7/26/2016 ARETE-ZOE, LLC 1

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1 Registered address: 1334 E Chandler Blvd 5 A-19, Phoenix Arizona, USA T: Skype: arete-zoe veronikav@arete-zoe.com Website SlideShare 7/26/2016 ARETE-ZOE, LLC 1

RISK MANAGEMENT PROCESS Assumptions and Ground Rules Aligning Risk Management Risk Management Board / Risk Working Group RISK MANAGEMENT Risk Planning Risk Identification methodologies, categories

2 RISK MANAGEMENT PROCESS Assumptions and Ground Rules Aligning Risk Management Risk Management Board / Risk Working Group RISK MANAGEMENT Risk Planning Risk Identification methodologies, categories Risk Analysis and reporting Risk register, Risk matrix Risk Handling Accept, Avoid, Transfer, Mitigate, Burn down Risk Monitoring RELATION TO OTHER RISK MANAGEMENT TOOLS ISSUE MANAGEMENT OPPORTUNITY MANAGEMENT MANAGEMENT OF CROSS-PROGRAM RISKS 7/26/2016 ARETE-ZOE, LLC 2

3 RISKS are future events or conditions that may have a negative effect on achieving program objectives for cost, schedule, and performance. ISSUES are events or conditions with negative effect that have occurred (such as realized risks) or are certain to occur in the future that should be addressed. OPPORTUNITIES are potential future benefits to the program s cost, schedule, and/or performance baseline, usually achieved through reallocation of resources. 7/26/2016 ARETE-ZOE, LLC 3

4 RISKS are future events or conditions that may have a negative effect on achieving program objectives for cost, schedule, and performance. Risks are defined by the probability of an undesired event or condition and the consequences, impact, or severity of the undesired event, were it to occur. 7/26/2016 ARETE-ZOE, LLC 4

5 Successful risk management should be implemented early in the project life cycle: Identify risks Make informed decisions Define handling strategies before the risks become issues. 7/26/2016 ARETE-ZOE, LLC 5

6 Risk management begins with requirements formulation and assessment, includes the planning and conducting of technical risk reduction, and influences development and test activities. Active risk management Anticipating possible adverse events Occurs throughout the lifecycle of the program Strategies should be adjusted as the risk profile changes. 7/26/2016 ARETE-ZOE, LLC 6

7 Active risk management requires investment based on identification of where to best deploy scarce resources for the greatest impact on the program s risk profile, and includes shaping and controlling risk, not just observation of its progress and reaction to risks that are realized. Anticipating adverse events evaluating probabilities of occurrence, understanding cost and schedule impacts, and deciding to take cost effective steps ahead of time to limit their impact if they occur is the essence of effective risk management. 7/26/2016 ARETE-ZOE, LLC 7

8 Risk Monitoring Risk Handling Risk Planning Risk Analysis Risk Identification 7/26/2016 ARETE-ZOE, LLC 8

9 Sponsor SYSTEMS ENGENEERING PLAN (SEP) Contractor/Investigator SYSTEMS ENGENEERING MANAGEMENT PLAN (SEMP) Assumptions and Ground Rules Aligning Sponsor s and Vendor s processes Risk Management Board & Risk Working Group Risk Management Plan Selecting a Risk Management Tool Risk Management Roles, Responsibilities, and Relationships 7/26/2016 ARETE-ZOE, LLC 9

10 Sponsor SYSTEMS ENGENEERING PLAN (SEP) Contractor/Investigator SYSTEMS ENGENEERING MANAGEMENT PLAN (SEMP) Programs to address risk management between organizations The process for how the program plans to manage risks Integration of sponsor s risk management processes with contractor s How the program identifies and analyzes risks How the program plans, implements, funds and tracks risk handling activities Key roles and responsibilities 7/26/2016 ARETE-ZOE, LLC 10

11 Sponsor SYSTEMS ENGENEERING PLAN (SEP) Contractor/Investigator SYSTEMS ENGENEERING MANAGEMENT PLAN (SEMP) The Risk Management Programs between parties shall be tiered and closely coordinated, with clearly defined roles, responsibilities, and accountability. 7/26/2016 ARETE-ZOE, LLC 11

