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OCR for page 107
107 Project is unique or unusual and has no historical basis of tion of the project background and issues. This presentation estimate. should be concise so that workshop participants can move on Project has a high degree of local impacts or political interest. to the workshop objectives. Risk identification and quantifi- Project has multiple solutions that meet the stated intent cation are typically the primary objectives of the workshops. in the planning report, with potentially significant differ- Without proper facilitation, participants can deviate from ence in the scope or cost or risk for each alternative. these objectives to risk mitigation, value engineering, or issue Project is complex and may include any or all of the solving rather than identifying and quantifying them for later following: mitigation efforts. Few alignment or bypass sections, Capacity improvements that widen an existing highway, Multiple permanent structures, Resources Interchanges on multilane facilities, Washington State Department of Transportation (2008). CEVP and Difficulty in acquiring material, Cost Risk Assessment (CRA) website. http://www.wsdot.wa.gov/ Major traffic control activities, Projects/ProjectMgmt/RiskAssessment/ (Viewed June 1, 2008). Schedule that spans many years, Major reconstruction, R3.7 Risk Priority Ranking Extensive or expensive environmental or geotechnical scope, and/or Risk prioritization is an important step in the risk manage- Numerous right-of-way and/or utility issues. ment process. The proper ranking of risks will help the team Project is estimated to cost more than X percent of the dis- focus resources on the risks most needing analysis, planning, trict program budget. and mitigation. How to use it? What is it? To be effective, risk workshops must be conducted only Through the use of qualitative or quantitative risk analysis, after adequate preparation, which includes preparation of an or through the use of estimator's judgment, risks are priori- agenda and objectives for the workshop. Figure R3.6-1 illus- tized or ranked. The criterion used to prioritization is often a trates how WSDOT uses this tool. perception of the potential impact to project objectives. Other criteria for prioritization may depend on the agency and spe- Example cific project objectives. The WSDOT addresses risk issues in its project cost esti- mation process by conducting risk workshops. This work- Why do we use it? shop approach to risk management was first implemented We use the prioritization of risks to best use the re- in 2002 as CEVP. The CEVP workshop is a collaborative ef- sources available for analysis, planning and mitigation. The fort where project teams, engineers, risk managers, and subject matter experts from private firms come together risks that pose a greater threat to project objectives are most with WSDOT engineers to scrutinize transportation proj- likely the ones in greatest need of qualitative and quantita- ects and relevant project information that would help in tive analysis. Since limited resources are available for analy- evaluating the cost and schedule estimates. They brain- sis, the risks with the highest probability and greatest impact storm and contribute to the effort of identifying and assess- (positive or negative) should be prioritized to be analyzed. ing the risks on a project. The first series of CEVP work- These principles apply when looking at mitigation strate- shops were conducted on 12 mega projects in 2003. The gies as well. By prioritizing risks, the greatest potential for CEVP was scaled down in 2003 to a less intense version the best use of funds and resources can be available for known as the cost risk assessment (CRA), with procedures mitigation. similar to the CEVP. Figure R3.6-1 illustrates how WSDOT uses this tool. What does it do? Prioritization helps the estimating and design teams focus Tips their energy on high priority risks. The risk allows for effective Workshop pre-planning and proper facilitation are keys communication between the design team and the estimating to success. The workshops generally begin with a presenta- team as to the items with the highest risk impact.

OCR for page 107
108 Cost Risk Assessment/Cost Estimate Validation Process Pre Workshop Post Workshop Workshop Activities Activities 1 8 PROJECT TEAM 7 COST RISK LEADS PROJECT TEAM PROJECT TEAM CONFIRMS Hosts Workshop Prepare workshop results, notes, and With Region Program Mgmt Office DRAFT REPORT and sends to CREM Project Title is Correct CREM and Region Coordinators OFFICE who forwards to Project Team for PIN(s) are correct DIRECT WORKSHOP review and comment. The DRAFT WIN(s) are correct REPORT is usually completed within 2 Mileposts are correct weeks after all information has been and the WOA is setup provided by the project team. NOTE Completes CRA/CEVP Request Form and sends to Region Coordinator's who forwards PROJECT TEAM provides: 9 to the CREM Office. Meeting venue; preferably with internet (Form available on the CREM web site.) PROJECT TEAM connection. Conducts a quick and thorough review Visual Aids such as: 2 Aerial Photos of the Draft Report and promptly sends CREM OFFICE Project Exhibits comments to CREM who works with Contacts appropriate consultant(s) Story Boards COST RISK LEADS to bring Draft to (Risk Elicitor, Cost Lead) to coordinate Plan Sheets Final. The FINAL REPORT is usually schedule for Prep Session and Workshop; R/W Sheets ready within 2 weeks of receiving and Etc. comments on the Draft. Prepares and sends consultant Task Orders to PROJECT TEAM for Concurrence and Project Info such as: prepares and distributes Prep Session Cost Estimate (in Excel Spreadsheet) Agenda to participants. Environmental Documents R/W Parcels Information R/W Cost Estimate 10 3 Other pertinent information CONSULTANTS PROJECT TEAM Prepares project information; Prepare the workshop results, notes, and invites REGION, HQ and other participants FINAL REPORT and provides to CREM involved with the project and Hosts Prep who delivers to PROJECT TEAM. Session 11 4 CREM OFFICE CREM and Risk Leads DIRECT PREP SESSION Closes file, approves invoices Workshop Lead Prepares Action for payment as they arrive. Items Risk Lead Prepares Flow Chart & 12 Notes for Review & Comment. PROJECT TEAM RISK MONITORING AND CONTROL Track identified risks, monitor residual risks, identify new risks, execute risk response plans, and evaluate effectiveness 5 throughout the project life cycle and CREM OFFICE maintains Risk Mgmt. Plan Spreadsheet. Invites independent external subject matter experts and HQ specialty groups identified in Prep Session to participate in Workshop. and Prepares Workshop Agenda then sends to all parties. 6 PROJECT TEAM Invites Region/HQ & other participants as identified in Prep Session to participate in Workshop. Figure R3.6-1. Example of WSDOT cost risk analysis/cost estimating validation process workshop.