Early in the morning on May 27, one of Britain's busiest annual travel days, British Airways canceled all flights from London's two biggest airports. More than 1,000 flights and 75,000 passengers were affected. In a statement, the airline announced that "a major IT system failure" had disrupted flight operations worldwide [Johnston 2017][Dans 2017].
On September 28 "network problems" struck the firm Amadeus IT Group SA, whose Altea software "is used by more than 100 airlines worldwide," including "Air France, Southwest, Lufthansa, British Airways, Qantas, China Air and Korean Air" [Rizzo 2017]. Passengers around the world reported long lines, and although the system did recover that same day, delays of hours were widespread, and many international passengers missed connections.
On that same day, in the midst of worldwide air traffic disruption, Reuters reported that the United States General Accounting Office would be investigating these disruptions and a string of others that had occurred in the previous six months [Shepardson 2017]. Fires, network outages, human error, and goodness knows what else were suspected causes.
Clearly something was not right with the airlines' management of technological risk. And since no major industry understands technological risk management better than the airlines, it's reasonable to suppose that if the airline industry is having trouble managing technological risk, just about everyone is.
However assiduously we avoid risk, we sometimes find — suddenly, as the airlines did — that we're up to our necks in it. How does this happen? How does risk creep into our projects and our operations? Let's consider projects, because they're time-limited and therefore a little less complicated.
When project champions are required to "sell" When project champions are
required to "sell" a project
internally, they sometimes overcommita project internally, they sometimes overcommit. If that happens because of an inordinately high bar imposed by senior management, one possible cause is a most curious phenomenon, related to what Boehm et al. call a "conspiracy of optimism" [Boehm 2016], and which is actually a variant of the n-person prisoner's dilemma [Hamburger 1973]. Specifically, senior management might be trying to manage enterprise-scale risk by requiring high returns at low risk from individual projects (or even individual portfolios of projects). Ironically, this approach results in risk elevation for the individual projects or portfolios, because project champions must promise the nearly impossible, or the outright impossible, to gain access to resources. The paradoxical result is that risk aversion on the part of senior management fosters an environment in which nearly all activities that are underway are high risk. By attempting to wring risk out of the enterprise, management opens the door and invites it in.
It gets worse. It turns out that the risks confronting individual projects, arising from the unrealistic promises of project champions, are correlated. And that means that when one risk event materializes, others will too. We'll explore how project champions contribute to risk creep next time. Top Next Issue
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More articles on Project Management:
- The Cheapest Way to Run a Project Is with Enough Resources
- Cost reduction is so common that nearly every project plan today should include budget and schedule
for several rounds of reductions. Whenever we cut costs, we risk cutting too much, so it pays to ask,
"If we do cut too much, what are the consequences?"
- Status Risk and Risk Status
- One often-neglected project risk is the risk of inaccurately reported status. That shouldn't be surprising,
because we often fail to report the status of the project's risks, as well. What can we do to better
manage status risk and risk status?
- The True Costs of Cost-Cutting
- The metaphor "trimming the fat" rests on the belief that some parts of the organization are
expendable, and we can remove them with little impact on the remainder. Ah, if only things actually
worked that way...
- Managing Risk Revision
- Prudent risk management begins by accepting the possibility that unpleasant events might actually happen.
But when organizations try to achieve goals that are a bit out of reach, they're often tempted to stretch
resources by revising or denying risks. Here's a tactic for managing risk revision.
- Why Scope Expands: II
- The scope of an effort underway tends to expand over time. Why do scopes not contract just as often?
One cause might be cognitive biases that make us more receptive to expansion than contraction.
Forthcoming issues of Point Lookout
- Coming July 18: High Falutin' Goofy Talk: III
- Workplace speech and writing sometimes strays into the land of pretentious but overused business phrases, which I like to call high falutin' goofy talk. We use these phrases with perhaps less thought than they deserve, because they can be trite or can evoke indecorous images. Here's Part III of a collection of phrases and images to avoid. Available here and by RSS on July 18.
- And on July 25: Exploiting Functional Fixedness: II
- A cognitive bias called functional fixedness causes difficulty in recognizing new uses for familiar things. It also makes for difficulty in recognizing devious uses of everyday behaviors. Here's Part II of a catalog of deviousness based on functional fixedness. Available here and by RSS on July 25.
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- The Race to the South Pole: The Power of Agile Development
- On 14 December 1911, four men led by Roald
Amundsen reached the South Pole. Thirty-five days later, Robert F. Scott and four others followed. Amundsen
had won the race to the pole. Amundsen's party returned to base on 26 January 1912. Scott's party perished.
As historical drama, why this happened is interesting enough. Lessons abound. Among the more important
lessons are those that demonstrate the power of the agile approach to project management and product
development. Read more about this program. Here's
a date for this program:
- Ohio National Insurance, 1 Financial Way, Blue Ash, OH: July
Monthly Meeting, Cincinnati
chapter of the International Institute of Business Analysis. Register now.
- Ohio National Insurance, 1 Financial Way, Blue Ash, OH: July 17, Monthly Meeting, Cincinnati chapter of the International Institute of Business Analysis. Register now.
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