12 Risks that may result from invalid assumptions: Priority of requirements Schedule dependencies Accuracy of models and simulations 7/26/2016 ARETE-ZOE, LLC 12

13 Ground rules: Time frame: Current probability and impact estimates (i.e. risk consequence evaluated as unmitigated risk) Time of risk event: The time at which the risk hypothetically will occur should be considered and documented Work Breakdown Structure (WBS) level: Hardware and software risks should be identified to the lowest level to facilitate identification of causal factors and handling strategies. 7/26/2016 ARETE-ZOE, LLC 13

14 Proactive risk management requires disparate RM processes divided among multiple participants and stakeholders to be tiered and closely coordinated to ensure intrinsic product safety which goes beyond mere compliance with regulations. 7/26/2016 ARETE-ZOE, LLC 14

15 Program Manager (PM) establishes and chairs RMB RMB has approval authority for risk management related products. RMB includes representatives of the various functionalities of the program office RMB documents actions, decisions (meeting minutes / risk register) Joint sponsor-vendor RMBs are co-chaired by the two PMs. RMB structure should define decision-making responsibilities and accountability. A tiered structure is often implemented to manage lower-level risks. RMBs may also address opportunities (Risk and opportunity management boards - ROMB) Frequency of meetings shall ensure that risk management activities remain timely and relevant. 7/26/2016 ARETE-ZOE, LLC 15

16 RWG Leader: A member of the Systems Engineering IPT or Program Management IPT RWG Charter: Roles and responsibilities of the RWG RWG Roles: To develop individual risk plans and recommendations for the RMB 7/26/2016 ARETE-ZOE, LLC 16

Risk Management Planning Risk Identification Risk Identification Methodologies Risk Categories Risk Statement Evaluation of Candidate Risks Risk Analysis Consequence Likelihood Risk Reporting Matrix

17 Risk Management Planning Risk Identification Risk Identification Methodologies Risk Categories Risk Statement Evaluation of Candidate Risks Risk Analysis Consequence Likelihood Risk Reporting Matrix Risk Register Risk Handling Risk Handling Risk Analysis Acceptance - Avoidance - Transfer - Mitigation Risk Burn-Down Risk Monitoring Risk Monitoring Risk Planning Risk Identification 7/26/2016 ARETE-ZOE, LLC 17

18 How the program manages risks to achieve cost, schedule, and performance goals: Establish Basic approach Establish RM working structure Document an comprehensive and integrated approach for managing risks Define goals, objectives and RM processes Define cross-program approach to identify/analyze/handle/monitor risks Allocate resources (personnel, schedule, and budget) to mitigate risks Define the means to monitor the effectiveness of the RM process Document the integrated RM processes as they apply to contractors, subcontractors, and teammates. 7/26/2016 ARETE-ZOE, LLC 18

19 Introduction: Purpose and objective Program Summary: Description of the program and its connection to other programs Definitions Risk Management Strategy: Implementation, communication, training RMB (s) and RWG(s): Formation, leadership, membership, and purpose Roles, Responsibilities, and Authorities: Full lifecycle of risk Risk Management Process and Procedures: Process, methodology, meeting rhythm, and guidance for implementing the plan Risk Management in Relation to Other Program Management Tools: tool compatibility Risk Evaluation Techniques: Cost, schedule, risk evaluation processes and procedure Communication and Feedback Process: Process for communicating/elevating risk status 7/26/2016 ARETE-ZOE, LLC 19

20 Roles, Responsibilities, Authorities: o Identifying, adding, modifying, and reporting risks o Providing resources to handle risks o Developing criteria to determine whether a candidate risk is accepted o Changing likelihood and consequence of a risk o Closing/retiring a risk Communication and Feedback Process: Process for communicating and/or elevating the status of risks 7/26/2016 ARETE-ZOE, LLC 20

21 Risk Evaluation Techniques: Cost, schedule, and performance evaluation processes, risk evaluating procedure o Overview and scope of the evaluation process o Sources of information o Planned frequency of assessments o Products and formats o Evaluation technique and tools o Likelihood and consequence parameters and thresholds Communication and Feedback Process: Process for communicating and/or elevating the status of risks 7/26/2016 ARETE-ZOE, LLC 21

RM tools support the implementation and execution of risk management.

