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risk in a collaborative culture
risk in a collaborative culture
Why risk matters
Profiling risk
Mitigating risk Communicating
and owning mitigation
why risk matters
what is risk?
What Drives Risk?
Project Management
• Change Managementhow does risk change during a project?
what happens if we ignore risks?
I’m beginning to think it wasn’t such a good idea to turn off
those unit tests
How Is Risk Management Different From Change Management?
profiling risk
There are many models . . . most work well.
How about: Delivery failure Business case failure Collateral damage
delivery failure
0 10 20 30 40 50 60
Failed
Challenged
Succesful
20061996
Standish Group Study, reported by CEO Jim Johnson, CIO.com, ‘How to Spot a Failing Project’
Always or Often Used:
20%
Never or Rarely Used:
64%
Standish Group Study, reported by CEO Jim Johnson, XP2002
Sometimes16%
Rarely19%
Never45%
Often13%
Always7%
business case failure
collateral damage
example…
Express Products
• Refactor existing enterprise software products for the SMB market.
• The goal: make these products consumable by the SMB market.
Risks
• What are the risks of delivery failure? • What are the risks of business case failure?• What are the collateral damage risks?
ConsiderationsBusiness Case Risk: High.
Why?– IBM Sales teams for these products were not experienced in
reaching customers in this market – Required new sales channels (telesales, business partners etc) – Required new support structures (IBM L1/L2/L3 and support
methods were accustomed to enterprise customers) – Marketing material needed targeting at this market
ConsiderationsDelivery Risk: Low
ConsiderationsCollateral Damage Risk: Potentially high.
Why?– Are there existing enterprise customers that will want to
migrate to the SMB versions?
exercise…
Stack Product• 10 or so discrete products with concurrent availability • Geographically dispersed teams (China, India, Egypt, Germany, UK,
many US locations, Canada)
Stack Product• Dependencies:
– within the product set – on other SWG products (eg WAS) – Third party dependencies (Oracle, Sybase, operating systems)
Stack Product• Typically major re-engineering in each release (new WAS version,
new technologies, new common components etc) • Problem diagnosis difficult
Stack Product• Announcement before development complete • Services needed to speed market adoption • Sales team need to be educated in new features and how to sell the
stack • Market expectations high at launch
How Would You Profile The Risks?
• In delivery?• In business case?• Collateral damage?
back to the models
Complexity and Uncertainty
As we profile risks, how much risk is driven by some combination of complexity and uncertainty?
uncertainty market
uncertainty
technical
uncertaintyproject duration
dependents
complexity team size
mission criticality
team locationteam capacity
domain knowledge gaps
dependencies
Complexity
Unc
erta
inty
Simple, young projects Need agility Tight Teams
Complex, mature market Need defined interfaces
Agility to handle uncertainty
Process definition to cope with complexity
Laissez faire
Low
Low
High
High
Well behaved
Complexity and Uncertainty
a model for profiling risk
Delivery Failure– What is the cost of delay and the impact of uncertainty
associated with schedule?– What is the impact of cost overrun, and the uncertainty
associated with cost?
Business Case Failure– What is the magnitude of the uncertainty in benefits,
specifically relating to product features?– What is the magnitude of the uncertainty in benefits
specifically relating to uncertainty outside our control, e.g. general market uncertainty?
Collateral Damage– Is there risk of collateral damage (risk to existing business,
etc.)?
How Do We Answer These Questions To Profile Risks?
Leading Agile
• Collaboration Model• Collaboration Process collaboratively
open environment
right people
fosterinnovation
step back
bring the right people together
from the entire enterprise
customers marketing salesproduct management
financedevelopment
support
bring the right people together
from the entire enterprise
in other words,
the affected and
affectors!
Trustworthiness stimulate creativity through collaboration process
and let them work
agree to goals and objectives
brainstorm
group in
silence
prioritize based on
business value
exercise…pick a project
Using the Risk Profiling Model, what is your risk profile?
What are specific areas of uncertainty and complexity?
Whose input is important to create an accurate, project-level profile of the risk?
• Delivery Failure– What is the cost of delay and the impact of uncertainty associated
with schedule?– What is the impact of cost overrun, and the uncertainty associated
with cost?
