Project Management

The Odds of Being Blue

From the Game Theory in Management Blog
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Modelling Business Decisions and their Consequences

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Hatfield’s Uncontestable Management Theory #9 is that any notion that can’t be clearly articulated, both as to what it is as well as what it is not, cannot be taken seriously, or even legitimately evaluated. An old business axiom (not one of mine) is that which cannot be measured cannot be managed; similarly, inchoate ideas aren’t even weak hypotheses, much less usable management science.

Which brings us back to our friends, the risk managers, and their ongoing assault on the English language. Last week I took them to task over this whole risk-equals-opportunity nonsense, but that at least had the characteristics of simply trying to manipulate the language in order to support an otherwise silly notion. What I wish to address next represents a full frontal assault.

A principal aspect of risk analysis theory (strikethrough) suspect assumptions is that future events can be categorized as either “known unknowns” or “unknown unknowns.”  I can’t help but to wonder what the person(s) who came up with this nomenclature was thinking, since these categories are anything but intuitively obvious. The future is unknown, and unknowable by mere mortals. Ah, but the whole risk management facade comes crashing down in a heckuva hurry if this fact becomes widely accepted. They, therefore, come up with these two categories, which, like the risk/opportunity conflation, are self-evidently contrary, attempts to bully those who know the plain meaning of the terms notwithstanding.

Which brings us back to the marginal concept of “unknown unknowns.” What are these? It’s not overly cynical to say that these are events that the risk analysts did not anticipate, and therefore couldn’t estimate odds of occurrence nor cost/schedule impact. Pretty nifty, no?, to be able to completely mis-judge a management situation, and pass off the failure by categorizing it as an “unknown unknown.”

Then we have the issue of the repetitive-contrary-term phrase. The prefix “un,” in the English language, means “not.” By definition, a thing cannot be both “N” and “not N,” any more than something can be both “known” and “unknown.” The very fact that risk managers would attempt such linguistic legerdemain is itself, stark evidence for the poorly-thought-out nature of their ideas. As for this phrase’s cousin, it’s simply repetitive. The future is unknown. Saying that a specific future occurrence is “unknown unknown” is sophomoric repetition; it’s unknown – that’s all that needs to be said about it.

Imagine a project to paint a house blue. As the PM sends his assistant to purchase the selected paint, he finishes erecting the scaffolding and is approached by his risk manager.

“I want to talk to you about your project’s scope, and risk registry” he begins.

“Umm, okay, whaddaya got?”

“Based on previous projects’ performance, I think you should prepare for the chance that you won’t paint this house blue.”

“Why not?”

“Because your previous projects were to paint houses different colors, meaning that we should prepare for the outcome here to be either blue un-blue, or un-blue un-blue.”

“What’s ‘blue un-blue’?”

“More like a green.”

“That’s not blue.”

“It is if you mix it with yellow. That’s why I called it ‘blue un-blue.’”

“But my assistant has the exact color formula.”

“Then there are the un-blue un-blues, such as red.”

“We’re not going to paint the house red.”

“But you have to prepare for the chance of that happening!”

“It won’t ‘happen.’ If my assistant comes back with the wrong color – any shade of ‘un-blue,’ – I will send him back to get the right color.”

“But we should plan for the cost or delays associated with that happening.”

“No, we shouldn’t. How much am I paying you, again?”

And our PM didn’t even ask about the odds of painting the house un-blue un-blue.


Posted on: August 08, 2016 09:42 PM | Permalink

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