Helpfulness: Will the tool be useful during the decision-making process?

22 RM tools support the implementation and execution of risk management. RM tool(s) need to be selected early and documented in the SEP RiskAoA SAPHIRE Support Objectives: Does the tool aid in meeting program objectives? RRE Risk Maturity Model Recurrence: Will the RM tool accommodate recurring updates to the RM process? Helpfulness: Will the tool be useful during the decision-making process? CAFTA Risk Register STAMP PRA Accessibility: Will the tool be accessible to all users? Integration: Does the tool aid in the integration with other program management tools and processes? Requirements: Does the tool meet the requirements for the program office and contractor(s)? 7/26/2016 ARETE-ZOE, LLC 22

EXECUTIVE LEVEL Milestone Decision Authority Program Executive Officer MANAGEMENT LEVEL WORKING LEVEL Program Manager Program Risk Management Board IPT Risk

23 EXECUTIVE LEVEL Milestone Decision Authority Program Executive Officer MANAGEMENT LEVEL WORKING LEVEL Program Manager Program Risk Management Board IPT Risk Management Board Risk Working Group Risk Manager Integrated Product Team Sub-Integrated Product Team Working Group Risk Owner Team Members 7/26/2016 ARETE-ZOE, LLC 23

24 Risk Monitoring Risk Handling Risk Planning Risk Analysis Risk Identification 7/26/2016 ARETE-ZOE, LLC 24

traceability of risk to technical requirements and overall program objectives Align sponsor and vendor roles, responsibilities,

25 Risk Handling Risk Analysis Risk Monitoring Risk Planning Risk Identification Assign roles, responsibilities & authorities Select and document overall approach: Process and procedures Criteria for likelihood and consequences Risk handling procedures Establish traceability of risk to technical requirements and overall program objectives Align sponsor and vendor roles, responsibilities, tools, and communication Determine RM resources, budget, facilities, personnel, and schedule Determine RM battle rhythm 7/26/2016 ARETE-ZOE, LLC 25

26 Risk Monitoring Risk Handling Risk Planning Risk Analysis Risk Identification 7/26/2016 ARETE-ZOE, LLC 26

27 Risk Monitoring Determine risk events and associated cause(s) that may negatively impact cost, schedule, and/or performance Risk Handling Risk Planning Understand underlying root cause(s) All personnel is encouraged to identify candidate risks. Risk identification is conducted continuously Risk Analysis Risk Identification EVALUATION Approved Rejected Deferred Management action SEP item If (risk) then (outcome-consequence) Potential event Associated consequences Contributing circumstance/cause Ability of the program to meet cost, schedule, and performance objectives. 7/26/2016 ARETE-ZOE, LLC 27

28 BRAINSTORMING DIAGRAMMING AFFINITY METHODS INTERVIEWS INTEGRATED BASELINE REVIEW SYSTEMS ENGINEERING ACTIVITIES LEADING INDICATORS INDEPENDENT ASSESSMENTS TRENDS IN PROGRESS Systems Engineering Technical Reviews (SETR) and design reviews Trade studies Maturity of critical technologies Checklists and trigger questions Evaluation of results Design changes Failure mode and effects analysis, fault tree analysis, reliability analyses Specialty engineering efforts 7/26/2016 ARETE-ZOE, LLC 28

29 Understanding of program-related documents helps people identify sources of potential risk Changes to Key Performance Parameters (KPP) and Key System Attributes (KSA) should be re-analyzed for risks A systematic method combining a top-level approach and a variety of lower-level methods is recommended. 7/26/2016 ARETE-ZOE, LLC 29

30 A systematic method using a top-level approach combined with a variety of lower-level methods is recommended. EXTERNAL INFLUENCES Changes in user requirements: Threats &Concept of Operations Requirements creep Externally driven cost/funding constraints Synchronization with critical external programs Synchronization of legacy systems availability and restrictions Other stakeholder requirements or interests Statutory and regulatory changes PRODUCTION Make-buy decisions changes to suppliers parts obsolescence product delivery issues Manufacturing readiness Process maturity Business consolidation Sole source suppliers Raw materials Export control ( ) 7/26/2016 ARETE-ZOE, LLC 30

