Enterprise Risk Management, 2nd Edition

CHAPTER 36Managing Risk Associated with Project Delivery: A How-To Guide

 

MIKE WINTERS

Chief Financial Officer, Modern Niagara Group Inc.

 

INTRODUCTION

As I write this chapter, I am leading my company through a major replacement and rearchitecture of our core processes and information systems—finance, field services, construction management, payroll, human resources, labor performance, digital time capture, reporting, and analytics—so the information within is fresh and pragmatic.

I am using information technology projects as the examples within this chapter, but these principles apply across any and all types of projects. As a company, Modern Niagara helps build and maintain commercial and institutional spaces. Whether your goal is to cut over to a new set of business systems or to achieve occupancy in a new hospital, risk management is an essential part of project delivery.

Fauser, Schmidthuysen, and Scheffold wrote:

The yearly CHAOS research of the The Standish Group (Standish Group International 2013), covering 50,000 company projects, illustrates that over 60 percent of organizations experienced failure. Drilling down into more detail reveals that time overruns are the primary issue that 74 percent of the challenged projects face, followed by shortcomings in developed features (69 percent) and higher costs than planned with 59 percent. Bloch, Blumberg, and Laartz (2011) confirm these as the key challenges organizations experience and add that in some cases a project ...