Assigment 3

Running head: Risk Analysis 1

Risk Analysis 7

Abstract

This paper discuss about the learning on risky analysis involved when dealing with the cultural bias in the organization on in turn its effects the cost and increase the risk of the project. This paper also discuss of different risk analysis interview process on how effectively the data is collected and interpreted. It also discuss the importance of Trigen analysis and how effectively this can be used in the project management

Keywords: Risk Analysis, Trigen, Interview

How to align organizational strategy:

Daily employee behaviors contribute to or detract from achieving company strategic objectives. Be sure you’re encouraging the right behaviors depending on your strategic objectives.

Culture eats strategy, strategy trumps culture. Primarily because culture drives the behaviors of individuals who are the one that achieve your strategy (or not). But culture is the driving force. Regardless of where you stand, its undeniable culture and strategy are deeply intertwined in organizations large and small, global or local, public or private, for-profit or non-profit.

According to Towers Watson also defines culture as “the shared beliefs (either explicit or implicit) that exist within a company and drive behaviors.” The real question we should be asking is: “How do we understand, manipulate, redirect or recreate the shared beliefs in such a way to drive the real behaviors we need to succeed?”

Looking at why most culture change efforts fail, identifying a lack of two key elements (quoting): A view of culture that goes beyond generic notions of “high performance” and focuses on those aspects of culture uniquely relevant to a company’s particular strategic goals. A focus on the underlying systems, processes and behaviors to support long-term culture change.

To resolve those challenges, Towers Watson did deep analysis, resulting in a definition of the 5 primary company strategies for success and the associated “cultural profiles” to achieve those strategies. That breakdown is illustrated here:

1) Redefine the culture attributes into actionable core values

2) Define behaviors associated with each of those core values

3) Frequently and very specifically recognize any and all employees

4) Share that recognition across the organization

5) Closely monitor, measure and report

How to improve performance by reducing bias:

1) Training and awareness building:

2) Enhancing the performance appraisal tool

3) Evaluation questionnaire

4) 360 degree feedback

5) Assigning SMART goals to individuals. SMART stands for Specific, Measurable, Achievable, Realistic and Time-bound.

6) Regular feedback

Biases in a project management

1. Behavioral / Perception related biases

2. Biases in Estimation of Probability and Belief:

This can be classified under below categories:

· Anchoring

· Insufficient Adjustment

· Overconfidence in Estimation of Probabilities

· Overestimating the Probability of Conjunctive Events

· Availability

· Ease of Recall Not Associated with Probability

· Representativeness:

· Conjunction

· Gambler’s Fallacy

· Ignoring Base-Rate Frequencies

· Ignoring Regression to Mean

· “A triangular distribution is a continuous probability distribution with a probability density function shaped like a triangle. It is defined by three values: the minimum value a, the maximum value b, and the peak value” Hulett, D. (2011).

· This is really handy as in a real-life situation we can often estimate the maximum and minimum values, and the most likely outcome, even if we don't know the mean and standard deviation.

· Worst case scenario – All costs are the highest possible value, and sales revenues are the lowest of possible projections. The outcome is losing money.

· Best case scenario – All costs are the lowest possible value, and sales revenues are the highest of possible projections. The outcome is making a lot of money.

· Most likely scenario – Values are chosen in the middle for costs and revenue, and the outcome shows making a moderate amount of money.

Risk Interview

Interviews to elicit project risk analysis data are of 5 kinds and is linked to the role of the Subject matter Expert interviewee.

Detailed Information: Detailed information is being sought about risks or cost factors from people with specialized knowledge. These interviews are focused on specific areas of the project. e.g.: procurement, design. This interview will include one or few individuals who are either directly involved in or possess knowledge about the project elements

Summary information: The high level overview of the risks is being sought from the people who have broad scope of responsibilities in the project preferably the project managers.

Background information: This involves getting general information about the project from the people who are not familiar with the project. The interviewee should be able to quantify the data on project element risk or risk register risked.

Confirmatory information: This involves getting details about project element cost or risk by interviewing more than one experts interviewing multiple people will help in getting different opinions or perspective. This gives the risk analyst confirmation of data already gathered or will help in alternative analysis. The drawback of this approach is that, the analyst will have multiple opinions on the table and should be able to choose the appropriate one from them or synthesize the data used for analysis by combining the data

The interviewees are encouraged to bring any documentation that could support the analysis. They can bring the materials supporting similar experience on the old project. People bringing in actual data from recent and related projects are bring better information for the analysis However this is subjective and the likelihood the similar risk appearing in the current project will not be 100%. Mostly the interviewees do not have hard copy of the data being shared. So analysts needs to be alert to the biases of the interviewees.

Risk interviews will be effective if interviewees list down the risk, probability of the risk being encountered and the range of impact well in advance of the meeting. The risks with low probabilities and impact range identified by interviewees will help as it showcases that all possible risks have been taken into consideration and relevant information shared to the analysts. Interviewers will challenge the rationale of the interviewees to find out the full extent of the risks. The probabilities and impact range get changed during the interview.

References Hulett, D. (2011). Integrated Cost-Schedule Risk Analysis. Burlington, VT. Gower Publishing Company. Derek Irvine (2014) Retrieved from http://www.eremedia.com/tlnt/5-steps-to-align-culture-to-get-your-employees-strategic-buy-in/ on 22nd may 2016 at 8:00 AM Dunckley, M., & Macdonald-Smith, A. (2013, Dec 04). Cost blowouts risk projects. The Australian Financial Review Retrieved from http://prx-herzing.lirn.net/login?url=http://search.proquest.com.prx-herzing.lirn.net/docview/1753210103?accountid=167104 Research and markets: The book 'statistical distributions, 4th edition' is an ideal introduction to the general theory of statistical distributions. (2010, Dec 22). Business Wire Retrieved from http://prx-herzing.lirn.net/login?url=http://search.proquest.com.prx-herzing.lirn.net/docview/819733063?accountid=167104