[Script Info]
Title: 
[Events]
Format: Layer, Start, End, Style, Name, MarginL, MarginR, MarginV, Effect, Text
Dialogue: 0,0:00:00.50,0:00:04.43,Default,,0000,0000,0000,,Okay, let's have a look at\Nrisk management in practice
Dialogue: 0,0:00:04.46,0:00:08.47,Default,,0000,0000,0000,,And what I want to do\Nis to start with some basic concepts
Dialogue: 0,0:00:08.48,0:00:14.02,Default,,0000,0000,0000,,then focus on two difficult areas\Nin the risk process
Dialogue: 0,0:00:14.24,0:00:19.16,Default,,0000,0000,0000,,So, I guess if I asked you\Nto define the word 'risk'
Dialogue: 0,0:00:19.17,0:00:22.95,Default,,0000,0000,0000,,you would have some ideas\Nof what it meant
Dialogue: 0,0:00:22.97,0:00:26.48,Default,,0000,0000,0000,,We might not have a formal definition\Nthat we could quote,
Dialogue: 0,0:00:26.48,0:00:30.25,Default,,0000,0000,0000,,but we all have something in our minds\Nwhen we hear the word 'risk'
Dialogue: 0,0:00:30.27,0:00:33.97,Default,,0000,0000,0000,,This is what we think,\Nand maybe you think of things like this
Dialogue: 0,0:00:34.23,0:00:38.53,Default,,0000,0000,0000,,Maybe you feel like this little guy,\Nfacing some big ugly challenge
Dialogue: 0,0:00:38.53,0:00:41.79,Default,,0000,0000,0000,,that you know is just going to\Nsquash you flat.
Dialogue: 0,0:00:42.07,0:00:43.77,Default,,0000,0000,0000,,Maybe you feel like this guy.
Dialogue: 0,0:00:44.02,0:00:46.49,Default,,0000,0000,0000,,This is a real job in North Korea,
Dialogue: 0,0:00:47.77,0:00:51.37,Default,,0000,0000,0000,,and his job is to hold the target\Nfor other people to shoot at
Dialogue: 0,0:00:51.50,0:00:53.98,Default,,0000,0000,0000,,Sometimes project managers\Nhave the target here
Dialogue: 0,0:00:54.29,0:00:56.91,Default,,0000,0000,0000,,We feel like everybody is shooting at us\Nin our job
Dialogue: 0,0:00:57.76,0:01:01.99,Default,,0000,0000,0000,,Or maybe you just know there's something\Nnasty out there, waiting to get you
Dialogue: 0,0:01:02.47,0:01:05.70,Default,,0000,0000,0000,,And maybe that's what you think of\Nwhen you think of the word 'risk'
Dialogue: 0,0:01:06.36,0:01:09.57,Default,,0000,0000,0000,,Well that's partly true\Nbut it's not the whole truth.
Dialogue: 0,0:01:10.19,0:01:13.62,Default,,0000,0000,0000,,Risk is not the same\Nas uncertainty.
Dialogue: 0,0:01:14.22,0:01:16.96,Default,,0000,0000,0000,,Risk is related to uncertainty\Nbut they're different.
Dialogue: 0,0:01:17.67,0:01:23.83,Default,,0000,0000,0000,,So all risks are uncertain\Nbut not all uncertainties are risks.
Dialogue: 0,0:01:24.65,0:01:27.59,Default,,0000,0000,0000,,If you have a risk register\Nor a risk list,
Dialogue: 0,0:01:27.94,0:01:31.44,Default,,0000,0000,0000,,you don't have a million items in it,\Nor you shouldn't.
Dialogue: 0,0:01:31.96,0:01:34.51,Default,,0000,0000,0000,,You don't even probably have\Na thousand items in it,
Dialogue: 0,0:01:34.51,0:01:35.79,Default,,0000,0000,0000,,you have a smaller number.
Dialogue: 0,0:01:36.71,0:01:40.01,Default,,0000,0000,0000,,Although there are millions\Nof uncertainties in the world.
Dialogue: 0,0:01:40.40,0:01:44.31,Default,,0000,0000,0000,,So how do we decide which uncertainties\Nwe're going to call 'risk'?
Dialogue: 0,0:01:44.68,0:01:47.28,Default,,0000,0000,0000,,And write them down \Nand put them in our risk register
Dialogue: 0,0:01:47.55,0:01:50.06,Default,,0000,0000,0000,,and decide to do something about them.
Dialogue: 0,0:01:50.48,0:01:56.36,Default,,0000,0000,0000,,Clearly 'risk' is a subset\Nof uncertainties, but which subset?
Dialogue: 0,0:01:56.94,0:01:58.13,Default,,0000,0000,0000,,How do you know?
Dialogue: 0,0:01:58.80,0:02:02.95,Default,,0000,0000,0000,,I think it's very simple to separate\Nrisk and uncertainty.
Dialogue: 0,0:02:03.20,0:02:05.27,Default,,0000,0000,0000,,And I used 3 English words,
Dialogue: 0,0:02:05.42,0:02:10.02,Default,,0000,0000,0000,,these words here,\N'risk is uncertainty that matters."
Dialogue: 0,0:02:11.50,0:02:14.78,Default,,0000,0000,0000,,Because most of the\Nuncertainties in the world don't matter.
Dialogue: 0,0:02:15.56,0:02:19.01,Default,,0000,0000,0000,,We don't care if it's going to rain\Nin London tomorrow afternoon.
Dialogue: 0,0:02:19.40,0:02:23.78,Default,,0000,0000,0000,,It might, it might not,\Nit's irrelevant, it doesn't matter.
