risk-confidence-urgency decision matrix for project managers, a simplistic approach
TRANSCRIPT
Risk-Confidence-Urgency Decision Matrix for Project
Managers, a simplistic approach
By Will Watkins, PEhttps://www.linkedin.com/pub/will-watkins-
pe/85/807/612
Introduction
Projects are constrained by three parameters: Quality, Time, and Cost.
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Project Managers (PM) are tasked to make Decisions throughout the life of the Project. Decisions are constrained by three parameters: Risk, Confidence, and Urgency.
Decision Constraints
• Confidence – refers to the PM’s belief he/she knows what is the correct choice. Confidence should be evidence based.
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• Urgency – refers to the need for a decision to be made. Is there a current Schedule / Cost impact? Can the decision be delayed to gather information?
• Risk – for the purpose of this matrix, Risk measures the amount of Project Damage incurred if the wrong choice is made.
The Matrix
The matrix is intended to serve as guide and will not be accurate in all circumstances.
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The Project Manager’s direct supervisor is referred to as the Project Sponsor.
In the following 8 scenarios, the 3 decision constraints are assigned at either HIGH or LOW. Based on the scenario, guidance is provided on how a PM should address each scenario.
RISK
CONFIDENCELOW
HIGH
These are every-day decisions.
In this Scenario,
The PM should….
MAKE A DECISION!
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Scenario 1
RISK
CONFIDENCELOW
HIGH
These are every-day decisions.
Since the Decision is not urgent it can be delayed if the situation is expected to change before action is needed, if not..
The PM should….
MAKE A DECISION!
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Scenario 2
RISK
CONFIDENCE
HIGH
HIGH
Since there is high risk, the Project Sponsor should be consulted.
With high confidence, the PM should be ready and willing to…
MAKE A DECISION,with the concurrence of the Project Sponsor.
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Scenario 3
RISK
CONFIDENCE
HIGH
HIGH
MAKE A DECISION!
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Since the Decision is not urgent it can be delayed to ensure the environment does not change. The Project Sponsor should be consulted.
The PM should monitor the situation and be ready and willing to….
Scenario 4
RISK
CONFIDENCELOW
LOW
MAKE A DECISION!
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With the combination of High Urgency and Low Risk, no decision may be worse than an incorrect decision. The PM should review all the information available and….
Scenario 5
RISK
CONFIDENCELOW
LOW
MAKE A DECISION!
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Due to the Low Risk, the PM may decide to go ahead and…
However since the decision is not urgent, the PM may choose to delay and search for information.
Scenario 6
RISK
CONFIDENCE
HIGH
LOW
Search for Information to increase Confidence
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This scenario may be approaching a crisis, The PM should...
notify the Project Sponsor.
Scenario 7
AND
RISK
CONFIDENCE
HIGH
LOW
SEARCH FOR INFORMATION
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This scenario is a crisis!
The PM should immediately...
NOTIFY THE PROJECT SPONSOR
AND
Scenario 8