Risk Creep: I

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

Are your projects always (or almost always) late and over budget? Are your project teams plagued by turnover, burnout, and high defect rates? Turn your culture around. Read 52 Tips for Leaders of Project-Oriented Organizations, filled with tips and techniques for organizational leaders. Order Now!

Footnotes

Your comments are welcome

About Point Lookout

Thank you for reading this article. I hope you enjoyed it and found it useful, and that you'll consider recommending it to a friend.

This article in its entirety was written by a human being. No machine intelligence was involved in any way.

Point Lookout is a free weekly email newsletter. Browse the archive of past issues. Subscribe for free.

Support Point Lookout by joining the Friends of Point Lookout, as an individual or as an organization.

Do you face a complex interpersonal situation? Send it in, anonymously if you like, and I'll give you my two cents.

Related articles

More articles on Project Management:

Seeing Through the Fog

When projects founder, we're often shocked — we thought everything was moving along smoothly. Sometimes, with the benefit of hindsight, we can see that we had — or could have had — enough information to determine that trouble was ahead. Somehow it was obscured by fog. How can we get better at seeing through the fog?

Risk Management Risk: II

Risk Management Risk is the risk that a particular risk management plan is deficient. Here are some guidelines for reducing risk management risk arising from risk interactions and change.

Personnel-Sensitive Risks: II

Personnel-sensitive risks are risks that are difficult to discuss openly. Open discussion could infringe on someone's privacy, or lead to hurt feelings, or to toxic politics or toxic conflict. If we can't discuss them openly, how can we deal with them?

Scope Creep and the Planning Fallacy

Much is known about scope creep, but it nevertheless occurs with such alarming frequency that in some organizations, it's a certainty. Perhaps what keeps us from controlling it better is that its causes can't be addressed with management methodology. Its causes might be, in part, psychological.

Allocating Action Items

From time to time in meetings we discover tasks that need doing. We call them "action items." And we use our list of open action items as a guide for tracking the work of the group. How we decide who gets what action item can sometimes affect our success.

See also Project Management and Project Management for more related articles.

Forthcoming issues of Point Lookout

Coming January 1: The Storming Puzzle: II

For some task-oriented work groups, Tuckman's model of small group development doesn't seem to fit. Storming seems to be absent, or Storming never ends. To learn how this illusion forms, look closely at Satir's Change Model and at what we call a task-oriented work group. Available here and by RSS on January 1.

And on January 8: The Storming Puzzle: III

For some task-oriented work groups, Tuckman's model of small group development seems not to fit. Storming seems to be either absent or continuous. To learn how this illusion forms, look closely at the processes that can precipitate episodes of Storming in task-oriented work groups. Available here and by RSS on January 8.

Coaching services

I offer email and telephone coaching at both corporate and individual rates. Contact Rick for details at rbrenyrWpTxHuyCrjZbUpner@ChacnoFNuSyWlVzCaGfooCanyon.com or (650) 787-6475, or toll-free in the continental US at (866) 378-5470.

Get the ebook!

Past issues of Point Lookout are available in six ebooks:

• Get 2001-2 in Geese Don't Land on Twigs (PDF, )
• Get 2003-4 in Why Dogs Wag (PDF, )
• Get 2005-6 in Loopy Things We Do (PDF, )
• Get 2007-8 in Things We Believe That Maybe Aren't So True (PDF, )
• Get 2009-10 in The Questions Not Asked (PDF, )
• Get all of the first twelve years (2001-2012) in The Collected Issues of Point Lookout (PDF, )

Are you a writer, editor or publisher on deadline? Are you looking for an article that will get people talking and get compliments flying your way? You can have 500-1000 words in your inbox in one hour. License any article from this Web site. More info