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A briefing that describes an underappreciated risk management option: contingent actions.
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T. Erickson ©2011 All Rights Reserved 1
THE SERENITY FACTORIN RISK MANAGEMENT
10/17/2011
T. Erickson ©2011 All Rights Reserved 2
DisclaimerAny opinions expressed in the following presentation are the author’s and do not reflect those of the Project Management
Institute or its Chapters.
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OVERVIEW
The Serenity Prayer The Principles The Underappreciated Alternative A Black Swan Hunt
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THE SERENITY PRAYER
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“May I Have The Courage To Change What I Can,
The Serenity to Accept What I Can’t,
And The Wisdom To Know The Difference.”
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THE BASICS
Risk: 1: possibility of loss or injury : peril 2: someone or something that creates or suggests a hazard 3 a: the chance of loss or the perils to the subject matter of an
insurance contract ; also : the degree of probability of such loss b: a person or thing that is a specified hazard to an insurer c: an insurance hazard from a specified cause or source <war risk>
4: the chance that an investment (as a stock or commodity) will lose value— risk·less \'ris-kl?s\ adjective — at risk : in a state or condition marked by a high level of risk or susceptibility <patients at risk of infection> Webster’s Online Dictionary
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“If anything can go wrong, it will.”
Murphy’s Laws, Number 1
“. . . And even if it can’t, it might.”
Barton’s Amendment
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PRINCIPLES
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Management
Goals
Plans
Uncertainties
Responses
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GOALS“As you travel on through
life, Brother, whatever be your
goal, Keep your eye upon the
doughnut, Not upon the hole”
Mayflower Doughnut Shop, 1956
““If you don't know where you are going, you might wind up someplace else.”
Yogi Berra8T. Erickson ©2011 All Rights
Reserved
Management
Goals
Plans
Uncertainties
Responses
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PLANS
"The plan is nothing; planning is everything.“
Gen. Dwight D Eisenhower
“Living consists of figuring out what to do next.”
Unknown
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Management
Goals
Plans
Uncertainties
Responses
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UNCERTAINTIES
“Life is what happen to you while you are making other
plans.”John Lennon
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Management
Goals
Plans
Uncertainties
Responses
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RESPONSES
“It doesn’t matter what you’ve got so much as what you do with
it.”Tom Erickson
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Management
Goals
Plans
Uncertainties
Responses
10/17/2011
MANAGEMENT
“It isn’t that things will necessarily go wrong, but
rather that they will take so much more time and effort than you think, if they are
not to.”Wolf’s Law
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Management
Goals
Plans
Uncertainties
Responses
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RISK RESPONSE
“One should expect that the expected can be prevented, but the unexpected should
have been expected.”Augustine’s Law of Amplification of Agony, (Number XLV)
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RESPONSE ALTERNATIVES
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Proactive ReactiveAlso
Known As?Mitigations/Promotions
Contingencies/Exploitations
Before The Event At or After The Event
Cost? Expensive Cheap
Necessity? Uncertain Definite
When?
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THE UNDERAPPRECIATED ALTERNATIVE Contingencies/ Exploitations
Relatively Inexpensive Doesn’t Waste Resources Promotes Flexibility Improves Preparedness
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ASK YOURSELVES:
How Much Can We Affect The Uncertainty?
Threats: Reduce Impact, Likelihood, Velocity
Opportunities: Increase Impact, Likelihood, Velocity
If Our Efforts Can Have an Affect: Mitigate! If Our Efforts Can’t Have an Affect: Plan
ContingenciesT. Erickson ©2011 All Rights
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The Serenity Factor
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BLACK SWAN HUNT
Black Swans: Highly Improbable, Highly Impactful, Unpredictable Excellent for Practicing Contingent Responses
Your Turn: What is a Goal Of Your Organization? What Is The Plan What Is The Worst That Could Happen? How Much Can You Have an Affect? What Could You Do To Prepare? How Would You Know It Was Starting?
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GOALS
Paperless Environment for Patrols Preventing Child Deaths
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PLANS/STRATEGIES
Paperless Environment for Patrols Identify majority of forms Establish data warehouse Develop the infrastructure
Preventing Child Deaths Developing methods for assessing risks to
children Identifying reporting structures, i.e. hot
lines
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BLACK SWANS
Identify majority of forms No one can agree on the correct form Opportunity to clean house
Establish data warehouse Develop the infrastructure
Facility can’t support the buildout Developing methods for assessing risks to
children Don’t get the budget
Identifying reporting structures, i.e. hot linesT. Erickson ©2011 All Rights
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CONTINGENCIES
No one can agree on the correct form The Chief Picks The Right One Start with a few and call it a pilot Plan to identify the key data that is common Prepare to merge the forms Forms focus groups, test marketing
Opportunity to clean house
Facility can’t support the buildout Don’t get the budget
T. Erickson ©2011 All Rights Reserved
2110/17/2011
WRAP-UP
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Management
Goals
Plans
Uncertainties
Responses
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FINAL THOUGHTS
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“May I Have The Courage To Change
What I Can. . .
“The Serenity To Accept
What I Can’t. . .
“And The WisdomTo Know The Difference.”
Mitigations
Contingencies
Serenity Factor
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T. Erickson ©2011 All Rights Reserved 24
Murphy Lives!
Be Ready For Him!
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Questions?
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Contact Information:Tom Erickson, P.E., PgMP
An Enterprise AgilistEmail: [email protected]
Mobile: 703.201.0021
10/17/2011
