Risk Determination in Highly Interactive Environments: How to Avoid the Titanic Factor in Your Project

As project managers, we all know how important it is to establish the risks our project may face. We are also aware of the need to quantify the risks we have identified, but how much time do we spend calculating how one risk occurrence may affect another risk probability? “Two risks might seem independent, but the probability of one occurring might change if the other materializes; the response to one risk might alter the consequences of or the probabilities of materialization of the other; or, the response to one risk might limit the project’s ability to respond to another.” In other words, how do intra-project risks interact and how can we take those interactions into special consideration?

The Sinking of the Titanic — Multiple-Risk Materialization and Interactions

Let’s look at a famous example of how multiple-risk materializations led to one of the world’s best-known disasters, the sinking of the RMS Titanic on 15 April 1912. In this case, almost every conceivable known unknown (risks) that could occur did occur, with a couple unknown unknowns as well.

Known Unknowns — Design of the Ship as a Risk Factor

As the largest steamship built up to that time, the RMS Titanic was conceived to be state-of-the-art. It had “watertight” bulkheads and was believed to be unsinkable, based on an …