Dialogue: 0,0:02:24.50,0:02:26.95,Default,,0000,0000,0000,,We don't care what the \Nexchange rate will be
Dialogue: 0,0:02:26.95,0:02:30.70,Default,,0000,0000,0000,,if it's between the Russian Ruble \Nand the Chinese Yen in 2020.
Dialogue: 0,0:02:30.70,0:02:32.39,Default,,0000,0000,0000,,It doesn't matter to us.
Dialogue: 0,0:02:32.89,0:02:35.12,Default,,0000,0000,0000,,But there are things on our projects,
Dialogue: 0,0:02:35.43,0:02:37.12,Default,,0000,0000,0000,,and things in our families,
Dialogue: 0,0:02:37.27,0:02:38.87,Default,,0000,0000,0000,,and things in our country,
Dialogue: 0,0:02:38.98,0:02:41.45,Default,,0000,0000,0000,,which are uncertain which do matter to us.
Dialogue: 0,0:02:42.20,0:02:45.34,Default,,0000,0000,0000,,If it's an uncertainty that matters, \Nit's a risk.
Dialogue: 0,0:02:46.19,0:02:49.99,Default,,0000,0000,0000,,So here's another question,\Nhow do you know what matters?
Dialogue: 0,0:02:50.75,0:02:53.40,Default,,0000,0000,0000,,In your projects, \Nwhat are the things that matter?
Dialogue: 0,0:02:54.08,0:02:57.88,Default,,0000,0000,0000,,The things that matter in our projects\Nare our objectives.
Dialogue: 0,0:02:58.53,0:03:02.22,Default,,0000,0000,0000,,So we must always connect uncertainty\Nwith objectives,
Dialogue: 0,0:03:02.99,0:03:05.63,Default,,0000,0000,0000,,in order to find the risks.
Dialogue: 0,0:03:06.00,0:03:08.36,Default,,0000,0000,0000,,And if we look at \Nsome definitions of risk,
Dialogue: 0,0:03:08.36,0:03:11.40,Default,,0000,0000,0000,,this is the ISO standard that I mentioned,
Dialogue: 0,0:03:11.44,0:03:13.80,Default,,0000,0000,0000,,it connects those words very simply.
Dialogue: 0,0:03:13.80,0:03:17.56,Default,,0000,0000,0000,,Risk is the effect of uncertainty\Non objectives.
Dialogue: 0,0:03:18.45,0:03:21.20,Default,,0000,0000,0000,,And we might look at another definition\Nfrom the UK,
Dialogue: 0,0:03:21.39,0:03:23.92,Default,,0000,0000,0000,,from our association \Nwith project management,
Dialogue: 0,0:03:24.14,0:03:28.13,Default,,0000,0000,0000,,it says the same thing that risk\Nis an uncertain event
Dialogue: 0,0:03:28.15,0:03:32.21,Default,,0000,0000,0000,,or a set of circumstances, \Nwhich is uncertain,
Dialogue: 0,0:03:32.21,0:03:35.37,Default,,0000,0000,0000,,but it matters because should it occur,
Dialogue: 0,0:03:35.37,0:03:38.59,Default,,0000,0000,0000,,it will have an effect on achievement of objectives.
Dialogue: 0,0:03:38.60,0:03:40.55,Default,,0000,0000,0000,,Uncertainty that matters.
Dialogue: 0,0:03:40.87,0:03:44.32,Default,,0000,0000,0000,,So we should be looking \Nin our risk register for two things.
Dialogue: 0,0:03:44.70,0:03:48.80,Default,,0000,0000,0000,,Is it uncertain? We don't want \Nproblems in our risk register.
Dialogue: 0,0:03:49.18,0:03:52.11,Default,,0000,0000,0000,,We don't want issues in the risk register.
Dialogue: 0,0:03:52.11,0:03:55.02,Default,,0000,0000,0000,,We don't want constraints or requirements.
Dialogue: 0,0:03:55.29,0:03:59.63,Default,,0000,0000,0000,,These things are certain,\Nwhat we want are uncertainties,
Dialogue: 0,0:03:59.72,0:04:02.24,Default,,0000,0000,0000,,something that might happen\Nor might not happen.
Dialogue: 0,0:04:03.08,0:04:06.77,Default,,0000,0000,0000,,But the other important question for our\Nrisk register is
Dialogue: 0,0:04:06.77,0:04:08.37,Default,,0000,0000,0000,,does it matter?
Dialogue: 0,0:04:08.44,0:04:11.74,Default,,0000,0000,0000,,Which objective would be effective \Nif this thing happened?
Dialogue: 0,0:04:13.30,0:04:15.81,Default,,0000,0000,0000,,And then when we want to see\Nhow big the risk is,
Dialogue: 0,0:04:16.16,0:04:18.32,Default,,0000,0000,0000,,we can ask those two questions:
Dialogue: 0,0:04:18.34,0:04:19.77,Default,,0000,0000,0000,,how uncertain is it,
Dialogue: 0,0:04:19.98,0:04:22.10,Default,,0000,0000,0000,,and how much does it matter?
Dialogue: 0,0:04:22.13,0:04:24.50,Default,,0000,0000,0000,,And that will tell us how big the risk is.
Dialogue: 0,0:04:24.56,0:04:27.04,Default,,0000,0000,0000,,So, this idea of uncertainty that matters
Dialogue: 0,0:04:27.08,0:04:30.54,Default,,0000,0000,0000,,then develops into something which is useful
Dialogue: 0,0:04:30.62,0:04:33.32,Default,,0000,0000,0000,,by linking uncertainty to our objectives.
