Risk is a major factor that affects all projects. In fact, statistics show that projects fail mostly because risks and issues are not managed effectively. This is evident from the fact that risks covers major areas of scope, time, cost and quality. Why I decided to write on display of risk management in Enterprise Project Management Dashboard is mainly because it has always been a challenging area in project management. I hope to provide certain key pointers in this article that will help to manage and display risks appropriately using tools such as Enterprise Project Management Dashboard.
ENTERPRISE PROJECT MANAGEMENT DASHBOARD
To start with let us first realise the importance of Enterprise Project Management Dashboard. EPM Dashboard is normally used to show the end to end project status across all phases in a given project. It is especially useful in large budget projects that would have multiple stakeholders and sizeable end result, service or product. Here, I have referred to a large scale IT project.
Naturally, the EPM dashboard that we are assuming here is of a large proportion with:
- Rich UI
- Consolidation of variety of tools such as MS Project 2007, Testing tools (standard or custom), Reporting tools (standard SQL reporting services or custom), Risk capturing tools (standard or custom) all linked through common databases (DB’s) that can connect to each other through complex or interdependent queries.
Before dealing with how useful EPM dashboard can be for managing risks, I have listed below, a probable list of indicators that can be displayed in EPM dashboard for executing, monitoring and controlling the project.
1) Earned Value indicators to show Schedule Variance, Cost Variance, Schedule Performance Index, Cost Performance Index, To Complete Performance Indicators (TCPI). This will help get a direct feel of the financial health of the project. These can be shown visually. I have explained one of the ways in my blog on “How to use Earned Value Management using MS Project 2007”.
2) Software Engineering Metrics such as:
a. Quality related Metrics like Percent Pass, Fail, Unable to Test for each build/release delivered to the customer over a period of time across Unit, Component, Module, System, Integration and Deployment Testing phases.
b. Productivity of developers and Testers. How to measure this has always been a debatable issue across IT industry. However, depending on the type of deliverable, it could be linked to Lines of Codes, Function Point analysis, number of test cases executed, or simply issues being fixed in a build that would have been raised by the customers during interim deliverables. I would also like to add Sprint velocity into this.
c. Burn down charts of each sprint in case of projects being developed in iterative or agile methodology using scrum framework.
d. Contents delivered in each build vs those scoped and the variance between the scoped items and the delivered items.
3) Risks and Issues statuses raised during the progress of the project and are currently open and need to be resolved. We will discuss more on this later in this article.
4) Overall Tasks completed, Tasks due for next period (normally a week) and pending tasks in each department say, Development, Solution Office, Testing, Deployment, Documentation etc.
The way these indications can be shown depends from organisation to organisation and the nature or type of projects. Some projects might need some more indicators while some may only need a few of those mentioned above.
How these are covered or displayed in EPM dashboard will also vary in different situations and the type of Audience. Some companies may prefer a web based user interface with high level summary accessible to top management that will drill down to more details as they click on each area. The access at the departmental level might be only to their respective areas depending on the policy and transparency of the organisation.
RISK MANAGEMENT DISPLAY IN EPM DASHBOARD
Before dealing with what to display in the risk area of the EM dashboard, let us have a brief overview of how risks/issues are managed. As we move along, I shall mention how it needs to align with projecting risks/issues in the EPM dashboard.
Risk Management normally goes through the following process:
1) PLAN RISK MANAGEMENT:
This is done in the planning process of the project, where the process of defining how to conduct the risk management activities is detailed. Risk management should definitely cover the vital areas of Scope, Cost, Time and Quality. This is where the methodology, tools, techniques and how to display the risks/issues should be detailed. So, the plan of displaying the risks, which risks to display, how risk tolerant is the organisation, which risks need to be shared with the customer especially that impacts the deliveries, how inter departmental risks/interdependency needs to be displayed. This is where the access rights of all stake holders needs to be clarified, since the data could be sensitive. What all risks needs to be captured needs to be well thought out and accordingly these fields need to be provided in the UI and mapped to the DB. The EPM tool needs to be developed such that the stakeholder responsible will input the risks in a standard format. No wonder that Risk management and its planning starts very early in the project.
2) IDENTIFY RISKS:
This is where you indentify the risks based on the RISK MANAGEMENT PLAN. Obviously the tool to capture risks/issues should be ready before the process of identifying risks. So, the EPM dashboard would be a project in itself mainly taken up by the PMO. Also, you could have a watch list (low priority risks or risks that might need attention at a later stage) that you may want to have in your radar and deal with later but would like to keep a track of it. Again, you may have the facility to capture a watch list, and later provide a low numerical value of importance. Whether to display this in EPM dashboard needs to be well thought out in advance. You may need to hide them till such time it becomes a risk that needs attention or might become high priority. The output is the Risk Register that is the key to risk analysis, tracking and risk responses. It is highly useful in tracking risks issues till it is closed. A typical risk register would contain fields such as:
Risk ID, Risk Name, Risk Details, Risk Owner, Risk Raised By, Risk Raised Date, Risk Follow up date, Risk Priority, Current Status, Risk Response etc. These fields can be provided as a UI to enter the risk details.
3) PERFORM QUALITATIVE AND QUANTITATIVE RISK ANALYSIS
This is a major area where the risks are first qualitatively prioritized for further processing and later provided with numerical values with say, 5 as highest priority risk and 0 as lowest priority risk. Various tools that are used for qualitative and quantitative risk analysis are Probability and Impact risk, Expected Monetary Value including Decision Tree, Monte Carlo Analysis. These would help provide appropriate priorities to the risks.
4) PLAN RISK REPONSES
Risks are broadly classified as Positive risks (Opportunities) and Negative risks (Threats). If Risks are positive, the typical responses are Exploit, Share, Enhance, and Accept. If risks are negative, the typical responses are Avoid, Mitigate, Transfer or Accept. The responses would depend on the nature of the risk and the situation. These responses need to be captured. Here the UI tool developed to enter the risks and the details will be useful. You should develop the Risk capturing tool such that one can update the risk details from time to time, since the risk status will always be dynamic depending on the progress of the project.
By now, you would be having the major risks displayed in the EPM dashboard based on the criteria settings as to what risks can be shared at what level.
5) MONITOR AND CONTROL RISKS
This is where you actually track risks, implement risk responses, update the risk register (that you are already maintaining as a database) and constantly update through the risk tool UI), identify and add new risk to the risk register DB, and keep evaluating the risk evaluating process. For effective risk management, it is necessary to track and evaluate risks frequently. The risks should be reviewed, discussed and updated in every status meeting.
The risks/Issues logged, tracked and updated are accordingly displayed based on the criteria set-up for display in the EPM dashboard.
Risk management is a highly process intensive activity. If the process is set-up properly, the tools will reflect the process and it will be a hassle free, centralised and self managed tool, with little or no manual intervention except for keeping the risk register updated on a weekly basis.
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