31 PROGRAMMATIC Generally within PM control Program estimates Program planning Program execution Communications Contract structure Schedule TECHNICAL May prevent the end item from meeting performance expectations. Technical risks can be internally or externally generated Requirements Technology Engineering Integration Test Manufacturing, Quality Logistics System security Training. BUSINESS (EXTERNAL) Originate outside the program Not within PM control Program dependencies Resources Priorities Regulations/Laws Stakeholders Market Customer Weather 7/26/2016 ARETE-ZOE, LLC 31

32 Risk Monitoring Risk Handling Risk Planning Risk Analysis Risk Identification 7/26/2016 ARETE-ZOE, LLC 32

Risk Handling Risk Analysis Risk Monitoring Risk Planning Risk Identification CONSEQUENCE The assessment should capture the greatest anticipated impact in any area as if the risk were fully realized.

33 Risk Handling Risk Analysis Risk Monitoring Risk Planning Risk Identification CONSEQUENCE The assessment should capture the greatest anticipated impact in any area as if the risk were fully realized. Quantify cost, schedule, and performance impacts RDT&E costs Procurement costs O&S costs Performance thresholds Schedule thresholds Assess the likelihood of the risk being realized Conduct analysis periodically LIKELIHOOD Level 5 Near Certainty 80-99% Level 4 Highly likely 60-80% Level 3 Likely 40-60% Level 2 Low likelihood 20-40% Level 1 Not likely 1-20% 7/26/2016 ARETE-ZOE, LLC 33

34 LIKELIHOOD Method for managing and communicating risk for prioritization and handling Level 1 Level 2 Level 3 Level 4 Level 5 Establishing priorities Cost-effectiveness Frequency of occurrence Time frame Interrelationship with other risks CONSEQUENCE Risks are characterized as low, moderate, or high based likelihood and consequence 7/26/2016 ARETE-ZOE, LLC 34

35 Risk Method for managing and communicating risk for prioritization and handling Risk Mitigation Expected Monetary Value Likelihood Consequence Cost Exposure Cost to handle Risk 1 20% $$ $$ $$ $$ Risk 2 40% $$ $$ $$ $$ Risk 3 60% $$ $$ $$ $$ Risk 4 80% $$ $$ $$ $$ TOTAL $$ $$ $$ ROI 7/26/2016 ARETE-ZOE, LLC 35

36 Risk registers are commonly used as a central repository for all identified risks, and record details and actions approved by the RMB. RR should be developed as early as possible in the program s life cycle. Plan Status Target Risk Rating Planned closure date Risk approval date Risk identified date Risk Handling Strategy Likelihood, Consequence Rating Risk Event Tier Status Type of Risk Owner Linked WBS/IMS ID# Risk # RR provides traceability of program risks and essential insight for program improvement 7/26/2016 ARETE-ZOE, LLC 36

37 Risk Monitoring Risk Handling Risk Planning Risk Analysis Risk Identification 7/26/2016 ARETE-ZOE, LLC 37

Risk Handling Risk Monitoring Risk Planning Risk handling strategy includes handling options or their combinations and the specific implementation approach.

38 Risk Handling Risk Monitoring Risk Planning Risk handling strategy includes handling options or their combinations and the specific implementation approach. Risk Analysis Risk Identification Elevate the risk to the appropriate tier? Cross-program risks included? ACCEPTANCE Continuous monitoring necessary to ensure the accepted consequences do not change for the worse. Identify resources and schedule needed should the risk be realized. AVOIDANCE TRANSFER MITIGATION BURN DOWN Elimination of the source of the risk by choosing a lower risk solution and by circumventing risks that are not critical to program cost, schedule, and/or performance. Reassigning the risk responsibility to another entity, program, or department. Transfer does not eliminate all responsibility. Risks must be monitored for potential consequences. Actively reduce risk to an acceptable level. Action to reduce the likelihood, or consequence of a risk to an acceptable level in order to minimize potential program impacts. Burn-down plan consists of time-phased handling activities that allow the program to plan to reduce all high, moderate, and selected low risks to an acceptable level or to closure. 7/26/2016 ARETE-ZOE, LLC 38