Dialogue: 0,0:04:34.77,0:04:37.15,Default,,0000,0000,0000,,So, we have two dimensions of ‘risk,’
Dialogue: 0,0:04:37.41,0:04:39.66,Default,,0000,0000,0000,,we have an uncertainty dimension and we
Dialogue: 0,0:04:39.66,0:04:42.09,Default,,0000,0000,0000,,have a dimension that \Naffects our objectives
Dialogue: 0,0:04:43.25,0:04:47.42,Default,,0000,0000,0000,,In projects, we call\Nthis probability and impact,
Dialogue: 0,0:04:47.45,0:04:49.50,Default,,0000,0000,0000,,We could call them other things,
Dialogue: 0,0:04:49.50,0:04:51.23,Default,,0000,0000,0000,,there are other English
Dialogue: 0,0:04:51.23,0:04:52.77,Default,,0000,0000,0000,,words we could use,\Nbut these
Dialogue: 0,0:04:52.77,0:04:54.55,Default,,0000,0000,0000,,are the ones,\Nmost often, we use.
Dialogue: 0,0:04:54.70,0:04:57.73,Default,,0000,0000,0000,,And I would like to ask you with \Nthis picture of the mouse.
Dialogue: 0,0:04:59.63,0:05:04.65,Default,,0000,0000,0000,,What effect matters to the mouse?
Dialogue: 0,0:05:05.87,0:05:09.32,Default,,0000,0000,0000,,So first of all, clearly, \Nhe is in a uncertain situation here.
Dialogue: 0,0:05:09.84,0:05:12.19,Default,,0000,0000,0000,,And he's seen some risks.
Dialogue: 0,0:05:12.46,0:05:15.36,Default,,0000,0000,0000,,His objective is to get the cheese\Nand stay alive.
Dialogue: 0,0:05:15.94,0:05:18.82,Default,,0000,0000,0000,,And so, one of the risks he has \Nidentified is a bad thing
Dialogue: 0,0:05:18.90,0:05:21.35,Default,,0000,0000,0000,,that might happen,\Nhe might be killed or injured.
Dialogue: 0,0:05:22.18,0:05:24.52,Default,,0000,0000,0000,,And so, he has been a \Ngood project manager,
Dialogue: 0,0:05:24.52,0:05:27.03,Default,,0000,0000,0000,,he has put his little helmet on, \Nand he is preparing
Dialogue: 0,0:05:27.15,0:05:32.05,Default,,0000,0000,0000,,so that it doesn't happen to him.\NSo, he doesn't get killed or injured.
Dialogue: 0,0:05:32.05,0:05:32.82,Default,,0000,0000,0000,,Very good.
Dialogue: 0,0:05:33.69,0:05:36.56,Default,,0000,0000,0000,,And there are things in our projects, \Nthat if they happened
Dialogue: 0,0:05:36.56,0:05:37.88,Default,,0000,0000,0000,,would kill or injure us.
Dialogue: 0,0:05:37.88,0:05:39.22,Default,,0000,0000,0000,,They would waste time,
Dialogue: 0,0:05:39.22,0:05:41.57,Default,,0000,0000,0000,,waste money, damage reputation,
Dialogue: 0,0:05:41.57,0:05:42.99,Default,,0000,0000,0000,,destroy performance,
Dialogue: 0,0:05:43.20,0:05:45.73,Default,,0000,0000,0000,,maybe even injure real people.
Dialogue: 0,0:05:46.23,0:05:49.88,Default,,0000,0000,0000,,And as project managers we have to\Nsee those things and stop them happening.
Dialogue: 0,0:05:49.96,0:05:51.79,Default,,0000,0000,0000,,Protect ourselves in advance.
Dialogue: 0,0:05:51.86,0:05:52.87,Default,,0000,0000,0000,,Avoid them.
Dialogue: 0,0:05:54.24,0:05:57.87,Default,,0000,0000,0000,,Are there any other uncertainties\Nthat matter for the mouse?
Dialogue: 0,0:05:59.64,0:06:01.33,Default,,0000,0000,0000,,Well there is...
Dialogue: 0,0:06:01.33,0:06:02.28,Default,,0000,0000,0000,,the cheese.
Dialogue: 0,0:06:02.68,0:06:05.56,Default,,0000,0000,0000,,There's an uncertainty here which \Nmatters a great deal.
Dialogue: 0,0:06:05.56,0:06:07.89,Default,,0000,0000,0000,,Will I get the cheese out of the trap?
Dialogue: 0,0:06:08.73,0:06:10.43,Default,,0000,0000,0000,,He might, or he might not.
Dialogue: 0,0:06:10.97,0:06:14.12,Default,,0000,0000,0000,,And if he doesn't get the \Ncheese out of the trap, he's failed
Dialogue: 0,0:06:14.96,0:06:17.47,Default,,0000,0000,0000,,So he has two uncertainties to manage,
Dialogue: 0,0:06:17.47,0:06:20.13,Default,,0000,0000,0000,,one of them is bad - he might be killed\Nor injured -
Dialogue: 0,0:06:20.42,0:06:22.64,Default,,0000,0000,0000,,the other is good - he might \Nget the cheese.
Dialogue: 0,0:06:23.13,0:06:24.62,Default,,0000,0000,0000,,And what he has to do,
Dialogue: 0,0:06:24.97,0:06:28.96,Default,,0000,0000,0000,,what he has to do is to manage both\Nof these at the same time.
Dialogue: 0,0:06:29.23,0:06:32.16,Default,,0000,0000,0000,,And as project managers, we have to\Ndo the same thing.
Dialogue: 0,0:06:32.79,0:06:36.13,Default,,0000,0000,0000,,And also we have to do it in the\Nbest possible way -
Dialogue: 0,0:06:36.13,0:06:40.55,Default,,0000,0000,0000,,sometimes there's a better way to get the \Ncheese without being killed or injured.
Dialogue: 0,0:06:41.43,0:06:44.52,Default,,0000,0000,0000,,In our projects we have to stop the \Nbad things happening,
Dialogue: 0,0:06:44.89,0:06:47.79,Default,,0000,0000,0000,,but we also have to get the cheese out\Nof our projects.
