Using Risk / Issue / Opportunity Management to Shape Your Acquisition

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2 Using Risk / Issue / Opportunity Management to Shape Your Acquisition Breakout Session #: F06 Matt Wilson, Larry Floyd, Lyle Eesley, Phil Salmeri Date: Tuesday, July 26 Time: 4:00pm 5:15pm

3 Objective / Format Objective Discuss Risk / Issue / Opportunity (RIO) handling related to the Acquisition process and related artifacts Format Basic RIO Model overview Provide examples from SMEs Provide a forum for discussion Learn from one another 2

4 Risk / Issue / Opportunity (RIO) What are we talking about? Risk Issue Opportunity 3

5 Options to respond to risk Responses Assessment Handling Mitigation Avoidance Acceptance Ignore Monitor / Track / Manage 4

6 Risk Assessment Risk Identification What is the RIO Describe it in a statement What category does it fall into? What is its likelihood How probable is this to happen What is its impact What is the consequence if this RIO comes to pass? 5

7 Risk Assessment Model Nearly Certain Highly Likely Likely Unlikely Remote Likelihood Minimal / None Somewhat Moderate Major Unacceptable Impact 6

8 Likelihood / Probability Likelihood Rating Description 5 Nearly Certain The event is expected to occur in most circumstances as there is a history of regular occurrence on this type of project. 4 Highly Likely There is a strong possibility the event will occur as there is a history of frequent occurrence on this type of project. 3 Likely The event might occur at some time as there is a history of casual occurrence on this type of project. 2 Unlikely Not expected, but there's a slight possibility it may occur at some time. 1 Remote Highly unlikely, but it may occur in exceptional circumstances. It could happen, but probably never will. 7

9 Impact / Consequence Set impact levels based on the category of the risk Cost Schedule Performance (Technical) 8

10 Cost Impact Scale based on the size of the project and/or its tolerance for variation. For example: Project budget of $2M Impact Rating Description 5 Unacceptable > 15% or > $350K 4 Major 10-15% or $200K $350K 3 Moderate 5-10% or $100K $200K 2 Somewhat 1-5% or $20K $100K 1 Minimal / None < 1% or < $20K 9

11 Schedule Impact Scale based on the duration of the project and/or its tolerance for variation. For example: Project duration of 1 Year Impact Rating Description 5 Unacceptable > 12 weeks schedule impact 4 Major 8-12 weeks schedule impact 3 Moderate 4-8 weeks schedule impact 2 Somewhat 1-4 weeks schedule impact 1 Minimal / None < 1 week schedule impact 10

12 Performance Impact Examples base it on Key Performance Parameters (KPPs) Impact on mission performance Website availability Facility Access Ability to handle calls 11

13 Performance Impact This is the trickiest one and may require multiple scales and sub-categories to properly quantify. Often subjective. Example: Achieve technical objectives Impact Rating Description 5 Unacceptable Catastrophic impact on the product /service. No credible work-around exists. 4 Major Significant impact on the product / service. Work arounds require considerable effort. 3 Moderate Noticeable impact on the product / service. Work arounds require effort. 2 Somewhat Minor impact on the product / service. Work arounds are not cumbersome. 1 Minimal / None Almost no impact on the functional quality of the product / service. 1 2

14 Risk Assessment Model Nearly Certain Highly Likely C Likely Unlikely Remote A B Likelihood Minimal / None Somewhat Moderate Major Unacceptable Impact 1 3

15 Acquisition Risks Risk / Issue / Opportunity Category Requirement (PWS, SOW, SOO) Performance Standards Acquisition Team Composition Contract Type and Structure Schedule Constraints Technical Challenges Organizational Alignment Funding Consistency Stakeholder Expectations Technological Stability Business Allocation Protest Source Selection Evaluation Factors Technical Evaluation Plan / Team Quality Assurance Surveillance Plan Cost Estimate 14

16 Impacts on Acquisition Areas of Opportunity / Mitigation Requirement (PWS, SOW, SOO) Performance Standards Acquisition Team Composition Contract Type and Structure Risk / Issue / Opportunity Category Schedule Constraints Technical Challenges Organizational / Political Funding Stakeholder Expectations Technological Stability Business / Programmatic Protest Other Source Selection & Evaluation Factors Technical Evaluation Plan / Team Quality Assurance Surveillance Plan Cost Estimate 15

17 Acquisition Risks Risk / Issue / Opportunity Category Requirement (PWS, SOW, SOO) Performance Standards Acquisition Team Composition Contract Type and Structure Other Schedule Constraints Technical Challenges Organizational Alignment Funding Consistency Stakeholder Expectations Technological Stability Business Allocation Protest Source Selection Evaluation Factors Technical Evaluation Plan / Team Quality Assurance Surveillance Plan Cost Estimate Other 16

