Examples of project opportunities

This section shows case examples of opportunities and priority ratings identified in project workshops we have conducted. In practice these were part of much larger risk and opportunity registers and, in most cases, there were far more risks than opportunities. Indeed, in a typical combined risk and opportunity workshop for a project we would not normally expect more than a quarter of the items to be opportunities, although we have obtained higher proportions in some strategic projects. This may also depend, to some extent, on whether the specific objective was to identify risks, or risks plus opportunities.

Table 11.3 shows the High opportunities identified in a public-sector project to establish a motor vehicle emissions-testing regime to improve air quality. As is often the case with projects having public policy implications, many of the High risks were related to the perceptions (or misperceptions) of the stakeholders, and many of them had to be dealt with in the project's communication and consultation processes. All three of the High opportunities depended on communication and consultation to some extent for their benefits to be realized. In this case, the identification and assessment process included an analysis of the urgency with which actions should be taken.

Table 11.4 shows the High opportunities identified when developing the business case for a computer-aided despatch system for emergency service vehicles. All arose in the key element 'Service capability'. The likelihood here was the chance of realizing the benefit within the available budget, either during the contract negotiation process or as part of project implementation. As in the previous case, an indication of the appropriate timing for action was recorded during the analysis.

As part of the analysis for a multi-nation services delivery project, the potential management structures under which the consortium companies might operate to provide a high-quality service to the customer were reviewed. The review was undertaken from the perspective of the benefits and risks to the participating companies and from the perspective of the customer (or our best guess about that perspective at the time). The potential management structures that were considered are outlined in Table 11.5.

Twenty specific features were noted, discussed and rated as either risks or opportunities under each of the structures and for both major stakeholders. Table 11.6 shows a summary of the analysis. In the table, the columns headed P show the ratings from Company P's perspective, and those headed C show ratings from the customer's. It should be noted that the simple counts of ratings in Table 11.6 do not necessarily provide a complete guide to

Table 11.3—High opportunities with communication and consultation treatments

Element

Opportunities

c

L

Urgency

5 Business rules

5.20

Clear test standards and processes

B

B

Prior to tender

increase the perceived fairness and

consistency of the system

13 Agency activities

13.07

Publish air quality improvements

B

A

Prior to tender

and outcomes

14 Repairers

14.08

Repair industry gets more work, and

B

B

Prior to tender

supports the programme actively

Table 11.4—Outstanding opportunities identified when developing a business case

Opportunities

Comments

C L Urgency

1.01 Increased effectiveness and higher standards of service, with significant community benefits

1.02 Improved work practices leading to more efficient and more effective service provision

1.03 Improved capability to enter data in the field

1.04 Improved access to data in the field leading to safer operations and more appropriate responses

Improved response times, more B A appropriate responses, better definition of service in terms of outputs

Opportunity to understand the B B

business better, leading to improvements in efficiency, development of better performance measurements than are available now

Field data entry via mobile data C A

terminals, leading to more complete and accurate data capture, once-only entry

Examples: chemical spills, hospital B A

databases, firearms registers

Immediate, urgent

After contract award

After contract award

Prior to selection

Table 11.5—Potential management structures

Structure

Notes

Prime

Independent Alliance

Incorporated JV Unincorporated JV

Company P is the prime contractor, with companies Q, R and S as sub-contractors

For example:

• Company P offers services for all countries except Korea;

• Company Q offers services in Korea, with companies R and S as nominated sub-contractors;

• Companies P and Q form a high-level alliance to ensure service delivery synergies are achieved through compatibility of systems and common data analysis processes

Special-purpose incorporated company structure Special-purpose partnership or JV contract arrangement the overall opportunities and risks associated with each management structure, as some features were far more important than others; the individual opportunities and risks were used in determining the structure that would be most beneficial for the consortium while remaining acceptable to the customer.

The outcomes from analyses like this may lead to adoption of specific forms of contract or contract terms for the inter-company arrangement, with cost and risk sharing mechanisms that have been tailored to the identified opportunities. More information on risk allocation within contracts is provided in Chapter 14.

Table 11.6—Summary of items in each category

Rating Prime Independent Incorporated Unincorporated

Alliance JV JV

3 Major opportunity 9910 671 1

2 Medium opportunity 64 6 2 10 9 4 5

1 Minor opportunity 1112 116 5

0 Not relevant 335 3 227 7

Table 11.7 shows a selection of the Extreme and High opportunities for a business unit with responsibilities for conducting small and medium projects within its organization and for managing the provision by other companies of large projects. There are a number of points of interest in this example.

• Consequence ratings were on the scale —A to —E for risks and A to E for opportunities.

• The criterion that was most affected by each opportunity was noted.

• The assessment of agreed priorities was extended to consider the inherent levels of opportunity. The inherent priority was interpreted as the potential opportunity that might be obtained if current plans and processes were implemented. In some cases the inherent priority was less than the agreed priority, indicating current plans and processes might not work or be difficult to implement effectively.

• Item 17.16 is worded as a fact that could be interpreted as major problem or risk. However, the members of the business unit preferred to think about it as an opportunity, in the sense that changing the pay and reward structure would generate far better business and project outcomes. Several other opportunities were described and evaluated from this standpoint.

• Item 27.03 was originally rated as a risk, with a negative consequence of —B, as shown in the table. However, when all the risks and opportunities were reviewed it was decided that there was a High opportunity for the company if the procurement process and the traditional contract structure could be changed to provide a more appropriate (and more equitable) distribution of risk.

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