Dialogue: 0,0:06:49.12,0:06:52.12,Default,,0000,0000,0000,,So what does 'cheese' mean,\Nin your project?
Dialogue: 0,0:06:52.12,0:06:54.30,Default,,0000,0000,0000,,What is the 'cheese' in your project?
Dialogue: 0,0:06:55.16,0:06:56.64,Default,,0000,0000,0000,,'Cheese' means value.
Dialogue: 0,0:06:56.81,0:06:58.44,Default,,0000,0000,0000,,'Cheese' means benefits.
Dialogue: 0,0:06:58.64,0:07:01.87,Default,,0000,0000,0000,,'Cheese' means products and \Nservices that people want and need.
Dialogue: 0,0:07:02.17,0:07:04.29,Default,,0000,0000,0000,,'Cheese' means customer satisfaction.
Dialogue: 0,0:07:04.49,0:07:08.69,Default,,0000,0000,0000,,'Cheese' is the good stuff that we're \Ntrying to get out of our difficult projects.
Dialogue: 0,0:07:08.87,0:07:11.96,Default,,0000,0000,0000,,And if we don't do anything bad -
Dialogue: 0,0:07:11.96,0:07:16.17,Default,,0000,0000,0000,,we don't waste time, we don't \Nwaste money, we don't damage reputation -
Dialogue: 0,0:07:16.17,0:07:17.95,Default,,0000,0000,0000,,but we don't create value,
Dialogue: 0,0:07:18.28,0:07:19.34,Default,,0000,0000,0000,,we've failed.
Dialogue: 0,0:07:19.68,0:07:23.18,Default,,0000,0000,0000,,If the mouse didn't die but he didn't \Nget the cheese, he failed.
Dialogue: 0,0:07:23.95,0:07:28.35,Default,,0000,0000,0000,,If we create benefits, but we waste time \Nand waste money and destroy reputation,
Dialogue: 0,0:07:28.35,0:07:29.37,Default,,0000,0000,0000,,we've failed.
Dialogue: 0,0:07:30.02,0:07:32.56,Default,,0000,0000,0000,,And if the mouse gets the cheese\Nand he's killed,
Dialogue: 0,0:07:32.72,0:07:33.78,Default,,0000,0000,0000,,he's failed.
Dialogue: 0,0:07:33.78,0:07:36.08,Default,,0000,0000,0000,,So we have to do both of these things.
Dialogue: 0,0:07:36.35,0:07:39.23,Default,,0000,0000,0000,,And when we think about risk \Nand think about impact,
Dialogue: 0,0:07:39.47,0:07:41.90,Default,,0000,0000,0000,,there are two kinds of impact that matter.
Dialogue: 0,0:07:42.52,0:07:45.18,Default,,0000,0000,0000,,Bad ones, and good ones.
Dialogue: 0,0:07:45.49,0:07:48.12,Default,,0000,0000,0000,,Uncertainties that could hurt the project,
Dialogue: 0,0:07:48.68,0:07:51.57,Default,,0000,0000,0000,,and uncertainties that \Ncould help the project.
Dialogue: 0,0:07:51.77,0:07:56.36,Default,,0000,0000,0000,,Both of these matter \Nand both of these need to be managed.
Dialogue: 0,0:07:56.87,0:07:59.08,Default,,0000,0000,0000,,And we have another word for those.
Dialogue: 0,0:07:59.30,0:08:03.79,Default,,0000,0000,0000,,So, here's the definition of risk from the\NProject Management Institute, the PMI,
Dialogue: 0,0:08:04.01,0:08:05.68,Default,,0000,0000,0000,,from the PMBok Guide.
Dialogue: 0,0:08:05.99,0:08:08.09,Default,,0000,0000,0000,,It's the same as the others \Nthat we've seen:
Dialogue: 0,0:08:08.09,0:08:12.38,Default,,0000,0000,0000,,an uncertain event or condition, \Nthat if it occurs, affects an objective.
Dialogue: 0,0:08:13.22,0:08:18.53,Default,,0000,0000,0000,,But PMI knows about the mouse. PMI knows \Nabout the cheese and the traps,
Dialogue: 0,0:08:18.72,0:08:22.28,Default,,0000,0000,0000,,and has added three words \Nto the definition of risk here.
Dialogue: 0,0:08:23.23,0:08:26.20,Default,,0000,0000,0000,,It's not the words 'cheese' and 'traps'.
Dialogue: 0,0:08:26.43,0:08:29.30,Default,,0000,0000,0000,,It's the words 'positive or negative'.
Dialogue: 0,0:08:30.07,0:08:33.98,Default,,0000,0000,0000,,What this tells us is that there \Nare good risks, as well as bad risks.
Dialogue: 0,0:08:34.54,0:08:37.100,Default,,0000,0000,0000,,And we heard that in one of our \Nkeynote speeches, earlier this morning.
Dialogue: 0,0:08:38.51,0:08:42.91,Default,,0000,0000,0000,,In the uncertain situation that this \Ncountry faces going forward
Dialogue: 0,0:08:42.96,0:08:46.06,Default,,0000,0000,0000,,with all the changes that their have been,\Nthere are threats.
Dialogue: 0,0:08:46.06,0:08:48.06,Default,,0000,0000,0000,,There are things that could go wrong.
Dialogue: 0,0:08:48.06,0:08:50.23,Default,,0000,0000,0000,,And you need to see those\Nand address them.
Dialogue: 0,0:08:50.41,0:08:53.19,Default,,0000,0000,0000,,But there are also opportunities.
Dialogue: 0,0:08:53.25,0:08:56.24,Default,,0000,0000,0000,,Uncertain things that might happen\Nthat could be good.
