FIGURE 17-20. Perfect planning.

Similarly, investing in risk management is not a guarantee that losses and damages will be prevented. Figure 17-20 illustrates perfect planning for risk management. The organization prepares a primary and possibly secondary risk handling plan for each potential hazard. Unfortunately, real-world planning is often imperfect, as shown in Figure 17-21, and some losses and damages may still occur, even for known risk issues.

Most companies desire to get to the marketplace in a timely manner because the rewards for being the first-to-market can be huge in both profitability and market share. Getting to the marketplace quickly often entails using concurrent engineering, or overlapping activities. The critical question is, "How much overlapping can we incur before we get diminishing returns?"

The risks involved with overlapping activities are shown in Figure 17-22. Overlapping activities can lead to schedule compression and lower costs. However, too much overlapping can lead to excessive rework and unanticipated problems that can generate significant schedule slippages and cost overruns. Finding the optimal overlapping point that increases benefits while decreasing rework is difficult.

Although there may exist numerous reasons for the rework, two common problems are:

• Combining new technology development and product development technology

• An insufficient test and evaluation program

Project Management Made Easy

Project Management Made Easy

What you need to know about… Project Management Made Easy! Project management consists of more than just a large building project and can encompass small projects as well. No matter what the size of your project, you need to have some sort of project management. How you manage your project has everything to do with its outcome.

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