39 ACCEPTANCE AVOIDANCE TRANSFER MITIGATION BURN DOWN Continuous monitoring necessary to ensure the accepted consequences do not change for the worse. Identify resources and schedule needed should the risk be realized. Elimination of the source of the risk by choosing a lower risk solution and by circumventing risks that are not critical to program cost, schedule, and/or performance. Reassigning the risk responsibility to another entity, program, or department. Transfer does not eliminate all responsibility. Risks must be monitored for potential consequences. Actively reduce risk to an acceptable level. Action to reduce the likelihood, or consequence of a risk to an acceptable level in order to minimize potential program impacts. Burn-down plan consists of timephased handling activities that allow the program to plan to reduce all high, moderate, and selected low risks to an acceptable level or to closure. 7/26/2016 ARETE-ZOE, LLC 39

Multiple Development Efforts Alternative Design Trade Studies Early Prototyping Incremental Development Technology Maturation Robust Design Reviews, Walk-throughs, and Inspections Design of

40 Multiple Development Efforts Alternative Design Trade Studies Early Prototyping Incremental Development Technology Maturation Robust Design Reviews, Walk-throughs, and Inspections Design of Experiments Open Systems, Standard Items, or Software Reuse Mockups Models and Simulation Key Parameter Control Boards Test, Analyze, and Fix Demonstration Events 7/26/2016 ARETE-ZOE, LLC 40

41 Current date (1) Planned Actual Pending (2) Complete (3) (1) Action 1 (2) Action 2 (3) Action 3 Day 0 1 year 7/26/2016 ARETE-ZOE, LLC 41

42 Risk Monitoring Risk Handling Risk Planning Risk Analysis Risk Identification 7/26/2016 ARETE-ZOE, LLC 42

43 Tracking implementation and progress of risk handling strategy Technical Performance Measures Regular status updates to changes to likelihood/consequences Tracking risk status in Risk registers and risk reporting matrix Communicate risk status Alerting management when adjustments are needed Risk Monitoring Documenting risks that can be retired Reviewing retired risks and watch for relapse Risk Handling Risk Planning Risk Analysis Risk Identification 7/26/2016 ARETE-ZOE, LLC 43

44 LIKELIHOOD TREND MATRIX Level 1 #12 Level 2 #82 #17 Level 3 #34 Level 4 Level CONSEQUENCE 7/26/2016 ARETE-ZOE, LLC 44

45 LIKELIHOOD Trend matrix TREND MATRIX Display the current risk status Level 1 #12 Visualize burn-down progress Level 2 Level 3 Level 4 #34 #17 #82 Similar indicator systems throughout life cycle Early warning Level CONSEQUENCE when the likelihood or consequence exceeds pre-established thresholds/limits, is trending negatively, or has evolved into an issue. 7/26/2016 ARETE-ZOE, LLC 45

46 LIKELIHOOD Regularly scheduled status updates TREND MATRIX Changes to likelihood or consequence Level 1 #12 Monitor earned value (cost variance) Level 2 #17 Variation in performance and schedule Level 3 #34 #82 Risk handling plans to be implemented Level 4 Adjustment of risk management plans Level CONSEQUENCE Alert the next level of management Tracking actual versus planned progress Management indicator to monitor risk activity. 7/26/2016 ARETE-ZOE, LLC 46

47 RISKS Cost Schedule Performance Program Requirements Program Constraints 7/26/2016 ARETE-ZOE, LLC 47

48 Program management tools Work Breakdown Structure (WBS) Integrated Master Plans (IMP) Integrated Master Schedules (IMS) Earned Value Management (EVM) Technical Performance Measures (TPM) Identify and monitor potential risks and progress to plan Balance program requirements and constraints against cost, schedule, or performance risks. 7/26/2016 ARETE-ZOE, LLC 48

49 WBS IMP/IMS EVM TPM Work Breakdown Structure (WBS) Facilitation of communication Common frame of reference for all contract line items and end items All the tasks that should be analyzed for risk Monitoring risks at their respective levels Evaluating the resulting effect of risks on the overall program Risk handling planning WBS updates needed to reflect task handling 7/26/2016 ARETE-ZOE, LLC 49