18 Impacts on Acquisition Areas of Opportunity / Mitigation Requirement (PWS, SOW, SOO) Performance Standards Acquisition Team Composition Contract Type and Structure Risk / Issue / Opportunity Category Schedule Constraints Technical Challenges Organizational / Political Funding Stakeholder Expectations Technological Stability Business / Programmatic Protest Other Source Selection & Evaluation Factors Technical Evaluation Plan / Team Quality Assurance Surveillance Plan Cost Estimate 17

19 Impacts on Acquisition Areas of Opportunity / Mitigation Requirement (PWS, SOW, SOO) Performance Standards Acquisition Team Composition Contract Type and Structure Risk / Issue / Opportunity Category Schedule Constraints Technical Challenges Organizational / Political Funding Stakeholder Expectations Technological Stability Business / Programmatic Protest Other Source Selection & Evaluation Factors Technical Evaluation Plan / Team Quality Assurance Surveillance Plan Cost Estimate 18

20 Impacts on Acquisition Areas of Opportunity / Mitigation Requirement (PWS, SOW, SOO) Performance Standards Acquisition Team Composition Contract Type and Structure Risk / Issue / Opportunity Category Schedule Constraints Technical Challenges Organizational / Political Funding Stakeholder Expectations Technological Stability Business / Programmatic Protest Other Source Selection & Evaluation Factors Technical Evaluation Plan / Team Quality Assurance Surveillance Plan Cost Estimate 19

21 Impacts on Acquisition Areas of Opportunity / Mitigation Requirement (PWS, SOW, SOO) Performance Standards Acquisition Team Composition Contract Type and Structure Risk / Issue / Opportunity Category Schedule Constraints Technical Challenges Organizational / Political Funding Stakeholder Expectations Technological Stability Business / Programmatic Protest Other Source Selection & Evaluation Factors Technical Evaluation Plan / Team Quality Assurance Surveillance Plan Cost Estimate 20

22 Impacts on Acquisition Areas of Opportunity / Mitigation Requirement (PWS, SOW, SOO) Performance Standards Acquisition Team Composition Contract Type and Structure Risk / Issue / Opportunity Category Schedule Constraints Technical Challenges Organizational / Political Funding Stakeholder Expectations Technological Stability Business / Programmatic Protest Other Source Selection & Evaluation Factors Technical Evaluation Plan / Team Quality Assurance Surveillance Plan Cost Estimate 21

23 Impacts on Acquisition Areas of Opportunity / Mitigation Requirement (PWS, SOW, SOO) Performance Standards Acquisition Team Composition Contract Type and Structure Risk / Issue / Opportunity Category Schedule Constraints Technical Challenges Organizational / Political Funding Stakeholder Expectations Technological Stability Business / Programmatic Protest Other Source Selection & Evaluation Factors Technical Evaluation Plan / Team Quality Assurance Surveillance Plan Cost Estimate 22

24 Impacts on Acquisition Areas of Opportunity / Mitigation Requirement (PWS, SOW, SOO) Performance Standards Acquisition Team Composition Contract Type and Structure Risk / Issue / Opportunity Category Schedule Constraints Technical Challenges Organizational / Political Funding Stakeholder Expectations Technological Stability Business / Programmatic Protest Other Source Selection & Evaluation Factors Technical Evaluation Plan / Team Quality Assurance Surveillance Plan Cost Estimate 23

25 Impacts on Acquisition Areas of Opportunity / Mitigation Requirement (PWS, SOW, SOO) Performance Standards Acquisition Team Composition Contract Type and Structure Risk / Issue / Opportunity Category Schedule Constraints Technical Challenges Organizational / Political Funding Stakeholder Expectations Technological Stability Business / Programmatic Protest Other Source Selection & Evaluation Factors Technical Evaluation Plan / Team Quality Assurance Surveillance Plan Cost Estimate 24

26 Impacts on Acquisition Areas of Opportunity / Mitigation Requirement (PWS, SOW, SOO) Performance Standards Acquisition Team Composition Contract Type and Structure Risk / Issue / Opportunity Category Schedule Constraints Technical Challenges Organizational / Political Funding Stakeholder Expectations Technological Stability Business / Programmatic Protest Other Source Selection & Evaluation Factors Technical Evaluation Plan / Team Quality Assurance Surveillance Plan Cost Estimate 25

27 Acquisition Risks Risk / Issue / Opportunity Category X Schedule Constraints Technical Challenges X X Organizational Alignment Funding Consistency X X Stakeholder Expectations Technological Instability X X Business Allocation Protest Address your highest Risks (ignore the green ones) X 26

28 What now? Identify RIOs Categorize RIO Assess Probability / Impact Only focus on higher risks Handle Risks Intentionally impact acquisition Where is the best place to address each item Track / Resolve 27

29 Contact Information Matt Wilson SimVentions (540) Larry Floyd DAU (703) Lyle Eesley SME (757) Phil Salmeri SME (540) Follow-up discussion here are World Congress at SimVentions Booth