• Business Case Failure– What is the magnitude of the uncertainty in benefits, specifically
relating to product features?– What is the magnitude of the uncertainty in benefits specifically
relating to uncertainty outside our control, e.g. general market uncertainty?
• Collateral Damage– Is there risk of collateral damage (risk to existing business, etc.)?
Leadership Role
profiling your risk
What is the best way to identify, evaluate, mitigate, monitor risk including risks in aggregate (rather than just component risks)?
In what areas can you tolerate risks?
At a high level, how would you rank the risks?
At a high level, what risk strategies (Avoid/Ignore/Contain/Contingency/Transfer) make sense?
mitigating
risks
Complexity
Unc
erta
inty
Simple, young projects Need agility Tight Teams
Complex, mature market Need defined interfaces
Agility to handle uncertainty
Process definition to cope with complexity
Laissez faire
Low
Low
High
High
Well behaved
Mitigating Complexity and Uncertainty
mitigating complexity
MarketDifferentiating
High
Low
Mission CriticalLow High
Differentiate
Parity
Partner?
Who cares?
Purpose Based Alignment Model
MarketDifferentiating
High
Low
Mission CriticalLow High
Innovate,Create
Do we take this on?
Minimize or
Eliminate
Achieve andMaintain
Parity, Mimic,Simplify
Purpose Based Alignment Model
exercise… for your project
Exercise: Mitigating Complexity Risk
• For your project, use the Purpose Alignment Model to identify ways to mitigate complexity risks.
mitigating uncertainty
Purpose
Considerations
Costs and Benefits
Business Value Model
The Business Value Model and Uncertainty
• This models iterative decisions.
exercise… for your project
use the Business Value Model to identify ways to deliver value and mitigate uncertainty risks.
exercise… your risk mitigation plan
What are the specific, prioritized ways you will change your project’s risk profile?
What is the value of making these changes?
our dynamic world
what happens if…
We need to accelerate the timeline?
The demand for the product shrinks?
We fold-in an acquisition?
A part of the team is pulled away?
team affects
What happens to our team’s risks?
what are the ripple effects on the broader team?
communicating
and owning mitigation
We have profiled risk and developed risk mitigation plans.
How do we now execute our plans?
How do we communicate the risks and the mitigation plan so that it is owned?
Scenario• In order to respond to a competitor, Product
Management announces an early release.• In order to meet the release date, Development
shrinks the time allocated to the quality plan.• The product releases but Support is not prepared
for the required support levels.• Support shifts some support tasks to
Development.• Development no longer has the resources to
meet the next planned release date.
One Option
• A clearly defined framework that we share among the team and across team and organizational boundaries. We call this the “Macro-Leadership Cube”
macro leadership
and risk
Macro Leadership Cube
Shared Boundaries
Interlock Interlock
exercise… for your project
look at your risk profile and mitigation plan . . .
What risks and mitigation plan activities need to be communicated to and owned by the broader team?
How can you maintain the interlock as things change?
Add these activities to your risk mitigation plan.
Leadership Role
Ok, now what?
Over time, we want to learn from our experience …
… and improve our ability to profile and mitigate risk
Consider the Conscious Competence Learning Model
Conscious Competence Learning Model
Level 1: Unconscious Incompetence
We don’t know that we don’t know.
Level 2: Conscious Incompetence
We know that we don’t know and start to learn.
Level 3: Conscious Competence
We know that we know and are highly skilled.
Level 4: Unconscious Competence
We don’t know that we know. We are so skilled that it does not require conscious effort.
exercise…
How can we specifically apply this model as we refine our risk mitigation with the broader team?
summary
Why risk matters
Profiling risk
Mitigating risk Communicating
and owning mitigation
There are many models . . . most work well.
How about: Delivery failure Business case failure Collateral damage
Complexity
Unc
erta
inty
Simple, young projects Need agility Tight Teams
Complex, mature market Need defined interfaces
Agility to handle uncertainty
Process definition to cope with complexity
Laissez faire
Low
Low
High
High
Well behaved
Mitigating Complexity and Uncertainty
mitigating complexity
MarketDifferentiating
High
Low
Mission CriticalLow High
Differentiate
Parity
Partner?
Who cares?
Purpose Based Alignment Model
mitigating uncertainty
Purpose
Considerations
Costs and Benefits
Business Value Model
communicating and owning risk
