Saturday, February 9, 2019

Two doors: risk and decision managers



A narrative*

Imagine two doors to the same room:
  • One labeled risk manager; the other labeled decision maker.
  • Though the risk manager's door, entry is for the inductive thinker: facts, experience, history looking for a generality or integrating narrative
  • Through the decision maker's door, entry is for the deductive thinker: visionary with a need to articulate specifics for the vision
Adding to the narrative:
  • Pessimists with facts enter through the risk manager's door
  • Optimists with business-as-we-want-it enter through the decision maker's door
Then what happens?
They seek each other (hopefully, if minds are open). In the best of situations, they meet in the middle of the room where this is buffer space and flexibility.

How does the inductive and deductive interact?
Risk management does not set policy for the project office; it only sets the left and right hand boundaries for the vision, or for the project policies.
The space in between is where the decision maker gets to do their envisioning, moving about, perhaps even bouncing off the walls, constrained only by the risk boundaries.




(*) Sound familiar? I hope so. You'll find a similar explanation known as the "project balance sheet" in Chapter 6 of "Maximizing Project Value: A project manager's guide". (Oh -- the book cover is shown below!)

In that balance sheet metaphor, the right side is for the fact-based inductive manager; the left side is for the visionary. And, since those two never agree fully, there is a gap.

And the gap is where the risk is. Risk is the balancing element between the vision and the facts. And who is the risk manager: the project team -- not the visionary. (That's why we pay the PMO the big bucks: to manage the risk!)

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