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By picking up where traditional risk management techniques begin to fail, it brings together leading-edge thinking from a variety of disciplines and shows how these techniques can be used to conquer uncertainty in projects. The ability to make good decisions when faced with uncertainty is the real challenge.
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For example, although there is consensus on which design of reactor is to be used in nuclear new-build projects in the United Kingdom, it is unclear whether the UK regulatory framework will require major changes to the reactor design before formally licencing it for use. Although the Generic Design Assessment HSE, has helped to identify specific licencing issues, this uncertainty materially impacts the ability of project managers to accurately define resource needs, scope the technical work required, and hence define project costs Atkinson et al.

Managing Project Uncertainty | Emerald Insight

The influence of industry regulators on project uncertainty is heightened by the complexity of the regulatory framework. Projects in safety-critical industries can find themselves in a position, in which preparation of the safety case or overcoming the required regulatory hurdles define the critical path of the project, and yet the resources capable of preparing the required paperwork sit outside the project team. Another determinant of uncertainty arising from the project context, particularly in civil aerospace, was the commercial imperative for the project.

Respondents described the sensitivity of the business case to changes in demand for the project, either due to industry sentiment shifting in favour of a competing product or due to fluctuations in macroeconomic demand having an impact on aviation industry globally. The third key determinant of project uncertainty in safety-critical industries was the capability to deliver the project.

Managing Project Uncertainty (Advances in Project Management)

This was described by respondents as operating on two levels: first at the level of the project organisation and secondly at an industry level. At the project-organisation level the major influences on uncertainty were the level of maturity of project processes, for example, the maturity of the organisation's risk management processes and how resource constraints are managed. Securing project resources was a recurring cause of uncertainty across projects in both civil nuclear and aerospace sectors, with respondents questioning their organisation's understanding of project management and whether the organisation had the capacity to meet demand in terms of the people and facilities required to undertake projects.

Several respondents also saw it as central to their role to mentor less experienced colleagues, helping foster the skills and judgements required to navigate project uncertainty. The skills and experience of project team members also contributed to the level of uncertainty in the project; projects that were able to mobilise a highly experienced project team were better placed to manage uncertainty than those that were not. The nuclear industry has attempted to address this issue by introducing the concept of Suitably Qualified and Experienced Personnel HSE, , but this formal requirement for appropriately approved individuals can have the unintended consequence of increasing the resource constraints under which the project must be delivered.

At the industry level, uncertainty in project delivery arises due to the nature of the industry supply chain and its skill base. For long-term projects, the presence of an aging workforce and the difficulty in retaining key skills were major sources of uncertainty. One respondent expressed this eloquently:.

Four Periods in the Development of Modern Project Management

So we are stuck with finding UK nationals and companies to work on this project, so even when we go out to find external resources to do the design work and work packages it's really quite challenging. So that is one of the key uncertainties. So, if I need people next year and I only get , then that is man-years of work not being done. And then that folds forward and you say, well hang on a second, we need to make sure that the most important work is getting done this year, so what's not getting done and you know, if there is any uncertainty around that stuff, then you could find yourself having dropped a piece of work that becomes quite critical next year and the schedule starts to give you problems as well.

The fourth key determinant of uncertainty was identified as organisational culture. Different organisations were seen to have differing propensities for coping with uncertainty, with the nuclear industry being particularly conservative and risk-averse in this regard. This low tolerance for risk manifests itself in projects proceeding in linear steps, following due processes, with the technology solutions chosen remaining conservative.

In effect, the onerous safety and regulatory requirements provide a secure stockade around the project, in an attempt to minimise project uncertainties. On the other hand, the civil aerospace project managers interviewed described operating in a more flexible environment: one where conforming to process was important but where innovations and new ways of working were possible and desirable, provided the appropriate sanction to proceed was in place or could be put in place ex-post.

This greater ability to tolerate uncertainty is perhaps a direct response to the sharper commercial imperative in the civil aerospace industry. How decisions are made, who is involved, and the level of accountability for decisions were all perceived by respondents to be a key influence on project uncertainty. One aerospace project manager summed up this view as follows:.

For example my organisation is an embedded matrix one.

The determinants of uncertainty identified by project managers in this study align to a large extent with the sources of uncertainty described in the literature, with the exception of two areas of dissonance. However, the capability of the organisation and industry, and cultural backdrop against which the project is delivered are less well addressed. And yet, capability and the dominant culture of conservatism and risk adverseness that are prevalent in the civil nuclear industry was an important factor in clarifying project uncertainty.

Taking this into account the authors of this study posit a model, which takes into account not just content and context but also the capability and culture of the organisation in order to determine the uncertainties present in projects in safety-critical industries. This is illustrated in Exhibit 3. Here the content of the project remains firmly at the centre of determining the uncertainties at play, but gives equal weighting to the context of the project, the organisational and industry capability to deliver it and the particular challenges which the organisational culture may present to the project.

This study identifies three major impacts of uncertainty on projects in safety-critical industries. The first of these is that uncertainty leads to less predictability of project outcome.

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This threat to predictable delivery may endanger the business case for the project or increase the likelihood of reputational damage to the project organisation. It may also manifest itself in diminished confidence in project relationships, since managing the expectations of stakeholders and sponsors is a fundamental part of project management. Unpredictable project outcomes caused by uncertainty, can lead to conservative technical solutions, which may not always be the best solutions, in an attempt to increase the likelihood of a successful outcome, or to sizeable elements of contingency in project budgets, or to increasing levels of project complexity as multiple options must be explored in parallel before a suitable technical solution is identified.

