Advanced project risk reporting webinar Wednesday 21 September 2022 APM Risk Specific Interest Group Presented by: Robert Balaam The link to the write up page and resources of this webinar: https://www.apm.org.uk/news/advanced-project-risk-reporting-webinar/ Content description: An insight into some advanced project risk reporting techniques to improve your project risk insights, and a glimpse into some emerging risk reporting. This session progresses some of the standard project risk reporting such as Probability-Impact Diagrams (PIDs) and Risk Cost Time Phasing, and demonstrate how additional refinement of these, often with information readily available, can immensely improve the insight given. Some advanced project risk reporting shows powerful techniques to assist in identifying possible gaps in your risk register, compare risk across projects, programmes, and portfolios, and enhancing mitigation measures. Emerging reporting and techniques, such as Integrated Cost & Schedule Risk Analysis Critical Path Analysis, was also be presented and discussed.

1. ADVANCED PROJECT RISK REPORTING
Robert Balaam
APM Risk SIG webinar
Wednesday 21 September 2022

2. OVERVIEW

3. OVERVIEW
• This session will progress some of the standard project risk reporting
such as Probability-Impact Diagrams (PIDs) and Risk Cost Time
Phasing, and demonstrate how additional refinement of these –
often with information readily available – can immensely improve
the insight given.
• Some advanced project risk reporting will also show powerful
techniques to assist in identifying possible gaps in your risk register,
compare risk across projects, programmes, and portfolios, and
enhancing mitigation measures.
• Emerging reporting and techniques, such as Integrated Cost &
Schedule Risk Analysis Critical Path Analysis, will also be presented
and discussed. The session will end with a Q&A.

4. CASE STUDY

5. CASE STUDY: OTTAWA LRT CONFEDERATION LINE
https://ottawa.ctvnews.ca/ottawa-s-lrt-by-the-numbers-1.4590317
• 12.5km – 2.5km under downtown
• 13 Stations, 9 Escalators
• Longest Transit Escalator (35.3m) in Canada
• 2,000 fewer bus trips downtown daily
https://ottawa.ctvnews.ca/lrt-is-here-everything-you-need-to-know-1.4590170
5 MISSED DEADLINES, 456 DAYS LATE
https://www.cbc.ca/news/canada/ottawa/lrt-handover-august-23-ottawa-1.5255872

6. ADVANCED REPORTING

7. REPORTING POTENTIAL
• Process is the start
• Read the documentation
• Read lessons learned
• Consult and engage experts
• Analysis > process enhancements > reports
• Some people like text, others like tables & graphs
• Some reports may only be used by risk team
• Test > Test > Test !!! (Pilot project?)
• Unleash reporting potential & maximize Return on Investment (ROI)
£ £ £

8. PROBABILITY-IMPACT DIAGRAMS (PIDS)
• ISSUE: PID count gives no indication of magnitude or depth of categories.
• RESULT: Tangible cost analysis, overall risk impact analysis.
Go further: Inherent, Current, Target | Impact Categories | RBS | Movements

9. START / END DATE PROFILES
• ISSUE: Risk draw down profile doesn’t show what is coming up.
• RESULT: Awareness of significant risks approaching and possible risk gaps.
Go further: Inherent, Current, Target | Phase | Impact Categories | HSE Categories | RBS | Movements

10. RISK % COST/TIME PROFILES
• ISSUE: Risk is looked at in isolation of duration or cost.
• RESULT: Much better information on ‘risky’ periods in relation to cost/time.
Go further: Inherent, Current, Target | Phase | Control Accounts | Work Packages | Movements

11. WBS-RBS MATRIX
• ISSUE: Project / Control Account / Work Package poor risk identification.
• RESULT: Identification of possible gaps in risk identification.
Go further: Inherent, Current, Target | Control Accounts | Work Packages | Movements

