Risk Management

Three Ways to Manage Risks and Opportunities with Data

Ray W. Frohnhoefer wants to shake all the subjective interpretations out of risk and opportunity management. He says maxims like “The customer is number one,” are getting in the way of good, hard data, and he writes for PM Hut with three ways to make the best use of it:

  1. Use data collected by others.
  2. Collect data within our organizations.
  3. Create data with reduced or removed bias.

Calculating the Best Calculations

You do not need to do all the legwork yourself. If you know where to look, there is data freely available outside your doors that can assist you, directly or indirectly. Frohnhoefer offers this:

Switching to a software example, suppose we want to confirm an estimate for a fixed date deliverable. Researchers such as Gerald Weinberg (SUNY) and Ben Shneiderman (SUNY and UMd) have spent years compiling data on programmer productivity and other programmer behaviors. The data is available for our use if we look for it.

As for collecting data within the organization, you should realize that every piece of data is an opportunity to improve processes. For instance, when having to meet a fixed date, you can look at data about how such time-sensitive projects were completed in the past, and what sacrifices had to be made to hit the deadline. There will always be instances where data has not been formally recorded, but is still within your power to manually look up and employ.

But Frohnhoefer is a stickler for objectivity, and he wants to ensure that you get the bias out of the metrics. To this end, he recommends comparing multiple dimensions of data with weighted averages and “quadratic means.” If math is not your strong suit, you may want to call in a friend to help out.

You can read Frohnhoefer’s full post here: http://www.pmhut.com/three-ways-to-manage-risks-and-opportunities-with-data

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