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94 Resources ops or if any major changes in scope are realized. Understand- ing project complexity is a key element of the approach for National Highway Institute (2006). Risk Management Instructor Guide, NHI Course 134065, National Highway Institute, Washington, DC. preparing estimates during all phases of project development. R1.1 Recognition of Complexity How to use it? Project complexity significantly influences the methods Refer to the Tables R1.1.1 through R1.1.3. First, review the and tools an estimator uses to prepare and manage project project using Table R1.1.1 for minor projects. If the project cost estimates. Project complexity also can be used to identify meets all of these criteria, it can be considered minor. If the proper risk management techniques. Mn/DOT is using this project exceeds one or more criteria, it cannot be considered tool to create a standard definition for project complexity in minor and should be reviewed next using Table R1.1.2 for order to communicate the issue to project team members and moderately complex projects. If the project meets all of these stakeholders. criteria, it can be considered moderately complex. If the proj- ect exceeds one or more criteria, it should be considered What is it? major. Table R1.1.3 can be reviewed to verify that the project should be classified as major. Recognition of complexity, through a formal definition, results in a classification of project complexity that can be applied to all projects. The tool use three definitions for project Tips complexity: 1) minor projects; 2) moderately complex projects; Early in the project development process, use the complex- and 3) major projects. These complexity definitions drive the ity definitions to establish a project's level of complexity. The choice of many other tools. For example, the Level I through assigned complexity serves as a basis to select the methods Level III risk analysis correlate directly to the three levels of and tools for project cost estimating and cost management. project complexity. Reassess project complexity at key milestones. If the project Complexity definitions can include a definition of project becomes more or less complex as it proceeds through devel- type (such as new or reconstruction), project setting (rural or opment, the definitions can be used ensure that appropriate urban), project location, available level of design detail, and other factors. The goal is to explicitly define project complex- resources are employed. ity through the use of this classification system. Examples Why do we use it? Mn/DOT will be using a set of complexity definitions Providing a standard definition of project complexity pro- developed by the Pennsylvania Department of Transportation motes transparent communication of a project's characteristics. (PADOT) and cited in NCHRP Report 574: Guidance for Cost The complexity classification can be used to assist in selecting Estimation and Management for Highway Projects During Plan- appropriate estimating methods and tools or to invoke specific ning, Programming, and Preconstruction. Tables R1.1.1 through cost estimating management or risk management procedures. R1.1.3 should be used for defining project complexity. It helps to ensure that projects of varying complexity levels are subject to appropriate reviews and attention. This allows Resources for a common language for communication regarding project complexity. PennDOT has established a system to define the level of complexity. See PennDOT's Design Manual: Part 1A: Transportation Engineering Procedures, Publication 10A, available from PennDOT. What does it do? This tool defines complexity based on specific criteria. The R3.1 Risk Management Plan definitions help classify projects according to their level of complexity, which in turn helps to identify the appropriate A formal risk management plan is a detailed plan of action strategies, methods, and tools for cost estimating, cost man- for the management of risk. Risk management planning in- agement, and risk management. volves the thoughtful development, implementation, and monitoring of appropriate risk response strategies. It is the process to develop and document an organized, comprehen- When to use it? sive, and interactive risk management strategy; determine the A project's level of complexity must be established early in methods to be used to execute a risk management strategy; the project development process and revisited as design devel- and plan for adequate resources.

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95 Table R1.1.1. Noncomplex (minor) project attributes (NCHRP Report 574 and PennDOT). Noncomplex (MINOR) Projects Roadway Maintenance betterment projects Overlay projects, simple widening without right-of-way (or very minimum right-of-way take) little or no utility coordination Noncomplex enhancement projects without new bridges (e.g. bike trails) Traffic Control Single traffic control/management projects Non-ITS but minor safety improvements Structures Bridge resurfacing or repairs that do not require re-analysis of bridge capacity Pipes, box culverts or minor culvert replacements where design can be picked directly from design manual or standards or using simple software where detailed interpretation is not necessary Sign structures for which the design can be picked up directly from either the standards or using design computer software Noise walls or retaining walls for which the design can be picked up directly from either the standards or using design computer software Right-of-Way Involve minor right-of-way acquisitions with no displacements, maintain existing access control Utilities Minimal, if any Environmental Categorical Exclusion (Level 1A or 1B) Minimum interaction with environmental and permitting agencies Do not involve cultural resources, hazardous waste, Section 4(f) evaluations or substantial flood plain encroachments Stakeholders No public controversy The risk management plan may be specific in some areas Why use it? and general in others. The key to this tool is its scalability. A risk management plan is a formal document that ex- Every project should have a formal risk management plan, plains how an agency manages risk. It provides guidance and but the level of detail varies with the project complexity. requirements, and serves as a communication tool for those who wish to be informed of a project's risk management ap- What is it? proach. The plan formalizes the ideas presented during the risk management process and may clarify some of the assump- The formal risk management plan is a document that gives tions the project team has regarding the risk management a summary of the project and outlines the different steps of the risk management process and how the agency is approaching process. them. The risk management plan employed will vary based on the complexity of the project, but most projects should include What does it do? an outline similar to the following: The risk management plan provides specific guidance for 1. Introduction the project team members in all steps of the risk management 2. Summary process. The risk management plan documents the processes 3. Definitions to use throughout the project for identifying, assessing, and 4. Organization and roles managing risk. 5. Risk management strategy and approach 6. Risk identification When to use it? 7. Risk assessment and analysis 8. Risk mitigation and planning The formal plan should be developed during the Planning 9. Risk allocation and Scoping Process and updated during subsequent project 10. Risk monitoring and control development phases.