Session 17 Dr. Dan C. Surber, ESEP ME 59700 Fall 2014 Introduction to Systems Engineering Session 17 Dr. Dan C. Surber, ESEP © Copyright 2013
Lecture Topics Risk Management Concepts Techniques Tools & Utility Carry over to later phases
Risk Management Concepts Risk: “uncertainty that can cause us to fail.” 2 components LIKELIHOOD (Probability factor, Pf) SEVERITY (Consequence factor, Cf) Both are expressed in PER CENT, so they are LESS THAN ONE their PRODUCT is the Risk Factor Mitigation: “set of steps to reduce Pf and Cf” Contingency: “what to do if MITIGATION fails” BOTH take resources and MIT needs to be on the SCHEDULE with start and stop dates
Risk Management Concepts Probability factor (Pf) How likely is it that the cause of uncertainty will be actually occur. Consequence factor (Cf) What is the severity of the outcome when it happens.
Opportunity Concepts Opportunity: benefit that has feasibility. 2 components LIKELIHOOD (Feasibility) CONSEQUENCE (Benefit) Both are expressed as numbers greater than 1, and their PRODUCT is the Opportunity Factor PURSUIT: a plan to take advantage of the OPP and gain the benefit, but it costs some resources to PURSUE
Opportunity Concepts Benefit (Bf) Feasibility factor (Ff) What is the benefit accrued to the program if the opportunity is realized. What will it COST to pursue and capture this. Feasibility factor (Ff) How likely is it that this opportunity can be achieved.
Risk Handling Methods Accept it Transfer it Manage it through mitigation Monitor it Don’t bring it into the active database but save for possible future use
RM Techniques & Tools Spreadsheet in MS EXCEL Database in MS ACCESS ARM, by Strategic Thought (SQL or Oracle) http://www.strategicthought.com/riskmanagement/risksolutons/ Prophet, a tool made by Hughes/Raytheon Risk Radar http://www.iceincusa.com/16CSP/content/software/tools/r_radar/risk_rad.htm Other sources: http://www.asce.org/files/pdf/seminars/fixWYRICK.pdf
Utility of RM Tools Spreadsheet or Database Concept Phase Early identification (“If this happens, then the consequence to the project/design is x, y & z.”) Best opportunity to “Design it out” Later Product Development Phases Technology on the CRITICAL PATH, but not the point of the project Management reserve must be used carefully Risks change with product life cycle phase Develop a RISK MANAGEMENT PLAN at the start of the project Stakeholders & risk review board Document how you will rate & rank Risks & Opportunities
Summary Everyone on the team is a key to finding risks and opportunities Identification is worthless without prioritization & action Ignoring OPPORTUNITIES is leaving money on the table & business at the mall Plan to mitigate, and have a CONTINGENCY in case that fails
Tools & Utility http://www.sei.cmu.edu/risk/ MS Access such as RISK RADARTM (ISO/IEC Guide 73) http://www.theirm.org/publications/documents/Risk_Management_Standard_030820.pdf http://www.risk-opportunity.com/ http://www.method123.com/risk-register.php http://www.wikihow.com/Develop-a-Risk-Management-Plan http://www.mitre.org/work/sepo/toolkits/risk/ToolsTechniques/RiskRadar.html Active Risk ManagerTM
System Safety vs Project Risk See SLIDES 17a.ppt HAZARDS System Safety vs Project Risk See SLIDES 17a.ppt