Dialogue: 0,0:08:56.92,0:08:59.35,Default,,0000,0000,0000,,And we also need to see those things,
Dialogue: 0,0:08:59.56,0:09:02.70,Default,,0000,0000,0000,,and to try and proactively \Nmake them happen.
Dialogue: 0,0:09:03.25,0:09:05.38,Default,,0000,0000,0000,,And that is equally true in our projects,
Dialogue: 0,0:09:05.38,0:09:06.94,Default,,0000,0000,0000,,in our personal lives,
Dialogue: 0,0:09:06.94,0:09:09.31,Default,,0000,0000,0000,,and also at the national level.
Dialogue: 0,0:09:09.78,0:09:13.58,Default,,0000,0000,0000,,And I'll be talking about some of \Nthose things later on this afternoon
Dialogue: 0,0:09:14.72,0:09:19.16,Default,,0000,0000,0000,,So, PMI has this definition. The other \Nstandards have something very similar.
Dialogue: 0,0:09:19.54,0:09:21.45,Default,,0000,0000,0000,,The iso standard, at the bottom here,
Dialogue: 0,0:09:21.45,0:09:25.62,Default,,0000,0000,0000,,says 'risk is the effect of\Nuncertainty on objectives.'
Dialogue: 0,0:09:26.54,0:09:29.25,Default,,0000,0000,0000,,Note, the effect can be \Npositive or negative.
Dialogue: 0,0:09:31.01,0:09:34.73,Default,,0000,0000,0000,,And the APM Association, for project \Nmanagement in the UK says the same thing.
Dialogue: 0,0:09:35.43,0:09:39.95,Default,,0000,0000,0000,,So we have this new idea,\Nthat risk is a double-sided concept.
Dialogue: 0,0:09:41.09,0:09:43.96,Default,,0000,0000,0000,,And it's the same impression,\Nthe word you have for risk,
Dialogue: 0,0:09:44.33,0:09:48.00,Default,,0000,0000,0000,,we mostly think of bad things.\NBut it could be used for good things,
Dialogue: 0,0:09:48.00,0:09:49.88,Default,,0000,0000,0000,,as well. Isn't that right?
Dialogue: 0,0:09:50.14,0:09:51.86,Default,,0000,0000,0000,,It's an uncertain word.
Dialogue: 0,0:09:52.28,0:09:55.03,Default,,0000,0000,0000,,And there are good risks as well \Nas bad risks.
Dialogue: 0,0:09:55.99,0:09:59.36,Default,,0000,0000,0000,,So in our project, \Nrisk management process,
Dialogue: 0,0:09:59.57,0:10:03.18,Default,,0000,0000,0000,,we should be looking out for the traps\Nand avoiding them
Dialogue: 0,0:10:03.18,0:10:06.00,Default,,0000,0000,0000,,and protecting ourselves and \Npreventing them happening.
Dialogue: 0,0:10:06.00,0:10:09.15,Default,,0000,0000,0000,,But we should also be looking\Nout for the cheese
Dialogue: 0,0:10:09.15,0:10:11.55,Default,,0000,0000,0000,,and chasing it, and making it\Nhappen proactively,
Dialogue: 0,0:10:11.55,0:10:14.90,Default,,0000,0000,0000,,so we get the maximum\Nbenefit for the minimum cost.
Dialogue: 0,0:10:15.96,0:10:19.38,Default,,0000,0000,0000,,That’s why risk management is so \Nimportant to
Dialogue: 0,0:10:19.71,0:10:22.68,Default,,0000,0000,0000,,project success. Because it effects \Nour objections.
Dialogue: 0,0:10:23.82,0:10:27.43,Default,,0000,0000,0000,,It gives us the best possible chance\Nto achieve our goals.
Dialogue: 0,0:10:28.57,0:10:30.29,Default,,0000,0000,0000,,So how do we do that?
Dialogue: 0,0:10:30.62,0:10:33.10,Default,,0000,0000,0000,,If we think about the risk management\Nprocess,
Dialogue: 0,0:10:33.54,0:10:35.90,Default,,0000,0000,0000,,the process has to do a number of things.
Dialogue: 0,0:10:36.52,0:10:39.56,Default,,0000,0000,0000,,If risk is uncertainty that affects\Nobjectives,
Dialogue: 0,0:10:39.63,0:10:41.75,Default,,0000,0000,0000,,we have to know what our objectives are.
Dialogue: 0,0:10:42.08,0:10:44.42,Default,,0000,0000,0000,,Then, we have to identify the\Nuncertainties.
Dialogue: 0,0:10:45.10,0:10:48.46,Default,,0000,0000,0000,,The uncertainties that would matter to\Nthose objectives.
Dialogue: 0,0:10:48.62,0:10:53.06,Default,,0000,0000,0000,,And remember that they could be good\Nor bad, threats and opportunities.
Dialogue: 0,0:10:53.90,0:10:56.75,Default,,0000,0000,0000,,That gives us a long list of uncertainties\Nthat matter,
Dialogue: 0,0:10:56.78,0:10:58.48,Default,,0000,0000,0000,,but they don't all matter the same.
Dialogue: 0,0:10:59.22,0:11:03.53,Default,,0000,0000,0000,,So the next thing we have to do is\Nto prioritize, and ask the question
Dialogue: 0,0:11:04.29,0:11:06.84,Default,,0000,0000,0000,,"How uncertain,\Nand how much does it matter?"
Dialogue: 0,0:11:07.05,0:11:10.13,Default,,0000,0000,0000,,Then we get a prioritized list of risks.
Dialogue: 0,0:11:10.21,0:11:14.39,Default,,0000,0000,0000,,We know which are the worst threats and\Nthe best opportunities,
Dialogue: 0,0:11:14.81,0:11:17.06,Default,,0000,0000,0000,,so that we do something about it.