12. RISK LINKAGE - THEORY
PROGRAM FUNCTIONS
COMPANY FUNCTIONS
BOARD
PROGRAM WBS
• Executive
• Health & Safety
• Procurement
• Health & Safety
• Communications
• Procurement
• Health & Safety
• Communications
• Procurement
• Operations
• Project 1
• Project 2
• Project 3
1
2
3
1
2

13. RISK LINKAGE
• ISSUE: Poor visibility of similar risks for comparison and overall assessment.
• RESULT: Ability to compare and assess similar risks and overall exposure.
Go further: AED | Inherent, Current, Target | Project Gaps | % of Cost/Time | Movements

14. THE FUTURE !!

15. INTEGRATED COST & SCHEDULE RISK ANALYSIS I
• ISSUE: QSRA & QCRA results don’t reflect combined effect.
• RESULT: Better insight, more accurate estimating.
Go further: Milestone Analysis | Phase Analysis | Resource Analysis | Movements | Trending

16. Current Outputs
• Criticality Index (CI) - probability activity lies on critical path
• Significance Index (SI) - relative duration importance of an activity
• Schedule Sensitivity Index (SSI) - SI * CI
• Cruciality Index (CRI) – duration - total duration correlation
INTEGRATED COST & SCHEDULE RISK ANALYSIS II
• ISSUE: Outputs don’t give decision making information.
• RESULT: Powerful decision making insights.
Go further: Activity Type Analysis | Cost Type Analysis | Supplier Analysis

17. INTEGRATED COST & SCHEDULE RISK ANALYSIS III
• ISSUE: Outputs don’t give decision making information.
• RESULT: Powerful decision making insights.
Go further: Activity Type Analysis | Cost Type Analysis | Supplier Analysis
Future Outputs
• Most cost effective activities (current and future) to expedite / reduce the critical path?
• Which activities are most likely to increase the critical path?
• Which activities most likely to increase the overall cost?
• What are the activities most likely to increase the critical path and overall cost?
• Where are the biggest cash flow periods and related values?

18. COST EFFECTIVE SCHEDULE MANAGEMENT
• ISSUE: Inability to see where schedule problems areas are.
• RESULT: Powerful visualisation of key areas to focus on.
Go further: Milestone Analysis | Activity Type Analysis | Cost Type Analysis | Supplier Analysis

19. RISK ALGORITHMS
• ISSUE: Bias in estimating and lack of historical insight.
• RESULT: Unbiased real-time insight and accurate forecasting.
Go further: Project Type | Key Resources | Key Materials | Movements | Benchmarking
• Uses historical information to predict risk
• Can combine data across companies, industries, and countries
• Sometimes just uses text to forecast
• Machine learning provides continuous refinement
• May not suit first-of-a-kind or unique projects

20. NET PRESENT VALUE
• ISSUE: Risk information doesn’t incorporate future interest or inflation.
• RESULT: Greater insight into financial exposures.
Go further: Project Type | Key Resources | Key Materials | Movements | Benchmarking
• Net Present Value (NPV) allows investment to be compared including interest / inflation
• £1 of risk next in 5 years may only be £0.20 risk today
• Positive NPV means it is profitable to take that course of action
• Negative NPV means it is not profitable to take that course of action
• Which project(s) offer best value to company / shareholders / owners?
• How could this risk or response affect the company share price?

21. CONCLUSION

22. CONCLUSION
• You have the information – USE IT !!!
• Don’t only focus on Cost and Drawdown Date
• No ‘bad’ view of risk data
• Try to automate – so many errors doing manually
• Really look at integrating your schedule, cost, and risk software using APIs
• Integrated Cost & Schedule Analysis if far better than siloed QRAs
• It’s a journey not a destination!
EMBRACE.
ENGAGE. EMPOWER.

23. "IN THE END, PROBABLY, THAT TRAINING IS
THE ANSWER TO A GREAT MANY THINGS.
YOU CAN DO A LOT IF YOU'RE PROPERLY
TRAINED. AND I HOPE I HAVE BEEN."
QUEEN ELIZABETH II

24. THANK YOU