Echoing Turner one respondent spoke of:. You can have a risk register that says we have certain techniques that are quite well developed and understood but what if we open the cans and it doesn't look anything like we expect it to. Unpredictability makes sponsors, other stakeholders, and the project team itself nervous: we are all more comfortable with predictability as opposed to uncertainty Gigerenzer, Project managers must respond to this need for predictability by making uncertainty visible and constantly communicating issues of uncertainty rather than hiding or ignoring them.

This leads us to the second impact of uncertainty: that uncertainty demands additional behaviours from project managers. Project managers have to be prepared for surprises and to be comfortable living in a world of questions and assumptions rather than answers Perminova et al. Respondents who thrive under uncertainty acknowledged that it could not be eliminated but only managed through proactive questioning of assumptions and a combination of flexibility and pragmatism in decision making Olsson, Several of those interviewed confirmed how important it is, in their view, to remain flexible, maintaining focus on the project outcomes, while in the midst of uncertainty.

The third impact of uncertainty is on the project life cycle and the project processes. Uncertainty implies an absence of the required information Atkinson et al.

International Journal of Project Management

Uncertainty in the required technology for a particular aircraft engine design or in what elements of a nuclear plant require seismically qualified concrete requires decisions to be made in the absence of complete information. Assumptions, rather than facts may form the basis of many decisions, requiring those assumptions to be documented and revisited periodically as new information emerges.


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Checkpoints rather than milestones may be used to monitor progress. One project manager advocated the use of. The reviews are complementary to the day-to-day regulatory controls which are applied in nuclear power stations. They provide the opportunity to undertake a comprehensive study of plant safety. Another process affected by the presence of uncertainty is the risk management process, which in the view of several respondents, is sometimes a box-ticking exercise. In the presence of uncertainty, considerable judgement and intuition are required in enacting the risk management process to identify knowledge gaps, and to allow areas of uncertainty to emerge.

If there is no documented uncertainty management process then project managers may be required to work outside the formal risk management process, interacting informally with experienced colleagues and documenting uncertainties as assumptions to enable them to move forward in the absence of complete information. The study, reported here, found that contingencies were commonly used as a means of delaying the impact of project uncertainty, although several respondents in both civil nuclear and aerospace had come under intense pressure to reduce contingency budgets or to deliver fixed-price projects irrespective of the uncertainties identified.

The presence of uncertainties in projects in safety-critical industries will also have an impact on the project life cycle in terms of increasing the amount of development or exploratory work that may be required. As asserted by Loch, De Meyer, and Pich multiple investigations and experiments may be required before an optimal solution to a particular design issue is found. At the opposite end of the project life cycle increased volumes of testing may be required to provide the information needed to ensure that the delivered project meets all the regulatory and safety case requirements.

How project managers tasked with delivering the next generation of nuclear power plants and how civil aerospace engines deal with the uncertainty inherent in their projects is a matter of interest to industry and the public alike. This paper offers the results of an exploratory qualitative investigation of this highly relevant topic, aiming to probe what the determinants and impacts of project uncertainty are in two safety-critical industries in the United Kingdom. Its objective was to enable project managers both to conceptualise the various determinants of uncertainty and to understand how these uncertainties will shape and influence their projects.

They use decision milestones to anticipate outcomes, risk management to prevent disasters and sequential iteration to make sure that everyone is making the desired product, yet the project still ends up with an overrun schedule, overflowing budget and compromised specifications. This statement articulates concisely the potential impact of uncertainty on a project. Uncertainty is a challenging beast for even the best project managers; and, before it can be tamed, the uncertainties at play in a project must be understood by the project manager and his or her team.

The model of the determinants of uncertainty developed in this study begins to enable project managers in safety-critical industries to do this. In this model, the content of the project its size, complexity, timescales remain firmly at the centre of determining the uncertainties present, but given equal weighting are: 1 the context of the project, 2 the organisational and industry capability to deliver it, and 3 the particular challenges, which the organisational culture may present to the project.

These determinants do not exist in isolation from one another; rather, they are interconnected and interrelated, each of them shaping and influencing the others in a manner that can magnify the level of uncertainty on the project. The impacts of uncertainty on a long-term safety-critical project manifest themselves in three broad ways; through increasing the unpredictability of the project outcomes, through demanding additional behaviours from the project manager and by impacting on the suitability and effectiveness of classical project management processes as articulated in the current bodies of knowledge from the Project Management Institute and Association of Project Management PMI, ; APM, These impacts require project managers to think outside the box; to expect, to prepare for, and to remain vigilant against uncertainty, engaging an appropriate mind set as much as the project processes to achieve this.

The authors note a number of limitations to the exploratory study presented in this paper. It was undertaken within the United Kingdom and only a small number of project managers from a limited number of organisations were interviewed. Therefore, the findings may not be generalisable across other organisations or geographic regions.

The findings are also biased towards the civil nuclear industry, given that the majority of respondents were employed in this sector. The authors plan to replicate the study over a larger number of projects in the civil nuclear and aerospace sectors and across wider geographic regions e. Aaltonen, K. Project stakeholder analysis as an environmental interpretation process. International Journal of Project Management, 29, Amalberti, R. The paradoxes of almost totally safe transportation systems.

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