Dialogue: 0,0:11:17.51,0:11:19.38,Default,,0000,0000,0000,,Then we plan how to respond.
Dialogue: 0,0:11:19.41,0:11:23.29,Default,,0000,0000,0000,,We think about what would be appropriate\Nto stop the bad thing happening
Dialogue: 0,0:11:23.34,0:11:24.97,Default,,0000,0000,0000,,and to make the good thing happen.
Dialogue: 0,0:11:25.58,0:11:28.92,Default,,0000,0000,0000,,And having decided, we do it of course.
Dialogue: 0,0:11:29.85,0:11:33.64,Default,,0000,0000,0000,,And then risk is constantly changing \Nso we need to come back and do it again,
Dialogue: 0,0:11:33.87,0:11:35.92,Default,,0000,0000,0000,,and see what has changed.
Dialogue: 0,0:11:36.52,0:11:42.05,Default,,0000,0000,0000,,We could express this process as a number\Nof questions that it's important to ask,
Dialogue: 0,0:11:42.18,0:11:45.60,Default,,0000,0000,0000,,and keep on asking about our project.
Dialogue: 0,0:11:46.34,0:11:49.90,Default,,0000,0000,0000,,In fact, you can use these questions for\Nanything.
Dialogue: 0,0:11:50.11,0:11:54.08,Default,,0000,0000,0000,,You could use these questions for your\Nnext career move.
Dialogue: 0,0:11:54.52,0:11:58.91,Default,,0000,0000,0000,,You could use these questions for deciding\Nabout your pension.
Dialogue: 0,0:11:59.14,0:12:03.69,Default,,0000,0000,0000,,You could use these questions to decide\Nhow to bring up your children
Dialogue: 0,0:12:04.32,0:12:09.18,Default,,0000,0000,0000,,or to decide on how to invest the nation's\Nwealth.
Dialogue: 0,0:12:09.100,0:12:11.76,Default,,0000,0000,0000,,These are the questions:
Dialogue: 0,0:12:11.80,0:12:15.41,Default,,0000,0000,0000,,What are we trying to achieve?\NThat's setting objectives.
Dialogue: 0,0:12:15.98,0:12:18.44,Default,,0000,0000,0000,,Then, what could affect\Nus in achieving that?
Dialogue: 0,0:12:18.53,0:12:20.57,Default,,0000,0000,0000,,That's identifying risks.
Dialogue: 0,0:12:20.92,0:12:24.46,Default,,0000,0000,0000,,Then, when we have a list of risks,\Nwhich are the most important ones?
Dialogue: 0,0:12:24.74,0:12:27.39,Default,,0000,0000,0000,,That's prioritizing, that\Nassessing the risks.
Dialogue: 0,0:12:27.67,0:12:29.81,Default,,0000,0000,0000,,Then, what could we do about it?
Dialogue: 0,0:12:30.24,0:12:34.40,Default,,0000,0000,0000,,Planning our responses and doing it,\Nimplementing the responses.
Dialogue: 0,0:12:34.85,0:12:39.17,Default,,0000,0000,0000,,And then, did it work and what's changed,\Nreviewing the risk.
Dialogue: 0,0:12:39.31,0:12:43.77,Default,,0000,0000,0000,,So if we look at a risk management\Nprocess, we could link each step in the
Dialogue: 0,0:12:43.80,0:12:46.93,Default,,0000,0000,0000,,process to one of these questions.
Dialogue: 0,0:12:47.09,0:12:49.77,Default,,0000,0000,0000,,And this is why risk\Nmanagement is so easy,
Dialogue: 0,0:12:49.88,0:12:56.12,Default,,0000,0000,0000,,because all we're doing is asking and\Nanswering obvious questions.
Dialogue: 0,0:12:56.30,0:13:01.12,Default,,0000,0000,0000,,Anybody who's doing anything important\Nwill ask these questions.
Dialogue: 0,0:13:01.32,0:13:04.00,Default,,0000,0000,0000,,What am I trying to do?\NWhat could affect me?
Dialogue: 0,0:13:04.14,0:13:06.44,Default,,0000,0000,0000,,Which are the big ones?\NWhat shall I do about it?
Dialogue: 0,0:13:06.47,0:13:08.98,Default,,0000,0000,0000,,Did that work?\NNow what?
Dialogue: 0,0:13:09.70,0:13:14.38,Default,,0000,0000,0000,,And you could ask those questions every\NMonday morning when you drove to work,
Dialogue: 0,0:13:14.40,0:13:16.03,Default,,0000,0000,0000,,or every Saturday morning.
Dialogue: 0,0:13:16.03,0:13:17.79,Default,,0000,0000,0000,,You can ask the question, say
Dialogue: 0,0:13:17.79,0:13:20.83,Default,,0000,0000,0000,,What am I trying to achieve today?\NThis week?
Dialogue: 0,0:13:21.29,0:13:23.64,Default,,0000,0000,0000,,What could affect me and\Nwhich are the big ones?
Dialogue: 0,0:13:23.74,0:13:24.84,Default,,0000,0000,0000,,What shall I do?
Dialogue: 0,0:13:24.87,0:13:30.35,Default,,0000,0000,0000,,We can manage risk on a very simple basis,\Nor we can use this as the structure for
Dialogue: 0,0:13:30.39,0:13:35.11,Default,,0000,0000,0000,,a risk process which is much more complex,\Nwhich involves lots of meetings,
Dialogue: 0,0:13:35.14,0:13:39.08,Default,,0000,0000,0000,,and lots of stakeholder groups and\Nlots of analysis and statistics.
Dialogue: 0,0:13:39.10,0:13:41.19,Default,,0000,0000,0000,,It's the same questions.
Dialogue: 0,0:13:41.91,0:13:45.31,Default,,0000,0000,0000,,So I would like you to remember\Ntwo important things.
Dialogue: 0,0:13:45.32,0:13:49.23,Default,,0000,0000,0000,,One is risk is uncertainty that matters.
Dialogue: 0,0:13:49.55,0:13:53.85,Default,,0000,0000,0000,,And secondly, these questions,\Nthese six questions.
Dialogue: 0,0:13:54.54,0:13:58.24,Default,,0000,0000,0000,,Because that's the heart,\Nthat's the basis of managing risk,
Dialogue: 0,0:13:58.24,0:14:00.76,Default,,0000,0000,0000,,and it really is very, very easy.
Dialogue: 0,0:14:01.40,0:14:06.20,Default,,0000,0000,0000,,Now, in the time that we have, I want to\Nfocus on just two parts of this process,
Dialogue: 0,0:14:06.35,0:14:10.59,Default,,0000,0000,0000,,and then give us the opportunity\Nto try out some of these things.
Dialogue: 0,0:14:10.62,0:14:14.31,Default,,0000,0000,0000,,The identification step, clearly\Nvery, very important
Dialogue: 0,0:14:14.34,0:14:18.49,Default,,0000,0000,0000,,because if we don't identify the risks,\Nwe can't manage them.
Dialogue: 0,0:14:18.98,0:14:21.62,Default,,0000,0000,0000,,And then planning responses.
Dialogue: 0,0:14:21.88,0:14:26.31,Default,,0000,0000,0000,,Understanding how we can deal with\Nthe uncertainties that we've identified.
Dialogue: 0,0:14:26.59,0:14:30.19,Default,,0000,0000,0000,,So, let's think about these things:\Nidentifying risks.
Dialogue: 0,0:14:30.36,0:14:32.49,Default,,0000,0000,0000,,How do we find all of the risks?
Dialogue: 0,0:14:33.50,0:14:35.02,Default,,0000,0000,0000,,Well, you can't.
Dialogue: 0,0:14:35.02,0:14:38.78,Default,,0000,0000,0000,,You can't find all of the risks because\Nthere are risks that arrive
Dialogue: 0,0:14:38.80,0:14:40.56,Default,,0000,0000,0000,,that we hadn't seen before.
Dialogue: 0,0:14:40.56,0:14:44.39,Default,,0000,0000,0000,,There are emergent risks,\Nnew risks, different risks
Dialogue: 0,0:14:44.61,0:14:48.91,Default,,0000,0000,0000,,and I'll be talking about those\Nlater this afternoon in my speech.
Dialogue: 0,0:14:49.09,0:14:54.85,Default,,0000,0000,0000,,What we want to find are the knowable\Nrisks: the risks that we could find.
Dialogue: 0,0:14:55.25,0:14:58.61,Default,,0000,0000,0000,,We don't want somebody\Non our project team who knows a risk
Dialogue: 0,0:14:58.61,0:15:00.19,Default,,0000,0000,0000,,and they're not telling anybody.
Dialogue: 0,0:15:00.24,0:15:04.52,Default,,0000,0000,0000,,So this process is about exposing the\Nuncertainties that matter,
Dialogue: 0,0:15:04.53,0:15:06.77,Default,,0000,0000,0000,,finding them so we can\Ndo something about them.
Dialogue: 0,0:15:06.89,0:15:08.71,Default,,0000,0000,0000,,And there are lots of techniques,
Dialogue: 0,0:15:08.71,0:15:11.72,Default,,0000,0000,0000,,brainstorming, workshops, check lists,
Dialogue: 0,0:15:11.72,0:15:15.14,Default,,0000,0000,0000,,testing our assumptions and so on.
Dialogue: 0,0:15:15.40,0:15:18.03,Default,,0000,0000,0000,,But I would like to answer a \Nbigger question
Dialogue: 0,0:15:18.26,0:15:20.44,Default,,0000,0000,0000,,A different question from technics.
Dialogue: 0,0:15:21.48,0:15:24.07,Default,,0000,0000,0000,,And it's the question, are we \Nfinding the real risks?
Dialogue: 0,0:15:25.39,0:15:29.79,Default,,0000,0000,0000,,When you go to a risk workshop and you\Nwrite things in your risk register,
Dialogue: 0,0:15:30.01,0:15:33.72,Default,,0000,0000,0000,,are they really the uncertainties that \Nmatter for your project?
Dialogue: 0,0:15:34.43,0:15:39.87,Default,,0000,0000,0000,,Are these really the things that could \Ndrive you off track or really help you?
Dialogue: 0,0:15:40.56,0:15:42.86,Default,,0000,0000,0000,,Or are they just the obvious things?
Dialogue: 0,0:15:42.90,0:15:45.95,Default,,0000,0000,0000,,Where all projects have problems with \Nrequirements,
Dialogue: 0,0:15:46.73,0:15:49.54,Default,,0000,0000,0000,,with resources, with testing. \NThese are things that
Dialogue: 0,0:15:49.79,0:15:52.62,Default,,0000,0000,0000,,always come up, and we have processes \Nto deal with them.
Dialogue: 0,0:15:53.73,0:15:55.75,Default,,0000,0000,0000,,But are they the real risks?
Dialogue: 0,0:15:56.03,0:15:59.30,Default,,0000,0000,0000,,I would like to suggest to you that often\Nin our risk registers
Dialogue: 0,0:15:59.66,0:16:02.02,Default,,0000,0000,0000,,we confuse real risks with other things.
Dialogue: 0,0:16:03.02,0:16:07.72,Default,,0000,0000,0000,,Often, we confuse risks with their causes,\Nwhere does the risk come from?
