Risk is not cut and dried.

Isorisk Map

Monday, January 30, 2017

Strategy is? 2

The strategy process is historically separated into planning and execution phases. Some writers tie the two together: Mintzberg and Quinn spring to mind. I do too.

This diagram attempts to capture the dynamic as a feedback system revolving around performance (which is where projects live).

Friday, January 20, 2017

The coffee queue problem

I'm sure that we've all been to conferences where we've encountered the 'coffee queue' problem. This is where the conference organisers have organised the coffee table to maximise congestion through coupling of workstations with incompatible dwell times.

Still, how could one expect catering types to understand work flow techniques, I had to study two Masters degrees to gain a decent exposure to them.

This is what we usually have:

People move through the fast stations quickly, only to crowd the slow stations, with those who can skip a station unable to do so because of the 'log-jam'.

A better way, that I've only too rarely encountered where the different rates of flow are de-coupled:

Wednesday, January 18, 2017

What do you mean, 'value'?

In risk analysis we sometimes multiply the probability of occurrence with the event loss to obtain an expected event loss for the risk. Thus, if the the probability of occurrence of cladding collapsing is 1%, and the cost of the collapse (clean up,  insurance premium, make good) is $10m, then the expected event loss is $100k. No much, and across a portfolio of risks it indicates the overall budget risk....of course you include that in a Monte Carlo analysis to introduce some objectivity.

Another page from Matthew's book, Chancing it bears consideration in this context.

Tuesday, January 17, 2017

Best practice?

Really? Best for whom?

I'd prefer to develop my project practice in Deming's cycle; therefore, not 'best practice' but 'better practice' better for my projects in my circumstances. Using someone else's 'best' ties me to their past, not my future.

Saturday, January 14, 2017

Strategy is?

There is possibly not a topic in business that is more written about than 'strategy'; except perhaps 'leadership.

What is 'strategy'?

In my view, all projects are a response to a strategic need: they build capability for mission delivery into the future.

Some concepts of strategy have a static feel to them: Porter's 5 forces, for example. I know Porter's model is not static, but it tends to a static iconography.

This diagram includes the dynamic forces that influence strategic thinking in business. It could be though of as the third dimension to a typical Porter 5 forces diagram:

The 'capability platform' is created by capital investment, responsive organisation structures and processes, and the right people to deliver skills that make strategic sense in the business environment.

Friday, January 13, 2017

Wisdom of crowds?

Having been thinking lately of early warning systems in project management, this passage from Matthew's book Chancing it popped out at me: