ARETE-ZOE designs, develops, and implements solutions individually tailored to needs and specifications defined by the Client. Development of a solution includes optimization of a process, development of process flowcharts, interactive forms, document templates, working instructions and SOPs for every step of the redefined process, training matrix for each function within organization, and development of training materials to ensure quality and consistency of the process. Evaluation phase ensures continuous reassessment of the process and its flexible adjustment and improvement in response to changing internal and external requirements.
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• RELATION TO OTHER RISK MANAGEMENT TOOLS• ISSUE MANAGEMENT • OPPORTUNITY MANAGEMENT • MANAGEMENT OF CROSS-PROGRAM RISKS
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RISK MANAGEMENT PROCESS
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Risk Identification
Risk Planning
Risk Analysis
Risk Handling
Risk Monitoring
RISKS are future events or conditions that may have a negative effect on achieving program objectives for cost, schedule, and performance.
Risks are defined by the probability of an undesired event or condition and the consequences, impact, or severity of the undesired event, were it to occur.
ISSUES are events or conditions with negative effect that have occurred (such as realized risks) or are certain to occur in the future that should be addressed.
OPPORTUNITIES are potential future benefits to the program’s cost, schedule, and/or performance baseline, usually achieved through reallocation of resources.
Successful risk management should be implemented early in the project life cycle: Identify risks Make informed decisions Define handling strategies
… before the risks become issues.
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I. ESTABLISHING AN EFFECTIVE PROCESS
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• Assumptions and Ground Rules• Aligning Sponsor’s and Vendor’s processes• Risk Management Board & Risk Working Group • Risk Management Plan • Selecting a Risk Management Tool • Risk Management Roles, Responsibilities, and Relationships
Programs to address risk management between organizations• The process for how the program plans to manage risks.• How risk management processes are integrated with the contractor(s) processes.• How the program identifies and analyzes risks.• How the program plans, implements (including funding), and tracks risk handling activities.• Key roles and responsibilities from working groups, IPTs, RWGs, and RMBs up to the PM.
SYSTEMS ENGENEERING MANAGEMENT PLAN (SEMP)
Sponsor Investigator
SYSTEMS ENGENEERING PLAN (SEP)
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ALIGNING RISK MANAGEMENT
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SPONSOR INVESTIGATOR IRB/EC REGULATORVENDORs
SUB-CONTRACTORs
CMO
CRO
CONTRACTORs
HOSPITAL MANAGEMENT
CONTRACTORs
RESEARCH PHYSICIANS
SUB-CONTRACTORs
ADJUDICATION COMMITTEE
Proactive risk management requires disparate RM processes divided among multiple participants and stakeholders to be tiered and closely coordinated to ensure intrinsic product safety which goes beyond mere compliance with regulations.
• Support Objectives: Does the tool aid in meeting program objectives?• Recurrence: Will the RM tool accommodate recurring updates to the RM process?• Helpfulness: Will the tool be useful during the decision-making process?• Accessibility: Will the tool be accessible to all users? • Integration: Does the tool aid in the integration with other program management tools and processes?• Requirements: Does the tool meet the requirements for the program office and contractor(s)?
Risk management tools support the implementation and execution of risk management. The PM needs to select the appropriate risk management tool(s) early and document details in the SEP.
CAFTA
Event Chain Methodology
SAPHIRE
Altova MetaTeam
PRARRE
Risk Maturity
Model
RiskAoA
Risk Regist
er
STAMP
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ROLES, RESPONSIBILITIES, RELATIONSHIPS
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EXECUTIVE LEVEL
MANAGEMENT LEVEL
WORKING LEVEL
Milestone Decision Authority
Program Executive Officer
Program ManagerProgram Risk Management Board
IPT Risk Management BoardRisk Working GroupRisk Manager
Integrated Product TeamSub-Integrated Product TeamWorking Group
Risk Owner Team Members
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RISK IDENTIFICATION
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Risk Identification
Risk Planning
Risk Analysis
Risk Handling
Risk Monitoring
• Examining the program to determine risk events and associated cause(s) that may have negative cost, schedule, and/or performance impacts.
Understand underlying root cause(s) • All personnel is encouraged to identify candidate
risks. Limiting risk identification to managers can result in risks being missed.
• Risk identification is conducted continuously
PROGRAM RISK REGISTER
RISK STATEMENT• Potential event • Associated consequences• Contributing circumstance/Cause Ability of the program to meet cost,
schedule, and performance objectives. • Single approach preferred for consistency. • “if (risk) – then (outcome-consequence)”
EVALUATIONApproved Rejected,Deferred Management action Engineering process item
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RISK CATEGORIES
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TECHNICAL • May prevent the end item from meeting performance expectations. • Technical risks can be internally or externally generated• Requirements • Technology • Engineering • Integration • Test • Manufacturing,• Quality • Logistics • System security • Training.
PROGRAMMATIC• Generally within PM control • Program estimates • Program planning • Program execution • Communications • Contract structure • Schedule
BUSINESS (EXTERNAL)• Originate outside the program • Not within PM control • Program dependencies• Resources • Priorities• Regulations/Laws• Stakeholders • Market • Customer• Weather
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RISK ANALYSIS
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Risk Identification
Risk Planning
Risk Analysis
Risk Handling
Risk Monitoring Quantify cost, schedule, and performance impacts
Assess the likelihood of the risk being realizedConduct analysis periodically
CONSEQUENCE LIKELIHOODLevel 5 Near Certainty 80-99%
Level 4 Highly likely 60-80%
Level 3 Likely 40-60%
Level 2 Low likelihood 20-40%
Level 1 Not likely 1-20%
The assessment should capture the greatest anticipated impact in any area as if the risk were fully realized, that is, without further risk reduction or handling opportunities.