50 WBS IMP/IMS EVM TPM Integrated Master Plans (IMP) / Schedules (IMS) IMP is an event-based plan that displays each milestone and supporting accomplishments needed for program completion CRA SHA SRA PRA Schedule Health Assessment (SHA) Schedule Risk Analysis (SRA) Cost Risk Analysis (CRA) Performance Risk Analysis (PRA) 7/26/2016 ARETE-ZOE, LLC 50

51 METRIC GOAL STATUS Logic incomplete tasks with missing predecessor or successor logic links <5% Leads number of leads (overlap between tasks with logic dependencies) 0 tasks Lags number of tasks with lags <5% Relationship Type establishes the order of task completion Hard Constraints fixed task start or finish date that prevents tasks from being moved by their logic-driven dependencies <10% non- Finish-Start <5% High Duration unfinished tasks over a baseline duration <5% High Float incomplete tasks with total float greater than 44 working days <5% Negative Float less than zero float, forecasted date may be unrealistic 0 tasks Invalid Dates incomplete tasks with actual start /finish date in the future 0% Resources allocated resources (hours/dollars) 0 improper Missed Tasks tasks that do not finish as planned <5% Critical Path Test identifies broken logic, missing predecessors/successors 0 days Critical Path Length Index (CPLI) measures the efficiency to finish on time >=.95 Baseline Execution Index (BEI) efficiency of work accomplished >=95% 7/26/2016 ARETE-ZOE, LLC 51

52 WBS IMP/IMS EVM TPM Earned Value Management (EVM) Method to integrate technical work scope, cost, and schedule objectives into a single contract baseline plan used for tracking contract performance EVM is used to: determine cost/schedule variances isolate causes forecast future cost schedule performance implement corrective action plans EVM Purpose: Quantify and measure program/contract performance Early warning system for deviations Forecast cost/schedule outcomes 7/26/2016 ARETE-ZOE, LLC 52

53 WBS IMP/IMS EVM TPM Technical Performance Measures and Metrics (TPM) TPM are tools used to support evidence-based decisions at selected events and knowledge points throughout the program life cycle. Selected for each life cycle phase Measure real vs. planned progress TPMs documented in the SEP Measures Specific/Objective Measurable Achievable/Observable Relevant Timely 7/26/2016 ARETE-ZOE, LLC 53

54 No evaluation of issue likelihood is necessary as the probability = 1. Issue Monitoring Issue Handling Issue Planning Issue Analysis Issue Identification 7/26/2016 ARETE-ZOE, LLC 54

55 IM process to identify, analyze, handle, and monitor issues to retirement Effective strategy to resolve critical and high-priority issues Strategy for issue resolution has been properly vetted Quantify issue urgency to prioritize resolution Document plans of action and milestones (POA&M). Identified issues should be updated periodically until resolved and reviewed Issue Handling Issue Monitoring Issue Planning ISSUE MANAGEMENT BOARD Proper focus on both issues and risks Issues shall not overtake risks & opportunities Assign owner to each issue Issue Analysis Issue Identification 7/26/2016 ARETE-ZOE, LLC 55

56 Issue Monitoring Issue Handling Issue Planning Issue Analysis Issue Identification 7/26/2016 ARETE-ZOE, LLC 56

57 Handling (or corrective action) plans should be developed and documented for high and moderate issues ISSUE TRACKING REGISTER Evaluate the handling options in terms of cost, schedule, performance, and residual risk, and select the best option (or hybrid of options) consistent with circumstances. Accept Accept consequence of the issue based on business case analysis. Avoid Eliminate the consequence by taking an alternate path Transfer Reassign or reallocate responsibility within organization Mitigate Implement a strategy to reduce consequences or minimize impact 7/26/2016 ARETE-ZOE, LLC 57

58 Opportunities are potential future benefits to the program s cost, schedule, and/or performance baseline. Opportunities usually achieved through reallocation of resources. Risk and opportunity management support Better Buying Power initiatives to achieve should-cost as well as will-cost objectives. 7/26/2016 ARETE-ZOE, LLC 58

