Project Management

Eeek! There’s A Mouse On My Cutting Board!

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

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There was a funny German comedy show that featured a skit where a woman and her elderly father are in the kitchen when she asks him “So, papa, how did you like the iPad we got you?” The dialogue is in German, but it’s clear that he’s been using the iPad as a cutting board, as he uses a knife to scrape sliced vegetables into the container in front of his daughter off of the iPad, and then proceeds to rinse it off and put it into the dishwasher. The look on the daughter’s face is priceless, as she reacts to a comically bad misuse of the device.

Speaking of comically bad misuses of devices, on the Wikipedia page for risk management[i], there’s a graphic of the International Space Station, with the areas most at risk from debris impact highlighted in red, and text underneath stating “Example of risk management.”  Directly beneath that is the topic classification, “Business administration.”  I have to admit, it’s a brilliant ploy, aligning an engineering function with a business administration one in the risk management aficionados’ desperate attempts at glomming on to legitimacy.

But it’s another example of comically misusing a tool. Here’s why.

To an engineer, “risk management” has nothing to do with management. It deals with the characteristics of materials, which are knowable. Specific designs using specific materials under various conditions can be analyzed, and their performance accurately predicted. Selecting steel over aluminum in building, say, those areas of the International Space Station most likely to encounter debris impact is the result of quantifiable, repeatable analysis, based on the likelihood of debris striking that part of the station, the added costs of lifting heavier components into orbit, the ability of certain designs and materials to absorb impact, etc., etc.

Not so managing a project. Project teams are composed of people, whose characteristics most certainly cannot be precisely quantified, much less predicted under specific circumstances. As I pointed out in last week’s blog, even in iterations of the Ultimatum Game, where choices available to the participants was limited to one decision each, the analysts completely missed the most likely strategies employed by the players, instead predicting the tactic that almost never worked. With that being the case, what are the chances (get it, risk managers?) that, with the number of available decisions open to members of the project team, customers, and other stakeholders, the likely outcomes can be captured through statistical analysis?

Oh, risk management isn’t about calculating likely outcomes? Then what is it about, exactly? That’s one of the most frustrating things about debating this topic with their true believers. They start with this whole business about how risk management is about “anything that impacts the project, positive or negative,” but then fall suddenly silent when asked to produce any report based on their analysis techniques that actually helps inform project managers’ decision-making. “The odds are X that something bad will happen to your project” does not help your typical PM, and modifying that to “the odds are X.N% that occurrence Z will happen to your project” isn’t any better.

What’s clear to me is that the risk managers took a concept that was perfectly legitimate in the engineering realm, and converted it to the project management arena, where it most certainly does not apply. When challenged on this, the risk managers I know point to RM’s legitimate uses, which are not in Project Management. But – again – people are neither structures nor materials! Need more evidence? Consider that crucible of PM, the Agile/Scrum Project Team. One of the many blessings that Agile/Scrum brought to the management science table is that they burned away some of the trappings of traditional PM that tended to be so overdone, they bordered on being superfluous (e.g., highly formal change control techniques). So, you Agile/Scrum Project Team members – do you even have a risk registry? No? Could it be because such teams are based on the decisions and choices made by the team members themselves? They behave in ways that cannot be predicted, nor quantified, and those behaviors are the key determinants of project success.  The sleight-of-hand involved in conflating engineering uses of RM and its alleged role in project management, as intellectually vacuous as it is, has taken in so many in the business realm that risk management is a multi-billion dollar industry world-wide.

But it’s completely invalid. And, if you believe to the contrary, my only advice is to closely inspect any cutting boards your children gift you.

 


[i] Risk management. (2016, August 24). In Wikipedia, The Free Encyclopedia. Retrieved 01:23, August 28, 2016, from https://en.wikipedia.org/w/index.php?title=Risk_management&oldid=736035884


Posted on: August 29, 2016 10:20 PM | Permalink

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Alaa Hussein Program Manager| MEMECS Baghdad, Iraq
Thanks Michael, great article!

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