Level 1
Level 2
Level 3
Level 4
Level 5LIKE
LIHO
OD
1 2 3 4 5 CONSEQUENCE
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RISK HANDLING
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Risk Identification
Risk Planning
Risk Analysis
Risk Handling
Risk Monitoring Risk handling strategy includes handling options or their
combinations and the specific implementation approach. Acceptance | Avoidance | Transfer | Mitigation BURN DOWN
Elevate the risk to the appropriate tier? Cross-program risks included?
ACCEPTANCE Continuous monitoring necessary to ensure the accepted consequences do not change for the
worse. Identify resources and
schedule needed should the risk be realized.
AVOIDANCE TRANSFER MITIGATION BURN DOWNElimination of the source of the risk by choosing a lower risk solution and by circumventing risks that are not critical to
program cost, schedule, and/or performance.
Reassigning the risk responsibility to another
entity, program, or department. Transfer does not eliminate all
responsibility . Risks must be monitored for
potential consequences.
Actively reduce risk to an acceptable level. Action to reduce the likelihood, or consequence of a risk to an acceptable level in
order to minimize potential program
impacts.
Burn-down plan consists of time-phased handling activities that allow the
program to plan to reduce all high,
moderate, and selected low risks to an
acceptable level or to closure.
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RM RELATION TO OTHER TOOLS
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Program management tools • Work Breakdown Structure (WBS)• Integrated Master Plans (IMP)• Integrated Master Schedules (IMS)• Earned Value Management (EVM)
Systems engineering tool• Technical Performance Measures and
Metrics (TPMs)
Program Requirements Program Constraints
identify and monitor potential risks and progress to plan.
balance program requirements and constraints against cost, schedule, or performance risks.
RISKSCost
SchedulePerformance
INTE
GRAT
ION
OF
TOO
LS
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ISSUE MANAGEMENT
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ISSUE MANAGEMENT BOARD Proper focus on both issues and risks Attention on current problems shall not
overtake risks and opportunities. Assign owner to each issue
Defined and structured issue management process to ensure issues are identified, analyzed, handled, and monitored to retirement. Effective strategy is developed for
resolving critical and high-priority issues and the strategy has been properly vetted
Quantify issue urgency to prioritize resolution, and document plans of action and milestones (POA&M).
Identified issues should be updated periodically until resolved and reviewed
ISSUE REPORTING MATRIX
Issue Identification
Issue Planning
Issue Analysis
Issue Handling
Issue Monitoring
Unlike opportunities and risks, no evaluation of issue likelihood is necessary as the probability = 1.
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ISSUE MANAGEMENT
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Through issue management, the program identifies and addresses events or conditions that have already occurred, are occurring, or are certain to occur in the future and have a potential negative impact on the program.
SJS/TEN ADVERSE DRUG REACTIONS: RISK OR ISSUE?
STEVEN JOHNSON SYNDROME / TOXIC EPIDERMAL NECROLYSIS
• Adverse drug reactions (ADRs) are among leading causes of death in hospitalized patients
• ADRs account for 0.3 to 7 % of all hospital admissions • Severity varies from mild rashes to severe reactions such
as Stevens-Johnson syndrome (SJS). • 5-8%of hospitalized patient develop serious a ADR.
Risk management applies resources to lessen the likelihood and/or the consequence of a future event of less than certain probability.
Issue management applies resources to address and resolve the consequences associated with a past, present, or certain future event.
Programs also should assess whether issues may create additional potential risks (e.g. product liability lawsuits), and evaluate them accordingly.
Issue Monitoring• Handling (or corrective action) plans should be developed
and documented for high and moderate issues • ISSUE TRACKING REGISTER • Evaluate the handling options in terms of cost, schedule,
performance, and residual risk, and select the best option (or hybrid of options) consistent with circumstances.
Accept – Accept consequence of the issue based on cost/schedule/performance business case analysis.
Avoid – Eliminate the consequence of the event or condition by taking an alternate path (changing a requirement, specification, design, or procedure)
Transfer – Reassign or reallocate responsibility from one program or department to another
Mitigate – Implement a strategy to reduce the consequences and residual risk or minimize impact.
A chosen implementation approach results in handling strategy RMB/IMB approves resources for implementation and handling plan activities
ISSUE REPORTING MATRIX
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OPPORTUNITY MANAGEMENT
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Opportunities are potential future benefits to the program’s cost, schedule, and/or performance baseline, usually achieved through reallocation of resources. Risk and opportunity management support Better Buying Power initiatives to achieve “should-cost” as well as “will-cost” objectives.
Risk M
anag
emen
t
Opportunity Management
Risk Management enables meeting “Will Cost” and “Should Cost”
INFORMATION EXCHANGES: Tiered, regular schedule of meetings with external programs and associated contractorsProgram team meetings, risk review boards, Program Management Reviews, executive meetings (etc.)• Synchronization of program schedule , results of
SRAs, and technical, business & programmatic risks. • The meetings should track performance to plan,
deviations from plans, integration, and review of risks, issues, and opportunities.
• To maintain visibility traditional interdependency chart can depict program health and challenges.
• Activities required due to interdependencies should be identified early enough so that necessary resources can be secured.
Multicentric clinical trialTechnical, business, and programmatic risks to cost, schedule and performance of a drug candidate identified too late in the process of drug development causes uncoordinated actions within disparately pursued projects and ultimately adversely affect overall success of the program.
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MANAGEMENT OF CROSS-PROGRAM RISK
PROGRAMS FY12 FY13 FY14 FY15 FY16 FY17 FY18Program X