59 Opportunities Help Deliver Should-Cost Objectives Risk Management enables meeting Will Cost and Should Cost Cost Issue Performance Thresholds Risk Handling Activities Opportunity Handling Activities Baseline Opportunity Management enables meeting Should Cost 7/26/2016 ARETE-ZOE, LLC 59

60 Opportunity Monitoring Opportunity Handling Opportunity Planning Opportunity Analysis Opportunity Identification 7/26/2016 ARETE-ZOE, LLC 60

61 Potential enhancements to cost, schedule & performance Opportunities should be sought across the program life cycle Opportunities include system and program changes Cost reductions: Research Development Test Evaluation Production Operations Opportunity Handling Opportunity Analysis Opportunity Monitoring Opportunity Planning Opportunity Identification 7/26/2016 ARETE-ZOE, LLC 61

Pursue Fund and implement a plan to realize the opportunity. Reevaluate Continuously evaluate the opportunity for changes in circumstances.

62 Pursue Fund and implement a plan to realize the opportunity. Reevaluate Continuously evaluate the opportunity for changes in circumstances. Reject Intentionally ignore due to cost, technical readiness, resources, schedule burden, or low probability of success. Opportunity Handling Opportunity Analysis Opportunity Monitoring Opportunity Planning Opportunity Identification 7/26/2016 ARETE-ZOE, LLC 62

63 LIKELIHOOD Level 1 Level 2 Level 3 Level 4 Level 5 OPORTUNITY MATRIX BENEFIT Level 5 Near Certainty 80-99% Level 4 Highly likely 60-80% Level 3 Likely 40-60% Level 2 Low likelihood 20-40% Level 1 Not likely 1-20% 7/26/2016 ARETE-ZOE, LLC 63

64 Plan, identify, analyze, handle, and monitor initiatives that potentially yield improvements in the cost, schedule, and/or performance baseline. Pursue / Re-evaluate / Reject Tracking Registries Improve the program cost, schedule, and performance baselines Programs evaluate approved opportunities RISKS, ISSUES AND OPPORTUNITIES SHALL BE EVALUATED IN CONTEXT 7/26/2016 ARETE-ZOE, LLC 64

65 Internal and external interfaces can be a significant source of risk Integration of mature hardware/software generally progresses more smoothly because it uses established and stable interfaces. New developments activities result in technical, programmatic & business risks Interdependent programs have differing priorities, schedules, and requirements should have strong risk management processes, regularly share risk management information, and foster a mutually supportive environment. Ensure effective control over critical interfaces with external programs. Align funding and priorities Instill sense of commitment to dependent system s successful development 7/26/2016 ARETE-ZOE, LLC 65

66 INFORMATION EXCHANGES: Tiered, regular schedule of meetings with external programs and associated contractors Program Team Meetings, Risk Review Boards, Program Management Reviews, Executive Meetings Synchronization of program schedule, results of SRAs, and technical, business & programmatic risks. The meetings should track performance to plan, deviations from plans, integration, and review of risks, issues, and opportunities. To maintain visibility traditional interdependency chart can depict program health and challenges. Activities required due to interdependencies should be identified early enough so that necessary resources can be secured. 7/26/2016 ARETE-ZOE, LLC 66

67 PROGRAMS FY12 FY13 FY14 FY15 FY16 FY17 FY18 Program X Sample Synchronization from the SEP Outline Program Y Program Z Milestone 1 Milestone 2 Current date Milestone 3 7/26/2016 ARETE-ZOE, LLC 67

ARETE-ZOE, LLC: 1334 E Chandler Blvd 5A-19, Phoenix 85048, Arizona, USA Email:

68 ARETE-ZOE, LLC: 1334 E Chandler Blvd 5A-19, Phoenix 85048, Arizona, USA veronikav@arete-zoe.com T: +1(480) T: +1-(631) /26/2016 ARETE-ZOE, LLC 68

Department of Defense Risk Management Guide for Defense Acquisition Programs

Department of Defense Risk Management Guide for Defense Acquisition Programs 7th Edition (Interim Release) December 2014 Office of the Deputy Assistant Secretary of Defense for Systems Engineering Washington,