Dialogue: 0,0:16:08.56,0:16:13.12,Default,,0000,0000,0000,,Or we confuse risk with their effects,\Nwhat do they do if they happen?
Dialogue: 0,0:16:14.00,0:16:16.52,Default,,0000,0000,0000,,But risks are uncertainties that matter.
Dialogue: 0,0:16:17.56,0:16:20.40,Default,,0000,0000,0000,,They are not causes or effects.
Dialogue: 0,0:16:20.47,0:16:25.36,Default,,0000,0000,0000,,So, causes are things that are true.\NThis is true that the project is difficult
Dialogue: 0,0:16:26.55,0:16:29.37,Default,,0000,0000,0000,,it is true that we do not have enough\Npeople on the project.
Dialogue: 0,0:16:29.73,0:16:33.23,Default,,0000,0000,0000,,it is true that the customer hasn't \Nsigned the contract yet.
Dialogue: 0,0:16:33.55,0:16:36.63,Default,,0000,0000,0000,,These are not risks, they are facts.
Dialogue: 0,0:16:36.79,0:16:38.43,Default,,0000,0000,0000,,They might be issues.
Dialogue: 0,0:16:38.43,0:16:42.25,Default,,0000,0000,0000,,They might be problems, but they are \Nnot risks because they are not uncertain.
Dialogue: 0,0:16:42.100,0:16:45.82,Default,,0000,0000,0000,,And a lot of people write these\Nthings in our risk register.
Dialogue: 0,0:16:45.89,0:16:47.97,Default,,0000,0000,0000,,We don't have enough time \Nfor this project.
Dialogue: 0,0:16:47.97,0:16:48.82,Default,,0000,0000,0000,,It’s a risk!
Dialogue: 0,0:16:48.82,0:16:51.36,Default,,0000,0000,0000,,No, it’s a problem.
Dialogue: 0,0:16:52.24,0:16:55.16,Default,,0000,0000,0000,,Sometimes we confuse risks\Nwith their effects.
Dialogue: 0,0:16:55.34,0:16:58.64,Default,,0000,0000,0000,,There could be an accident,\Nwe could be late.
Dialogue: 0,0:16:58.84,0:17:02.20,Default,,0000,0000,0000,,those are not risks either,\Nthey are the effects of risks,
Dialogue: 0,0:17:02.20,0:17:06.94,Default,,0000,0000,0000,,how do you manage, we could be late?\NIf your late, it’s too late.
Dialogue: 0,0:17:07.26,0:17:10.55,Default,,0000,0000,0000,,What we want to know is,\Nwhy might you be late?
Dialogue: 0,0:17:10.87,0:17:15.23,Default,,0000,0000,0000,,what unplanned thing could happen\Nthat would result in, you being late.
Dialogue: 0,0:17:15.54,0:17:19.44,Default,,0000,0000,0000,,So, risks sit between causes and effects.
Dialogue: 0,0:17:19.94,0:17:23.67,Default,,0000,0000,0000,,We can’t manage causes because \Nthey are here now, they are facts.
Dialogue: 0,0:17:24.19,0:17:27.34,Default,,0000,0000,0000,,We don't want to manage effects\Nbecause they may never happen.
Dialogue: 0,0:17:27.80,0:17:30.86,Default,,0000,0000,0000,,What we can manage is risks\Nthat sit in the middle
Dialogue: 0,0:17:30.86,0:17:33.32,Default,,0000,0000,0000,,because they haven't happened yet.
Dialogue: 0,0:17:34.28,0:17:38.29,Default,,0000,0000,0000,,So, risk management has \Nto separate risks from
Dialogue: 0,0:17:38.29,0:17:41.26,Default,,0000,0000,0000,,their causes and risks from\Ntheir effects.
Dialogue: 0,0:17:42.11,0:17:46.09,Default,,0000,0000,0000,,And I find looking at hundreds of\Nrisk register all around the world.
Dialogue: 0,0:17:46.92,0:17:51.76,Default,,0000,0000,0000,,I've worked in 48 different\Ncountries, every continent, every culture.
Dialogue: 0,0:17:52.11,0:17:56.48,Default,,0000,0000,0000,,Uh, not the Antarctic, it’s too cold.\NUm but nearly every continent.
Dialogue: 0,0:17:56.67,0:18:02.36,Default,,0000,0000,0000,,And over half of the stuff in risk\Nregisters are causes or effects.
Dialogue: 0,0:18:02.69,0:18:03.71,Default,,0000,0000,0000,,Over half.
Dialogue: 0,0:18:04.23,0:18:07.06,Default,,0000,0000,0000,,So the things we are trying to\Nmanage in the risk register
Dialogue: 0,0:18:07.10,0:18:10.49,Default,,0000,0000,0000,,are not risks and then \Npeople are surprised that it doesn't work.
Dialogue: 0,0:18:11.51,0:18:16.15,Default,,0000,0000,0000,,So how do we separate cause, risk, and\Neffect here is a little test.
Dialogue: 0,0:18:17.29,0:18:19.84,Default,,0000,0000,0000,,And these statements are\Nwritten in your notes.
Dialogue: 0,0:18:20.03,0:18:22.30,Default,,0000,0000,0000,,Or you can just think as we go.
Dialogue: 0,0:18:22.36,0:18:26.08,Default,,0000,0000,0000,,Each of these statements and they are\Nall very simple is one of these things.
Dialogue: 0,0:18:26.12,0:18:28.44,Default,,0000,0000,0000,,A cause is something that is true today.
Dialogue: 0,0:18:28.100,0:18:31.73,Default,,0000,0000,0000,,A risk is an uncertainty that might,\Nor might not happen.
Dialogue: 0,0:18:32.22,0:18:35.12,Default,,0000,0000,0000,,The effect is why it matters\Nto our objective.